Article 13
The critical few vs. the trivial many
1-2 minute read
CAPSULE SUMMARY – Businesses face major challenges identifying and prioritizing the 4th Stakeholder tactics with the highest impact because of a lack of common metrics, a misplaced reliance on financial ROI, and a lack of consideration for second-order impacts.
13.1 One of the most important roles I play as a CEO is to ensure that the finite resources of the company I’m running are focused on the most impactful priorities. There will always be competing interests and priorities within a business, but a well-run organization will identify the critical few to drive towards business success, reallocate its resources accordingly to tackle them with sufficient energy, and put in place rigorous metrics and operating mechanisms to ensure they are on track.
13.2 Although this might sound simple in theory, in practice it becomes one of the most difficult and valuable things you do as a leader. The challenge of prioritization stems from the thorny conflict between what you want to do / should do and the finite resources you have available. I’m sure you have been in an environment where a team, organization, or company spreads its resources over the ‘trivial many’, and as a result, doesn’t make progress on the key things that matter most. This diluted focus can be the death-knell for any organization.
13.3 You must have a clear point of view on the things that will have the biggest impact and put sufficient resources towards those priorities, even if that means (and it invariably does) that you are putting other items “below the line” that feel like things you really should be working on. It’s not that those things aren’t important; they just aren’t as important as your top priorities.
You must focus on the biggest impact areas first and resource them sufficiently.
13.4 The third major gap I have seen as businesses embark on their 4th stakeholder journey is a lack of this kind of ‘big swing’ prioritization. Companies are often consumed doing many different small things (which they point to as proof of great progress), all while the biggest swings aren’t being taken.
13.5 This inability to easily prioritize and take the big swings comes from three main root causes:
Because no common denominator exists for ‘doing good’, companies don’t have a simple way to actually identify the bigger swings vs. the smaller ones.
Businesses mistakenly narrow down their list of tactics to only those with positive financial ROI, which takes the biggest and thorniest issues off the table.
Companies don’t take a holistic view of all possible swings, inclusive of the two areas we have previously discussed (building more positive value creation into the business model and thinking about all first and second-order effects).
13.6 To overcome this prioritization gap, we must address these issues. In the next four papers, I’ll discuss each of these areas in more depth and will provide a simple but powerful prioritization matrix to help you turn this from concept to real action.