With less resource available we need to be better at prioritising, we won’t do the things we like to do but the things that we need to do!
This phrase has become commonplace across the industry, executed in different ways with differing descriptions from modernisation, transformation, streamlining or resource reallocation to maximise investments into priority areas, to name just a few.
How do these situations arise, do they creep up on us or are they a sign of wanting to do everything for everyone which in the longer term is not sustainable. What is surprising is the number of times a reprioritisation happens, suggesting a lack of execution, organisational buy-in or perceived necessity for change.
The Pareto principle is a cornerstone in prioritisation, the 80/20 rule. For example, 80% of your value comes from 20% of the products in your portfolio. The Pareto principle or Lorenz curve has been used in many analyses that I’ve undertaken over the years, whilst it has not been as clear cut as 80/20 it facilitates a discussion. A very rational analysis can lead to a very emotional discussion as there is a suggestion you should stop doing something or change focus.
Gregory Milano, Founder and CEO of Fortuna Advisors LLC has built on this, suggesting the concept of extreme prioritisation and why too much time and effort continues to be focused on the poor performers in a portfolio, “you probably won’t get fired if your star business doesn’t reach its full potential, as long as it generally performs well. But you might lose your job if you don’t fix a poor performer1.” Going on to suggest that “extreme prioritization is important for everything from strategy development to portfolio optimization to planning and decision-making, and for all aspects of execution1.”
From a business intelligence perspective this can be applied to many processes from portfolio assessment, customer and account attractiveness, the creation of KPIs, development of incentive schemes as well as managing the off plan ad-hoc requests for support. Prioritisation should formally exist and guide us, most organisations set team and individual priorities, these tend to be created and set at the beginning of the year, supporting the organisational short-term in year objectives.
Personally, I’ve always been a strong believer in the power of three. This is intrinsically linked to neuroscience based on the theory that we struggle to remember more than three things, explained by Mark Moore2 in his TedX talk.
If you can distil and communicate the complexities into what is important and really needs to be achieved there is a high probability of success. This can give the clarity of what you, the team or team of team’s are trying to achieve. This is achievable if you have the accountability to make
this happen with a clear hierarchy and alignment. How does this manifest in a matrix environment? Is it possible to really prioritise or do you end up playing lip service and doing what you’ve always done as everybody has their own priorities which ultimately becomes your priority by stealth?
Reflecting back to Gregory Milano, he suggested “If your company has 10 business units, statistically speaking, two of them likely create the vast majority of the value. As a result, companies should be deliberate about devoting outsized resources and attention to managing and growing these businesses. This is not to suggest one should ignore the other eight businesses, but rather that their needs should be subordinated to those that are doing most of the heavy lifting.1”
Two of the ten business units will be growing the business whilst the other eight shouldn’t be ignored. Is this the problem? Teams that span the entirety of the organisation, often referred to as critical business partners feel and live this challenge. How do you prioritise when everything is implied as important? The organisation priorities are focussed on growth potential whilst the out of focus business units still have their own financial contribution targets and will need to achieve these often with less resource. This still requires the same or more specific critical business partner input due to their organisational standing.
From experience what is often lacking is ownership at different levels to ensure that the overall prioritisation plan is not only understood but acted upon. This is where striving for extreme ownership has a place, in summary. Based around five areas, i) plan, ii) prioritise and execute, iii) check ego, iv) accountability and v) believe3, Bridging military leadership to the business world, the work of Jocko Willink and Leif Babin is a fascinating insight sparking many reflections that will be saved for another time!
Can we get to the point of extreme prioritisation? Anything is possible if the vision, willingness and desire is present. Adopting the principle of extreme ownership and utilising the power of three as way to think, act and communicate will propel us forward.
Article sources
1. Forbes.com: "The Benefits Of Practicing 'Extreme Prioritization' In Your Business (forbes.com)"
Accessed September 2024
2. Mark Moore: “The Power of Three https://youtu.be/o1jm-2WfTvk”
Accessed September 2024
3. Semibiogroup.com: “5 Key Takeaways from "Extreme Ownership" | SEMbio (sembiogroup.com)”
Accessed September 2024
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