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Prioritization is a challenge for leaders in even the best of times. But at a time of limited resources and increased market pressure, setting the right priorities is critical.
When individuals at every level are aligned on the most important work they need to do, managers know how to course-correct their employees, and leadership is transparent about company goals, it creates a virtuous cycle of engagement and strong business outcomes. On the other hand, poor prioritization can sink a company when external conditions decline.
So how can leadership, departments, managers and individuals strengthen this skill?
Making Tough Choices in Tough Conditions
Inflation and rising interest rates have companies bracing for a downturn. In fact, a KPMG study found that 91% of large U.S. companies are preparing for a recession in the next 12 months.
Monique McDonough, COO at employee experience platform WorkTango, said that organizations must undertake “ruthless prioritization” in periods like this.
“They’re asking, ‘What are the most important pieces of work we need to do to grow and flourish?’” she said. “If you look at some of the changes major companies are making, they’re moving away from ancillary projects and focusing on their big bets.”
Larry McAlister, founder of the Corporate Humanist Consultancy, explained that companies need to “build the muscle” to thoughtfully readjust goals and priorities in response to downturns or recessions before they take place to avoid putting shock into an organization. The more an organization can strengthen its ability to reprioritize before it actually needs to, the better off it will be.
“Oftentimes, companies cut costs, but their goals never change,” he said. “How can that be? It speaks to the inefficiency of an organization.”
Both McAlister and McDonough agreed that while companies don’t need to bring innovation to a complete halt during an economic downturn, it needs to clearly contribute to identified priorities.
“Unaligned innovation is generally a waste of time,” McAlister said.
McDonough explained that even if they’re focused on working towards business goals, employees should still get the opportunity to grow and try different types of work. Focusing on developing their talent and investments in skill-building is more likely to translate into the type of innovation that creates success.
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Setting Cascading Organizational Priorities
Although most companies take the time to set broad goals and priorities at the top of each year, quarter or even more frequently, those that achieve alignment on them across their organization are at a significant advantage. Research from LSA Global found that highly aligned companies grow revenue 58% faster and are 72% more profitable.
However, many employees struggle to resonate with broader company goals, said McAlister, particularly if they’re at the bottom of the corporate ladder or at a big organization. This often results in priorities that aren’t truly aligned.
To solve this, leaders need to commit to giving real-time, thorough feedback on department or team goals before managers can set individual ones with their direct reports.
In addition, McDonough said that organizations need to not only be clear about what their broader goals and priorities are, but set a manageable amount. Organizations that struggle typically haven’t set well-defined goals, or fail to communicate progress towards them, she added.
“If these goals easily cascade from the company level to the department, leader and individual level, there’s a higher likelihood everyone will understand the connection,” she said.
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Misalignment With Managers
Even employees with clear quarterly or yearly goals may struggle to prioritize at a more granular level. A recent study from Gallup found that only 22% of employees strongly agree that their manager continually helps them clarify work priorities. Moreover, nearly twice as many managers (43%) believe they were actively helping employees set priorities, pointing to a larger difference in perception.
McAlister explained this often happens because employees (including managers) get too caught up with daily responsibilities to think long-term.
“Human nature is very short-term,” McAlister said. “People are often just trying to keep the wheels turning, instead of making sure they’re steering in the right direction.”
Leadership needs to place clear expectations on managers to have larger, goal-focused conversations at a regular cadence, he added. He also stressed the importance of modeling this culture at the highest levels: “If priority setting isn’t happening effectively at the top, how can a front line manager be good at it?”
In fact, the Gallup study found that employees who had “meaningful” conversations with their manager at least once a week were four times more likely to be engaged at work. These types of talks included:
- Clarifying current priorities (not just long-term ones).
- Ongoing coaching from managers.
- Strategies to leverage employee strengths.
- Support in completing goals through resources and partnerships.
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Creating a Culture of Prioritization
Poor prioritization has consequences beyond bad business outcomes.
“There’s a bigger, more menacing problem if people aren’t pulling towards the same goals, and that’s constant double work,” McAlister said. “People are wasting time on work that doesn’t need to happen.”
McDonough noted that if even one individual isn’t able to contribute in a productive way, it can have a ripple effect on teams and drive down results.
On the other hand, she said organizations that create strong feedback loops and regularly communicate about goals are able to more easily shift focus when necessary. Having some kind of goal-tracking technology or system in place also makes it easy to foster “a constant dialogue” about priorities and progress at every level.
Being able to course-correct is also critical, McDonough said, whether that’s an employee rethinking their daily workflow or leadership changing the corporate course.
“Organizations with the highest potential for success focus on the most important priorities and set the right goals to achieve them,” she said. “They’re the ones who are able to say no to or pause work that doesn’t create impact.”