Integrations are the lifeblood of modern software companies. They enable your product to seamlessly connect with other tools, expanding its capabilities and reach. However, with a plethora of integration opportunities, how do you decide which ones to prioritize? That's where a popular prioritization framework, RICE, comes into play.
What is RICE?
RICE (short for Reach, Impact, Confidence, Effort)is a popular prioritization framework used to decide which projects or tasks to tackle first, it was originally developed by Intercom and is a popular framework for deciding where to expend your effort.
It's a straightforward way to prioritize and make sure you're working on the most impactful tasks
The first factor in determining your RICE score is to get a sense of how many people you estimate your integration will reach. The following can help you understand reach:
Platform size: Larger platforms offer higher potential for reach
User overlap: Tools like CrossBeam can help identify the tools your customers also use, offering insights into potential user overlap between your customer base and the tool you are integrating into
Research and forum requests: Analyze user demand for specific integrations through forum requests. Even if there aren’t specific requests for your integrations you can get a sense of the demand for your category by searching feature request boards and forums.
No matter what methods you use to estimate a number, reach is all about quantifying the number of individuals directly impacted by the integration.
In the context of the RICE framework, the impact component can focus on both quantifiable and qualitative goals. When you're investing in an integration, however, the ultimate aim is often to drive a quantitative goal, typically centered around revenue generation.
Here are key factors to examine to estimate the potential revenue impact:
New Revenue Contribution: Calculate the potential increase in revenue resulting from new users who discover and engage with your software due to the integration.
Existing Revenue Contribution: Evaluate how the integration may influence existing users to continue using your solution or upgrade their subscriptions. This can result in improved customer retention and higher revenue.
Intercom uses a five-tiered system for evaluating impact and it can work well for estimating revenue too: 3 = massive revenue, 2 = high revenue, 1 = medium revenue, 0.5 = low revenue, 0.25 = minimal revenue. This scoring method helps assess the integration's significance on revenue streams.
The confidence metric is all about how confident you are in your estimates. There are a couple of factors that increase confidence
Customer Demand: Gauge demand by analyzing customer feedback, requests, and insights from sales interactions. This helps you understand the real interest from both prospects and existing customers for this integration.
Comparative Analysis: Evaluate the performance of similar integrations on the target platform. This analysis provides insights into the overall demand for this integration category.
Market Research: Conduct market research, including social listening and forum discussions. Identify areas where users are investing significant manual effort to connect systems. Your solution can address these pain points effectively.
Typically you’ll choose one of three scores 100% = high confidence, 80% = medium confidence, and 50% is low confidence.
Effort involves resource allocation and cost:
Time: Assess the estimated development and launch time,
Resource: Consider the manpower needed for integration, launch, and support. This may involve various teams like marketing, business development, engineering, product, and support.
A common calculation is person-months, e.g., if 4 team members work on the integration full-time for 2 months, the cost is 8 person-months. This is where partnering with service providers like Lunch Pail Labs can streamline the effort. External service providers have the resources to assist you in taking an integration from planning to launch, minimizing the effort your team expends.
And then you put it all together for your RICE score, integrations that score high should be prioritized.
The RICE framework provides a structured approach to prioritizing integrations based on their potential reach, impact, confidence, and effort. By systematically evaluating these factors, you can make data-driven decisions and focus your efforts on integrations that offer the most significant potential for your software company's growth.
And that’s a wrap! If you prefer a visual rundown, check out our video recap here:
For personalized support in navigating the integration landscape, Lunch Pail Labs is at your service. Feel free to book an intro call to discuss strategizing your integration roadmap.