• J.D. Solomon

Five Ways to More Effectively Facilitate Capital Program Prioritization

Cranes on the skyline underscore need for capital program prioritization and Communicating with FINESSE
Organization maturity is a big factor in determining which type of prioritization method to use. One method does not fit all situations or contexts.

The foundations of systems thinking and facilitation apply to capital programs because the analysis requires a group to establish the nature of separate and inter-related components (the projects). This article discusses five ways to effectively facilitate capital programs prioritization by conducting pre-session exchanges, asking powerful questions, using exercises that engage, anticipating disruption, and controlling the tempo.

Capital programs are a necessary part of any organization that invests in facilities, infrastructure, or the environment. Capital programs consist of physical projects that must be planned, permitted, designed, constructed, operated, maintained, renewed, and replaced. Projects that must be capitalized for accounting purposes occur in all phases of a physical system's lifecycle. This project must be prioritized relative to one another because most (nearly all) organizations do not have unlimited resources.

Facilitation is defined as a structured session(s) in which the meeting leader (the facilitator) guides the participants through a series of predefined steps to arrive at a result that is created, understood, and accepted by all participants." As provided in the definition, the fundamentals of good facilitation are always essential. For capital programs, predefined steps and a process for arriving at results that are created, understood, and accepted by all participants are especially important as different interests compete against each other for their share of limited organizational resources.

Facilitating Capital Program Prioritization

A capital project is a long-term, capital-intensive investment project with the purpose to build upon, add to, or improve a capital asset. Capital projects are defined by their large scale and large cost relative to other investments that involve less planning and resources (Investopedia, 2022).

Some asset improvements or new purchases must be capitalized or depreciated for accounting purposes; however, everything that is capitalized for accounting purposes does not become a project in a capital program, capital improvement program (CIP), transportation improvement program (TIP). The purchase of a large computer system or the replacement of a like-kind pump are examples of investments that must be capitalized for accounting purposes but which may not be included in a capital program (usually planned and designed by engineers, architects, or other professionals).

Most organizations with large-scale investments in facilities or infrastructure have an existing capital project list. This is beneficial from a facilitation starting point; however, a list of projects may not rise to the level of an actual program where each project is funded, scheduled, monitored, adjusted, and improved from planning through completion as part of a formal management system.

One of the first decisions that must be made in facilitating capital program prioritization is how to handle ongoing projects, phased projects, and projects which are strongly dependent on preceding projects. In many cases, the understanding that any given participant has of an ongoing or predecessor project will strongly impact, either positively or negatively, their prioritization of the entire capital project list.

Capital project prioritization is usually performed by one of two formal processes. The most common is based on Multiple-Criteria Analysis (MCA), also referred to as Multiple-Criteria Decision Analysis (MCDA) and Multiple-Criteria Decision Making (MCDM). This approach of problem disaggregation focuses on structuring and solving decision and planning problems by scaling and ranking disaggregated values (the criteria). Stakeholders develop consensus through working through the various values associated with the problem or project. It is the most popular method for prioritizing and building consensus related to capital projects.

Ranking Approaches are a second form of capital project prioritization and can take a variety of forms based on the Theory of Choice. Preferential voting methods by ballots are utilized to complete a ranking. Plurality, Borda Count and Pairwise Comparison are the three ranking methodologies that are commonly used.

Multiple criteria and ranking approaches will arrive at a similar result with respect to a prioritized list. However, ranking approaches will not provide insight into “by how much” or “why” one item is preferred to another; multiple criteria will provide these insights and are frequently used to help build consensus for complex problems. However, multiple criteria approaches involve considerably more time than Ranking Approaches. Therefore, multiple criteria are best suited for more mature capital project programs or ones with relatively high complexity.

Risk-based approaches are a third approach and are common in many modern management systems, where risk is characterized as the product of the likelihood of failure and the consequences of failure. Risk-based approaches are common when managing assets and infrastructure that are already owned but are problematic when prioritizing capital programs where system growth is part of the equation.

These are five ways to be more effectively facilitate capital programs.

Pre-Session Exchange

The pre-session exchange for capital program prioritization should focus heavily on understanding the goals and objectives of the executive sponsors. One common point of discussion is whether there is a desire to have a balanced distribution of projects across all departments or whether the highest-ranked projects will be implemented regardless of whether one department gets most of the capital program (or only a small portion of it).

Another common point of discussion is whether a “bucket” amount of money needs to be set aside for a class of assets (such as large valve replacements) regardless of whether a specific need has been identified. Additional points of discussion can include the impact of grant funds or the willingness to do alternative project delivery methods.

The pre-session exchange with participants should focus on their project list and their understanding of other departments’ needs or projects. A secondary focus is providing each participant with an understanding of the approach and tools that will be used in the facilitated session.

Powerful Questions

Most of the powerful questions when facilitating capital program prioritization validate the assumptions and understanding of each project before the prioritization exercise(s). Imagination phrases like "Think about the last time you experienced a project like this falling behind schedule," or "Imagine if the preceding project is delayed," or "Consider if the partnering department of transportation backs out of the cost-share." Clarifying questions that begin "I understand you mean…." or “I am not completely sure I understand…” are usually needed when participants express that a project is a “must” or “not needed at all.”

Exercises That Engage

The most engaging exercises involve computer programs that allow the scoring to occur in real-time. I use Audience Response Systems (ARS) for multiple criteria scoring and manual ballots with an Excel-based program for rankling exercises.

Anticipate Disruption

The biggest disruptor associated with capital program prioritization occurs when the preliminary rankings are shown to participants. The disruption usually comes in the form of a subset of participants wanting to change the scoring criteria or methodology to get their pet projects to have a higher ranking.

One method to diffuse the disruption is to clarify before scoring projects that the outputs will require additional human judgment, which is always the reality. A black box approach is inappropriate because no scoring systems can anticipate all of the special cases and circumstances.

The second method to diffuse concerns is to perform a sensitivity analysis to let all participants understand what makes the most difference in the scoring model. A third method is to use multiple approaches and to examine the commonalities (or differences) in the outputs.

Controlling the Tempo

Capital program prioritization is typically a long process because many organizations have initial capital lists of at least 50 to as many as 200 projects. For reliable results, the same group should conduct all of the scoring over a one or two-day period. This requires much work upfront documenting the project details, some thoughtfulness on how to sub-group projects during the facilitated session(s), and developing an efficient set of automated tools to make the process more engaging.

As always, it is never a good idea to drive participants through finishing a session when they are burned out. Take a break or call it a day and resume tomorrow (or at some point in the future). For large capital programs, consider using the first day for scoring and the second day for reviewing results.

Thinking About It

Capital program prioritization requires system thinking because of the many inter-related parts (projects) and the limited resources that organizations have to achieve their investment-based outcomes. Organization maturity is a big factor in determining whether to use a more detailed and time-consuming multiple criteria approach or a more straightforward ranking approach.

Facilitators should focus on all five aspects of making the sessions more effective. When it comes to capital program prioritization, the pre-session exchange and the engaging exercises are the primary determinants of whether the facilitated sessions are good or whether they are great.


JD Solomon Inc provides facilitation at the nexus of facilities, infrastructure, and the environment. Contact us for more information about facilitation services ranging from Strategic Plans and Board Retreats to Criticality Analysis, Root Cause Analysis, and Capital Program Development. For more information on JD’s new book or to join the community of technical professionals committed to learning how to get their boss’s boss to understand, visit Communicating with FINESSE or sign-up for updates.