Kind managers force priorities ??

Some principles of management are so obvious that we assume they’re always followed. “Setting priorities” is in the job description of every people leader and other leaders too. It’s important, and it’s expected. But leaders don’t always do it. Why, and can that be fixed?

Nearly all organizations set?objectives, and sometimes they mistakenly think that’s prioritizing. Here’s an example:

In “The Art of Action ”, a guide to achieving goals with big teams in changing landscapes, Stephen Bungay lists some typical financial objectives:

A typical list of things a manager has to achieve in a year might look like this: 1. Increase revenue by 8% 2. Raise average net margin to 15% …

Often, objectives are listed like this, implying that they’re all equally important. Yet simple lists of objectives aren’t enough. We need to know how to make tradeoffs between them. Continuing his example, Bungay explains why:

If come next December, someone is sitting in front of a customer ready to take a large-volume order which will lift revenue growth to 10 percent but with a low margin which will reduce our average net margin for the year to 12 percent, what should we do? Will we be congratulated for landing a significant order and beating our target, or told off for loading up our books with poor-quality business and missing the all-important profit figure? We need to talk and get some clear direction. It might be “Aim for revenue of 8 percent but on no account allow margins to fall below 15 percent,” in which case the margin figure is a hard constraint; or we may learn that a 15 percent margin would be nice but what really matters is that it should not fall below 12 percent. Whatever the answer, we need guidance. Good guidance allows us to make trade-offs.

Why would the organization care so much about which objective is met first? Because it might make the difference in achieving its ultimate goals. Bungay again:

If our intent is to gain market share in order to strengthen our long-term position, the main effort is revenue and holding margin at 15 percent is a constraint. If our intent is margin improvement, but we want to grow with the market in order not to lose position, revenue is a constraint.

So that’s an easy example of how sales priorities tie to an organization’s financial goals. Yet rare! Organizations may set targets for both, without enough practical guidance on tradeoffs.

How about other kinds of priorities, in development, or design, or customer service? They are all important too. (Some are?more?critical to financial goals over time.) The people enacting those priorities need to feel they are contributing to the central goals too, by focusing on the things that count.

And yet, data suggests it’s equally rare for other functions to spell out tradeoffs. Prioritizing seems hard:

• Only 12% of employees in a recent Gallup study strongly agree that their managers helped them set priorities.
• Many job descriptions require people who “have a high tolerance for ambiguity”. Does all that ambiguity go with the nature of the job, or could part of it stem from ill-defined priorities?

But in my experience, organizations do appreciate managers helping to make tradeoffs and set priorities.

So if priorities are so critical for an organization to meet its goals, why aren’t priorities always made clear? Three reasons I can think of:

1. It’s often a gamble. You never have quite enough information about the business and competitive landscape, so prioritizing is?always?a bet on what will turn out to be most important. Books filling shelves full of strategy literature try to break apart the problem. One of my favorites is Bungay’s Art of Action, from which I quoted above. (Chapter 6 has several practical examples of prioritizing.) But it is never easy.
2. It can seem like the safer option to?not?prioritize — to stop at listing objectives, without guiding tradeoffs. Certainly in a risk-averse organization, a way to minimize blame is to say that you?did?in fact tell people to do the thing that turned out to be most important (even if you also told them to do 9 other things!) Actually, if you?don’t prioritize, you almost guarantee mediocre results. And in a competitive landscape, that could mean failing. But although people talk aggressively about winning, sometimes “not immediately failing” seems more attractive.
3. Setting priorities for teams might seem to limit their ability to plan work for themselves. It might even hark back to Taylor’s Scientific Management, when it was managers’ job to do the thinking, and their reports’ jobs to do the doing. But to say how team objectives relate and rank, is not to dictate how those objectives should be achieved, through what actions and in what order.

How to set priorities effectively?

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