Answering: “Your product’s current value is low and your most recent three releases have failed to improve the current value, but the unrealized value of the Product is high.”

Find and remove waste so the Product Cost Ratio drops and time to market improves, which frees capacity for future innovation. Pushing more features through a clogged system or dropping the product ignores what the data shows.

Exam Question

Your product’s current value is low and your most recent three releases have failed to improve the current value, but the unrealized value of the Product is high.
– Your product cost ratio is 85%, meaning that you have a very low capacity to deliver new features.
– Your time-to-market is also quite long.
As a Product Owner focused on the long-term viability of your product, which strategy should you pursue?
(choose the best answer)
A. Drop the product, since you have not been able to improve customer satisfaction, it is better to focus on some other opportunity.
B. Focus on identifying and delivering high-value features with the limited capacity you have, trying to win customers and increase revenue.
C. Seek out and eliminate the sources of waste to improve your Product Cost Ratio and Time to Market, building a foundation for future innovation.

Correct Answer

C. Seek out and eliminate the sources of waste to improve your Product Cost Ratio and Time to Market, building a foundation for future innovation.

Why This Is the Correct Answer

In Evidence-Based Management, a high Product Cost Ratio and a long time to market mean most of the budget and effort go to keeping the product running. With 85 percent of cost absorbed, the team has little capacity for new value, which explains why recent releases changed nothing. The unrealized value is still high, so the opportunity exists. The constraint is the team’s Ability to Innovate and Time to Market. Removing waste, such as manual processes, technical debt and unused features, frees capacity and shortens feedback cycles. With that foundation in place, the Product Owner can pursue the unrealized value much more effectively.

Why the Other Options Are Wrong

A. Drop the product and focus elsewhere. Unrealized value is high, so the market opportunity is real. The problem is the delivery system, not the idea.

B. Focus the limited capacity on high-value features. With 85 percent of cost going to upkeep, this keeps fighting the same bottleneck. Recent releases show it has not worked.

Exam Tip

When an EBM scenario shows high cost ratio and slow time to market, the answer usually targets the capability problem first, not more features.

Key Takeaways

• A high Product Cost Ratio leaves little room for new value.
• High unrealized value means the opportunity is still there.
• Fix the delivery system before chasing more features.