Often, it’s not until things aren’t getting done that it suddenly becomes very clear: Employees are being asked to do more than they can actually do. That’s also the time when many managers will decide to start prioritizing their initiatives.
Other managers will prioritize initiatives at the beginning of the year, looking at what they want to get accomplished that year and then making sure higher priority initiatives get done first. And sometimes, it all works out as intended. But not always.
If you want to improve your odds of actually getting your most critical initiatives completed when you need them, read on for a five-step plan to help you get better at initiative prioritization.
Everything isn’t the same, and everything can’t be weighted equally. To prioritize effectively, you have to start with a clear understanding of what will drive your organization’s success this year. Maybe you need to focus on customer service to improve loyalty, or you need to create more innovative products to reclaim your competitive advantage. Maybe you need to cut pricing because you’re losing business. There has to be some overarching strategy that guides the direction of your organization for the year.
Consider what capabilities you need to have in three to five years to remain competitive and to be the company your ideal customers want to do business with. With that context in mind, you can then define a strategy that will help your organization get better in those particular areas. Your strategy might be to improve things like operational logistics, new industry penetration or international sales.
To be able to determine how valuable your initiatives are to the organization, you’ll need to identify criteria to evaluate them against. You’ll use your strategy and goals to help you do that. For example, a major criterion might be customer service because that’s going to be pivotal to your organization’s success this year. Others might be increased sales, strategy alignment, regulation compliance, and expense reduction. Don’t consider cost or the time to complete the initiative as criteria at this point. You’ll address those at a later step in the process.
Once you have the criteria identified, you’ll need to weigh them to determine the relative significance of each criterion against all the others. You can use a Pairwise Comparison Approach to do this, or you can simply allocate 100 points across all the criteria. The sum of all the points must equal 100, and each criterion can have as many points as needed up to all 100 points to reflect its significance against the others.
Use a scale of 1 to 10 to score an initiative’s support to each criterion, then multiply the score for each against the criterion’s weight. Add all the criteria scores up for the initiative and divide by 100, and that will be the benefit score for that initiative.
There may be certain items or categories of risk that can hurt an initiative. For example, you may not have the skill level or technology within the organization to do it. Or maybe you don’t have any experience with that type of initiative. Evaluate risk based on these kinds of key risk categories, and then assign a probability of success score of H (high), M (medium) or L (low) to indicate their likelihood of success.
Now it’s time to look at time and cost. You’re not digging deep into the initiative and doing extensive planning at this point; you’re just taking a guess, performing a top-down estimate. Start by estimating the number of Full-Time Equivalents (FTE)s needed to complete an initiative, then convert the FTEs to a dollar cost. To come up with a dollar figure for each human resource, either use one standard cost for all or break out by skill level.
Next, estimate the other direct costs to complete each initiative — e.g., purchasing hardware, supplies, and office equipment — any other costs besides labor. Then add it up to get an estimate of the total dollars needed to complete the initiative. Estimate the number of months needed to complete it, and now you’ve got your time and cost.
As a final step, display your initiative data on a graph to get a visual representation of your initiatives.
As this graphic shows, you’ll plot the scores along one axis that focuses on the initiative’s probability of success and another that depicts the initiative’s benefits (1-10). Lastly, represent where each initiative is on the chart by creating a bubble that’s sized according to the cost it will take to complete it — the larger the bubble, the higher the cost.
The highest priority items will be initiatives in the top right portion of the graph with the smallest bubbles. These have a high chance of success, high benefits to the organization and aren’t too costly. The lowest priority items will be those in the bottom left portion of the graph with the biggest bubbles. Those initiatives in between the highest and the lowest will need to be prioritized based on your organization’s drivers and limits. Assign a priority from 1 to N (N = the total number of initiatives).
Where to begin? The duration of initiatives and number of FTEs will often influence the order in which you actually take them on. Create a schedule for the year (or a portion of it), and schedule in the initiatives based on the order you chose to start them.
Working through these five steps doesn’t take much time, and you’ll end up with some pretty powerful data. And considering the insights, clarity, and value you’ll gain — not to mention the likelihood that your most important initiatives will get completed and will deliver the results you need — it’s more than worth it.