Key takeaways from implementing the Discovery phase in the software development process

As an experienced entrepreneur who has launched several successful startups and now works in a B2B company helping other businesses grow, I always highlight the importance of thoroughly researching your target user before beginning development of a product.

Back in May 2022, we got a proposal from a client in the banking industry (we can't reveal their name or the company they represented due to a signed NDA). They were interested in creating a banking app similar to Bank of America, but that was about as far as their vision went. They didn't have a clear understanding of their target audience, a comprehensive list of desired features, or a solid concept for the app's future look.

Given these uncertainties, we proposed that the client go through a Discovery phase before starting the development process. During the Discovery phase, we would work with the client to clarify their goals and objectives, understand their target audience, and identify their key requirements. This would allow us to provide them with a more accurate estimate of the resources and time required to build the app, as well as a clear roadmap for the development process.

During the Discovery phase, we typically break things down into a few different steps.

1. The first step is user research. This is where we try to get inside the heads of the people who will be using the product. We might conduct interviews, surveys, or focus groups to learn more about their needs, preferences, and pain points. It's all about gaining insights that will help us create a product that truly meets their needs.

Thanks to this stage, the client receives user portraits [ https://docs.google.com/spreadsheets/d/1p8KuZbFd1or7OdlOpxr6F5e4F4zyyV21Hau5MTJABww/edit?usp=sharing ] complete with detailed descriptions of their goals, pains, and frustrations.

2. The next step is competitive analysis. Here, we take a look at what's already out there on the market that's similar to what we're planning to create. We want to understand what works well, what doesn't, and where there might be room for us to innovate and offer something new and unique. For that particular client, we went to great lengths by analyzing the user flow of three competitors [https://docs.google.com/spreadsheets/d/1Nfp5uIvSod7oah74mWBgp-GKur1XfPsASRMz65fJ8Z4/edit?usp=sharing ], including the process from signing up to issuing cards, as well as evaluating the design and functionality of their respective apps.

3. From there, we move on to ideation and brainstorming. This is where we collaborate with the client to come up with potential solutions to address the user needs we've identified and the gaps we've found in the market. It's a fun part of the process where we get to be creative and think outside the box.

4. Once we've got some ideas on the table, we move on to wireframing and prototyping. This is where we start to create a basic blueprint of the product that we can refine and improve based on feedback. We create wireframes or prototypes that help us visualize how the product will look and function. And the best part? It only took us about 50 hours! That's a significant savings compared to the typical 80 hours it takes to finalize wireframes without a clear understanding of the target audience. These 4 steps are essential in the process of new product development, we covered them all in our guide [https://yellow.systems/blog/new-product-development-full-guide ].

You can watch the prototype via this link [https://drive.google.com/file/d/1plzZg4rtzSWQXnnYMniDsxSHGMlg55M5/view?usp=share_link]. Sorry, it seams that I can't upload gifs or videos here.

The benefits of going through a Discovery phase are numerous. Firstly, it allows you to validate your ideas and ensure that everyone is on the same page before you start investing time and resources into development. Secondly, it can help you identify potential roadblocks and make any necessary adjustments to the project plan before it's too late. Finally, it can result in a more efficient and effective development process, as all the necessary research and planning has been done upfront.

It always ends up being much more cost-effective than proceeding with development without clear goals. Fortunately, the client realized this and we were able to start the Discovery phase with a two-hour call with them.
But who needs it and when is it necessary? Here's a checklist to break it down:

1. If you're starting a new project from scratch: A Discovery phase can help you determine the scope of the project, identify any potential roadblocks, and ensure that everyone is on the same page.
2. If you're working on a complex project: If your project involves multiple stakeholders, integrations with other systems, or has multiple moving parts, a Discovery phase can help you better understand the project's requirements and ensure that nothing is overlooked.
3. If you're not sure what you want: If you have a general idea of what you want to achieve but are not sure about the details, a Discovery phase can help you flesh out your ideas and determine the best course of action.
4. If you're working on a project with tight deadlines: If you're under pressure to get your project up and running quickly, taking the time to plan and research during a Discovery phase can save you time and resources in the long run by ensuring that everything runs smoothly.
5. If you want to minimize risk: By taking the time to plan and research during the Discovery phase, you can minimize the risk of unexpected problems arising later on in the project. We also described how to properly define the budget for your project development in this article https://yellow.systems/blog/your-project-budget-is-definitely-wrong

Can you conduct user research on your own? Sure, but it can take many forms, including interviews, surveys, and focus groups, and it requires significant time and expertise to interpret the collected data accurately. Hiring someone experienced in the field can provide you with more accurate data and unbiased interpretation. At Yellow, we offer two packages [https://yellow.systems/discovery-phase-services ] to make user research accessible for businesses of all sizes. And trust me, investing in this service will save you thousands of dollars in development costs in the long run.
This is exactly what happened with our client. Thanks to the wireframes we created, we were able to move straight into development. By analyzing the feature list of the Bank of America app, we were able to identify which features our target audience didn't need and wouldn't use. As a result, we were able to fully develop the banking app with all the necessary functionality in just 5 months, while the client took care of the compliance work on their end.

The results truly speak for themselves! With our in-depth user research and evidence-based development approach, we were able to create an app that effectively addresses and solves the problems of its users.

In addition to cost savings, our product development strategy was highly effective in achieving success. We were able to develop a minimum viable product (MVP) in a shorter timeframe than is typically required, with an 8-month development period compared to the industry average of 12 months for bank app development.

As a result of this streamlined process, our app has gained significant traction, with 30,000 monthly active users in Q4 2022 and a high AppStore rating of 4.8. This is a testament to the effectiveness of our development approach, which prioritized efficient and cost-effective solutions without sacrificing quality or user experience.

Fellow indie hackers, have you ever conducted user research on your own and how has it impacted your project? I'd love to hear your experiences and insights.