Why is RICE dead in 2023
November 23, 2023
The RICE score. Everyone talks about this method used to prioritize initiatives and projects based on their potential impact. "Potential impact" is where the problem lies, and we are here to offer a new perspective.
Years ago, Spotify shared its prioritization method, which involves determining Reach, Impact, Confidence, and Effort.
- Impact: It evaluates the expected impact of the initiative on users, revenue, customer satisfaction, or other key performance indicators. A higher impact corresponds to a higher Impact score.
- Confidence: It reflects the team's confidence in its impact estimates. If the team is highly confident in its forecasts, the Confidence score will be higher.
- Effort: It measures the amount of effort, resources, and time required to implement the initiative. Lower effort corresponds to a higher Effort score.
By combining these four criteria, the RICE score prioritizes projects and enables informed decision-making based on their potential for success. It is widely used by product teams to optimize resource allocation and maximize the impact of initiatives.
So, how does it work in practice and how is it used by product teams?
The idea is quite simple. We have a list of initiatives. Let's take some real examples:
- Slack integration
- Adding a Kanban view
- Improving the roadmap
The product team in charge of these initiatives has the challenging task of prioritizing and ordering these topics based on their importance. The goal is to start with the topics that will have the greatest impact on users.
Let's get started! I'm diving in! My product knowledge will surely help... well, I hope so:
Initiative 1: Slack integration
- Reach = 85/100
- Impact = 3.5/5
- Confidence = 78%
- Effort = I will discuss this with the tech team.
Some may immediately question: where do these numbers come from?
Good question, and the answer is: from thin air.
What is particularly revealing is that if you have a team of 5 people, each one will assign different scores. Averaging can be a smart way to smooth out risks, but it's still a makeshift solution.
In recent months, the economic context has changed, favoring impact, profitability, and streamlining in companies. Now, effective prioritization is needed to offer users a product they love, consume, and recommend.
Guesswork prioritization is increasingly problematic for product teams wondering how to gain better visibility into the actual impact their initiatives will have. And most of them turn to business impact.
It's a commendable goal that would certainly change the way we do product management, but it's a challenging goal for many.
Here are some insights we've explored with Gravite.io:
The first thing we wanted to know at Gravite was how much impact an initiative could have in terms of revenue. For example, if we developed the Slack integration, how many new deals could we sign? How many of our customers would be delighted to have it?
We did three things to achieve this goal:
Salespeople spend their day talking to customers. We asked them to share the needs they have to sell more.
- We did the same with Customer Success (CS).
Customer Success has a clear goal: retaining customers. Their feedback helps us understand what customers want to stay.
- We centralized and structured all this data on Gravite.
The insights we have now are just incredible. I can know that an initiative is requested by 67% of prospects and that we have a 70k€ opportunity.
Here's what it looks like:
We were able to change our prioritization approach effortlessly and bring teams together, all focused on the same objectives: customers, product, and growth.
Do we miss the RICE score? I wouldn't say that we miss RICE, but it's an interesting tool, especially for new topics. If you have ancillary products where you want to conduct extensive discovery phases, the RICE score can make sense.
But in what we call "the Run," we prefer to stick to the standards of other business services: revenue, customer acquisition, churn management...