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Investment Control at the Technical Stage of a Startup

Dmitriy Nortenko
Dmitriy Nortenko
business.com Member
Dec 01, 2019

In the era of technology boom, promising startups appear every day, which is a major challenge for investors and product owners.

I founded a quality assurance company in 2008 and, since then, we've worked on the number of projects with different levels of investment funding. Not only did these projects require multistage management, but product owners and investors also needed to maintain comprehensive control over progress.

Today's competitive market leaves no options but to utilize the latest digital technologies to gain the edge over the competition. In attempts to reduce costs and accelerate product delivery, IT companies undertake a variety of initiatives. But often, instead of anticipated success, these initiatives bump into schedule, budget, and development hurdles, which then turn into troubled projects and ultimately fail. 

Although Project Management Institute (PMI) reported a 20% decrease in project failure rates, the amount of money lost is still staggering. The report estimates nearly $97 million to be wasted for every $1 billion invested in the product.

Data from CIO estimates a 50% project failure in the IT industry. The Harvey Nash/KPMG CIO Survey found that weak ownership is one of the main reasons why 46% of IT projects never go live. This means the team lacks involvement from the executive level, while the process itself lacks sufficient control and support. However, the experience of our team says these issues aren't the prior reason for failure. Unqualified ownership leads to poor monitoring of the development life cycle evident in 90% of the projects we've worked on. 

Why does project performance control matter?

Project performance control is a key aspect of successfully launching and growing a startup. Why? Because it works both ways.

  • As a product owner or investor, you're on the safe side. Seventy-five percent of IT teams anticipate project failure at the very beginning, according to Geneca research. What the survey says is that the issues of IT projects are usually hidden below the surface right from the start. That is the reason to take over monitoring the whole process, see the internal processes across the entire development chain and identify whether the project is safe for further investment.  

  • Improved performance. Over optimism on project success still plagues the IT industry. Strong credibility of the executive level combined with the specific goals and expert development progress management would be an antidote for the team facing the challenge of over-optimistic expectations. 

What should product managers consider

The following tips are key for any project manager to keep in mind when working to successfully launch and grow a startup. Following these tips will help improve the quality assurance process and boost the chance of success.

Calm down

The proactive approach is excellent, but chances are that rushing at the start results in work overload, delays and inconsistent development. The way any project begins defines its further growth. Rushing implies improper risk management, drawbacks in work planning and lack of communication. That's why you must try to balance optimism with well-thought-out strategic planning. That's easier said than done, of course. It is possible, though, if you let your team participate

Mull your plan over

Sometimes to release a product means to roll out the services or hardware across the country and to support the software at the same time. While deploying a product to one location isn't always hard, rolling it out simultaneously to hundreds of locations across the country is a different task. Moreover, complicated products require thorough, large-scale deployment planning. It means dealing with thousands of servers within a single release properly. These projects require more planning and more cooperation amongst the team. Lack of structure here leads to unexpected human resource needs, equipment or supply shortages and cost increases. Be ready to create a detailed plan and to adjust it daily. 

Listen to your IT specialists

Often, product managers aren't that aware of coding, software architecture and testing specifics, while IT specialists help to pave the path for the project to grow. Planning is not only about predicting the results. Even the "genius level" idea requires professional feedback about the step-by-step development strategy. Present the concept to the dev and QA teams and make them involved in the project planning process. Ask questions, make sure each member understands the task, be ready to accept critical notes, and modify the requirements. 

Consider alternative solutions

Managing a team means reaping the benefits of a diverse set of skills and approaches each member offers. Notably, the task of a product manager is to come up with the most efficient solutions for project growth and overcoming the challenges that arise. But I'm positive that input from project team members will add a surprising value. Listen to their contribution, discuss the options and agree together on the best way out. The ability to value opinions that differ will help to avoid vague project scope, budget shortages and miscommunication. 

Think of a methodology

Development strategy will define the way your product grows and profoundly impact the overall teamwork. The choice of Waterfall, Agile or any other model depends on the project type and scope. Whatever model is yours, it is crucial to respond to the modifications in project development. 

How can product managers make sure the project is on the right path?

Another significant measure for the successful project delivery is efficient progress control. This aspect is of particular interest among the investors and product owners who`d like to be sure the business is worth investment. 

The assistance of a third-party software testing vendor might be a way-out for long- and short-term projects. Since such companies work with quality assurance (QA) engineers, they offer software QA expertise and provide an independent development progress overview. I will illustrate the way a QA company reports on the quality at each development iteration: 

  • Requirements and planning: While the dev team envisions the project, prioritizes the tasks and works on funding, QA engineers take part in initial environments and requirements setting. In this case, the project acquires approved requirements that meet the product owner`s vision. Moreover, testing early-stage defects is less costly. It is an effective preventive strategy from further complications in the software flow. 

  • Design and development: These are the stages of active software construction. While developers work to deliver the product per the initial requirements, QA engineers cover strategy and test plan. Here, the QA team works both ways: It ensures proper deadline management and tests the completed software parts. As such, product owners and investors are sure the features are ready as agreed and get a profound review on the software's critical and minor defects. 

  • Iteration final line: This is a result-analytical part of the process. Product owners and investors receive a brief overview of the feature performance quality. Usually, at the end of each development stage, QA engineers prepare a "round report" where the investors find the information about the objectives met, level of software quality and budgetary limits spent. 

How the involvement of QA helps?

Involving a QA team can provide significant benefits to a tech startup. These include

  • Minimized risks of control failure: With the help of an independent QA vendor, investors get the unbiased review of the project flow and keep track of the way it develops under the current management system. Contracting with a QA company brings objective feedback about the results achieved within the deadlines agreed. Once you find discrepancies in the vision of a product growth strategy, you leave. 

  • Funding and revenue risks eliminated: Project success isn't always predictable: The expenses, complications in development and due date delays are aspects that must be encountered when you analyze the potential profitability of the project. Moreover, the company may require additional funding for operating wastes, development of new software features and expansion of marketing strategy. Constant tracking of development unveils its blind spots. A QA company takes a backup line to provide investors and product owners with a detailed analysis of project scope. In fact, the report will ensure whether it is worth further investment or if it`s high time to stop supporting the project. 

  • Fraud risks prevented: Misleading conduct is not new in the area of investment, especially when it comes to supporting immature business. Of course, legal agreements regulate corporate relations and help to manage conflicts, yet there is no guarantee to save investments. Often, investors get misled by the over-positive reports from the project board. In such cases, the QA provider takes the role of a backup team to ensure the development strictly follows the road map and reports depict real-life results. A timely third-party view prevents fraud and helps to protect investors from funding dead-end projects. You will have a clear picture of the team's performance and their approach to business. 

Starting a project that will turn into a profitable business is no easy task. Again, competition on the tech market leaves no choice but to take a comprehensive approach to product development and its further growth. It's always better to stop investing in a dead-end idea at its early stage. That is why I encourage investors and product owners to take every precaution on their way to success. 

 

 

 

 

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Dmitriy Nortenko
Dmitriy Nortenko
business.com Member
I`ve always thought that a successful business is about high-standard services and customer-orientation. That`s the reason why I built my entrepreneurial career path around quality assurance. I’m CEO & founder of QA Madness, a company that specializes in software testing and QA consulting. I`ve successfully run my business since 2008 thank my 15-year experience in sales, management, leadership, and strategic planning. My deep sense of responsibility and motivation always drive me to improve the work my team and I do together.