Agile Product Development: The Ultimate Guide

agile product development

What is Agile Product Development?

Do you recall the following image of a cat and a cat tree tower representing user needs and product features? It went viral on social media at some point as it perfectly illustrates the modern-day agile product development process. Without proper product discovery, there’s a high chance your product won’t meet the actual user needs. If you have a cat, you know what I mean.

user needs

What does it have to do with the Agile methodology?

Agile product development is about producing working software in chunks, so-called iterations. It favors early release to get invaluable feedback from the users, which in turn feeds into the constant improvement of the product. This way, you listen to your users’ needs, observe and learn how they use your product to better understand which functions are lacking and which are not needed at all. It’s about bringing value in small increments. 

With Agile software development methodology, you’re not building a fully-fledged product in one go. You start small and test to see if this is what your users need at that particular moment. 

Let’s go back to the cat tree tower example. In the Agile product development process, you would build the first level of the cat tree tower (small iteration) and observe how cats are behaving. You’re testing the specific piece of the product. You could ask the following questions: 

  • Do the cats like spending time on the first level? 
  • Do they use it? 
  • Do they feel comfortable staying there for a while?

Based on this review and feedback you would either continue building additional levels or adapt and change the direction completely. I don’t know about your experience with cats but I’ve never seen my mom’s cats use the cat tree tower!

Flexibility and adaptability is the core of the Agile methodology. With constantly changing user behaviors, new competitors, new products, new technologies, and new market trends, Agile helps to keep an open mind. With an Agile mindset you’re continuously discovering, learning, adapting, and quickly responding to change. That’s Agile in a nutshell.

If the cat analogy doesn’t do much for you, here’s a video from the Agile 2022 Conference in Nashville. One of our colleagues asked some of the participants how to explain the Agile methodology to a 5-year-old; this might do the trick!

Agile has become a buzzword in the software development world after Agile principles and values got clearly defined by the Agile Manifesto in 2001.

During the 2019 COVID Pandemic, more focus was put on Agile practices as we all understood one simple truth — nothing is stable. External events can irreversibly change user behavior, and all businesses must adapt quickly to new circumstances to survive in the current market.  

The main principles behind the Agile methodology defined in the Agile Manifesto were the following:

  • Individuals and interactions over processes and tools.
  • Working software over comprehensive documentation.
  • Customer collaboration over contract negotiation.
  • Responding to change over following a plan.

Which can roughly translate to:

The Spirit of Collaboration & Communication — Agile software development doesn’t favor top-down hierarchy. Everyone collaborates, talks, and shares knowledge. Stakeholders are invited to Sprint Reviews and Retro sessions. There is transparency and mutual understanding of the blockers that everyone faces so that solutions can be worked on together and processes are not blindly followed but rather adapted and changed to fit the current needs.

The Spirit of Providing Constant Customer Value — providing value to the customer in the form of working software is the number one priority in the Agile approach. Embracing ambiguity and learnings through user feedback instead of holding on to complex product documentation. Aligning Business Objectives with what customers value and want at this very moment.

The Spirit of Implementing Customer Feedback — Customer Feedback is more important than constant product requirements negotiations. Customers’ satisfaction should be the number one priority, and the products should always be built with customers in mind. Otherwise, the software development team will just spit out features that no one will use, invariably contributing to a high churn rate.

The Spirit of Flexibility & Adaptability — plans are important to map a direction and guidance, however, being flexible and embracing change is even more crucial. There are plenty of unknowns and uncertainties in software development, which cannot always be controlled due to the dynamic nature of the tech market.

In Agile software development, there is a big push toward a mindset that isn’t rigid and fixed but is rather open to alternative solutions. The Agile mindset should be adopted throughout the whole organization, especially at the stakeholder level, for the Agile transformation to be successful.

Agile methodology vs traditional project management: Waterfall

Traditional project management, the so-called Waterfall, is akin to gambling everything on the turn of one card. You spend a lot of resources and time planning the product roadmap and then wait for the big fat launch without testing how users respond to your product in a real-life setting. Traditional Project Management can turn into a huge success or a massive flop. 

With Agile development, it’s a different story. You release an early version of the product, to provide value as soon as possible, and test how users respond to it. Then new features are built based on user feedback and their experience with the product. In Agile methodology, product discovery and development go hand in hand in an infinite loop of product improvements to meet customers’ expectations.

Let’s look at the main differences between the Agile methodology and Waterfall.

Product requirements

In Waterfall, product requirements are clearly defined at the very beginning of the project in the form of complex documentation. Once fixed, there is no room to go back and make some changes. The software development team works with what has been decided upfront.

In Agile product development, product requirements can be changed and adapted at any stage of the development process. They are presented as user stories, which don’t have to be very detailed right from the start. Fine-tuning comes at a later stage when all of the dependencies come to light.


In Waterfall, you cannot make any last-minute tweaks as it’s rigid and not open to sudden changes in the scope. Traditional project management is based on the theory that users’ behavior is predictable, which is not necessarily the case.

With Agile development, it’s much easier to change the scope, reprioritize certain features, and change direction. Short and repetitive release cycles allow frequent improvements and quick bug fixes. 


In traditional project management, testing is done once the code has been finalized and all product requirements are fulfilled.

In Agile methodology, testing happens after each iteration, i.e., Sprint. There is more opportunity to analyze the code and inspect or refactor it.


Agile development relies on teamwork, collaboration, and communication between the development team, stakeholders, and end users. There is much more transparency and mutual understanding, especially during retro sessions where the development team communicates the constraints they’re facing. Agile favors self-organizing teams that trust each other rather than micromanagement and top-down hierarchy.

In Waterfall, the main decisions are taken at the executive level, with less transparency and less cross-team collaboration. Teams tend to be locked in silos and work apart.

User feedback

In Agile, user feedback and customer value are of the utmost importance. 

In Waterfall, user feedback is gathered at the very end stage of the project, once the product is finally released to the market. There are no in-between check-ins with the users to see if the product meets their needs.  


With digital products, there is a fair amount of uncertainty. The tech market is dynamic with constantly emerging new technologies. In Waterfall, embracing ambiguity is very difficult. Everything needs to be clearly defined right at the start.

Agile, on the other hand, embraces ambiguity at every stage of the project. Not everything can be defined initially, which doesn’t stop the development team from getting the ball rolling. The product is continuously improved with each software iteration, and ambiguity is a natural component of the software development process.

Waterfall to Agile transformation

Most companies pride themselves on being Agile. However, it takes a village to transform the whole organization into adopting the Agile mindset; everyone needs to be on board — leaders included! 

Check out the following tips to ensure the Agile transformation is successful in your organization:

  1. Involve the company leaders and make them aware of Agile transformation’s benefits. 
  2. Start from the ‘pilot.’ Pick a less impactful project, analyze the impact, and see if Agile can be scaled across the whole organization.
  3. Promote small, self-organizing teams and cross-functional teams’ collaboration.
  4. Divide large projects into bite-sized chunks that can be completed over a specified time frame.
  5. Embrace ambiguity and uncertainty as an integral part of the software development process.
  6. Invite stakeholders to retro sessions and sprint reviews to promote transparency and encourage more frequent internal communication.
  7. Test different Agile events like Sprint Planning, Retrospective, Daily Scrum, and Sprint Review to structure and optimize your team’s workflow.  
  8. Be open to change and occasional shifts in priorities mid-project.
  9. Identify issues your team is facing and test different Agile methodologies that respond to those needs.
  10. Reach out to a certified Agile coach or agency and introduce a clear Agile training path for the whole organization:
    a. Leadership training
    b. Scrum Master training
    c. Product Owner training
    d. Agile Practitioner training
  11. Pick an Agile collaboration tool that can be used in any setting (remote or onsite) and create one source of truth.
  12. Give everyone time to get familiar with Agile principles and adopt them into their daily routine.

Templates for Agile Product Development process

It’s easier to start something new once we have a bit of guidance and can look at an example. Here at, we’re constantly expanding our Template Library, and we have a bunch of ready-to-use Agile Templates that are easy to understand.

Check the quick overview of our most popular Agile templates below. You don’t have to start from zero!

User Story Mapping Template

Put your user at the center. Create a User Story Map and capture all the activities and tasks your users need to complete to benefit from your product fully. 

user story mapping template

PI Planning Template

Collaborate with multiple Agile teams in your organization, discussing the product strategy, and planning new feature releases, all in one virtual space on a PI Planning Template.

Daily Standup Meeting Template

Run the Daily check-in with your Agile team using the Daily Standup Meeting Template. Monitor the progress of the current tasks, spot any blockers, or import the tickets from Jira to try the ‘Walk the board’ approach.

Quick Questions Retrospective Template

Reflect on what went right and what went wrong during the last Sprint using our Quick Questions Retrospective Template. Simply write down your question and ask the person to your right to answer it! 

quick questions retrospective

Magic Estimation In Story Points Template

Use Magic Estimation natively integrated with Jira to estimate the amount of effort needed to ship work items from the product backlog.

Planning Poker Template

Use Planning Poker to gamify the estimation sessions with your team. Choose between story points, time estimates, or t-shirt sizes to make your estimates quick and fun.

Plus Delta Template

Run a Plus Delta Retro session, where you assign pluses to the things that went well and deltas to those that could be improved during the next Sprint.

plus delta template

Kanban Board Template

Work out the most optimal workflow for your Agile team with an easy-to-customize Kanban Board Template.

Product Backlog Refinement Template

Keep your product backlog in check with the Product Backlog Refinement Template. Manage stakeholders’ expectations, prioritize stories and keep your product backlog clean and tidy with the help of handy Jira update zones.

Don’t hesitate to test them out with your team, especially during your first steps with Agile product development.

Doing Agile, being Agile, and ‘fake Agile’

There’s been so much noise about Agile in recent years. According to the 15th Annual State Of Agile Report, Agile adoption in software development teams jumped from 37% in 2020 to a whopping 86% in 2021. 

How can you tell if your organization is truly Agile? 

Many companies believe that they’ve transitioned completely to the Agile way of working; however, this might not be entirely true. There is a difference between ‘Doing Agile,’ ‘Being Agile,’ and ‘Fake Agile.’

Agile transformation can take several years — the change will not happen overnight. Using Agile tools and terminology is not enough — the ultimate goal in the Agile product development process is adopting the Agile mindset. 

Doing Agile

If your company is ‘Doing Agile,’ it can simply mean that your organization has adopted some Agile practices and processes. Some of them could include:

  • Scheduling regular Agile events like Daily Standups, Sprint Planning, Retros, and Sprint Reviews.
  • Adopting Agile terminology and Agile roles like Product Owner and Scrum Master.
  • Slicing bigger projects into smaller pieces that are managed by self-organized teams.
  • Visualizing work items on a collaborative board.
  • Assigning scheduled workload into shorter release cycles, i.e., Sprints.
  • Incorporating Agile estimation techniques like planning poker, t-shirt size estimation, the bucket theory, and Fibonacci sequence.

Being Agile

‘Being Agile’ means that the company is already ‘Doing Agile’ and has also adopted the ‘Agile mindset’ across the whole organization, especially at the higher management level. This is the ultimate goal of the Agile transformation. 

The Agile mindset is open to change and embraces the uncertainty of modern-day software development. An Agile mindset means that a new direction is welcome. There is no resistance at any level. Communication, transparency, and collaboration are encouraged across different departments and Agile teams, as everyone is working towards a common goal.

Fake Agile, a.k.a. Agile Theater

Many companies fail at Agile because they unknowingly practice the so-called ‘fake Agile.’ According to’s 15th Anual State of Agile report, 42% of respondents rated the organizational resistance to change as one of the top blockers when it comes to successful Agile adoption. 

Introducing the Agile terminology and roles is not enough. Agile needs to be adopted at the core.

If you want to spot fake Agile practices in your organization, ask the following questions to dig deeper.

  • How does the team gather user feedback? What channels or methods are put in place?
  • Does the team continuously deliver value?
  • Does the team take feedback from the customer and act on it?
  • Is there a budget allocated toward changes triggered by customer feedback?
  • How is the success of Agile transformation measured? Is it measured by customer/user satisfaction or on-time delivery?

If your colleagues start raising eyebrows or can’t provide you with a concrete answer, it’s a sign that your company isn’t truly Agile. If there is no clear process for gathering user feedback and no budget allocated towards changes triggered by it — this clearly sets alarm bells ringing.

Your company could still practice the traditional project management, Waterfall, in disguise. Agile requires an open mind and extensive training from the top where everyone follows the same script.

Agile is a long journey. Mastering different phases of Agile product development takes time and should be factored into the whole Agile transformation plan.

Don’t expect your company to turn a switch and start ‘Being Agile’ from day one. It’s the same with kids. You don’t expect them to run straight away after they are born. They crawl first, then walk and finally run a Marathon…erm… Sprint ;).

Agile Product Development done rightthe Agile guide download

Don’t leave without our ‘How to go Agile the right way’ guide! Follow our tips to sidestep common pitfalls when transitioning to Agile.

agile for business guide