Defining Opportunities

An opportunity solution tree is a visual tool that helps teams map out the steps to achieve a desired business outcome. It starts at the root with the outcome — this is the goal or business need your team aims to meet. From there, the tree branches into the opportunity space, which includes customer needs, pain points, and desires that, when addressed, will drive the desired outcome.

Next, you move into the solution space, where you brainstorm potential solutions that can solve the identified opportunities. Finally, at the base of the tree, you have assumption tests. These tests help validate whether the proposed solutions will effectively create customer value while also contributing to business goals. By visually mapping this process, teams can align their actions with customer and business needs in a structured, iterative way.

An opportunity solution tree helps product teams make smarter decisions, stay aligned, and move faster. Here are the main benefits:

• Balance business and customer needs: It helps find a middle ground between achieving business goals and satisfying customer needs, ensuring both sides benefit.
• Create a shared understanding: The tree serves as a clear visual tool that keeps everyone aligned on goals and possible solutions.
• Foster a continuous mindset: It encourages ongoing exploration and adjustment based on feedback, allowing for flexibility and avoiding rigid plans.
• Improve decision-making: Teams can see multiple paths and make informed choices about which opportunities to pursue.
• Speed up learning: The tree allows teams to quickly test assumptions and learn what works, saving time and effort.
• Boost confidence in next steps: It provides clarity on what to do next by mapping out opportunities and solutions.
• Simplify stakeholder communication: The visual layout helps explain progress and decisions to stakeholders, making communication smoother.

To effectively use an opportunity solution tree, there are a few important prerequisites that teams should address before diving into the process:

• Target customer theory: You need a clear understanding of who your target customer is and the value proposition your product will offer them. Without this, you won’t be able to identify meaningful opportunities that will resonate with your audience.
• Clearly defined outcome: It's crucial to have a well-defined, measurable outcome that reflects your business goal. This will be the root of your opportunity solution tree. Shifting from outputs (e.g., features or deliverables) to outcomes (e.g., user engagement, revenue growth) ensures you are focused on impact rather than just delivery.
• Customer interviews: Conduct at least 3-4 story-based interviews with your customers. These will provide the real-life insights needed to populate your opportunity space with concrete needs, desires, and pain points.

In an opportunity solution tree, the outcome at the top serves as the guiding scope for all the discovery work. It helps teams identify which opportunities are relevant and directs focus towards the right solutions. There are generally 3 types of outcomes:

• Business outcomes: These are financial metrics that measure the overall health of the business, like increasing revenue, growing market share, or reducing churn. These outcomes reflect broader business goals but might be too abstract for direct product team control.
• Product outcomes: These measure customer behavior or sentiment directly related to the product. This could include metrics like increasing engagement, improving customer satisfaction, or reducing product friction. Product outcomes are more within the team's control and are usually the preferred type for guiding opportunity solution trees.
• Traction metrics: These measure the adoption or success of a single feature. While important, they are often too narrow for discovery work and are better used as part of product optimization rather than exploration.

Having a product outcome at the top of the tree usually strikes the best balance, providing clear direction while allowing room for discovery and adaptation.

In an opportunity solution tree, opportunities and solutions serve different but interconnected roles. Opportunities reflect the underlying needs or pain points of your customers, while solutions are the specific ways to address those needs.

Let’s break it down with different examples:

• Opportunities: I feel stressed after a long day.
• Solutions: Attend a yoga class to relax.

Opportunities are open-ended and can be solved in many different ways. For example, feeling stressed can be addressed by yoga, meditation, or even going for a walk. But a solution is a specific, actionable way to meet the opportunity.^[1]

Retrieving opportunities involves digging into real customer stories to uncover unmet needs, pain points, or desires. One effective method for this is story-based interviewing. Opportunities uncovered in this way are grounded in reality. They reflect true customer struggles rather than assumptions made by product teams. It's important to avoid creating opportunities off the top of your head, as that can bring biases and irrelevant issues into focus. Instead, using customer stories as a foundation ensures that you're working with genuine, real-world needs.

By mapping out these stories, you can then transform them into actionable opportunities for your team. For example, after hearing multiple customers describe frustration with last-minute flight price hikes, the opportunity becomes clear: create a feature that alerts users when prices are about to increase. This ensures the solutions your team works on are grounded in actual customer pain points.

The best time to start mapping the opportunity space is after conducting three to four customer interviews. At this point, you will have gathered enough stories to identify patterns without letting any single story dominate your perspective. It’s important to have multiple data points to ensure you aren’t overreacting to a single customer’s experience. However, you don’t want to wait too long and fall into the trap of "analysis paralysis" by gathering too much information before taking action.

Continuous interviewing is key. After every three to four interviews, refine and update your opportunity space. This ongoing process ensures that you stay aligned with real customer needs and pain points as they evolve, making your product discovery more accurate and timely. It’s not about finishing the interviews but keeping them as a constant part of your workflow to adapt and iterate based on fresh insights.

Mapping the opportunity space involves breaking down customer insights into a clear, actionable structure. Here’s a simplified version of the process in 4 steps:

1. Create an experience map: Capture the stories from customer interviews to build a high-level overview of their journey or interaction with your product.
2. Identify key opportunities: Pull out critical moments from the experience map that highlight customer needs or pain points—these are your top-level opportunities.
3. Group opportunities under moments: Organize individual opportunities under their corresponding moments in the customer journey, making sure each one is linked to a specific need or pain point.
4. Structure the opportunity tree: Build a clear hierarchy by creating parent-child relationships between related opportunities. This will help you see how different opportunities connect and which ones need further exploration.

When creating an opportunity solution tree, adding customer segments at the top can help teams address the distinct needs of different user groups. For example, a food delivery service may cater to both restaurant owners and customers, each with unique pain points. Alternatively, in a project management tool used by freelancers and enterprise teams, both groups will have different requirements. By segmenting customers, teams can prioritize opportunities and solutions that resonate with each group, ensuring more tailored product development.

However, the structure of your tree should reflect your team's responsibilities. If your team serves multiple audiences, placing customer segments at the top is necessary to organize the opportunity space effectively. If your team only focuses on one group, customer segments may not be needed.

In an opportunity solution tree, choosing a target opportunity is crucial for driving progress. Instead of focusing on too many opportunities, teams should concentrate on one small, actionable opportunity at a time. This approach allows teams to deliver value incrementally, following the Kanban principle of limiting work in progress.

Start by drafting a rough version of the opportunity space — don’t worry about perfection. The aim is to identify a target opportunity early, even if the opportunity space is still evolving. Choosing a focus area quickly helps teams explore solutions and test assumptions faster. This is where most learning and refinement take place, allowing teams to compare different solutions and iterate based on real-world feedback. This process encourages continuous improvement and speeds up decision-making, keeping teams moving forward.

When assessing opportunities within a product discovery process, it's crucial to evaluate several key factors to ensure you're focusing on the most impactful and valuable opportunities. Here are the main areas to consider:

• Opportunity sizing: Determine how many customers are affected by the problem and how frequently. This helps prioritize based on the size and reach of the issue.
• Market factors: Evaluate how solving each opportunity could affect your product’s position in the market. Consider if it will enhance your competitive advantage or boost user acquisition and retention.
• Company factors: Consider how addressing each opportunity aligns with your company's mission, vision, and strategic objectives. Does it support long-term goals or promote growth?
• Customer factors: Assess how important the opportunity is to your customers. Are they satisfied with existing solutions, or is there a significant gap that your product can fill?

By weighing these factors, product teams can make informed decisions about which opportunities to prioritize.

Balancing business value with customer value is crucial for the long-term sustainability of a product. Without business value, even much-loved products can fail. A good example is Dark Sky, a popular weather app that was eventually shut down after being bought by Apple. Despite its customer popularity, it didn’t generate enough ongoing value for Apple.^[2]

In an opportunity solution tree, the focus starts with business value because without it, a product cannot last. Business value ensures the company can keep serving customers. The opportunity space, on the other hand, helps align business value with customer needs. This balance ensures that products remain both desirable to users and sustainable for the business over time.