How to Prioritise Projects When It’s Not About Money

 

Prioritising projects is pretty easy when you can look at the business case and see which one is going to bring you the most return financially. Whether you’re looking at sales, profit, return on investment or some other cost benefit analysis the great thing about money is that it is tangible and numbers-led. So the comparisons are straightforward. Many execs would opt to work on the projects that bring in the most financial return with the least effort. Simple.

Why projects don’t use financial prioritisation

Organisations don’t use financial methods for prioritising for several reasons, including:

• They don’t know how
• There is no mechanism to measure costs or benefits
• Budgets only include external costs, not resource time or internal costs
• There’s no need to because projects are funded centrally so money “isn’t a problem”

In reality, projects don’t just deliver financial tangible returns. Some projects would struggle to put any money-related measures down on paper. They simply don’t compute that way.

In those situations it is a much harder job to compare projects and choose which ones to work on first. Prioritisation becomes more of a shouting match: the manager who shouts the loudest wins. You also risk priorities changing quickly because someone had lunch with someone else who is influential in deciding these things and suddenly your resources are pulled and given to another team.

Without clear prioritisation, it’s impossible to establish which project is the most important. Let’s look at ways that you can prioritise projects when it’s not about the money.

Other ways of prioritising

By the need to stay in work

The main category of project that I’ve worked on that does not have an easy monetary value is the ones that revolve around staying in business. Examples are:

• Regulatory projects
• Compliance projects
• Legal projects
• Projects to address a crisis
• Projects to maintain the status quo e.g. moving from one software tool to another, maintaining infrastructure or networks etc
• Projects to enhance the status quo slightly e.g. moving to a new version of software, upgrading telephony infrastructure

Projects that allow you to continue to operate should be considered high priority. However, they might not be urgent if you can put the work off a bit. So that’s a YES the project must be done but a NOT NECESSARILY NOW for the work schedule.

By the value added

If you can’t compute value in monetary terms, this categorisation of project becomes quite difficult to measure and therefore compare. Narrative is good: have the discussion and thrash it out but use objective questions to force ‘enthusiastic’ project sponsors to fully justify where the value will be added.

Typically you’ve got two choices:

• Adding value to an existing asset/process/product e.g. new features into existing products, process improvements, staff satisfaction/engagement (as staff are an asset).
• Creating new value e.g. launching a new product, introducing new working practices.

You can see that there is likely to be some overlap – is a new process adding value to existing team members or creating new value? – but I think you get the picture.

By easiness

Why not do the easy projects? They can fit in around the larger, more strategic pieces. To be able to prioritise the easy work and slot it in to the programme, you need to know how easy it is going to be. Subjectivity comes into play here as well, as you will have to take a relatively educated guess about what’s achievable for your business.

If you have done something similar before, you have clear goals, the skills are in-house and the risk profile is low, then that sounds straightforward enough for me.

These three prioritisation options gives you different ways to look at the portfolio of projects and align the work with strategic priorities. If it’s easy and adds value, do it. If it’s important to keep the business functioning, do it. If it looks really hard and you won’t get much value from it, ditch it. It’s not rocket science.

As with anything that is not based on numerical, statistical analysis, you have to be careful that people don’t game the system. Ideally you want to create a questionnaire that is completed by an objective party in consultation with the sponsor. Give each criteria a ranking and then calculate the overall total. Then you can put your projects in order and work on them as they reach the top.

Project prioritisation is something that you have to go back to regularly. The order you set for your team today won’t be the same in a few months as business priorities will have shifted. The NOT NECESSARILY NOW projects may be at the top of the list then.

I’d be interested to hear your thoughts when you have no way of using monetary criteria to prioritise projects. How do you do it?