There is perhaps no more critical capability for a company to develop than prioritisation. In my previous article, I wrote about the importance of establishing your vision — the overall long-term direction of the company. This vision is reflected in your strategy — the steps required to achieve your vision over the longer term.
There are two important reasons that developing a culture of rigorous prioritisation will materially improve your business; velocity and efficiency.
The difference between speed and velocity
Many leadership teams talk about speed and agility. They want to measure success by the rate of delivery of projects and ensure that they can respond rapidly to changing requirements.
Unfortunately, speed is not the same as velocity. Imagine your strategic projects as a number of small boats, making up an armada. Each boat in the Armada has its own speed, equivalent to the rate of delivery of each project.
Allow me to be geeky for a moment about the difference between speed and velocity: speed is the rate that an object covers distance. Velocity is something a little more special — it also measures the direction of travel. You can consider that velocity is speed in a certain direction.
That may sound boring, but consider how this might apply to strategic projects. You may be demonstrating a high capability to deliver projects rapidly, but are they aligned? Are they contributing equally to the strategic direction of your business?
The purpose of our strategy is to create alignment between individuals in the organisation and the projects we commit to. With a clear strategy, anyone in the business (and especially the leadership team), can regularly test that the work being done is contributing towards achieving our goal.
Efficiency, side projects and the curse of business as usual
Do you know the one thing that will eventually make every single business fail?
Time.
Whether you’re a startup or multinational corporation, the difference between success and failure is how well we use our resources. Cash and people are the levers we pull to achieve our goals. Reducing delivery time can be achieved by spending more cash, or using more people, however, this is often a fool’s errand.
Efficiency in how we use our resources is the best driver of reducing time to deliver value. Prioritisation is the most powerful capability that we can exercise to deliver value most quickly.
Whilst I’ve laboured to make it clear that strategy and vision are important, I would like to suggest that, where we faced with a binary choice, it’s better to have a bad strategy and a good prioritisation process than vice versa.
Bear with me; strategy allows us to commit our resources to a unified goal, but if that strategic goal happens to be wrong we can still succeed if we have a process to learn and adapt.
Even if our initial strategy pointed in the opposite direction of success, our ability to judge the business value of projects quickly, and to deliver those learnings and updated assumptions into our strategy, will allow us to course correct.
It’s important to have a process which allows us to review the projects we complete, and also to choose where we place our bets — to control the size and number of projects we commit to in order to maximise our success and learning. This process gives us the true agility our leaders expect.
The cost of too many projects
One of the most effective ways to destroy velocity is to commit to too many projects. An even more effective way is to tolerate projects which haven’t even been formally committed to.
So-called ‘side of desk’ projects, bright ideas from throughout the organisation (although invariably from the CEO), side-gigs, vanity projects, anything with ‘innovation’ in the name and tasks masquerading as ‘business as usual’ all distract us from the things we should be doing to succeed.
Stop for a moment and consider how many things you are working on right now. How many projects can you name that your organisation currently has in progress? What tasks did you do today? Are you clear how those tasks impact on your strategy? Are you even clear who asked for them, or why they were agreed to?
Every business that I have worked with has been guilty of allowing too many projects, always under the illusion that it was necessary to meet client requirements or to beat the competition. Every single company was wrong because the best way to deliver quickly is to focus. Multi-tasking inside teams can only ever slow down delivery.
Multi-tasking, or context switching, adds a considerable overhead. As individuals, multitasking has been shown to cause us to make 50% more errors, see a 40% drop in productivity and take 50% longer to complete a single task. This same inefficiency scales up to teams.
This, of course, doesn’t mean that your whole business can only work on one project at a time — clearly, your finance teams, HR teams, developers and sales executives need to work on ongoing and continuous tasks. The aim is to make sure that clearly defined, appropriately skilled and right-sized teams are assigned to important work.
As an organisation, you will need to consider the ‘standard work’ that operational teams like Sales need to do, and project work which is exceptional and needs to jostle for resources to be assigned.
Proposition development, product engineering, innovation, and research projects and even project-based client work (like enterprise sales implementations) are the type of project work that needs to be captured on to your roadmap and forms the basis of the prioritisation process.
A simple method to prioritise your roadmap
Prioritisation, like strategy, is another process which can become tortuous and overcomplicated. Should the prioritisation or investment gating process become laborious, companies stop doing it and the old habits of working on too many concurrent projects with insufficient focus and ceding resource to the loudest voices returns.
Prioritisation is one of those times where even a flawed discipline is better than no discipline. To a degree it doesn’t even matter that you have really picked the most important thing — it only matters that you have picked one thing. The aim is to quickly decide what work we should do and exclude everything else.
Famously (and perhaps apocryphally), Warren Buffett once gave his pilot some advice on how to choose what to do with his life:
- Step 1: Write down your top 25 career goals on a single piece of paper.
- Step 2: Circle only your top five options.
- Step 3: Put the top five on one list and the remaining 20 on a second list.
Seems easy? Buffett’s trick, however, was to call out the 20 item list as the ‘avoid at all cost’ list. That’s how the process I’m about to describe works for companies.
“Now, Next and Future”, is a process which is as simple as it sounds. Project work and strategic bets can be broken down into three columns, now, next and future:
In the ‘Now’ column, you should list the projects that are currently being worked on.
In the ‘Future’ column, you should list projects which don’t really have enough data to be prioritised, but probably sound big and exciting. This is probably where all of your blockchain projects belong.
The ‘Next’ column is where all the work is done. Projects in the ‘Next’ column are listed in rank order of importance (we’ll discuss how this happens later), with the most important at the top.
This is a ‘pull’ system. When, and only when, one of our ‘Now’ projects is completed can we move something from our ‘Next’ column. Projects at the top of the ‘Next’ column are the most critical to our success as a business and have been reviewed to make sure they align with our strategy.
On the nature of projects
Teams inside the business should understand that the prioritisation process applies to any investment. It’s all too frequent in the businesses that I’ve worked with that technical staff maintain a mystical technical backlog for work that they know should be done. Invariably, the existence of this backlog hurts more than it helps, as the projects never have time set aside to be delivered.
Teams throughout the business should be encouraged to add their strategic projects — especially those that require resources in other teams — onto the Now/Next/Future backlog. This should encourage teams to justify important work in business terms, and also allow senior leaders to understand the cost of not investing in these projects.
In the companies that I have worked with, I tend to suggest that projects of over 2 weeks make it onto the strategic board, with autonomy given to local leaders (eg product owners) for smaller, shorter pieces of work. This allows teams to maintain ownership of some of their own tasks but aligns them with the overall strategy. In your business, you may want to play with what constitutes a roadmap project, and what makes it onto the backlog without consideration from the leadership.
Running a prioritisation meeting
In order to keep this article focused on the ‘why’ of prioritisation, I have broken out the ‘how’ into a separate article: Running a Prioritisation meeting.
The key to the meeting is to bring all of the stakeholders together and facilitate an open discussion about where our chips are placed. An important element of the meeting is to be relentless and honest about the number of projects that we can truly run concurrently. The more data and evidence that you can demonstrate for your overall velocity, the better the process will run.
In brief, the prioritisation meeting will normally run once a month for an hour. During the meeting, the first 15 minutes should focus on status updates from the current bets in the ‘Now’ column. The next focus is to discuss any new, urgent entrants to the ‘Next’ board, where a new initiative requires urgent triage.
The last 40 minutes of the meeting will be consumed with a discussion of the order of the top of the next column. Given that we have a sense of our ‘work in progress’ (WIP) limit for the column — how many large projects we can run concurrently — we only really need to focus on a similar number of projects at the top of the ‘next’ column.
The ‘future’ column is used as a holding pen during the meeting for all those great sounding ideas that just don’t make it onto the backlog. In the last few minutes of the meeting, the group should consider whether any future or next bets should be removed from the board.
By the end of this meeting, the group should leave informed about current project process and consulted about the relative priority of where the business will be placing its bets. The outcome of the meeting can readily be shared throughout the organisation to ensure that individuals have a clear view of the future and understand the direction of the business.
See the process in detail here
Discovery, Definition, and Delivery
We have seen over the past two articles on how to approach the task of defining a company vision and overarching strategy. Today we have talked about how to prioritise our strategic bets. In the next article, I’ll walk through the final element of this process — controlling and gating investments based on our confidence that they’ll pay off. In particular, we’ll look at how to avoid investment until the last responsible moment. It is this final jigsaw piece which differentiates good and great product companies.
Remember; your strategy is never perfect and will always need to change. Having a process to consider strategy quickly and efficiently is much more powerful than a complex, infrequent process.
Prioritising ruthlessly is the most effective way to win with limited resources.
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