3 Reasons to Invest in Project Prioritization
- Stuart Easton
Organizations that invest in strategic prioritization deliver 40% more value.
This seems like reason enough to invest in improving the project prioritization process, yet many organizations don't realize that their current process is broken; it's evolved over time, it worked last year...
But this is like the proverbial frog in a pan of water. The environment is changing around us all the time and we need to have a well-structured process for recognizing and reacting to the change. Well, to come back to the frog analogy, you get boiled but don't notice until it's too late.
1. Selecting projects that deliver the most value
This is kind of obvious but if you improve your project prioritization process and select a portfolio that better reflects your goals and priorities you get benefits in the following areas:
Increased project success rate.
Projects that are well aligned with strategy are 54% more likely to succeed. Good prioritization ensures your projects are aligned and that fewer fail.
Higher return on investment.
Projects that are better aligned with corporate goals will naturally deliver more value. Align the whole portfolio and you're looking at a significant leap in RoI.
Better quality of project requests.
When your managers understand the strategic goals, they align their initiatives with those goals. They are able to brainstorm ways of addressing key issues rather than reacting to "local problems" - ultimately, this leads to better quality projects being requested.
Eliminate obsolete projects.
A structured project prioritization process will ensure that only well-aligned projects are approved and that any projects that become obsolete will be caught early.
2. Helping project teams with execution
Projects that are aligned with strategy are more likely to succeed. Thus, an investment in better project prioritization helps you improve project execution by:
Project team commitment.
Transparent, value-based prioritization means that project team understand why their projects are important. This builds trust in the portfolio and individuals commit more fully to completing projects, as highlighted by research from Stanford University.
When every project is tightly aligned with specific strategic goals or operational targets, it helps maintain the executive sponsorship that can make-or-break a project.
Having a clearly prioritized list of projects means that resources can be more effectively allocated during implementation.
Project teams are able to make better decisions when they have clear goals and priorities for each project.
3. Making organization more efficient
A good prioritization process will help you use your time more effectively. Examples of how the process can reduce the effort involved in prioritization include:
Executive time savings. Executives set priorities and make the final portfolio decision but they don't need to go through the details of every project. This leg-work can be done by subject matter experts whose input is summarized and quantified to help executives make the final decision. In fact, endless hours can be wasted when executives invest time in advocating specific projects and arguing around in circles. A good prioritization process will all-but eliminate these contentious executive team discussions.
Less travels. Not only do you spend less time in meetings (a real-world saving!) but also, with right collaborative tools, you can eliminate travel. Our TransparentChoice online meetings with web-based real-voting, for example, can speed up meetings, enhance mutual understanding and communication, all without the need for costly travel.
Reduced politics around portfolio selection. A more structured process moves your project selection from a heated debate to a rational, quantitative assessment. This reduces both the time and emotional stress involved in the process. It means you can focus on detailed research into the projects themselves rather than spending time being a political football.
Lessons learned. By tracking the success of projects over time, the organization can build a picture of which factors really make an impact. This learning is captured in the form of explicit priorities that help managers nominate and select projects that are more likely to succeed. In other words, a formal process lets you measure outcomes and then adjust the process. This is all-but impossible for a less formal process because there is, in essence, no process to be improved.
Saving the frog. Hopefully, you'll now be inspired to make a change, to get the frog out of the pot of water. There are many ways to start, but often the best way is to get smart.
Whatever you do, start it today.