Strategic Prioritization – How to Rank Transformative Digital Projects
Prioritization is fundamentally a way of developing ideas and then setting an order for preferred completion for each idea, thereby creating a ranking of importance. It’s especially difficult within a company structure because there are so many stakeholders and various personal opinions. However, according to a Harvard Business Review article, the payoff for prioritization is impressive, “Prioritizing increases the success rates of strategic projects, increases the alignment and focus of senior management teams around strategic goals, clears all doubts for the operational teams when faced with decisions, and, most important, builds an execution mindset and culture.”
Different stakeholders will very often have varying opinions on the most pressing IT projects. The CISO might desire a security-related improvement to be placed well before the CMO’s CRM project intended to boost sales. There are conflicting desires and it’s difficult to weigh the needs of internal teams over the company’s and customers’ needs. Everyone in the organization might assume their proposed project is essential, but they should all understand the firm can’t develop and implement every project at once.
The executive teams that are most successful are those that can effectively prioritize projects and then quickly dive into their full completion. Ideally, this team will be willing to take some risks and will be able to narrowly focus on development priorities that are deemed essential for growth. A strategic approach to prioritization is needed to determine the best project development order.
Using a Model
Using a model is a way to objectively look at potential projects. You won’t always be able to create hard metrics and need to estimate, but modeling is very useful for adding structure to the prioritization process. You can use models such as the Eisenhower Matrix to gauge the balance between urgency and importance, or Cost of Delay models to examine how letting time continue on without the project will diminish its value.
For complex projects, consider using a mix of models to narrow down priority order. For example, various customer-facing projects can go through the Kano model, which is a popular system for gauging customer satisfaction. It includes ways to gauge “must-have” qualities of the new product or service, review of “one dimensional” performance attributes, and “attractive” metrics which look at the excitement level of the new initiative. Balance this model with others that help you see the cost of waiting for implementation, and you can develop a sound sense of the project’s importance. Models are useful for gauging the immediate and long-term impacts of a new tech development, which are especially important for the mobile-first customer who expects immediacy and smooth UI’s. Models such as Kano can guide you towards prioritizing projects that don’t just meet the needs of customers but also have the potential to delight them and improve the user experience.
Finding and Developing High-Value Targets
A key consideration for prioritizing projects should be locating those that are high value but require low effort. These might be rare, but they’re important for the business and the team to see some momentum, and then they can provide context to other projects which are also high in value but require considerable effort. This approach is the “low-hanging fruit” cliché which often holds true, as there are benefits to crossing items off the priority list that shows the team they can accomplish projects quickly and efficiently.
Finding high-value projects should include modeling and also categorizing the project’s potential benefits. Some notable benefits/areas of impact that should go into the prioritization process include:
- Any competitive advantage offered through the project
- Cost savings realized
- Improvements in operational processes, especially those impacting the customer experience
- Compliance, regulatory or legal risks that can be reduced
- Improvements in quality of services offered
The high-value approach is based upon the idea of “lean development” where resources are not wasted on less valuable ideas or projects. One way to prevent wasteful incidences is to perform user research and testing in the early stages of a prioritized project. User feedback might uncover some problems with the project itself, or a lack of interest in the users can indicate the project’s value was misjudged during the initial stages. Testing the projects allows you to base prioritizations on another set of data points, so you have user testing information combined with modeling, as well as thoughts on what’s important for the business.
Gathering data and involving user research does not mean prioritization must occur slowly. You likely cannot and should not collect boundless data on every potential project, but instead should narrow down the list with simpler values. Perhaps you look at a “must have” versus a “good to have” list to get the first draft of priorities. Work quickly to get a short list of projects and then take a little time to conduct modeling and data gathering. Remember the main goal is to get things done, so understand prioritization is an imperfect exercise, and you must act quickly based off the best information on hand.
After decisions are made, then the success or failure of the projects should influence future priorities. Ask some hard questions before reorganizing the priority list such as: Did one department have too much say in the past? Was the modeling conducted fairly and considered in the decision-making process? Prioritizing at the company and personal level is a skill, one that can be refined based on feedback and considerate review of past results.
Sphere has the development expertise and “outsider” perspective to help you prioritize projects that will pay the biggest dividends. The Sphere team understands prioritization must be an informed process, one that uses modeling to gauge a project’s value, cost, and time involved against the benefits for internal staff and customers.