The value of prioritization is not in the classifying of initiatives as important. Nor is it simply about deprioritizing work that is trivially unimportant. The true pain of prioritization comes from deprioritizing initiatives that are important, but not important enough.
In this video, we explore the fourth step in successful Strategy Planning: prioritizing ideas for strategic opportunities. Each idea should be scored, for instance by Impact versus Feasibility, to give a sense of which ideas are the highest return-on-investment.
Be sure to watch the overview of all 6 steps here.
Presented by Kut Akdogan, Partner at Gaussian Holdings.
Click here for the next video in this series.
In the previous step, Ideation, we said that strategic opportunities are high level tactics and approaches to making meaningful progress against our desired outcomes. We also talked about why ideation and prioritization have to be separated. Ideation must be unrestrained and creative, while prioritization must be analytical. With ideation handled, we now tackle the prioritization and selection of strategic ideas.
There are many frameworks for ranking and prioritizing, so we'll share a simple one here: impact and feasibility. Score an idea's expected impact low, medium or high: 1, 2 or 3, based on the risk adjusted impact it would have on your desired outcomes. Be quantitative. If your desired outcome is an additional $10 million in annual revenue, then "high impact" should be $5 million or more of revenue, "medium" should be $2 to 5 million and "low" should be under $2 million.
Score feasibility low, medium or high, 1, 2 or 3. For simplicity, feasibility scores can be relative to each other, but in complex setups. You may calculate this using time and cost drill downs. Adding impact to feasibility gives you priority. Look at your 2-5 highest priority opportunities. If they are cohesive, achievable communicable and obey the other elements of good strategy we talked about earlier, then you're looking at the components of your organization's new strategy. If not, you may need to adjust your opportunity ideas, splitting and slicing them and then reprioritizing.
Prioritization can often happen in one to two working sessions with some offline pre-work. Sometimes, to get more precise and quantitative, teams may need to conduct more research before reconvening. Defensible prioritization is critical to a good strategy.
In our next video, we'll look at the fifth step of strategy planning - vetting and approval.
For more resources or services for ranking and evaluating strategic opportunities at your organization, contact us here or shoot us a note by email or on LinkedIn.
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