A prioritization matrix is a way to force rank opportunities according to two equally valid but conflicting criteria. Those which win out against both criteria should be selected for implementation.
By looking at the relative position of opportunities on the matrix, you can understand how to sequence (prioritize) them. It’s a simple visual way to create clarity on what to invest in, do, and why.
A very common example of a prioritization matrix is a Value vs Effort matrix for quick prioritization, where Value (customer, business, revenue) is plotted on one axis, and Effort (difficulty, time, resources) is plotted on another.
Other common examples of prioritization matrices include Time vs Money, or Risk vs Impact. There’s also a whole series of matrices which help decide whether you should enter new customer segments or markets, and how you should allocate your resources.
A prioritization matrix is best understood as a powerful communication tool and a strategic mental model. It’s an effective model to align workshops around, or to use to communicate complex trade offs in an elegant framework.
In this guide we’ll take you through the prioritization matrix, origins, common examples and how to make one.
We’ll also share a free prioritization matrix template, flashcards and how to run a workshop using a prioritization matrix.
What is a prioritization matrix
In this section we’ll run through the:
- 2 x 2 prioritization matrix: where items force ranked according to 2 criteria
- 3 x 3 prioritization matrix: where items are force ranked according to 3 criteria
Intro to 2 x 2 prioritization matrix
Depending on where you choose to place your axes, a 2 x 2 prioritization matrix looks like this:
Or like this:
It doesn’t really matter which version you pick (central vs non central hand axes). It’s purely a matter of visual preference. Central is easier to scribble on a white board. Left hand is better on slides.
The goal is to identify the most attractive opportunities or projects by scoring them according to 2 inputs. This determines their attractiveness as projects to pursue.
The 2 x 2 prioritization matrix framework is extremely adaptable. You can use it to score all sorts of types of things according to different criteria.
Prioritization matrix example: The Eisenhower matrix
“I have two kinds of problems, the urgent and the important. The urgent are not important, and the important are never urgent.” – Dwight D. Eisenhower, 34th USA President
Let’s demonstrate how adaptable the 2 x 2 matrix is via an example.
There’s a variant of the 2 x 2 Value vs Effort prioritization matrix called the Eisenhower matrix.
It forces you to score your to do list according to Urgency and Importance. This helps you figure out what to get done first.
You want to do the things which are most urgent, and most important first. The things which are not urgent and not important you can either drop or delegate.
3 x 3 prioritization matrix
Some people refer to 3 x 3 prioritization matrices – these aren’t cubes, but 9 cell matrices, such as the GE matrix. They allow you to display inputs in a more granular way.
However fundamentally these are are a 2 x 2 matrix with a middle ground:
People sometimes use this model to make it easier to place items on the matrix and gain less black and white outputs.
Free prioritization matrix template and flashcards
Get the free Hustle Badger prioritization template here
We’ve created several free resources to help you use the framework:
- Prioritization Matrix Template: this is a combined impact model and bubble graph display which allows you to display a RICE framework scoring on a 2 x 2 matrix visually for stakeholders. It includes an impact model, where you can score revenue uplift from initiatives, connected to a RICE scoring, which then displays outputs on a Value vs Effort matrix for implementation.
- Prioritization Matrix Flashcards: a flashcard set, or slides template that you can use in workshops to help your stakeholders decide which prioritization method matters to them
Get the Hustle Badger prioritization flashcards here
Looking for the Kano model? We cover it in our backlog prioritization techniques guide.
Common prioritization matrix examples
The following types of prioritization are very common. You may well have come across all or some of them before:
- Value vs Effort: a loose proxy for a cost / benefit calculation, this matrix is quite commonly used as a workshop tool between product managers and engineers
- Important / Urgent: the Eisenhower prioritization matrix is a common tool for executives to manage their to do lists
- Impact / Urgency: the Eisenhower prioritization matrix applied to business opportunities. Particularly effective in fast growing businesses where there’s a host of equally valuable opportunities, and you want to capture value fast.
- Risk (probability something might happen) / Impact: known as the risk matrix, this is a mental model for the major risks you might face, plus the probability that they wipe out your business. Especially useful in uncertain environments and highly regulated industries.
- Time / Money: there’s a concept called the time value of money, where having a $1 today is worth more than having a $1 tomorrow, due to inflation, risk and so on. While value, effort are all important inputs, so are payback cycles and how much ultimately it will cost.
- Cash flow / market share: used to apply investment payback logic to investments of time or capital. The BCG matrix
- Market / Product | The Ansoff matrix: used to choose a growth strategy before you prioritize the initiatives inside it.
- Market attractiveness / Business unit strength: the nine cell GE matrix. Used to prioritize investment across a portfolio of business units or product lines depending on the attractiveness of the market, and the ability of the business unit to build comparative advantage
One helpful way to think about all these different types of matrix is as different lenses or models to look at a problem or opportunity space. There’s no 1 matrix to rule them all: they’re strategic tools to help you examine complex problem spaces and start to articulate goals and tradeoffs.
You can think of plotting opportunities on these different axes as a type of extended feasibility exercise, where you take a 360 look at the opportunity space. Many of these are particularly useful when thinking through new products, new markets, allocation of resources, or mitigating wastage and risk.
Let’s deepdive the Value vs Effort prioritization matrix to bring this to life, and then explore the others in more detail.
Value vs Effort prioritization matrix
The Value vs Effort matrix is a commonly used 2 x 2 prioritization matrix. One axis represents Value from low to high and the other represents Effort from low to high. It’s sometimes called an Impact vs Effort matrix, or the Effort Value matrix.
Users of this method estimate future value, and effort to deliver, and then place initiatives or projects on the matrix according to the value / effort calculation. Things can be:
- Low value, high effort: Do not do
- Low value, low effort: Little value in doing, delay until no other options
- High value, low effort: Execute soon as quick wins
- High value, high effort: Check strategy alignment and make a plan to execute
Value vs Effort Prioritization Matrix
It is popular as a basic prioritization tool, but it has significant limitations if not used carefully.
Bad examples of the Value vs Effort prioritization matrix
Bad examples of the Value vs Effort prioritization matrix:
- Use guesstimates: unless you and your team are extremely good at guessing, any time you estimate value or effort without calculating according to an agreed methodology, the outputs will be off. Guesstimates also open the way to different people using different baselines, having different concepts of value or effort, or bias.
- Are simplistic: in order for a 2 x 2 matrix to be truly mutually exclusive, and collectively exhaustive, ideally the inputs on the axes are complex, rather than simple inputs
- Apply value vs effort to topics where value vs effort is not the right question: it’s often the wrong lens to apply when you’re considering building new products or allocating team resources
- Are over-used: it can be tempting to apply this prioritization matrix as a well known cookie cutter tool – but as we have shared, often other inputs are stronger.
Good examples of the Value vs Effort prioritization matrix
If you are calculating value it is better to do a proper impact calculation, taking into account how many people it will reach, and the level of confidence they have in their supposition, for example using the RICE framework.
Example of value modelling and impact calculation in the Prioritization Matrix template
As we’ve shared, there’s ways to bring the RICE framework and this visualization together, and as demonstrated in our prioritization matrix template, which shows a RICE methodology visualized on Value vs Effort axes..
Prioritization Matrix Template combines RICE with a Value / Effort visualization for stakeholders
There are other times when the Value Effort matrix can make sense and add value:
- As a quick sorting method to understand where to prioritize more discovery or to focus impact calculation, for example as a way to do wrap ups in ideation sessions
- When senior stakeholders with a low attention to detail want to see a simple visual aid to planning and decision making: but here the onus must be on you to do the real work behind making it accurate via value and effort calculations. Particularly useful for SLT or Board meetings
If you’re using it, here are our recommendations
- Use it as a way to sense check the pulse: a rough sorting mechanism to understand where to focus your efforts for RICE calculations. See it as a first, not an end stage in your prioritization process
- If you are presenting as a finished prioritisation scheme: have a way to calculate value and effort and then plot inputs: don’t guesstimate. Value could be an aggregation of Reach, Impact and Confidence, calculated according to the RICE methodology, and Effort could be days work / sprint / person month estimations; plotted on the matrix.
- Really sense check if this is the best tool for your audience: while this framework might feel intuitive and easy, consider whether as a group you’d reach better outcomes using another tool.
Impact vs Urgency matrix
This matrix is particularly useful in fast growing businesses with lots of competing opportunities with similar impact, reach and effort scores. This can be an extremely effective workshop tool with senior stakeholders to understand their priorities and focus.
There will always be times where a very senior stakeholder feels the urgency is not where they would like it to be regarding what they perceive as a high impact opportunity. Founders may wish to pursue a strategy that they have not yet outlined to the team.
This matrix is a great stakeholder management tool to flush those preferences out into the open and manage up effectively.
Impact vs Urgency Prioritization Matrix Template
Risk vs impact prioritization matrix
This type of matrix evaluates
- The risk or probability that something might happen
- The impact it would have on your business
This can be particularly useful to suss out where there might be genuine risk to your core business from competitors or from other external factors, such as legislation. It can be a useful workshop tool in scenarios where internal stakeholders are insisting on x y z feature, and whether you can bring in senior stakeholders to streamline decision making. This can help in scenarios where you need to prioritize something which results in no monetary value for the business: for example, implementing a cookie banner.
It can also be critical as an additional input when prioritizing in highly regulated industries, such as fintech or healthtech.
Risk vs Impact Prioritization Matrix Template
Time vs Money prioritization matrix
The time vs money matrix is especially important when you’re managing cash flow.
Let’s say you have two different opportunities, one B2C, one B2B.
Both are of about the same value, effort, importance, deliver the same market share, and would take the same amount of time.
You would select the B2C opportunity over the B2B one because B2C customers pay upfront to use the product, while B2B customers pay on invoice, c. 45-60 days after invoice receipt.
The B2B opportunity is still valuable – and arguably longer term more valuable as B2B customers tend to be stickier – but the B2C option brings money today.
There are lots of times where getting cash into a business can be useful: start up cash runways are often under pressure. It’s particularly key in early stage start ups.
Time vs Money Prioritization Matrix Template
BCG Matrix | Cash flow vs Market share
The original example of a prioritization matrix came from the management consulting firm Boston Consulting Group (BCG).
The BCG Matrix is a method to help businesses manage their yield and investment strategies across different business lines for optimum company value.
“The growth share matrix was built on the logic that market leadership results in sustainable superior returns. Ultimately, the market leader obtains a self-reinforcing cost advantage that competitors find difficult to replicate. These high growth rates then signal which markets have the most growth potential. The matrix reveals two factors that companies should consider when deciding where to invest—company competitiveness, and market attractiveness—with relative market share and growth rate as the underlying drivers of these factors.” – What is the Growth Share Matrix, BCG
The inputs are as follows:
- Cash cow: Low Growth, High Market Share: throws off a lot of cash, milk that cash to invest in new businesses. Example: for Google this is the search advertising business.
- Star: High Growth, High Market Share: invest in these to make them future cash cows. Example: for Google, this could be Youtube.
- Question Mark: High Growth, Low Market Share: invest or divest these, depending on their potential to become future stars. Example: for Google, this could be Gemini.
- Dogs: Low Market Share, Low Growth: Shut down, or sell. Example: for Google, this could be Circle, their social network.
The BCG matrix can be a helpful framework for when you need to:
- Decide which markets to prioritize: when working across multiple geographies, with many asks from different markets, this can be one way to to prioritize market specific asks
- Allocate resources across different business lines: the McKinsey Horizons model is another of these mental models, but the BCG matrix can also assist when you’re considering whether to work on older business lines versus new ones.
Market vs Product prioritization matrix | The Ansoff Matrix
The Ansoff matrix is a mental model which helps an organization and senior stakeholders align on where investment and initiatives are to be concentrated: in new products or new markets.
It’s an articulation of 4 types of growth strategy for existing businesses, each of which come with different levels of risk.
The 4 quadrants, or possible growth strategies are:
- Market penetration: This is about focusing on your existing products, and existing markets. The goal is to sell more of what you have to the customers you already have. The lowest risk option. Example: Bloom & Wild’s subscription business.
- Market development: Expanding an existing product into a new, usually adjacent market. This is about taking what you already have into a new geography, segment, or channel. Example: Bloom & Wild expanding into Germany & Austria.
- Product development: Building or distributing a new product to your existing market. This is about building something new for the customers you already understand. Example: Bloom & Wild expanding into letterbox gifts.
- Diversification: Building a totally new product for a completely new market. This is the highest risk growth option since you’re innovating both a product and a new customer segment. Example: Bloom & Wild haven’t done this, preferring to focus on expanding their share of market within their existing product ranges (plants, deliveries). However Amazon are moving into healthcare.
This matrix is all about focusing attention on types of bets, and allowing more mature businesses to systematize growth.
It’s easy for companies to experience organic mission creep: customers ask for things, teams have good ideas, innovative founders jump to the next big thing. The Ansoff matrix is helpful as a way of articulating types of bets and clarifying for teams which they should go after in which order.
It’s helpful to use alongside the BCG matrix: both at the outset and as an evaluation mechanism for which bets are paying off. It was invented by Igor Ansoff, an applied mathematician, sometimes referred to as ‘the father of strategic management’.
GE matrix | Market vs Business unit strength
This matrix grew out of some work that McKinsey did for GE in the 1970s, and is also referred to as the GE McKinsey matrix. It’s a 9 cell matrix which groups business units and proposes action to take.
Multi business lines are common in business, but where should you invest most, and which should you focus? This has been the discussion for the last 3 matrices we’ve covered, and is the number one strategy issue businesses try to solve.
However, it’s tough sometimes: business units operate in different contexts, might have different success metrics, and different types of teams. How can you compare them, and how can you analyze their success?
The first thing it does, similar to the BCG matrix, is cut the noise around different markets / business units, and set 2 criteria by which they can all be ranked. The ranking criteria doesn’t depend on forecasts, or reported metrics: it simply looks at market attractiveness, and how competitive the business unit is.
- Market attractiveness: how big the market is, what percentage of the market you could realistically capture
- Competitiveness: the comparative advantage or strength of the business unit, or their ability to capture market share
Use TAM SAM SOM to articulate market attractiveness
Within those 2 dimensions, business units can be assessed comparatively and grouped into opportunities:
.
- Invest / grow: those who should be allocated more resources, since they operate in an attractive market with an effective team and proposition
- Selectivity / earnings: the middle ground which has to be assessed individually, allocated selective resources, and the earnings monitored
- Harvest / divest: similar to the BCG matrix, depending on the cash generation of the business, you can either manage for cost, and treat it as a cash cow, or divest it / wind it down
As with every matrix this is intended as a starting point for discussion: but can be useful when considering annual investments or the true viability of business units.
When to use a prioritization matrix
They’re most useful as
- Strategic frameworks: articulating key trade offs, and getting people to zero in on inputs they really care about, or what has to be done.
- Simple intuitive displays of complex topics: especially effective for slides for senior management, an elegant way to display complex topics, and start complex discussions
- Stakeholder engagement tools: useful when you are looking to read the room: what does the CEO think is most important? Are the engineers going to get sticky? Does that customer really want that? A powerful method to gauge which way the wind is blowing.
- Sorting priorities where strategic objectives and trade offs are already well understood: you don’t need to use complex prioritization tools where there’s a clear strategy and everyone in the room ‘knows what to do’. In these situations a simple sorting as a group can be advantageous and time efficient.
They’re most dangerous when:
- Used reductively: many topics are complex, and require more than two inputs to get to the right answer. Even if you’re using a 2 x 2 prioritization matrix to display opportunities visually, you should have invested the time to understand the true priority of different inputs according to a more refined logic.
- Used as the default: different matrices address different topics or give different perspectives. If you always default to one, without considering risk, or strategy, or the source of revenue, you’ll make mistakes.
- Estimates are seen as a source of truth: it’s fine to do some rough estimates to understand where to focus your energy for more analysis, effort or exploration. It’s not ok to skip that step in favor of swift estimates.
- Used in a vacuum: if you don’t have a clear strategy, if you haven’t done discovery, if you don’t have a solid way to calculate impact, it quickly becomes based on people’s biases and feelings.
Our strong recommendation is to
- Treat these as powerful workshop tools: to understand stakeholder priorities and needs, to understand where to invest the time in more robust prioritization efforts (such as RICE)
- Use these as powerful visual aids to demonstrate where you and your team are focusing and why – again, with robust calculations behind them
- Understand how to make them really powerful: a 2 x 2 matrix can be deceptively simple, devilishly smart. It all comes down to how well you define the problem statement, how deep your thinking is behind which are the 2 inputs which best articulate the problem statement trade offs, and how well you articulate and stack rank your hypotheses based on mutually exhaustive, collectively exhaustive logic.
- Not to use these as your sole prioritization methodology: things are often more complex than 2 estimated inputs. They’re a great workshop tool, they’re a great visual aid, but they shouldn’t be where you start, and the only system you use.
- Pause and think if you’re having trouble prioritizing: if everyone in the room has a different idea of which inputs are most important, and a different idea of what should be in the top left hand corner, it means everyone has a different idea of what the strategy and the vision is. This is a strong signal for a time out, an articulation of the goals and a regroup once there’s some alignment.
How to create a prioritization matrix
We’re going to go through
- Selecting axes: how to select what should go on each axis
- Defining actions: how to group your outputs and assign actions
- Ensuring stakeholder buy-in: if you’re using this methodology, you need your stakeholders to agree to it
- Plotting robust inputs: making sure items are in the right place
Selecting axes
You can assign any input you like to each axis.
In order to make your matrix effective it helps to ensure that they are:
- Mutually exclusive: the axes should trade off two equally valid but entirely different imperatives. If you score opportunities by Value and Revenue, you’re essentially scoring everything according to one input.
- Of equal magnitude and importance: the two axes should have equal weight. A good example of two inputs with equal magnitude and importance are Value and Risk.
- Meaningful and important to your organization: most companies have a topline goal which is aligned to a key result. Prioritization is as much political as a science. Include that metric in your prioritization, or ensure there is alignment about using a different metric.
- Defined: words can mean different things to different people. Spell out whether Value is monetary value, customer value and how it’s measured: net cash, NPS, etc.
- Inputs you can assign quantitative values to: the best prioritization matrices are a graph, plotted according to relative numerical inputs.
Defining action
Any matrix will have inputs which are
- High / Low
- Low / Low
- Low / High
- High / High
- Medium / High
- Medium / Low
It’s key to define (and write down) what action you will take depending on the place on the matrix.
Ideally write it on the matrix so that when you are plotting things, either solo or in a workshop, that you can quickly see whether that action feels intuitively correct for that input.
If something looks funky, go back to first principles and consider whether your axes, scoring or baselines are correct.
Ensuring stakeholder buy-in
Prioritization is as much about understanding your audience as it is about the science of how you prioritize and frame your criteria.
Don’t omit to
- Socialize your choice of axes with your stakeholders
- Ensure stakeholder participation in the process to ensure buy in
- Prepare: make sure you can confidently ground your prioritization in data and reasoning that seems fair and that they can accept
- Involve stakeholders iteratively in the process, and avoid a big bang announcement
In workshops it’s fine to place things on the matrix according to gut feel and feedback from the room. Higher, lower, bit to the right, etc.
But when you’re working up a prioritization matrix for presentation, there should be an excel spreadsheet, with a score per input and the points plotted on a graph. You should then overlay the matrix onto the graph.
When calculating your inputs you have several options:
- Calculate future possible output numbers: for example, when calculating Value, you might determine that Value = Revenue, and calculate the future possible revenue impact a given opportunity might create.
- Estimate an input according to a logarithmic scale (0.1, 1, 10, 100) which indicates order of magnitude: for example, if something is very urgent, you might score it 100, versus something which is not very urgent (score 1), and something which should be done in the next 6 months might be scored 10.
We advise against simple scales like (Value is High, score 3, value is low, score 1), because these don’t represent different orders of magnitude.
Here’s an example where we’ve plotted 3 different opportunities according to a Value score, an Effort score, and represented the relative revenue size of the opportunities as the bubble size on the chart, calculated via simple impact modeling.
Example prioritization matrix template here: Google Docs
As you score, you may decide that you need more granularity than a 4 box quadrant. This is when you might decide to use a 9 cell matrix, like the GE matrix example.
Tips and tricks when creating a prioritization matrix
There are many off the shelf examples of prioritization matrices. A common mistake is to reach for a well known model (i.e. Value / Effort) without doing the upfront thinking as to whether value, and effort, are the right questions to be asking.
Always go back to first principles and ask: Is value or effort the right question to be asking here? Are there other inputs which matter more?
Remember that there is no right or wrong matrix. You’re trying to find the best possible visualization of your problem statement.
If you’re not sure:
- Try out some different inputs: see what insights you gain into what is important from placing opportunities on different dimensions
- Know your matrices: we’ve shared multiple different methodologies here, but have a chat to Claude and see what else might be relevant
- Use a different prioritization methodology as your starting point: We anyway recommend using RICE or a similarly multi-dimensional prioritization framework to validate your inputs.
How to run a prioritization matrix workshop
“Individuals and interactions over processes and tools” – the Agile manifesto
Running a session using a prioritization matrix can be valuable to:
- Understand stakeholder priorities: by having people explain why they think an idea has such high potential you gain more information about strategic priorities
- Help stakeholders understand the team perspective: inevitably senior stakeholders and the team will diverge at some point. This allows the team to share valuable insights and information with senior management who are usually more removed from the front line.
- Start discovery: sorting in this way via workshops allows many stakeholders to share what they know about the topic
- Gain quick information from specialists: a directional prioritization can help refine opportunities later developed further
Preparation
For your opportunity area you should have collected and refined a list of opportunities. Ideally they are
- Collated according to opportunity area (i.e. monetization opportunities)
- They are mutually exclusive
- As far as possible they are similar sized pieces of work: don’t use different scales when it comes to tasks, try to describe them on similar scales
- The list contains context i.e.
- Nominated by xx stakeholder
- Rationale for doing the work / hypothesis about doing the work
- Any doc links
- Any risks i.e. GDPR compliance is noted
You should also have scoped some prioritization axes options in advance, and socialized them with stakeholders.
Ideally you will go into your workshop with at least 2 different types of prioritization criteria, in order to look at problems through different lenses and engage your stakeholders in the process, uncovering their needs and perspectives along the way.
Your plan should be to run min 2 group scenarios to help the group think through the problem in the round and agree where to invest more discovery time.
Running the workshop
Setting ground rules
Start the workshop by explaining:
- The purpose: this is to align the group on what to do and when, and to create clarity around stakeholder priorities, plus share relevant information to allow the group to reach a consensus
- The need for respectful participation: take turns, allow others to speak, act non-hierarchically for best results
- The need to be transparent and explain your why: you’ll be asking folks to score different options and it’s important that they explain their reasoning to others
- Share with them the matrixes you worked up in advance, and explain how they work & what you need the group to do
- Share that this is a process: based on outputs from this workshop, you will invest further time in refining a prioritized opportunity list (with calculations) and share back. It’s key not to let stakeholders walk out of the room thinking the thing at the top right is happening tomorrow.
Running scoring cycles
In order for this to be most effective you want to avoid groupthink. Therefore run your cycles in the following order:
- Share your first matrix, with the trade offs, and the actions you will take based on quadrant placement with the group
- Share your definitions of the two axes: if Value is an input on an axis, explain the definition of Value that you would like the group to score with
- Share your list of opportunities: and ask if it’s complete, or other things need to be added
- Give the group 10-15 mins to individually score the opportunities in private, and send you their scores
- Once the cycle is complete, copy paste people’s individual scores into a spreadsheet, with a column per person, and call on them one by one as you work through the opportunities to explain their scoring
- Get the group to agree on a consensus score per opportunity and enter it in the spreadsheet
- Plot the opportunities on the matrix according to the group’s score and throw it up on the wall: ask if it looks right
- Iterate until everyone aligns on the priority order
- Lock the matrix, and go again with a different matrix with different axes
Concluding the workshop
At the end, ask people to share their reflections and what they have uncovered through the process. What inputs matter the most to them? Do they think you’ve missed a key prioritization input? Have they any general reflections?
You should capture this, and take away your populated matrixes to work up a prioritized list of opportunities.
You can use RICE, or you might find that your organization wants to use variants, i.e. ‘Can we add urgency to RICE? Can we add risk as an input?’.
Take that into account and use those inputs to derive a final prioritization score and a stack ranked list of opportunities to inform your backlog.
Wrap up on prioritization matrix best practices
A prioritization matrix can be a useful strategic tool.
It’s especially useful as a thought model to look at problems from different angles, with different lenses.
Its simplicity makes it a powerful communication mode, especially for stakeholder sessions.
However it does come with risks. Don’t use it without considering if it’s the right tool for the occasion. Don’t reach for the same matrix every time. Don’t use it when another framework would be better.
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