The Forbes Technology Council has a nice little article, Project Prioritization 101, that highlights ten key elements of any good prioritization model. Here are the first five (I've paraphrased):
Align with business strategy - Be sure your projects align with business goals and strategies
Rank projects based on impact and effort (aim to do the impactful ones, discard the rest)
Anticipate setbacks and assess potential losses (it helps if you assess resource needs and have a contingency plan in advance)
Attack time-sensitive and highest impact projects first
Understand your team's bandwidth
On that last topic, which is near and dear to my heart, the article quotes Zohar Dayan, CEO of Wibbitz, who says:
"When it comes to prioritization, the biggest consideration is to measure the impact of a project versus the time and resources that need to be devoted to it. A firm understanding of the value each project brings back to your company coupled with a knowledge of your team’s bandwidth is crucial for prioritization."
I couldn't have said it better. To this , I’d add that Success = Prioritization + Resource Allocation + Execution.
Back to prioritization, I’ve also seen organizations adopt the Eisenhower Matrix (later popularized by Stephen Covey), where projects are categorized based on urgency and importance. Obviously, things that are urgent and important should get done first. Projects that are important, but not urgent, should be scheduled accordingly.
The tricky ones are those that are deemed urgent, but not important. This either means someone has exaggerated the urgency or was unable to articulate its importance. So it’s a matter of determining which it is. And of course, the last category are those that are non-urgent and unimportant, which should be quickly rejected.
Some industries have a rigorous project acceptance process whereby all approved projects are by default highly important and thus use a FIFO (First in, First Out) approach to ranking. Though, with increasingly common resource constraints, this is a weak method in and of itself., and would benefit from a relative impact/effort assessment.
Check out the Forbes article for additional prioritization info, and the remaining five tips.
Also, for information on lean prioritization methods, see this insightful article from All About Lean, titled, “How to Manage Your Lean Projects - Prioritize.”
Finally, to complete the trifecta of valuable prioritization articles, see this HBR article, “How to Prioritize Your Company’s Projects,” which talks about how having a “Hierarchy of Purpose” is critical to any prioritization model. This involves tying together the 5 Ps (Purpose, Priorities, Projects, People, and Performance).
Jerry Manas is the bestselling author of The Resource Management and Capacity Planning Handbook, Napoleon on Project Management, and more. At PDWare, Jerry helps clients improve strategy execution through tools and processes that align people and work with organizational priorities. Connect with Jerry on Twitter and LinkedIn.