Reach-Impact-Confidence-Effort (RICE)

Welcome back (or just welcome) to our series on prioritization techniques. As I work with teams and organizations, I notice a huge component of planning missing in their endeavors; prioritization.

I often say that a Product Owner's job is to maximize the amount business value delivered of a Scrum Team (or any agile team), but how can I assess the value of something if I don't know the cost? Then we get stuck on how much of the cost do I have to know to assess that equation. I have articles related to that, but lets agree that a good light-weight estimating technique for our developers paired with an equally light-weight prioritization process can be powerful in stabilizing the priorities of our teams.

In this post, we will address a common prioritization technique that is fairly new to the world and developed in-house by another product development company willing to share. Sometimes those are the best as they balance academia with real-world pressures.

What is the RICE scoring model?

The RICE model represents the following four key attributes in determining the priority of a feature, new idea, or initiative.

  • R - Reach - For how many users will this feature reach impact within a specific period?
  • I - Impact - What is the impact of this feature for each user?
  • C - Confidence - The level of confidence about a particular feature
  • E - Effort - How long will it take to complete this feature?

The model then uses the following unique formula to weigh and produce a single score (RICE Score) for each feature you want to consider.

Rice Formula

You can use the RICE formula to weigh any idea using their pros and cons, allowing product teams to reduce personal bias and take more informed decisions when prioritizing the work.

How was the RICE model invented?

The RICE model was co-developed by Sean McBride while working as a product manager (PM) at Messaging-software maker Intercom. The RICE model was introduced due to efforts to find the best prioritization technique that fits the company’s unique set of project ideas.

Before that, Sean and other PMs needed help finding a suitable technique from the numerous available prioritization techniques. The team develops its own scoring model combining reach, impact, confidence, and effort factors to output a single score for every idea providing an objective way to choose the most important features for their roadmap.

How to use the RICE Model for prioritization?

Simply, product teams need to find out the RICE score for each feature, idea, or initiative determining their Reach, Impact, Confidence, and Effort factors.

Measure the Reach

First, you need to estimate the Reach or how many users your idea will reach during a given period. The co-founder of the RICE model, Sean, states, ‘ Reach is about asking yourself: how many customers or people will this project idea affect?’

For example, lets’ say you are building a new feature for essay-type assignments in your e-learning platform. Suppose the total number of users of this platform is 100k per month, but the essay-type assignment type is used by only 30% of the total user base. Then the new assignment-type idea will reach 90k users per 3 months. Another example is introducing a new feature for a login page. If a total of 30k users logs in through this page per month, then annually, 360k users, or 100% of the users, will reach this product. Therefore, the second feature has a higher reach than the first one as it reaches more users.

You must define which users you will take or the period to consider. It is totally up to you to decide if you consider the new users or your existing user base.

Measure the Impact

The impact is asking yourself, ‘ How much impact will this feature, idea, or initiative have on an individual customer or the business goal?’ How you measure the impact should be based on how your business assesses the impact. For example, suppose you assess the impact of an idea by making weak students achieve more marks for their assessments. In that case, you can use the following scale to determine the impact.

  • 0 - no impact
  • 1- low impact
  • 2 - medium impact
  • 3. High impact
  • 4. Large impact
  • 5. Massive impact

When measuring the impact related to your business goals, it is important to know your long-term and short-term business goals. Sean also states that ‘it’s important to have a single goal in mind as you’re comparing project ideas,” if not, it will be difficult to assess the impact factor correctly for your features.

Measure the Confidence

The third step is determining the confidence in your idea that balances the reach, impact, and effort score estimations. Measuring confidence is asking yourself, ‘how much confidence do I have in the reach, impact, and effort scores I gave each feature? You can use the percentage score to determine a confidence score for each feature. For example, imagine you have measured Reach, Impact, and Effort to build a new feature. But you are uncertain about the numbers you put as you have not considered some important facts to feel confident about your estimates. In that case, a confidence score helps you to incorporate that uncertainty into the formula. Following is Sean McBride's example scale, which you can use to determine the confidence score.

  • 100% - High confidence
  • 80 % - Medium confident
  • 50% - Medium confident

Below 50% - no confidence about the feature or the estimates you have put into it as no prior research was done to prove them.

Measure the Effort

The last step of prioritizing using the RICE model is calculating the Effort or how long it will take for your teammates to complete or implement this feature. This factor is the negative factor in the RICE formula's denominator. If the feature takes a large effort, the RICE score will go down and vice versa.

This measurement unit can be man/person-months, man-weeks, or Story Points, based on the work one can accomplish within a month or a week. For example, lets' say your teammates estimated that it takes two people to complete the feature in one week, then the Effort will be three man-weeks.

When measuring the Effort, your teammates must come up with approximate estimates based on their research and technical information rather than guessing the Effort. This makes the RICE score more realistic and reflects the true priority of the feature.

Conclusion

Identifying the Reach and Effort of this equation are usually the most challenging parts of the equation. Work with your stakeholders to agree on how to assess Reach.

Work with your Developers to come up with a consistent way to score the effort of something without taking up too much time of the team (requirements come later, we just need to evaluate now if we should even push forward with the idea). Teams sometimes conclude a T-shirt sizing mechanism is best for this level of estimation (S, M, L, XL, etc...) and we would put ranges around those sizes. I don't recommend doing this for the Product Backlog, but for this level of estimating it should be fine.

The most important thing is to come up with an ideation or innovation process that you can use to prioritize the infinite list of ideas that come in and then pair that with the capacity of your team to determine what can be accomplished in reality with all of the current initiatives.

Join us at one of our upcoming workshops!

In our CSPO and A-CSPO workshops, we spend quite a bit of time going over some prioritization techniques as well as hands-on use of them in the workshop

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