Organizations are facing far more competing priorities than ever before. With a growing number of improvement projects, strategic initiatives, and last minute “high priority” items on the go, it is challenging to meet objectives, keep teams motivated, and drive sustainable progress. Naturally, effective prioritization is the remedy. Very few organizations, however, are good at it, which compromises the successful implementation of strategies. With many different approaches and tools out there, what does great prioritization look like?

In a world with growing complexity, there is simply more “stuff” that organizations need to manage today than in years past. Being able to prioritize efforts and investments is a necessary capability when there are so many competing priorities.

Prioritization is tough and very few organizations have mastered it. What makes it so difficult? Organizations of all shapes and sizes face similar challenges that often come down to siloed functional thinking, overly ambitious appetites within short timeframes, and limited people and fiscal resources. This combination leads to too many things to do with not enough capacity to do them. Addressing these challenges requires process and cultural interventions. It requires tools to help leaders get to “no” instead of always saying “yes” to adding new items to their roadmaps.

Effective prioritization is both art and science. It must marry discussion, alignment, and good business judgement with quantitative analysis and evaluation. Both ingredients are necessary to master prioritization as a competency. Moreover, it should encompass all potential projects, including both strategic and “run the business” items, as each draws from the same pool of resources.

Start with “Science”

The “science” of prioritization encompasses data-driven evaluation and comparison of initiatives. A best-in-class approach involves business casing, building an evaluation framework, and engaging your team in scoring. This assumes that a clear strategic direction is already in place supported by strong buy-in.

High-Level Business Casing

The journey starts with building a business case for individual initiatives. This typically involves describing the strategic objective of the initiative and outlining capital and operating expenditures, high-level resource requirements, timelines, and some sort of cost-benefit analysis (i.e., ROI, IRR, payback period).
For large initiatives this may be a more robust analysis that involves financial modeling. For smaller initiatives this may simply be a documentation of data and high-level estimates.

Evaluation Framework

Once initiatives are well understood through business casing, there needs to be a framework to compare them on an even playing field. To do so, we recommend establishing a set of weighted criteria related to both Strategic Impact (including risk) and Ease of Implementation. Criteria must be carefully selected and weighted to reflect your organization’s strategic objectives and operating context. Getting this right will provide an objective way to compare immediate profit-driving initiatives that have a direct ROI to foundational investments in underlying technology, people, or culture. Building alignment to the criteria up front is key as it helps mitigate disagreements later in the process.

Team Scoring and Ranking

Once an evaluation framework is established, team members should be engaged in a scoring exercise. Team engagement is a critical step of the process. It provides a platform for all relevant parties to have a say and ultimately leads to greater buy-in to the outcome.

By consolidating individual scores against the weighted criteria in your framework, you will end up with a ranking of best to worst scoring initiatives. It should start to become clear which initiatives are priorities and which should hit the cutting room floor. Importantly, effective prioritization should also provide insight into how spread out or concentrated your team’s views of various initiatives are to help inform the art part that comes next.

Refine with “Art”

There is a saying that no model is perfect, some are just less “wrong” than others. This reinforces why the “Art” of prioritization is a necessary next step. Initiative scoring and ranking provides a great starting point for discussion, but communication, alignment, and implementation realities must now be factored in through discussion and sound business judgement.

Visualization and Communication of Outcomes

Scoring and ranking initiatives are only as useful as your ability to communicate outcomes to your team members. Reading through data tables of arbitrary scores is no help to anyone. By using charts, visuals, and incorporating storytelling, you can help bring team members along and understand why things fell out the way they did.

Drive to Consensus and Alignment Through Discussion

This is perhaps the most important part of the entire process. If done right, it is where you’ll achieve buy-in and ensure your plan “sticks” through its implementation. Getting it right requires expert facilitation skills, creating safe space to table ideas and challenge each other, and focusing energy on contentious topics.

It is not a good use of Management time discussing every initiative being considered. There will be some that are no-brainers to prioritize (or deprioritize) that everyone agrees on. There will be others that average out to a middling score but may have polarizing views across the team. With the right tools in place, you can assess the level of consensus for each initiative based on the scoring exercise and focus your efforts unpacking those where there is disagreement.

Implementation Realities and Key Dependencies

All too often organizations start by thinking about their current capacity and use that as a governor when choosing what to focus on. We, however, believe in a more iterative approach. One that encourages unfiltered ambition at the outset, layering in implementation realities only once you’ve established what you think the “right” set of priorities should be.

This model encourages more innovative problem solving to capacity challenges rather than limiting ambition from the get-go. Often, creative solutions can be found through sequencing, outsourcing, or leveraging partnerships, to name a few.

Maturing prioritization and business planning is a multi-year journey that requires several iterations of trial, error, and learning. Level5’s approach to prioritization and business planning has been refined and field tested through over 20 years of experience supporting organizations to build and implement strategies that stick. Please contact us if you’re interested in learning more about our tools and approach.