Choosing the right projects to focus limited resources on is clearly key to the success of any business.
When projects / programs are prioritised in in your (most) businesses is this always done using the best and most objective methods available? How are they chosen in your organisation? How are the chosen projects and programs then prioritised against each other?
Most organisations will no doubt claim to have a very organised and agreed approach to this process based around business priorities and the clear business benefits from each project being considered. If you look more closely though the reality is often very different with processes like these;
– Which project is sponsored by the most senior individual in the organisation?
– Which project is being pushed by the most aggressive sponsors/ individuals?
– Which project has the best sales pitch (e.g. best presentation)?
– Which project is being pujshed by the sponsors / individuals with the best political connections in the organisation?
– Whish project will provide the greatest return on investment (ROI)?
While I am sure you are thinking that ROI sounds like a reasonable choice for choosing projects, and indeed used 100% impartially it can be, however it easy to manipulate ROI figures and most ROI statements such as “will save xx millions” have little supporting, reproducible, evidence. Also, in reality how many projects thoroughly calculate the ROI on a project after it is completed and hold those who made the statements accountable for their accuracy?
In addition to the above thoughts on how projects are chosen, it is also clear that the more projects an organisation has to choose from the less time they are likely to be able to put into correctly choosing the best projects for that organisation.
One logical approach to the process of choosing and prioritising the best projects for your organisation is that of value graph analysis. Interestingly this process has come up twice recently, in the book ‘Simple Architectures for Complex Enterprises’ and on the recent ISEB Enterprise and Solution Architecture course I attended.
The idea of Value Graph Analysis is that it allow you to impartially take into account factors such as the risks of doing or not doing the project, the cost of doing the project, the potential returns of doing the project, the time and resource requirements to complete the project.
While the included factors in a graph can be tailored, both sources that highlighted this approach suggested the same set of default / typical factors;
– Market Drivers – what market reasons support the project?
– Cost – what is the project cost?
– Organisational Risk – what are the risk factors the project addresses?
– Financial Value – what are the financial benefits of doing the project?
– Organisational Preparedness – how ready is the organisation to complete the project?
– Team Readiness – how ready is the proposed project team to complete the project?
– Status Quo – what are the outcomes / impacts of not doing the project?
The output of assessing all the above factors is the Value Graph, an example of which is shown below as a spider graph;
Values closer to the edge of the graph are considered positive. Aside from ensuring a wide range of key inputs are included in the prioritisation process, a key advantage is that Value Graphs, especially when using the spider graph representation, enable easy comparison of projects to define priorities by comparing the relevant graphs for those projects.
I recommend checking these out; creating Value Graphs for your projects will enable clear and logical prioritisation and will definitely benefit your organisation in the long term!