When prioritization is done well, it can be the difference between a strategy's success or failure. This is why nailing your prioritization matrix is so important.
Many organizations make a common mistake: they create a list of projects or initiatives, based on a strategic vision or set of goals, and jump straight into implementation. This impatience compromises the evaluation of their initiatives' risk and value, and results in inefficient allocation of resources.
This puts your organization’s strategic vision at risk!
Prioritizing strategic initiatives for your function or organization is key to the efficiency and success of strategy execution. One of the best ways to gain consensus on priorities is by building a prioritization matrix.
The first step is to list everything you need to achieve in order to realize your organization’s strategic vision. Keep this high level. These initiatives are what you need to prioritize to increase efficiency and reduce waste.
Next, evaluate these initiatives. Objectivity is key. You will need weigh up how much value and risk each initiative carries in the context of the organization achieving its strategic vision.
For example, score each item out of 4 for both risk and value, with 1 being “very high” and 4 being “low”. Once you have scored each initiative as high or low value and high or low risk, you will be able to prioritize them.
Doing this process in a spreadsheet looks like this:
While there is nothing wrong with listing your initiatives in a spreadsheet, you can easily transform your spreadsheet into something far more visual that is simpler to interpret: a 2x2 prioritization matrix.
A two-by-two (2×2) prioritization matrix is an effective means of prioritizing initiatives (as well as more granular tasks and projects). With a 2x2 matrix, you plot initiatives into one of the four quadrants by evaluating their relative value and risk.
The resulting visualization is a far more compelling tool for building consensus and identifying the initiatives that aren’t quite right.
To use your prioritization matrix accurately, you need to determine how to define “value” and “risk”.
Using value and risk as the evaluation criteria is key to substantiating where initiatives should sit in the list of priorities. However, these are subjective terms.
The complexity of how you evaluate the value and risk of an initiative is up to you, relative to the level of sophistication and accuracy required and effort afforded. Just ensure that you are consistent and apply the same definition of value and risk when evaluating each initiative.
The measures of an initiative’s value are usually tied to your organization’s value drivers. Organizations' value drivers vary vastly; for example, the value drivers of a non-profit (e.g. saving lives) are very different from those of a publicly listed bank (e.g. shareholder return).
There are too many measures of value to list, but you should start by answering these 3 questions for each initiative:
Consider 2 questions to evaluate the risk of your initiatives:
Divide your page or slide into 4 equal quadrants. Use the horizontal axis to delineate value, with the lowest value on the left and the highest value on the right. The vertical axis will measure risk, with the lowest risk at the top and the highest risk at the bottom.
The relative value and risk assigned to each of your initiatives should result in them being split across the 4 quadrants. But what do the quadrants mean?
Each quadrant needs a category that determines the priority status for initiatives. Clockwise from top left, label your quadrants: Challenge, Implement, Possible, Reconsider.
Understanding your prioritization matrix on a deeper level can be the difference between successfully achieving your business goals and wasting precious resources. That's why we recommend adding another layer of prioritization on top of your matrix.
Draw a series of curved bands onto your matrix, radiating from the top right corner (the "Implement" corner) towards the bottom left corner. This is the next level of prioritization. You want to work from left to right and top to bottom when it comes to execution, and adding bands clarifies this with even more precision than just the quadrants.
With your initiatives prioritized in a logical and reasoned manner, you’re in an excellent position to start planning the implementation and delivery of each initiative to reach your strategic goals.
Once you've prioritized your initiatives on a 2x2 matrix, the easiest way to present and communicate this with your team and stakeholders is by building a strategic roadmap.
Transferring prioritized initiatives into a roadmap format is simple and fast with a dedicated software tool like Jibility.
Jibility has been designed for building strategic roadmaps to help your bridge the gap between strategy and execution in your organization. To do this, the tool guides you through a unique methodology in either 4 Steps or 6 Steps.
Both versions of the methodology include an interactive 2x2 prioritization matrix for your initiatives, followed by a simple drag-and-drop roadmap builder.
Creating a prioritization matrix that works can be done in 4 steps: 1) determine what initiatives need to be undertaken to achieve your strategic vision, 2) determine the value and risk associated with each initiative, 3) score each initiative based on its value and risk, 4) plot your initiatives relative to each other on a 2x2 matrix, where the initiative's position indicates its priority status.
Tasks, projects or initiatives can be categorized into 4 levels for prioritization: “Challenge” means tasks are high risk but high value, “Implement” means tasks are low risk, high value, “Reconsider” means tasks that are high risk and low value, and “Possible” means tasks are low risk but low value.
A 2x2 prioritization matrix refers to a simple yet effective way to prioritize tasks in a 4-quadrant visualization. A 2x2 prioritization matrix helps you determine what initiatives to implement immediately and which initiatives to reconsider.
A problem prioritization matrix refers to a simple yet effective way to prioritize problems within your team’s workflow. Problem prioritization matrices work to help you determine what challenges to address immediately and which challenges to work on later.
Jibility is a free SaaS product for building strategy roadmaps, of which the prioritization matrix is a key component. Our interactive matrix makes it easy to plot your initiatives and highlight the priorities, with all changes you make flowing through the other steps of the app to keep everything in sync.
How to build and use a 2x2 prioritization matrix to determine strategic priorities. Free prioritization matrix tool and templates.
Master the top 5 prioritization methods to optimize resource allocation and drive maximum impact. PowerPoint templates included!
A prioritization grid, also known as a prioritization matrix, is a 2x2 matrix that plots strategic initiatives based on Value vs Risk.
