What to develop

The classic “No silver bullet” paper states that the essence of software development is the decision what to develop (& not the accidental aspect of how to develop). Agile methodologies try to solve this by saying modestly that the solution to this problem can’t be known in advance, but rather reached iteratively using a feedback loop involving the software customer. Value-Creation methodologies recommend strategic gating, & various focus methods that try solve the essential problem of what to develop, which when done right eliminates many derivative problems.
Web2.0 best practices talks about early beta release & continuous feedback based improvement, directed in solving the problem right. Some companies, Google notably, allow themselves a more brute-force approach, of shooting to all directions, with small beta offerings, which either succeeds & is continued, or fails & is discontinued.
There are also several vendors, (e.g., Accept Software (which I happen to work with)), which try to help companies solve the problem right, by enabling analysis of what should be developed, based on both market/prospects inputs & development/resources cost estimations.
Even if you don’t practice all of these great solutions to the essential problem, at least be extremely aware of it: always focus on the initial “what to develop” question.

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