PPM 101: How to Effectively Use a Priority Matrix

In this post we will cover what a priority matrix is and how to use a priority matrix in the context of project portfolio management.

What is a Priority Matrix?

A priority matrix is a tool used to categorically prioritize types of work. It has three primary strengths: simplicity, speed, and applicability to all types of work (projects and operational work). A priority matrix is easy to understand and simple to use because calculations are not required.

The most simplistic prioritization matrix has three choices, the classic low/medium/high, but some organizations may utilize “must do”, “need to do”, “should do”, and “could do” priority assignments. In the example below, we expand this much further to provide a greater range of priority categories within the must do/need to do/should do/could do paradigm (each row representing a different level of impact). We can add an urgency dimension to the priority matrix by using three columns in the matrix below (each column representing a different level of urgency). In this way, we can further segment priorities across each impact level.

If no prioritization is done in an environment with a high volume of work requests, work intake simply becomes a matter of starting projects on a first-in/first-out basis, which violates the principles of portfolio management

This is valuable when organizations need a wider range of options for categorizing projects. Remember – a priority matrix is categorical prioritization (i.e. prioritization based on the category of work) and when there are more categories of work, greater segmentation is useful.

Priority Matrix Example
Priority Matrix Example

The Eisenhower Matrix Versus the Priority Matrix

The priority matrix we are talking about is a little different than what is referred to as an Eisenhower Matrix, which is focused on task management. The Eisenhower matrix is a 2×2 matrix that also applies urgency and importance. It is designed to help people prioritize tasks in order to focus on tasks that are most important and eliminate tasks that do not add value. The Eisenhower matrix resembles the priority matrix above, but the application of the priority matrix is on project work and operational work that commonly impacts more than one person. The priority matrix enables multiple categories of work to be prioritized so that a fair comparison can be made between types of work. The Eisenhower matrix does not support this.

 


Click here for a copy of these slides and a blank priority matrix template.

 

When Should a Prioritization Matrix Be Used?

There are a few primary use cases for a priority matrix, which we will cover below:

High volume of project intake requests

In environments where there is a high volume of project requests, it may not be practical to apply a scoring model to each request in order to prioritize the work. A prioritization matrix can be used to triage large volumes of project requests to focus the organization on the most important and urgent projects. I have seen this approach used in organizations that received a high volume of different sized project requests. In this case, scoring would be an over-kill; the organization needed a way to focus on the most important work at that time. If no prioritization is done in this environment, work intake simply becomes a matter of starting projects on a first-in/first-out basis, which violates the principles of portfolio management.

Where there is a high volume of project and operational requests

A related scenario occurs when there is a high volume of both project requests and operational requests. In this case, it is imperative to distinguish true project work from operational work. This happens by having clear definitions of a project so that the organization can distinguish between project and operational work. However, some operational work may still require a lot of resource effort and may in fact be more important than some project work. Again, we would never suggest applying a project scoring model to operational work, but there needs to be a way to prioritize operational work from project work. This is where the simplicity of the priority matrix shines.

In one engineering organization, various safety requests, regulatory compliance requests, and other improvement requests would come to the different engineering teams. Certain safety and compliance requests were urgent and needed attention immediately, but other compliance requests were less urgent and could be out into a general work queue. By clearly identifying which safety and compliance requests were urgent and which ones were not, operational work could be prioritized. Furthermore, we had a specific place in the priority matrix for PMO project work. This allowed an “apples to apples” comparison of project and operational work so that resource managers knew how to assign their people to work.

As a simpler alternative to prioritize work without a scoring model

Prioritization matrices are good for organizations new to the portfolio management process. Due to the simplicity, organizations can quickly get the benefit of prioritization without spending the time to do a thorough scoring of each project. Even in organizations where projects are scored and ranked, prioritization matrices can be used for “pre-screening” purposes to do a preliminary prioritization. This would be commonly used in a stage-gate process before a formal business case has been developed. A governance team could quickly determine a categorical priority for the project at an early gate review.

In addition, the topic of prioritization can be highly political in some organizations. Several years ago, a CIO stated that priorities give people an excuse not to do work. There was no prioritization in that department. The saying holds true, “if everything is a priority, then nothing is a priority”. In other organizations, it goes against the culture to say ‘no’ and prioritizing work implies that work won’t get done or will get done later. In some cases, senior leaders may ask how all the work is still going to get done (in other words, if we prioritize, how will you ensure that the low priority work will still get done?). I use these examples to underscore that is not simply a method, but it affects leadership decision making and cultural work behaviors. Prioritization is also a natural part of portfolio planning. If organizations cannot say no to work requests, they don’t really have a portfolio management process and will sub-optimize business value delivery.

How Does a Priority Matrix Compare to a Scoring Model?

A prioritization matrix is simply a different approach to prioritizing work. It is not in conflict with a traditional scoring model (which we highly endorse as long you build your model correctly). In fact some companies may use both for selected use cases. The priority matrix is about categorical prioritization, prioritizing work based on the type of work request. A scoring model takes into account multiple dimensions for evaluating project work and is used to determine relative project value. Furthermore, when evaluating multiple large projects, a scoring system will provide a more accurate analysis over a prioritization matrix.

Strengths of a priority matrix

Prioritization matrices have three primary strengths: simplicity, speed, and applicability to all types of work.

  • Prioritization matrices are easy to understand and simple to use.
  • Calculations are not required for determining the relative priority of a project.
  • It is most useful for prioritizing high volumes of work requests quickly
  • Because of its simplicity, prioritization becomes a much faster exercise and allows decision makers to quickly distinguish important projects from less important projects.
  • Various kinds of work can be prioritized using a prioritization matrix.
  • With a traditional scoring model, it is difficult to evaluate “keep the lights on” type of work, but with a prioritization matrix it is easier to compare priorities for project and non-project work.
  • It can provide a categorical ranking of projects in the portfolio

Weaknesses of a priority matrix

  • Prioritization matrices are unable to produce a discrete rank ordered list of projects in a portfolio
  • A priority matrix won’t help prioritize projects within the same category.
  • Prioritization matrices cannot do a good job of evaluating projects based on multiple criteria, and therefore cannot do a thorough job of distinguishing important projects from less important projects.

How to Build a Priority Matrix

There are a few basic steps to building a priority matrix.

  1. Determine segmentation required to categorically prioritize work. In the example shown above, there are 12 total options with 3 options for each row across the Must Do/Need To Do/Should Do/Could Do categories. There is nothing magical about a 4×3 matrix. Your organization may choose something smaller or larger.
  2. Identify the categories of work. In some instances, it is valuable to be more descriptive; break out work types into more categories as it makes sense. Example: At one engineering department, they got very prescriptive with the types of regulatory compliance requests coming in. Rather than just having a single category of regulatory compliance, it was broken out further based on the types of requests and how urgent they were.
  3. Map the categories of work to each cell of the matrix. In essence, what you are doing here is prioritizing the categories of work against each other. As you map categories of work you can compare this to other categories ranked higher and lower to determine whether the mapping fits the priority. This is an iterative exercise requiring feedback from multiple stakeholders to get approval for where each category of work maps to the matrix. This can also be a political exercise as not everyone may like how a certain category of work is assigned.
  4. Test out the priority matrix (“run water through the pipes”). Take some recent examples or project or operational work requests and map them to the priority matrix. Ask yourself whether these relative priorities feel right. Make adjustments as needed.
  5. Finalize and align with leadership. It can take a little time to get leadership alignment on the priority matrix. Based on experience, it is best to demonstrate how the priority matrix works in practice by showing some examples that the leadership team can relate to. Show them how simple the process is and how this will improve work performance.

Using a priority matrix in combination with Kanban is an excellent way to bring priorities and resource capacity together in a simplistic fashion

Priority Matrix Analysis

Percentage of Requests by Priority Category

You should conduct some level of analysis on your new priority matrix to understand its effectiveness. The simple example below shows the relative breakdown of the percentage of requests that fall into one of the four basic categories (we will see an example later where we break this down into more detail). The chart below shows us that a high percentage of requests are in the ‘Could Do’ category implying that a lot of low value work may be going on in the organization. By utilizing a priority matrix, you can get visibility of how much high-value versus low-value work is being done and start to limit the ‘Could Do’ work. In this way, you will quickly elevate the value of work being performed in the organization.

Priority Matrix Analysis by Category
Priority Matrix Analysis by Category

Before and After Analysis

If you are already using the basic High/Medium/Low priority designation, you can re-evaluate work using the priority matrix and then compare the results. The chart below highlights how you can evaluate priorities using the old method against the new method. In this example, the dots within the red box represent the requests that remain ‘high priority’ after using the priority matrix (note: for the purpose of analysis, items in categories 1-4 of the priority matrix were comparable to “high” priority work, items in categories 5-8 were comparable to “medium” priority work, and items 9-12 were considered “low” priority work). Several work requests that were previously marked as “high” priority actually fell lower in the priority ranking after the priority matrix was applied. In fact, one team saw a 35% decrease in high priority work items. This highlights that the priority evaluations were more accurate and helped the team focus on the truly high priority items.

Priority Matrix-Before and After Analysis
Priority Matrix-Before and After Analysis

Priority Matrix and Kanban

Finally, if you apply Kanban processes to your intake process while using the priority matrix, it can become very effective. Kanban is a simple approach to help control the flow of work by making visible all the work in progress. (For a quick overview of Kanban, I recommend a couple videos, one by Axosoft and the other by Atlassian, but please note that while this is often discussed in the context of software development, Kanban can be applied to managing many types of work). If you apply work-in-progress limits (WIP limits), then you can supercharge your intake process by fully controlling the amount of work people do without exceeding their capacity. Kanban is an excellent way to bring priorities and resource capacity together.

For organizations that see a high volume of work requests, these requests should be captured in a central location. Before starting work, a Manager can review the backlog of requests and apply the priority matrix to determine the initial priority of the work. Based on this evaluation, all work in the queue can be sequenced based on priority. Only when resources are available to begin new work will new assignments be given based on the WIP limits. This helps provide a steady stream of work without overloading the teams involved.  This approach works for managing large volumes of project requests, operational requests, or a mix of both.

 

 

What is a priority matrix?

A priority matrix is a tool used to categorically prioritize types of work. It has three primary strengths: simplicity, speed, and applicability to all types of work (projects and operational work). A priority matrix is easy to understand and simple to use because calculations are not required.

When Should a Prioritization Matrix Be Used?

There are a few primary use cases for a priority matrix: 1) When there is a high volume of project intake requests that need to be evaluated. 2) When there is a high volume of both project requests and operational requests that utilize common resource pools. 3) For organizations new to portfolio management and need to start with a simpler mechanism for prioritizing project work.

How Does a Priority Matrix Compare to a Scoring Model?

A priority matrix is simply a different approach to prioritizing work. It is not in conflict with a traditional scoring model (which we highly endorse as long you build your model correctly). In fact some companies may use both for selected use cases. The priority matrix is about categorical prioritization, prioritizing work based on the type of work request. A scoring model takes into account multiple dimensions for evaluating project work and is used to determine relative project value. Furthermore, when evaluating multiple large projects, a scoring system will provide a more accurate analysis over a prioritization matrix.

What are the strengths of a priority matrix?

• A prioritization matrix is easy to understand and simple to use. • Calculations are not required for determining the relative priority of a project. It is most useful for prioritizing high volumes of work requests quickly • Because of its simplicity, prioritization becomes a much faster exercise and allows decision makers to quickly distinguish important projects from less important projects. • Various kinds of work can be prioritized using a prioritization matrix. • With a traditional scoring model, it is difficult to evaluate “keep the lights on” type of work, but with a prioritization matrix it is easier to compare priorities for project and non-project work. • It can provide a categorical ranking of projects in the portfolio