How to Prioritize Business Growth Opportunities (Ansoff): The ICE Prioritization Tool

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How to Prioritize Business Growth Opportunities (Ansoff): The ICE Prioritization Tool
Diana Alexandrova, Entrepreneur, United Kingdom

The Ansoff Matrix can be a useful model to generate and communicate business growth opportunities. However, organizations need to keep in mind that there are several factors that might hinder companies to pursue certain strategies, such as the availability of resources and access to resources. Therefore, companies need to evaluate and prioritize potential strategies in a systematic manner.
Chaneski (2012) argues that business decisions need to be based on priorities. A helpful tool for setting priorities is the ICE tool. ICE stands for 3 factors that should be considered whenever strategic priorities are set: Impact, Cost and Effort:
  • IMPACT: Impact can be measured in terms of sales growth; cost savings; quality improvement; better customer service and anything that benefits the company.
  • COST: Cost is a critical component when evaluating any growth strategy. With limited funds, companies must make careful choices about where to focus resources. Even the best idea should not be pursued if the costs are too high.
  • EFFORT: Strategies must be considered in terms of resources available and time required. Effective allocation of human resources is critical.
Combining these three decision factors yield 5 different scores:
  1. A score of 4 is the highest score. It shows an extraordinary opportunity because it can generate a high impact with low cost and low effort. These opportunities must be acted upon immediately.
  2. A score of 3 is the second highest. It represents a strong opportunity that can generate a high impact with either low cost or low effort. These opportunities must be acted upon as soon as possible.
  3. A score of 2 is the mid-level priority score designating something that provides either a high impact with a high cost and effort, or a low impact that can be achieved at low cost and low effort. Companies may want to address priority 2 opportunities as resources and funds become available.
  4. Any opportunities with a score of 1 or 0 on the ICE prioritization tool should probably not be pursued in the near future or not at all.
  5. In conclusion, the ICE prioritization tool evaluates the importance of various tasks or growth strategies that need to be accomplished but compete for the same resources or a limited pool of funds.

    ⇒ In my experience, the application of the ICE prioritization tool is a useful tool to assess the benefits of growth strategies. The team I worked with listed the various business growth strategies via a brainstorm session, thereby using the Ansoff Matrix as a guide. The ICE tool enabled us to prioritize and choose which growth strategies should obtain highest priority and which should be pursued as a priority. What is your experience? How do you choose between growth strategies? What tools have you found useful or not so useful?

    Sources: Chaneski, W.S. 2012, "Use ICE to Set Business Priorities", Modern Machine Shop,vol. 84, no. 9, pp. 34-34, 36.


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