Prioritisation is the process of evaluating similar elements - e.g.

tasks, requirements, projects - according

to deliberately chosen criteria with the aim of achieving a hierarchy of elements. What methods and tips
exist?

Prioritisation - The ranking of similar elements ....................................................................................... 2

Methods for prioritisation ......................................................................................................................... 2
Eisenhower Matrix ............................................................................................................................... 4
Decision Matrix .................................................................................................................................... 6
Decision Tree....................................................................................................................................... 8
Pugh Matrix........................................................................................................................................ 10
MoSCoW Method .............................................................................................................................. 11
ABC Analysis ..................................................................................................................................... 14
Tips for prioritisation .............................................................................................................................. 16
Notes on the topic of prioritisation ......................................................................................................... 17

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Prioritisation - The ranking of similar elements
You have more tasks than you can do in one day. You have more requirements than you can handle in
one iteration. Or you have several potential projects and need a decision which of these projects you
want to implement first. There are many situations where people and organisations have to define se-
quences. The process of evaluating similar elements according to deliberately chosen criteria with the
goal of achieving a ranking of the elements is called prioritisation.

Practically everything that people and/or organisations do can be prioritised. For example:

 tasks,
 work packages,
 work assignments,
 requirements,
 user stories,
 change requests,
 risks,
 impediments,
 use cases,
 stakeholders,
 objectives or
 projects.

The criteria used to determine a ranking can be chosen freely, but depending on the element in question.
For example, requirements can be classified in a “must have” category; requirements that are placed in
such a category “must” be fulfilled. However, there is no “must have” category for risks.

Methods for prioritisation

There are different methods of prioritisation for the different elements. Here you will find a list of some
methods and practical tools:

 The Eisenhower Matrix is a method for prioritising tasks and helps to distinguish between important
and unimportant, urgent and non-urgent tasks.
 A decision matrix is a tool for selecting the best alternative from various options, taking into account
defined criteria. Since in the practice of decision making not all criteria are always equally important,
they are often weighted with separate factors.
 A decision tree visualises a multi-stage decision process with all decision options. The purpose of
a decision tree is to arrive at a final decision on the basis of various visualised answer options to
concrete questions. In theory, it is suitable for all types of decisions and prioritisations.
 The Pugh-Matrix is a decision aid for prioritising competing concepts compared to a basic concept.
It is based on a set of defined weighted criteria, the evaluation of alternatives compared to a basic
solution, the multiplication of the evaluations with the respective weightings and the subsequent
addition of the weighted evaluations.

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 A business case is used to assess the possible financial and strategic effects of a company’s in-
vestment in a project or undertaking. The assessment is carried out as a comparison of different
options for action on the basis of a profitability analysis.
 The risk matrix is a graphic representation of an identified risk situation. The positioning of the risks
enables a comparison of the risks and is the basis for the definition and prioritisation of measures
to minimise the main risks.
 The Precedence Diagram Method visualises activities that are on the critical path and that are
essential for achieving deadlines or project goals. It thus helps to identify and prioritise activities
that are necessary to achieve the project goals.
 The MoSCoW Method is a procedure for prioritising requirements, goals or activities that defines
four categories (Must, Should, Could and Won’t).
 The Kano Model describes the relationship between customer satisfaction and the fulfilment of
customer requirements. It shows that individual product features are of varying importance for
customer satisfaction, so that the implementation of corresponding features should be prioritised.
 The stakeholder analysis determines the most important stakeholders for a project or development.
It provides the basis for stakeholder communication including prioritisation.
 The ABC analysis is an analysis procedure for weighting objects according to their importance. It
can be used, for example, to prioritise work packages in project management, in sales when clas-
sifying customers and sales areas, or in materials management when considering rationalisation.
 The XYZ analysis is a procedure in business administration or materials management in which
items – i.e. goods, merchandise, services, etc. – are classified according to their sales regularity.
The findings of the XYZ analysis are important for the timely production of articles or the procure-
ment of goods.

The more areas you look at, the more methods for prioritisation you will find. In portfolio management,
for example, the project dependency analysis or the cost utility analysis are used to prioritise projects
and make investment decisions. The Ivy Lee Method requires the prioritisation of a maximum of 6 daily
tasks, whereby the task with the highest priority should be completed first. The Eat that Frog Principle
propagates to make the most unpleasant task the first daily issue. In production planning there are
heuristics with priority rules for machine allocation. And processor cores in computers know a priority
scheduling to be able to perform more important processes more often than less important ones.

In short, the number of methods, techniques or tools for evaluation, weighting or scoring is almost limit-
less. Some of the methods mentioned are described on the following pages.

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Eisenhower Matrix
The Eisenhower Matrix is a method of time management to distinguish between important and unim-
portant, urgent and non-urgent tasks. It goes back to the former US President and General Dwight D.
Eisenhower, who tried “not to do things correctly, but to do the proper things”. It is a tool for increasing
effectiveness (“Doing the right things”) and not a tool for increasing efficiency (“Doing things right”).
Alternatively, the Eisenhower Matrix is also known as the Four Quadrant Method, Eisenhower Method,
Eisenhower Principle or Eisenhower Box.

The aim of the Eisenhower Matrix is to sort and prioritise tasks according to their importance and ur-
gency. To do this, two questions must be answered for each task:

 How important is the task?

 How urgent is the task?

To answer the questions, the matrix defines four categories:

 A: important and urgent

 B: important, but not urgent
 C: urgent, but not important
 D: not important and not urgent

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Principles of the Eisenhower Matrix

The principles of the the Eisenhower Matrix are relatively simple:

 Important tasks are those that are directly related to defined goals.
 Urgent tasks cannot be postponed and should ideally be completed immediately.
 Important and urgent tasks should be completed by yourself as quickly as possible.
 Urgent, but not important tasks should – if possible – be delegated or automated. If this is not
possible, they should be completed after the urgent and important tasks and before the important
and non-urgent tasks.
 The personal realisation of important but non-urgent tasks can be planned and scheduled. The
tasks themselves are prioritised lower than the important and urgent tasks, so that the realisation
only takes place afterwards.
 Non-important and non-urgent tasks should not be processed. Depending on the context, they can
be archived or completely deleted.

Advantages and disadvantages of the Eisenhower Matrix

The Eisenhower principle offers several advantages:

 It’s easy to understand and apply. It does not require any special previous knowledge and no trai-
ning period.
 Separate aids – besides a sheet of paper and a pen – are not necessary. The result is ideally lists
of tasks that need to be done immediately, that can be planned, that should be delegated and that
can be easily ignored or deleted.
 The visualisation is simple, creates order and provides a clear structure for the completion of tasks.

In theory, the Eisenhower principle sounds simple, but in practice there are always challenges. Here
you will find a list of possible drawbacks:

 People often work in agile, possibly even spontaneous or chaotic environments, in which new tasks
are constantly being created, so that time planning usually does not last.
 The classification simplifies the reality, especially since the effort to create a valid categorisation is
much greater than it seems.
 The handling of concrete dates is not explicitly addressed.
 Within the four quadrants of the matrix there are also gradations, so that an A may become an A1,
an A+ or an AAA.
 People are not machines that can perform every task with maximum concentration. This leads to,
for example, a C task being performed before an A or B task.
 When working with tasks, new tasks arise that can be even more important than other important
and urgent tasks, depending on the perspective and context.
 Not all people like to work in a clocked, one hundred percent structured way. This is a contradiction
in terms, especially when it comes to creative activities.
 The matrix is not suitable as a working tool because of the number of tasks; at best, the principles
function as a mental construct or as a tool when working with task lists.

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 The number of tasks leads to a backlog of tasks despite the corresponding categorisation; too many
tasks remain too many tasks.

Criticism of the Eisenhower principle

Some publications mention two prerequisites for the application of the Eisenhower Matrix: The ability to
plan tasks independently and the right to delegate tasks. These two prerequisites are obvious and it is
not surprising that the Eisenhower Method is often simply declared to be “common sense”. There is little
objection to this.

Furthermore, the Eisenhower principle does not claim to be able to structure and solve all tasks by
magic. On the contrary: people can and should continue to judge individually what consequences arise
from their actions or the postponement of actions. For example, an employee can decide to complete a
task because he fears anger if he does not complete it as quickly as possible or because he expects
praise. The individual motives are not addressed in the categorisation of tasks. Therefore – and this
would actually be a point of criticism – in practice it is often not enough for employees to always prioritise
their tasks individually. Here it is advisable to exchange information in teams, as is usual, for example,
with Sprint Planning in Scrum.

Decision Matrix
A decision matrix is a tool for selecting the best alternative from various options, taking defined criteria
into account. It is a table that arranges different decision options or alternatives in columns and criteria
or properties in rows. The fulfilment of the criteria can be judged, for example, by entering “Yes” or “No”
or a number-based evaluation (e.g. from 1 to 10). Depending on the rating, the numbers or the positive
or negative values are summed. The decision is made for the alternative with the highest sum or the
most positive ratings.

In decision theory, the decision matrix is regarded as an extension of the result matrix. This matrix
presents alternative actions, environmental conditions and the resulting outcomes in tabular form. Each
outcome is then assigned a (possibly weighted) benefit or utility value and the alternative with the highest
total utility value wins the decision.

Simple and weighted decision matrix

Here is an example of a simple decision matrix. Alternative 2 receives the highest rating total and is
therefore the right decision.

Since not all criteria are equally important in decision-making practice, they are often weighted by se-
parate factors. Here is an example with a weighted decision matrix.

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The different weighting of individual criteria suddenly results in a completely different picture. Alternative
1 is now the best option. This results from the fact that the user-friendliness was rated significantly higher
than the image and the purchase price.

The decision matrix in practice

In practice, the decision matrix is frequently used, e.g. when selecting software (see example: Selecting
UML software based on supported UML diagram types).

The selection should fall to alternative 1. It supports 10 of 13 possible diagram types. It supports more
diagram types than the other two alternatives, but how well the individual diagrams are supported cannot
be seen from this decision matrix. And how important is it to have as many diagram types as possible
when the software development team only needs 3 or 4 diagrams?

This results in various findings for practical use:

 The mere existence of a criterion in an alternative says nothing about the quality of the criterion.
 The amount of criteria – i.e. the quantity – influences the alternative to be chosen.
 The weighting of the criteria is essential for decision making.
 Decisions based on weighted criteria are not always rational and objective. On the contrary, they
can even be very subjective. If an employee supports a certain alternative, he could try to weight a
criterion – e.g. the user-friendliness, for which there is no measure of correct assessment per se –
very highly. This increases the chances for “his” alternative.
 The actual evaluation of a criterion should ideally be as objective as possible; in practice, however,
it is also often subjective.

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If both the evaluation of individual criteria and the weighting of the criteria can be subjective, is the use
of a decision matrix worthwhile at all? In general, this question cannot be answered because the answer
depends on the degree of subjectivity. In other words: the more objective and rational the decision matrix
is filled, the better the decision should be.

Difference to other tools of decision making

Even if a decision matrix tries to find decisions based on a table, the terms decision matrix and decision
table differ. A decision table visualises groups of business or decision rules and thus provides instruc-
tions for action in concrete situations. Example: If the invoice was issued by the supplier and these were
not paid by the customer within 14 days, then a reminder is sent.”

Decision tables are often supplemented by decision trees. A decision tree displays a multi-stage deci-
sion process with all decision options.

The Pugh Matrix is also a tabular decision aid that compares competing concepts or alternatives with a
basic concept in order to evaluate them.

Decision Tree
A decision tree represents a multi-level decision process with all decision options. Since the decision
paths are represented by individual branches, it is also called a tree diagram.

A decision tree represents a multi-level decision process with all decision options. Since the decision
paths are represented by individual branches, it is also called a tree diagram. It is a visualisation and
serves as a decision aid. Often you can find examples of decision trees on the Internet that show alter-
native paths in a process but are not suitable as decision aids. The purpose of a decision tree is to arrive
at a final decision based on various visualised answer options to concrete questions.

Even though a decision tree can be visually appealing, it is clearly structured by formal rules. This is
also the biggest advantage for users, who can easily follow these rules over several levels – the ques-
tions with their answer options – and thus make a decision.

The visualisation of decision trees

A decision tree can be presented from top to bottom as well as from left to right. Rich decision trees
know besides

 the questions
 and the response options (also referred to as alternatives)
 additionally environmental conditions.

These environmental conditions are external factors that influence the outcome of a decision but cannot
be influenced by the decision maker (e.g. weather in agriculture or opening hours in stationary retail).
They are therefore uncertainty factors and represent risks in the decision-making process.

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This decision tree distinguishes between rectangular and round branch nodes.

 Decision nodes are rectangular (e.g. E1 and E2).

 State nodes are round.

The first decision E1 leads to a choice of an alternative A1 or A2 and to environmental states Z1 and
Z2. This is followed by further decisions with further alternatives and states, providing a decision can
be made all the way to the end.

Advantages and disadvantages of decision trees

In principle, a decision tree is suitable for the systematic derivation of decision options. Since the crea-
tion of a decision tree does not require specific qualifications apart from technical expertise, working
with decision trees is relatively widespread. Working with decision trees offers the following advantages:

 They are easy to create and easy to read.

 Dependencies in both chronological and logical sequence are identified.
 Only pens, paper or the simplest graphics programs are needed to create them.
 They can be refined and built up step by step.

Another advantage is that they can also be used as a form of documentation; this makes sense whene-
ver organisations want to understand why a decision was made x(A1, A3, Z1, Z3) and not x(A1, A4, Z1,
Z3) in the course of a project or development.

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Theoretically, a decision tree is suitable for all types of decision making – in corporate or project ma-
nagement practice, however, there are limits when it comes to very complex relationships. The following
disadvantages exist when working with decision trees:

 The representation can quickly become confusing when there is a lot of information and options.
 Not always all decision options or possible consequences in terms of costs, risks, probability of
occurrence etc. are known. Whether information is missing, however, cannot be seen in the presen-
tation.

Pugh Matrix
The Pugh Matrix, named after its inventor Stuart Pugh, is a decision-making aid for evaluating competing
concepts in comparison to a basic concept. It is based on a set of defined, weighted criteria, the evalu-
ation of alternatives in comparison to a basic solution, the multiplication of the evaluations with the
respective weightings and the subsequent addition of the weighted evaluations. The Pugh Matrix, also
known as the Pugh Method, Pugh Analysis, Pugh Concept, Pugh Controlled Convergence or decision-
matrix method, consists of a table with the following columns:

 Column 1: Category of the evaluation criteria used to structure the decision matrix and form subto-
tals.
 Column 2: List of evaluation criteria.
 Column 3: Weighting of the criteria, e.g. from 1 to 5 or from 1 to 10. The more important the criterion
is, the higher the weighting. The more gradations there are, the more precise the weighting of the
criteria can be. Ideally, the evaluation criteria should be weighted before the solution concepts are
evaluated. (As an extension of the Pugh Matrix, the categories could also be weighted additionally.)
 Column 4: The basic concept is a baseline with a collective rating of 0 per evaluation criterion.
 Column 5 and following: Presentation of various solution concepts including comparison with the
baseline. There are different variants here: If 3 values are used, 0 means as good as the basic
concept, -1 means worse and +1 means better than the basic concept. When using 5 values +2
means much better, +1 means better, 0 means equally good, -1 means worse and -2 means much
worse than the basic concept. With 7 values, the scale ranges from +3 to -3.

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The addition of the values per solution leads to a ranking. In addition, relative strengths and weaknesses
of the various solutions can be quickly identified and, if necessary, used to optimise individual alternati-
ves later. If solutions are improved, a new evaluation can be carried out.

The objectivity of the Pugh Matrix

As with any weighted decision matrix, the Pugh matrix cannot guarantee that all criteria, weightings and
assessments are objectively selected and made. Nevertheless, the Pugh Matrix tries to objectify deci-
sion making and is therefore universally applicable in many areas. The special thing about the Pugh
Matrix is the pairwise comparison, in which an alternative is always compared with the basic concept.
This can lead to a very precise differentiation.

MoSCoW Method
The MoSCoW method is a four-step prioritisation process. It is usually used to categorise requirements,
but in principle it is also suitable for prioritising objectives, activities or change requests. The inventor of
the MoSCoW method is Dai Clegg, who first used the method at Oracle in 1994 within the framework of
the so-called Dynamic Systems Development Method (DSDM). Today MoSCoW – also called MoSCoW
principle, analysis or prioritisation – is used in business analysis, requirements engineering, project ma-
nagement and software development.

The individual capital letters stand for four categories:

 M = Must (have)
 S = Should (have)
 C = Could (have)
 W = Won’t (have)

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Often in the course of the MoSCoW method an acronym is spoken; since the lower-case letters serve
only the readability, this is not completely correct, but by the use of the o’s the principle can be pro-
nounced simply like the Russian capital.

The four categories of MoSCoW

What exactly do the four categories mean?

Must (have) – the category for “must” requirements. They are considered non-negotiable and should
not conflict with other mandatory requirements. If you apply the Business Analysis Body of Knowledge
– BABOK for short – they should also be complete, consistent, correct, implementable, modifiable, un-
ambiguous and testable.

Should (have) – the category for “target” requirements. Ideally, requirements that end up in this category
should also be implemented. However, since the priority is lower than for “mandatory” or “must” requi-
rements, which always have to be implemented as a matter of priority, they may be implemented in
subsequent releases or projects.

Could (have) – the category for “can” requirements. They can be implemented after the “must” and
“should” requirements have been implemented. They are therefore also referred to as “nice to have”. In
the event of time bottlenecks or resource conflicts, these requirements are first postponed or not rea-
lised.

Won’t (have) – the category stands for requirements that are not implemented. Alternatively, the W is
also interpreted as Would – would be nice if it could soon be implemented – or Want – is desired, but in
another project, project or release – interpreted. Basically it is recommended to document requirements

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within this category as well, because in this way it can be understood whether a seemingly new requi-
rement has already been recorded. In addition, documented requirements can serve as a source in
future projects.

In practice, both “must” and “should” requirements usually end up in further documents such as requi-
rement specifications or business cases. “Could” requirements and requirements that cannot be imple-
mented, however, usually remain in internal backlogs, lists or tools..

Advantages and disadvantages of the MoSCoW method

The MoSCoW method offers some clear advantages:

 There is a simple categorisation of requirements – ideally in coordination with the stakeholders.

The use of the words Must, Should, Could and Won’t provides clarity about the meaning of the
categories at all times.
 The classification of requirements (or goals, tasks, change requests, etc.) results in a natural order
of implementation.
 The principle behind the method is very easy to understand, so that stakeholders and developers
can easily find a common denominator.

On the other hand, the MoSCow method also has some disadvantages:

 The classification as such is relatively rough and does not provide any indicators of the order in
which requirements are to be implemented within the individual categories. Therefore, at least the
“must” and “should” requirements should be considered in more detail. Technical dependencies,
effort, resources – there are some aspects that are useful for further sorting within the categories.
 In practice it happens again and again that a large part of the requirements are declared as “must”
requirements. The classification of requirements into other categories leads at best to a later im-
plementation, in the worst case they are not realised at all. Some guidebooks therefore recommend,
for example, to declare a maximum of 60% of the requirements as “must” requirements; however,
such suggestions are very short-sighted, because they do not change the worries of the require-
ments providers, they ignore any development capacities and of course do not answer the question
“which requirements belong to the ominous 60%?
 As with many methods, it is a key date observation. Stakeholders can change their minds, technical
challenges can arise, and new requirements or changes can be added – so it’s not uncommon for
requirements to wander within categories.
 We are happy to recommend categorising according to the wishes and ideas of stakeholders. Here,
however, there are other concepts, such as the Kano model of customer satisfaction, which take a
more differentiated view of requirements. Companies should therefore consider combining different
methods and principles in the course of analysis and prioritisation.

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ABC Analysis
How can companies determine which customers are most important? How does an organisation decide
which project to implement? And, if applicable, how do you determine which of your tasks you will carry
out today? The answer is: prioritisation. A common method of prioritisation is the so-called ABC analysis.

ABC analysis is a method or procedure for weighting similar elements according to their priority, im-
portance or significance. It is generally applicable and can be used

 for the prioritisation of work packages in project management,

 in requirements engineering for the evaluation of requirements,
 in sales and distribution in the classification of customers and sales territories,
 in materials management when considering rationalisation,
 in logistics or controlling.

The ABC analysis has three levels or categories: A, B and C.

 A stands for “high priority”, “very important” or ”major significance”.

Example: A project with high priority from which a company hopes to gain strategic advantages.
 B stands for “medium priority”, “important” or “medium significance”.
Example: Important customers with whom companies generate revenues and who, if properly
looked after, can become very important customers.
 C stands for “low priority”, “less important” or “low significance”.
Example: Requirements that could be implemented, but only after the important requirements
commissioned by customers have been implemented.

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The basis of the ABC Analysis

The ABC analysis refers to H. Ford Dickie, a manager at General Electric. The basis of the procedure
first described in 1951 is, among other things, the 80-20 Rule, also known as the Pareto principle. The
rule states that 80% of the results can be achieved with 20% of the total expenditure, while for the
remaining 20% of the results 80% of the total expenditure must be invested. As a result, the ABC ana-
lysis attempts to separate the essential from the insignificant. This can be recognised graphically in a
Pareto Chart.

For example, if a company achieves 80% of its total turnover with 20% of its customers, these are A-
customers; they enjoy the greatest importance for the company. If another 30% of the customers con-
tribute to 15% of the total turnover, then these customers are assigned to class B with a medium im-
portance. Accordingly, the allocation of the remaining 50% of customers to Class C is less significant
because they account for only 5% of sales.

Advantages and disadvantages of ABC Analysis

ABC analysis offers the following advantages:

 It is easy to apply and independent of the object of investigation, e.g. it could also help in the as-
sessment of risks in project management or in a sales potential analysis.
 It enables the analysis of complex situations with justifiable effort by limiting it to essential factors.
 The results of the analysis can be presented clearly and graphically.

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The following disadvantages are attributed to the ABC analysis:

 The three classes are often too rough, so that further classifications (ABCD or ABCDE)
become necessary, whereby this contradicts the desired reduction at complexity.
 Usually only individual criteria are used for classification, e.g. turnover per customer.
Customers could be very interesting with corresponding sales potential, but also with
currently lower sales figures. In practice, such a blending makes it possible, for example,
to simultaneously support existing customers, who can be categorised according to their
sales, and to acquire new customers, who would fall through the raster if only sales were
considered.
 In contrast to quantitative factors, qualitative factors are usually not considered (sales of
a customer versus image of the customer).

Basically, the result of an ABC analysis is always a snapshot; the results should therefore be checked
at regular intervals. In general only one criterion of the evaluation is concentrated, the use of further
analysis procedures could be meaningful. In materials management, for example, it is combined with
XYZ analysis.

Tips for prioritisation

The result of an evaluation or weighting is a ranking of elements from which priorities can be derived.
The term “priority” is derived from the Latin word “prior” – the front one. In the practice of weightings,
there are always situations in which prioritisation only apparently produces a ranking and thus a struc-
ture for processing. For example, requirements are often divided into three categories: very important,
important, desirable. Such a classification often leads to a long list of requirements ending up in the
first category “very important”, because any other classification means that a requirement will probably
never be implemented due to the number of requirements. A few tips can be derived from such a situ-
ation:

 Work with absolute values and not with classifications. A request with priority 984 is
more important than one with priority 983.
 If you (have to) work with classifications, ensure that the weighting criteria are transpa-
rent. If possible, have the evaluation carried out by a “neutral” role such as the product
owner or product manager. Alternatively, you can also perform the weighting in a team.
 Use quantity restrictions such as the Ivy Lee Method or the WIP Limit from Kanban. And
learn, for example, from key figures such as Velocity.
 If you set priorities that influence customers, colleagues, employees or other projects
and developments, communicate them. Justify any decisions you make.
 Depending on the element, the process of evaluation can be a continuous task. In Back-
log Refinement and Sprint Planning, for example, this regularly leads to new rankings
based on new insights and assessments.

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 …

It is not surprising that the list of tips can also be easily extended.

Notes on the topic of prioritisation

Interestingly, in various contributions and articles on prioritisation, there are references to the AL-
PEN method, the SMART method or even Walking Skeleton, although these are not originally pri-
oritisation methods. The 80-20 rule or the Pareto principle also “merely” explains that a small num-
ber of high values contributes more to the total value of a defined set of values than a high number
of small values. Only in combination with ABC analysis, for example, does the topic of prioritisation
come into play.

And a small note on our own behalf: Information on precedence diagrams, working with business cases,
the advantages of the Kano Model or dealing with stakeholders can be found in separate documents in
the t2informatik Download Center.

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About t2informatik

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