"How to generate the highest Return On Investment toward strategic priorities — across multiple teams that need to work together."
I get asked this question a lot. I've also seen lots of slow, disjointed, unresponsive and generally painful ways to approach this — and in lots of different organisations.Rather than poking holes in alternatives, here's how I would recommend approaching it:
The first thing we need is to seed the system with some Value and Urgency signals. For that, I'd suggest starting with your organisation's strategic priorities. These are the things that are likely to be on the radar of the Exec team, so it probably makes sense to at least start there.Work out the Cost of Delay of the strategic outcomes. Crucially, this needs to be outcome focused (i.e. what will be different NOT input focused (i.e. days or hours of a team) or output focused (i.e. deliver feature X and Y or implement predetermined solution Z). Ideally, this would be expressed as $X/month or some similar common "currency" that works across ALL strategic initiatives. It could be "Baby Rhinos saved per year" but you need an Apples to Apples way to compare. It also doesn't need to be super accurate: is it worth thousands or hundreds or millions of dollars per month? An order of magnitude is often a "good enough" starting point. If you need more detail to break a tie, you can always drill into that later. Here's a framework for thinking about value if you get stuck.
Bring the Teams together (preferably face to face in one location) to generate options for how they might together contribute towards the desired strategic outcomes. Be careful not to predetermine or anchor them around what the "best" way might be. Be clear about the outcome, but have an open mind about how to achieve that outcome. At this point you want divergence, not convergence. If, together, the teams can't think of at least three different ways to contribute to the outcome then you're not giving them enough time or space or safety to come up with options. Don't prematurely close down paths at this point! You should also ignore the cost or time it might take – we cover this in the next step.To be clear, these options don't have to fully deliver the outcome or solve the problem either. Some options may only contribute 10 or 20% toward the desired outcome. (Don't bother going down to 12% or 17.2% contribution. 10% increments is good enough at this point. If you need to break a tie, that comes later.) Obviously, doing this needs the full team, including whoever has the most knowledge about the desired outcome and can help guesstimate the % contribution.So, now you should have a rough Cost of Delay for each option. This is the numerator of CD3.
Now ask the Teams to guesstimate (this only needs to be very rough!) what their Team's input is likely to be for each of the different options. I prefer to use Days vs Weeks vs Months vs Years as a good enough approximation. Again, breaking a tie comes later, so don't waste time on too much detail at this point. In most cases you don't need that level of precision. Express all of these into a common unit. (I prefer weeks as the common unit, but as long as you are consistent, it really doesn't matter.)
Combine the above into a single CD3 score for each option. For the Duration, take the longest duration of all the different teams. Don't add them up. So if Option A takes Alpha Team 1 week, Bravo Team 4 weeks and Charlie Team 0.2 weeks, then use 4 weeks as the "Duration" for that option.CD3 assumes it is possible to develop —and ship!— the options independently and in any order. If it's not – if there are prerequisites, then you need to add the Duration of the non-parallelisable parts. So, if Alpha Team have to finish their component before Bravo Team can start their piece, then the Duration for that option should be the End-to-End Duration for both of them. Using the Durations above, that would be 1 week + 4 weeks = 5 weeks. (We'll discuss this a bit more later...)
Now rank the options for each teams' pieces of work from highest CD3 to lowest CD3. This is of course the local priority, but it has been informed by a global understanding of the Cost of Delay of strategic outcomes. It also gives the required room for teams to figure out (since they are best placed to do so) how best to "move the needle" for each of the desired strategic outcomes. It also takes in to account how long each of the options is likely to block the various pipelines of scarce capacity for.If you want to, you could also roll up and aggregate these local CD3 rankings into a global view – but it is the local view that is the master. That is the only way any of the top-down strategic outcomes are going to get worked on.To summarise:
Having said that, I know (from bitter experience) that this is a technical reality in many large organisations. Assuming we are already investing as much as we can to improve independence, I'd suggest making adjustments to the raw CD3 scores to reflect the fact that prerequisite dependencies have to be delivered before other pieces. To do this, adjust the Duration for calculating CD3 to be not just one teams' duration, but the duration of the entire required sequence. Obviously this adjusts the CD3 score across all of the parts, to reflect that that option actually blocks the combined pipeline (before any value is delivered) for much longer. (Before, this option was basically cheating.) That doing so penalises the CD3 score (and therefore the priority) is a good thing. It should encourage both investment to make teams more independent, and it should also encourage the surfacing of options that avoid prerequisite dependency, resulting in shorter Durations.
OK. Hope that helps. There's a bunch of related things that I might recommend depending on your context, but this is a decent starting point — one that I've said many times, but haven't written down for wider consumption yet. If any of this doesn't make sense, please let me know and I'll try to clarify!/Joshua
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