The key to success for any new product development effort is to clearly define what you want to produce. A Product Requirements Document (PRD) helps you create this definition. It acts as the destination to guide the development journey.

This blog explains what a PRD is. It covers what should be in it, what to leave out, and how to write it. Whether you’re responsible for getting a new product developed and released or you’re just part of the development team, reading this will increase your chances of success.

What is a product requirements document (PRD)?

A PRD is a master document that spells out what you want to develop, why, and to an extent, how. This “how” is where you define the product features and functionality required. A PRD may also cover the release criteria, timelines, milestones, information about potential volumes, and success metrics.

The length and level of detail depends on the type of product. For example, a doorknob may need only a single page, while a graphics card might take dozens of pages to define.

Organizations that use the waterfall methodology of development (where the project moves from one clear-cut stage to the next), will require a large and detailed PRD document. The PRD document for those that have an agile development environment will likely be more dynamic and evolve as work progresses and teams learn new information.

When creating a PRD, a template helps ensure nothing gets overlooked. The template will need to be tailored to your organization, product, and development process. It must be thorough — and it must also be available to everyone working on the project. Remember: a document that no one can access is of no use to anyone.

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The 5 main stakeholders involved in PRD development

Product development requires input from many different teams. Because so many business functions are affected, they should be involved from the outset. (The alternative is that they find out their input is required after key decisions have been made, making it hard to get their buy-in and likely resulting in suboptimal product performance.)

Who are the key stakeholders involved in developing a PRD? The engineering team will probably be the group most deeply tied-in, but it’s vital to get other key people involved as well. These include:

1) Product Manager (PM)

The PM is the principal author of the PRD. They document the final vision of the product, incorporating input from engineering, sales, marketing, management, and even customers. While the leads of each of these departments are responsible for specific contributions, the PM pulls together their inputs and ensures the project stays on track.

2) Engineering Manager

The engineering team reality-checks the product definition. Can the features outlined in the PRD be developed without defying the laws of physics? In the timeline requested? For the targeted costs? Sometimes, a small R&D effort is required to answer these questions before the PRD can be finalized — and that’s okay. It’s better to spend time early on to answer these questions rather than waiting until it’s too late or too costly to make changes.

3) Sales Manager

The sales team needs to help determine if end users actually want the features listed in the PRD, and if any fine-tuning is required to optimize the product-market fit. The sales team is also responsible, along with finance and customer teams, for helping figure out how much customers would be willing to pay for the product that’s been defined.

4) QA Manager

The new product will need an inspection (and testing) to ensure it meets requirements and is fit for sale. Letting the QA team see early versions of the PRD helps them budget for and organize the resources needed. These peripheral costs are often neglected when calculating the actual cost to develop, test, and manufacture a product. Test equipment can get expensive quickly!

5) CEO

The CEO needs to review the product roadmap outlined in the PRD to make sure it aligns with the company vision and is consistent with the business model.

None of these teams should work in isolation. PRD development is a company-wide effort involving multiple conversations and debates. And the effort will definitely test your negotiating skills when the engineering team reports that the features are too expensive or will take too long to build, the sales team refuses to raise the price for the customer or remove a feature, and the CEO mandates the product be on store shelves within six months!

Resolving these conflicting objectives or points of view requires the Engineering-Management-Sales team triad to roll up their sleeves and work together. It often takes multiple iterations of the specifications before all three teams are happy with the outcome. The PM is the final arbiter and records the decisions.

Pros and cons of using a PRD

It’s common in engineering for people to want to dive straight into design and development. When told a PRD is required, the response is usually complaints about how it will slow the process. In fairness, while PRDs are used by many organizations with mature product development processes, there are arguments against creating them. Below, we break down a few of the positives and negatives of going through the process of creating a PRD .

Pros of a PRD

  • Provides high-level direction for the product: Team members can see how the product fits with the established company roadmap and strategy. It may be a clever product idea, but a business probably shouldn’t pursue it if it doesn’t fit with their long term strategy.
  • Aligns the organization around a common vision: Ensures that cross-functional teams have the context they need to work toward the same goal.
  • Documents timelines and milestones: Provides visibility for the intended release date and areas of ownership.
  • Encourages feedback and input: Team members can see how their contribution affects the overall project and will have the opportunity to raise concerns or share feedback early.

Cons of a PRD

  • Takes time and effort that teams could spend on actual development: However, without a PRD, there’s a high probability of investing effort in the wrong things, duplicating efforts, and leaving gaps that cause project delays.
  • Requires a learning curve: If the organization hasn’t used PRDs before, there will be some growing pains. However, everyone has to start somewhere, and the time invested and lessons learned will be rewarded many times over when writing subsequent PRDs.
  • Constrains the design and engineering teams’ creativity: Restricting the creative process has the potential to squash game-changing feature improvements. However, too much creativity can lead product development efforts off track, delaying the eventual release.

Key components of good PRDs

Every PRD is unique because it addresses the specific description and requirements of a particular product. However, there are core elements that should be consistent. Below is a list of those key components and examples of what they may look like.

Overview

This first section tells the reader what the PRD is about. It names the product being developed, who is involved (team members and stakeholders), and the timing or release date. It should also note the current revision: As with all such documents, version or revision management is important to prevent people from working from outdated copies.

“Goal: Launch a new range of pullwear for luxury kitchen cabinets

Version: 1.2 (17th, January, 2023)

Stakeholders: Product Manager, Engineering Manager, Sales Manager

Target release date: End Q2, 2024”

Objective

Here you outline why you’re developing this product. This should cover the needs it will address, the market for the product, and how it fits within the context of other products the business sells.

“The kitchen cabinet market shows 17% CAGR. While we manufacture drawer organizers we are not on the outside of the drawers. The proposed pullwear range will create the opportunity for our resellers to leverage our existing product portfolio.”

Context

This section explains who would want the product and why. It may include customer personas and example use cases. It includes notes on competing products a customer might choose to help stakeholders understand the opportunity for this product — and whether it can meet customer needs.

“A slowdown in new luxury home construction will result in rapid growth in the kitchen refit industry. End users seek increased differentiation, and this product will help retailers offer an expanded range.”

Assumptions

It’s helpful to draw out any assumptions and dependencies that underpin the PRD and can negatively or positively affect the prospects for success. For example, these might be related to prospective customers’ capabilities or knowledge, regulatory environments, or actions taken by industry leaders.

  • Interest rates will remain at historically high levels, curtailing new home construction for the next five years.
  • High-net-worth households will continue to upgrade their kitchens.

Scope

This section spells out what is, and perhaps of greater importance, what is not included in the development effort. It will list features and may assign priorities, perhaps as “must-haves” (which define the minimum viable product) and “nice-to-haves,” and can identify features to leave for later versions or releases.

  • Must-haves: Copper and nickel finishes
  • Handles for both cabinets and drawers
  • 2 different lengths
  • Suitable for on-site installation
  • Nice-to-have: Space for labels
  • Later: Finish in other colors: Black, green… 

Requirements

Here the PRD details what the product should include or incorporate. You can spell out details as user stories or, particularly for user interfaces, in the form of wireframes. Mock-ups may also help explain what’s needed or expected.

  • Lengths: 18″ and 24”
  • Mounting points: 2
  • Cleanability: Wipe with household cleaners – must not stain or degrade after five years service
  • Mounting: Gaskets to prevent surface marking, crosshead screws, must stay tight for 5+ years
  • Installation template to be included
  • Performance

These metrics will tell the development team when the product is ready for release. It might include passing particular performance or endurance tests, meeting a cost target, or conforming to size and mass constraints.

  • Manufacturing cost per unit stays below $5
  • Fewer than 6% defective products
  • Remain under 10 oz per unit 

Open Questions

Almost certainly, there will be things the team doesn’t know when the project starts. These should be captured in this section — and ideally assigned to individuals or specific teams to get answers. Examples of such questions could include tooling costs and lead times on key components or materials.

  • What is involved in applying a brushed copper finish? Action: Assign to Manufacturing Engineering team to answer in detail
  • How durable is a copper finish? Action: Product Engineering to run tests and report back
    Anyone familiar with product lifecycle stages will see overlaps between those and the PRD sections outlined above. This is to be expected.

One other point to make about the contents of a PRD: this is not a project management document. The teams involved in the development process will almost certainly produce their own project management plans, and the PRD may be one of the docs they reference, but the PRD is not the project plan.

Quick tips for writing an effective PRD

Now that you understand the importance of a PRD and what it should cover, how do you create one? Here are some best practices to keep in mind.

  • Keep it as short as possible while still covering the points listed above: The longer it is, the less likely it is to be read. You want it to be a living document that team members refer to whenever they need. (Using a standard template will help you do this.)
  • Make it a collaborative process: Gather the stakeholders around a whiteboard or use a collaborative software tool. When people from different functions come together to write the PRD, there may be a vigorous debate — but you’ll get a high level of buy-in to the finished document and a much better level of detail.
  • Accept that your PRD will never be finished: Limit how much time you spend looking for answers. Capture unknowns and things that need to be found in the Open Questions section and move on.
  • Keep it specific: Avoid vague or unquantified statements and terms such as “light” and “attractive” because people can interpret these descriptors differently. Instead, keep the SMART framework in mind when writing your PRD: specific, measurable, achievable, relevant, and time-based.

Downloadable PRD templates to try

Creating a PRD from scratch is hard, even if you’ve done it before. It’s easier to customize a template for your business’s particular needs and process. Here are a few downloadable templates to help you get started:

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New product development is a collaborative undertaking, and a well-written PRD ensures all the stakeholders are on the same page.

Every PRD is specific to the organization and product. The PM could create it from scratch, but using a PRD template is a faster, less error-prone approach.

While it’s easy enough to find PRD resources online, it’s an entirely different animal to nail down a single source of truth that can actually benefit the cross-functional teams that touch it. PLM tools from Duro are ideal for this task. These can help you centralize data for your PRD, keep it accessible, and ensure everyone works from the latest design revision as you follow the process. Schedule your demo today to learn more.