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Business, 5 MIN READ

Why Does Project
Discovery Phase Matter?

July 2, 2019
According to McKinsey, 17% of IT projects turn out so bad, they cause the collapse of the company. While only 7% of the projects are delivered late, 45% exceed the estimated budget. Careful analysis and planning could prevent many failures. While not a panacea, the discovery phase is vital for business owners who wish to complete their project on time and on budget.

What Are the Phases of a Project?

Traditionally, project managers split the project life cycle into five stages that include initiation, planning, execution, control, and closure.
project life cycle
5 project stages
When the project goes through the stages in order and without cutting corners, the chances for success skyrocket. Underestimating the value of initial stages that precede actual development can cause scope creep, budget overspending, and missed deadlines.

To prevent project failure, discovery should come hand in hand with project initiation and transition into planning. Over 70% of IT vendors require a discovery phase before tackling the project, and today we'll delve into its specifics and answer the question of "What is a discovery phase and why should you care?".

What Is the Discovery Phase?

Discovery or scoping phase is a process of collecting and analyzing information about the project, its intended market, audience. It allows getting a well-rounded and in-depth understanding of the goals, scope, and limitations.

Business discovery stage helps understand the end users, their needs, and requirements. The technical part of the process leads to the system requirements specification (SRS). This document includes information necessary for development. For example, primary and additional features, measurable deliverables, and more.

Depending on the project's scope, the discovery phase can last from one week to two months. One sprint (2 weeks) is a typical timeframe. The cost may be fixed or calculated based on the hourly rates and the time spent.

Project manager, business analyst, and account manager take the lead during the discovery stage. Sometimes team leads, developers, or designers can join the efforts. They help with SRS, wireframe prototypes or scope assessment.

At the onset of the discovery phase, the team requests several meetings. Each of them can be 1 to 2 hours long and helps to get a better understanding of the project. The rest of the process doesn't require your constant input.

Considering the time and budget investments, the discovery phase outputs are crucial. Once it is complete, you will receive:
  • System requirements specification. It fully describes the project, its goals, features, suggested technology stack, and architecture overview. Study it carefully and suggest corrections before you approve it.
  • Preliminary UX prototype. Long before developers start working on your project, you will receive a simple representation of the digital interface and its critical features. Coupled with an SRS, it provides a clear understanding of how the project will work and feel once it is finished.
  • MVP development plan and estimates. You will get a suggested team lineup, an accurate estimate of the development timeline and budget. The numbers based on the discovery phase UX prototype and SRS are unlikely to change along the way and ruin your business goals.
Project discovery phase results
Discovery phase outputs

Purpose of Discovery Phase

In project management, discovery phase is an intensive research stage at the beginning of every project to define its scope. However, there is another angle. The discovery stage is a way to deal with the uncertainty abundant at the onset of any project.

Communication, research, and analysis help solidify the goal and define the direction of the development process. They are needed to identify and tackle potential roadblocks and risks.
A productive discovery phase provides time to
get most of the uncertainty out of the way.
It establishes focus necessary for efficient and
timely development.
Considering this purpose of the project discovery phase, its benefits become clear.

Benefits of a Discovery Phase

When everyone is chasing to get the product up and running, the project discovery phase may seem like a waste of time. However, this step is crucial for successful development. It helps:
  • Reduce risks. A clear understanding of your goals and requirements helps the development team create accurate estimates of time and budget. The risk of missed deadlines is reduced by 75%. The overall cost savings can exceed 50%. Ultimately, the discovery phase meaning is the difference between success and failure.

  • Establish a roadmap. When the team relies on a clear set of requirements, they can develop a step-by-step plan and keep to it. You get a full timeline of the project with interim goals, deliverables, and deadlines. That will take the product from an idea to launch, no rescheduling or alterations necessary. The SRS and wireframe prototypes developed during the discovery stage can increase the startup's feasibility with investors and bring in extra funding.

  • Build trust. Even after a promising sales pitch, you can't be 100% sure you've made the right choice of an IT vendor. However, regular communication and in-depth discussions of your project with the team will ease your mind and establish two-way trust. Alternatively, you may realize you've picked the wrong company and make a switch before it is too late and your budget is gone.
benefits of project discovery phase

How to Run a Discovery Phase?

The project's size can extend the duration of this stage, but the discovery phase outline remains the same:
  1. Define the stakeholders. The list should include product owners, administrators, end users, developers, investors, and any other categories that are involved in creating or using the finished product.
  2. Talk to stakeholders. As a product owner, you should have a vision of the finished product and be able to answer the discovery session questions. The team will also need access to other people involved in the project to ensure everyone's needs and requirements are met.
  3. Review internal documents and existing research. If you have already run market surveys or user interviews, there is no need to waste time on some discovery phase activities. Supply the business analyst with relevant papers for review and analysis.
  4. Create user avatar and journeys. These tools help design a technical solution and achieve your goals through effective marketing campaigns. User interviews are necessary to understand their problems and create the best solutions through writing user stories, establishing the feature set and the SRS.
  5. Research the competition. Market research helps find the strengths and weaknesses of the existing solutions. So, you will be able to identify the niche your product can occupy to attract users.
  6. Analyze the data and develop the SRS. Aggregated information transforms from a data set into an actionable list of business and technical requirements. They address stakeholder needs and account for user journeys and competitors' experience.
  7. Estimate the budget and timeline. All the hard work finally pays off and enables the team to assess the time and money needed to implement the idea into an MVP or a full-fledged product.

Why Does Discovery Phase Matter?

With benefits and technicalities out of the way, let's consider what happens when you refuse the project discovery stage, and the development starts without a clear understanding. You can expect:
  • A project that doesn't meet your needs. Miscommunication at the earliest stage of engagement leads to further misunderstandings. They result in a rift between your expectations and reality, wasted time and budget.

  • Endless scope creep. Without measurable deliverables, the project implementation extends, and the launch is postponed indefinitely. New requirements and features cause chaos and discourage the development team.

  • A bloated budget. The lack of clear goals and direction causes constant requirements changes that increase expenses. You run out of money long before the team can deliver the finished or at least usable product.

  • Missed deadlines. Besides overspending, scope creep causes shifts in the development timeline and pushes back the delivery dates. On a competitive market, missed deadlines are equal to huge business losses.

  • Inability to change IT vendors. When you tire of dealing with the development team, shifting to another one is nearly impossible without initial documentation. You might as well start over, this time without missing the discovery phase.
Overconfidence and enthusiasm may push you to skip the project discovery phase. But you need to reign them in and invest in the preliminary development stages.
Skipping discovery turns from a money-saver
into a huge hole in your budget.
IT vendors are not trying to pad the bill by adding extra services besides coding. With dozens of successful projects in their portfolios, they know the value of discovery even if it seems out of place in the fast-paced agile methodology.

What Is Project Discovery Checklist?

We rely on a project discovery checklist to ensure the team has all the data before moving on to planning and execution. The checklist includes:
  1. Company/Client: primary goals, target audience, existing research and marketing materials, and reasons for change (if the project is not designed from scratch).
  2. Current offers: existing products and services, buying habits, the prospect-to-customer transition factors, customer service effectiveness.
  3. Market: online and offline research, industry-specific publications, subscriptions, white papers.
  4. Competition: online and offline primary and secondary competition, competitive features analysis, unique selling propositions.
  5. Audience: Demographic information about the target audience, customer avatars, and user scenarios.
  6. Marketing: current marketing strategy and methods, short and long-term measurable goals, branding strategy, approach, and message.
  7. Current solution: usability test results, customer feedback, content audit, technology stack, and feature set analysis.
  8. Technical requirements: system requirements specification with a list of features, solutions, an updated technology stack.
  9. Other: additional industry-specific data for a more in-depth understanding of the market's requirements.
FreshCode clients have first-hand experience with the benefits of the discovery stage. If you are ready to implement your ideas or scale your business, reach out to our business analysts for a free consultation.
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