Opportunity Assessment

Definition

Before a product team begins discovery work on an idea, Cagan has the product manager answer four questions and share the answers with the team and key stakeholders: What business objective does this map to? How will we know if we've succeeded (key results)? What problem will this solve for our customers? What type of customer are we focused on? He calls these "the bare minimum" — deliberately not a full business case or requirements document — and notes it normally takes the product manager only a few minutes to draft answers.

In the Book

Chapter 35 positions the opportunity assessment as the entry gate to discovery: every member of the product team needs to know and understand the answers to these four questions before jumping into discovery work on an idea. The first two questions tie the opportunity explicitly back to the team's assigned OKRs — Cagan gives the example of a team asked to reduce customer churn, where the second question forces the team to state up front whether a 1 percent improvement would count as excellent or as a waste of effort, rather than discovering the bar for success only after the work is done. The fourth question, target market, exists because "so much product work fails because it tries to please everyone and ends up pleasing no one" — forcing the team to name a specific persona, market, or job-to-be-done before starting. Cagan flags one exception: when a senior leader assigns work for a strategic reason outside the normal objective-setting process (his example is supporting a partnership), the team should still answer what it can of the four questions rather than skip the discipline entirely.

Why It Matters

A large share of wasted product effort traces back not to bad execution but to a team starting work without anyone having stated, in writing, what problem is being solved, for whom, and how success will be measured — so disagreements about scope and priority surface only after resources are already spent. A cheap, mandatory framing step that takes minutes to complete but forces explicit answers to a handful of load-bearing questions is a general technique for catching those disagreements before they become expensive: it trades a small, fixed up-front cost for avoiding an unbounded downstream one.