Project Prioritization Process Overview

Project Prioritization Process Overview

Project Prioritization Process Overview

MAAR charts can tell us which projects are needed to close performance gaps, but they cannot – on their own – tell us how to optimize the choice of projects in a real life situation where resources are limited and there are many KPIs to work on. All organizations need an effective project prioritization process to support their scorecards and activities. It needs to be applied when first setting out the scorecard and every subsequent time the scorecard and KPIs are reviewed.

The data linkages we have created can offer us an easy way to look project prioritization, (provided we organize the data in a suitable information system that allows us to manipulate data views). The more of the ‘Translate’ tree we have in place, the more useful this functionality becomes. We can begin to aggregate project impact up to higher levels in the tree, and see relative impact on higher level objectives between projects that are aimed at very different KPIs on different operational level scorecards.

To strengthen our project selection process, we can utilize the following three data views:
1. A matrix of objectives vs. projects;
2. Impact as a function of time and project cost;
3. Resource usage/allocation by role.

The figure below shows a matrix that assesses project proposals against the objectives on our Operational Scorecard, viewing ‘impact’ at the highest level available to us. (The level depends on how high our connection of objectives and sub objectives reaches.)

project proposal matrix

We can investigate impact as a function of time and project cost using a Bubble Chart, as in the following figure.

Impact vs cost and time

Time to completion is plotted along the x axis, impact up the y axis and the size of each bubble is proportional to the resource cost of the project. Favorable projects are high on the Y-axis (high impact), to the left of the x-axis (short delivery time) and represented by a small bubble (low cost to complete).

Of course, the interpretation of ‘impact’ depends on the degree of interconnection of the objectives and KPIs. Impact should be aggregated up to show impact against the highest level of objectives/KPIs that are connected. If we only have our Operational Level scorecards in place then the impact is shown against the parent level objectives.

Finally, we must also consider resources. It’s all very well showing that there are projects that will have significant impact on objectives, but do we have enough of the right resources to run the actions?

Organizations from an ‘Improver’ background usually have a head start in being able to answer this sort of question. A project run to, say, a DMAIC methodology, automatically defines what ‘roles’ will be required on the project and roughly how long those resources will be tied up. With this level of project scoping, organizations can produce a resource usage report during the project selection process that looks like below.

proposed project portfolio

With a modern IT system to help present data, it should be possible to run and rerun the analyses in the above mentioned figures with a number of different project portfolio proposals to iterate towards the maximum potential impact in the shortest time within the constraints of cost and skills availability.





Original: https://www.i-nexus.com/stratex-hub/project-prioritization-process-overview
By: Paul Docherty
Posted: March 9, 2018, 11:37 am

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Anton Sirik

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