Were we to simply jump in and attack the things in no particular order we might hit a winner, but the chances are we’d lose momentum, return to the status quo and not be able to strive properly to our goal.
So we need to find a way to evaluate each one against some set criteria that can give us a scored result as a very obvious pointer to what to do first and what needs further thought.
(Remember – we’re just thinking about the opportunities inside our existing business here, not a whole new business plan, so much of the usual gumph doesn’t apply!)
The Method
First I get the whole lot into a landscape document with a big margin on the right hand side to scribble in and print myself off a stack to scribble on. It seems there’s something different about how your brain operates when faced with a pen and a doodle space as opposed to a screen and keyboard; for me it makes the thinking process much clearer. There’s also a reason having such a massive list of opportunities in a pile of paper is good for the business brain that I’ll come to in a moment..
Next, you need to decide on the Rules for evaluation. These can be anything you want depending on your business and goals. For example:
- How much money can this opportunity make us?
- How many development hours are needed?
- How many admin hours are needed?
- Will it create recurring or one off income?
- What’s the percentage chance of success?
- Will it have a non-financial benefit like creating a barrier to entry, adding a killer sales feature etc?
Now, pick a subset of your Rules and create a scoring system for each. One framework I’ve used is this:
- A: Annualised financial opportunity in monetary value
- B: Percentage chance of success
- C: Development cost in days
- D: Admin cost in days
- E: Other cost in monetary value
In the big margin write down the scores for each opportunity as best as you can estimate. Don’t get analysis paralysis and spend weeks buried in spreadsheet models to score any one row – you probably won’t be any more accurate than your gut feeling about something.
As an aside – it’s important to avoid emotion when evaluating these things, that’s where the size of the list can help. When you’ve only got a couple of opportunities in front of you, it’s a natural human tendency to favour one over the other in an instant. The trouble is, once you’ve made that commitment to something, it’s hard to shake off. The act of going over pages and pages of mixed opportunities de-personalises it all and enables you to think more clearly.
Next is to dream up an equasion to put your figures through to give you a “score”. Using the Rules above:
Opportunity 1: Get to #1 in the SERPS for our primary keyword: A – 100,000, B – 40%, C – 10, D – 100, E – 20,000 = (AxB)-(C x 100)-(D x 100)-E = 9000
Opportunity 2: Find one more customer per month being worth 1000 per month additional revenue: A – 144,000, B – 50%, C – 10, D – 100, E – 30,000 = 31,000
You can see that Opportunity #1 scores far less than opportunity #2, although if you asked me to decide between the two without any analysis I would probably have jumped on #1. The big score for #2 A is because we’re looking at annualised financial opportunity – so at the end of one year, if 100% successful, we’ll have 12K/mo additional revenue.
You can keep slicing and dicing too, looking at each opportunity with different subsets of your rules and scoring things differently.
By the time you’ve finished, you’ll have a much, much clearer way to rank the importance of each opportunity for your business and one less thing to need to worry about when you’re trying to fit them into the development timeline.
In practice.. this has turned out to be a brilliant way to focus everyone on what’s important in the coming weeks. It’s made us all more relaxed because we know we’re working on the useful stuff, not wasting time on the small stuff, and we’re not setting ourselves up for disappointment when projects we’ve randomly worked on turn out to be tiny opportunities.
Next post we’ll figure out how to do the same thing with the Weaknesses list and then get onto the nitty gritty stuff of actually writing an action plan…
