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Project Talk: How to Prioritize Projects

pmo professional development project management ruffin veal iii Dec 06, 2021
Project Talk: How to Prioritize Projects

Welcome to our initial edition of the ProjectTalk newsletter. Monthly we will be focusing on subjects of interest to the professional project management community. We shall present insights and best practices from various sources insuring a wide and diverse range of opinions and experience. Enjoy. 

Ruffin Veal III


As a Project Manager, you often have more than one project "on the go" at the same time. So to help you manage this, we've described here in this newsletter "How to Prioritize Projects". 

Why should you prioritize your projects - don't they all have to be delivered on time and within budget? Yes, but any smart Project Manager will recognize that they only have limited time, resources and budget available to do it. So they need to set priorities, to ensure that their most important projects don't run out of time, people or money when they need them. 

So here are 3 steps to help you prioritize projects quickly and easily...


Here are 3 steps to help you prioritize projects quickly and easily...

Step 1: Define your Criteria

The first step is to define your criteria for ranking one project over another. And the best criteria for determining project priority is the fit between your project and the overall business strategy. If one project is undertaken to achieve a critical part of your business strategy, then it may be marked as a higher priority than one that's not related to the business strategy at all. 

If you have no clear business strategy from which to prioritize, then use other factors, such as the: level of project risk, the amount of resource consumed, the extent to which other projects are dependent on this one, or simply the likelihood of success.

Step 2: Match your Projects

With a clear set of criteria defined, the next step is to match your projects against those criteria. You will need to identify the extent to which each project matches the criteria set out, and identify any gaps. 

This is the most important step, as projects that you thought would be a perfect fit against your criteria may not end up being so. And projects that you didn't think were that important may end up meeting many of the criteria and therefore be marked as high priority. 

Note: Make sure that your personal preferences don't influence the exercise. It's easy to make the "fun" projects the ones that receive all of the priority. Unless they are critical to the business, they should always be the "icing on the cake". It's often the more mundane projects that are critical to the strategy for the business.

Step 3: Define the Priorities

Ok, so you now have a list of projects that are each ranked according to their fit with your criteria. You now need to define their priorities.

We suggest you keep it simple. Group them into A, B and C (with A being "high priority", B "moderate priority" and C "low priority"). Decide now how you are going to manage each priority grouping differently. You may decide for instance, to spend more time on your "Group A" projects than your Groups B & C. You might drive them harder than the rest, report on them at a more detailed level than the rest and always allocate spare resource to them, over the rest.

And there you have it. By taking these 3 steps, you'll prioritize projects faster and more efficiently than before, boosting your chances of delivering your high priority projects on time and under budget.

Tips for outsourcing your projects

Outsourcing is a term used when an external supplier (i.e. vendor) is responsible for delivering a set of goods and services to your business. Follow these tips, when outsourcing to an external company:

Step 1: Define Requirements

The single most important step to take when appointing a supplier, is to define your outsourcing requirements by documenting them in a "Statement of Work". In this document, you will describe in depth the; goods and services that must be provided, the delivery process, terms and conditions, and timeframes for providing them.

You should then release the document to your supplier to see if they can actually meet your requirements. If they can, then you have a clear "stake in the ground" around which you can create a supplier contract. But if they can't meet your needs, then at least you know upfront, and you can then go about finding a more suitable supplier to work with.

Step 2: Get Formal

Even if the supplier is 'your best mate', 'an expert in the market' or 'someone you've worked with before', you still need to get formal by creating a Supplier Contract with them. The contract is needed in case things get messy. It's a great tool for clarifying all of the deliverables up front, and for setting out the terms and conditions for delivery.

Every contract should include a set of delivery milestones, which state the dates for delivery of the goods and services to your project. And if you're smart, you'll add supplier reviews straight after those dates and then schedule payments to suppliers around those dates as well. In that way, everyone knows what will be delivered, by when and when they will be paid.

Step 3: Manage Milestones

You then need to manage each milestone, as though your life depended on it. Schedule time in your diary to make sure that a supplier milestone NEVER slips, and make sure you have penalties in your contract in case it does. 

Sure, it might be your fault that the supplier hasn't met their target delivery date, but even if this happens, still run the milestone reviews regardless. The review can determine how late they are going to be, the cause of the delay and the effect on the project timeline and budget.

By always running the reviews on time, your supplier will quickly learn that late delivery is unacceptable, and your whole team will be motivated next time round to helping the supplier to deliver their part of the bargain. In this way, a true supportive partnership can be established.

The process of managing suppliers is more of an "art than a science", but only by being supportive, yet firm, will you promote the right supplier behavior and boost your chances of achieving project success.

Managing outsourced projects

If you outsource part of you projects to third parties, then you’ll need to keep a close eye on them to ensure their success. Here's how… 

 Take these 5 steps to ensure the success of your outsourced projects:

Step 1: State the Work

Before you outsource, specify the Statement of Work. This is a document which is released to the third party, specifying exactly what you need them to deliver, when and how. It lists your requirements and it gives your supplier the opportunity to confirm that they can meet your expectations.

Step 2: Seal the Deal

Every successful supplier relationship has a strong contract behind it. In your supplier contract make sure you clearly state the responsibilities of each party. Include delivery milestones which are points in time by which elements of the project must be delivered. And make it clear that you will only pay them when each delivery milestone is completed. Go one step further by including penalties for late delivery and clauses allowing you to pull out if response and/or service is unsatisfactory.

Step 3: Monitor Progress

Make sure that once the contract is signed, you can scrutinize the progress of your supplier on a regular basis. Get them to complete timesheets and weekly status reports. Make them log all issues, risks and changes and use online project software that you can access, to track their progress. Make sure your status reports are received on time. If you don't receive them on time, it's often because the project is behind schedule and they don't want you to know. Remember - to succeed, you need the right status information, at the right time.

Step 4: React Like Lightening 

If you notice delays, risks or issues that have not been dealt with, then react like lightening. Arrange a formal meeting with the supplier to discuss it. Have a copy of the contract to hand, so they know you're serious. Come heavy handed by bringing your boss along. Meet in the office, not at a café. State clearly what it is that you want them to do, by when and how. The more seriously you take it, the more likely they will meet your demands and the greater your chances of success.

Step 5: Accept Deliverables

As your supplier completes each delivery milestone, you need to review and formally accept the deliverables produced. Never leave this to someone else, always be involved in the process personally. Make sure a formal acceptance process is followed, one that tests each deliverable and ensures it meets your needs.

 Physically sign off on each deliverable, and only when all of the deliverables are signed off, should you make your final supplier payment. Along with this payment, you both need to re-sign the contract, stating that it is 100% complete. This covers you legally and ensures your success.

And there you have it. By following these tips, you can manage outsourced projects more easily.