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A decision grid is a simple tool for defining priorities when
you have a large number of possible courses of action but limited
capacity.
For example, you ask everyone in your team to come up with ideas
for improving profitability. If you’re lucky, and they’re
motivated, you will get a long list of big and small ideas.
Organise
If you try to implement them all at once, you’ll end up
getting nothing done. So you need to prioritise. You also need
an objective way of ranking the ideas, so that people whose suggestions
lower down the list can understand why.
What you need is a decision grid. First choose two factors, to
represent the constraint and the benefit. In this example, the
benefit is profitability. The chosen constraint is cost, because
the business is short on cash. What you need to choose is the
thing that’s most likely to stop you, which could equally
be time, resources (people), or level of risk.
Plot
Draw two axes on a chart, from low to high profitability on one
axis, from low to high cost on the other. Now plot all the ideas
on the graph. Try to treat all ideas in a consistent manner but
don’t do detailed calculations – an estimate should
do.
Prioritise
When you have finished, you should find a scattering of dots across
the page. Now cut the graph into four sections by drawing a horizontal
line and a vertical line across the middle. The sectors are A:
high profit low cost (top priority), B: low profit low cost (medium
priority), C: high profit high cost (medium priority), D: low
profit high cost (low priority).
Refine
Obviously, you will want to refine these lists to take account
of synergies or clashes between different ideas, as well as the
secondary constraints, such as time. But you’re well on
your way to having a clearly defined action plan that the whole
team can understand and buy into. |
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Other
sources of information about making decisions: |
