Source: Planning for Value: How much? When?
Author: Allan Kelly
Section: 3 — Lesson 2: Know the Time-Value Profile
Reading time: 1 minutes
Tags: time-value-profile best-before-date use-by-date value-decay seasonal-value story-prioritization-by-value santa-app-example halloween-app-example time-sensitive-delivery value-curve-analysis deadline-driven-value
Summary: Kelly’s second lesson introduces Time-Value Profiles — how the value of a product or feature changes over time. Using a toy retailer building a Santa app and a Halloween app, he shows that value isn’t constant: it has a ‘Best Before Date’ (when value starts declining) and a ‘Use By Date’ (when value hits zero). The Halloween app has a much steeper time-value curve because its seasonal window is narrower, making delivery sequence a critical financial decision.
Lesson #2: Know the Time-Value Profile of the thing you are building
Not all value is created equal over time. Kelly introduces the Time-Value Profile — a chart showing how the value of a product or feature changes depending on when it’s delivered.
The toy retailer example
A toy retailer wants two apps built, starting September 1st:
Story 1 — Santa app: Kids select from a special range for parents to buy.
- Value = $1,060,000
- Time to delivery = 6 weeks
Story 2 — Halloween app: Kids make lists of toys they want Santa to bring.
- Value = $355,000
- Time to delivery = 4 weeks
Which story do you build first? The instinct is to build the higher-value Santa app first. But Kelly shows this is wrong.
Best Before Date and Use By Date
Each product has two critical dates:
- Best Before Date: The date after which value starts to decline. For the Santa app, value starts falling after September 15th — the earlier it ships, the more of the Christmas shopping season it captures.
- Use By Date: The date when value reaches zero. After Christmas, the Santa app is worthless until next year.
The Halloween app has an even tighter window: its Best Before Date is earlier (late September) and its Use By Date is October 31st. Miss Halloween and the value is zero.
The right answer: Halloween first
- Santa first: Santa makes $1,025,000 (lost $35K from late start). Halloween makes $0 (missed the window entirely). Total: $1,025,000
- Halloween first: Halloween makes $340,000 (lost $15K). Santa makes $800,000 (lost $225K from later delivery). Total: $1,140,000
Halloween first generates $115,000 more — because the time-value profile of the Halloween app decays faster. The lower-value item with the tighter deadline should be built first.
The Time-Value Profile is an input to planning. You cannot make good prioritization decisions without understanding how value changes over time.