Overview
Cost of Delay (CoD) is the value lost per unit of time by not delivering a feature. CD3 (Cost of Delay Divided by Duration) creates a prioritisation score. It makes delay visible and quantifiable, replacing gut-feel sequencing with economic reasoning.
When to Use
When teams argue about sequencing. CoD transforms 'I think this is important' into 'delaying this costs us X per week.'
How to Apply It
- Estimate value generated per week once shipped — revenue, cost saved, risk reduced
- Estimate the cost of NOT having it: churn risk, missed opportunity, regulatory exposure
- Estimate duration — how many weeks to build?
- CD3 = Cost of Delay ÷ Duration
- Rank by CD3 score — shorter, high-value items go before longer, lower-value ones
Examples in Practice
🎵 Spotify
Fixing a podcast resume bug (users lose their place): CoD = estimated ~£200K/week in lost subscription revenue. Duration: 1 week. CD3 = 200K. New social sharing feature: CoD = £10K/week. Duration: 6 weeks. CD3 = 1.7K. The bug fix has 120x the CD3 despite feeling less exciting.
📊 Trade Surveillance
Please contact the author for more information on these examples at linkedin.com/in/kshitijrege
Common Pitfalls
- Struggling to quantify intangible value — even a rough estimate beats no estimate
- Ignoring the cost of delay on technical debt items
- Using CD3 without considering dependencies and sequencing constraints
Origin
Don Reinertsen
2009
Further Reading
- Principles of Product Development Flow — Don Reinertsen
Related Frameworks