Prioritization
“Things which matter most must never be at the mercy of things which matter least.”
– Johann Wolfgang von Goethe, 18th Century German Author
A strategy is simply arranging actions in order of importance. Strategic leadership is simply a massive ongoing exercise in prioritization.
– Prioritizing what customers, geographies, and markets to go after
– Prioritizing the needs of customers to address
– Prioritizing the innovation and ways to serve customers better
– Prioritizing what is important to focus on
– Prioritizing a company’s resources, capital, and investments
– Prioritizing actions, people’s time and resources to achieve the goals
– People prioritizing what they do every single day
It sounds strange, but prioritization is the main role of a strategic leader. All of the strategic concepts and tools we go over are to help strategic leaders prioritize the actions necessary to achieve a goal. And, if there is one thing that all strategic leaders should focus on day in and day out, across everything they do, it is prioritizing.
When I was a strategy analyst at Mercer Management Consulting, fresh out of Stanford, my manager and I were debating a PowerPoint slide for the executive team of a multi-billion manufacturer. It was a pretty dull slide, with some bullet points on one side of the slide, and a chart on the other, it was 8 pm, and I just wanted to feed my rumbling stomach.
My manager, Jonathan, looked at a slide for a few minutes, looked at me, paused, and then said, “How are these bullet points and this chart prioritized?”
Confused, I said, “What do you mean?”
He replied, “Joe, everything you do should be prioritized, whether it is figuring out what you are going to do today, analyzing data, or communicating recommendations. “
What Jonathan said that evening had a profound impact on me. And, from that day on, I embraced prioritization as one of my core principles that I try to apply to everything. The essence of problem solving is simply prioritizing the largest problems and opportunities, and prioritizing the most effective and efficient solutions to those problems and opportunities.
Why is prioritization so important?
I often find myself telling CEOs and leaders, “Imagine how much you would grow, if every day, every person, prioritized everything they worked on?”
We only have so much time in a day, so much energy, so many resources, and so much money in the bank. Constant prioritization of problems, activities, investments, and hires, is critical to making sure the actions we take will create the most value.
How do you prioritize everything?
It takes the right mindset, goal orientation, use of the right tools, and vigilance to prioritize everything continually. Here are some of the best practices for making it happen.
Prioritize Prioritization
More than anything, prioritization is a mindset of figuring out and navigating through the magnitude and importance of problems, opportunities, and solutions. Strategic leaders infuse prioritization within an organization. The simplest way to prioritize prioritization is to continually use a simple question, “How do we prioritize…fill in the blank…?”
Understand Magnitude
Prioritization is arranging things in order of importance, which necessitates understanding the magnitude of things. A substantial amount of analysis within organizations is done to try to understand the magnitude of things. We’ll go over some of the most important analytical tools to help understand the magnitude, including Pareto analysis, trend, sensitivity, variance, correlation, benchmarking, and voice of customer analysis.
Create More Options and Understand Opportunity Cost
Strong strategies and prioritization necessitate creating better options. Often, the best thing to do is not even in the current options. Spend more time figuring out what are all the options and then prioritize. If you prioritize a bunch of options that aren’t going to drive much value, then you are optimizing a sub-optimal solution.
Align Efforts to the Mission and Goals
One of the easiest ways to ensure activities are naturally prioritized is to filter them through the mission and goals of an organization. Once again, use simple questions, such as “How does this idea help us achieve our mission or goals?”
Focus on Return on Investment (ROI)
Another way to think about prioritization is to understand and rank order the relative ROI of a set of options. Whether you are thinking through a big project or figuring out your daily priorities, there are always two parts to the ROI equation. The investment of doing something, which represents the costs and capital tied to the time, and resources for doing something. And, the return, or the positive impact to revenues, cost, and/or capital of doing something. In a later section on decision-making, we’ll go over cost-benefit analysis, prioritization matrices, and decision matrices to help you understand the relative ROI of options.
Focus on Low-Hanging Fruit
Anytime I work with an organization, there is often a substantial amount of low-hanging fruit, or activities, which necessitate little time and investment to capture a large amount of value. Use the prioritization matrix as a nice tool to help you identify low-hanging fruit.
DOWNLOAD THE PRIORITIZATION POWERPOINT WORKSHEET
To get you going on your prioritization, download the free and editable Prioritization PowerPoint Worksheet.
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