Executive Summary
- Most FY plans fail because they carry too many defensible priorities, not because the ideas are weak.
- The real test of a priority isn’t whether it matters. It’s what it displaces.
- Most leadership teams can genuinely resource three to five priorities, not the ten or more usually on the FY plan.
- Every surviving priority needs one named owner, a stated trade-off, and a visible change in the first 48 hours.
- A strong FY kickoff or offsite should produce decisions, not just alignment.
Why do we call them priorities if there are twelve of them?
At that point they’re not priorities. They’re a group chat with budget attached.
Finance has cost discipline. Product has the roadmap. People and Culture has retention. Transformation has transformation, which somehow always manages to get priority boarding.
And the frustrating part is everyone is right.
Every item on the list has a good reason to exist. Someone can defend it. Someone can show the business case. Someone has already made a slide for it.
That is why financial year plans don’t usually fail because the ideas are weak. They fail because no one wants to cut a good one.
In Execution Intelligence™, the gap between a decided priority and a delivered one starts showing up right here, before the FY plan is even drafted. I ask every leadership team I work with to write their top three priorities down alone, and whether it’s a CHRO defending retention or a CFO defending cost discipline, the lists almost never match, not enough to run the year from, anyway. That mismatch is the first sign of initiative overload, and it means the decision hasn’t actually happened yet, no matter how many workshops have refined the deck.
What Is the Priority Displacement Test?
The Priority Displacement Test is a five-question check that forces every surviving FY priority to name what it costs the organisation, not just what it’s worth.
For every priority that survives, I ask the leadership team to answer:
- What does this priority require?
- Who owns it?
- What existing work loses time, budget or attention because of it?
- What visibly changes in the first 48 hours?
- What gets reviewed at the next leadership check-in?
It works because it turns “is this priority good” into “what are we willing to stop funding,” which is a decision, not a debate about merit. Everything on a typical FY list is good, that was never in question. The test doesn’t argue with the idea, it argues with the calendar.
How Many Priorities Is Too Many For The Year?
When I ask leadership teams how many priorities they can genuinely resource, the honest answer is almost always three to five. When I ask how many are actually written into the FY plan, it’s rarely fewer than ten. That gap between the two numbers is the difference between a plan and a wish list.
Two separate bodies of research land on almost the same number, which is rare enough to take seriously. A survey of 1,800 executives, run by strategy researchers Paul Leinwand and Cesare Mainardi, found that revenue growth declined as priority lists grew, and organisations capped at three were the most likely to post above-average growth, according to Columbia Business School’s account of the research. FranklinCovey’s research across thousands of teams found a similar cliff: teams with two to three priorities tend to achieve all of them, four to ten sees achievement drop sharply, and ten or more means nothing gets done well.
Neither study proves that three priorities magically creates growth. What both show is that focus behaves like an operating constraint, not a motivational slogan, and that most FY plans are really a capacity vs demand problem wearing a strategy costume. Doing less better always beats doing more badly, and the discipline is in arriving at the number, not just knowing it.
Why Good Ideas Are So Hard To Cut
Most priority lists aren’t bloated because leaders are careless. They’re bloated because every item has a politically reasonable defender. Someone promised it, someone funded it, someone announced it, and someone has probably already built half a dashboard for it.
This is where most annual planning cycles quietly fall over, not because the priorities are wrong, but because cutting any of them feels like an attack on whoever proposed it. Nobody in the room argued for chaos; they argued, one at a time, for something sensible, and that’s exactly how a plan quietly becomes undeliverable, one good idea at a time.
The fix isn’t more discipline or a stronger case for saying no. It’s a mechanism that makes the trade-off visible, so the no isn’t personal, it’s arithmetic. That’s what the Displacement Test is actually for.
How To Use The Priority Displacement Test
Run it live, in the room, with the actual list on the table, not as a pre-meeting survey people fill in alone. Take each surviving priority through the five questions above out loud, in front of the whole leadership team, and write the answers down where everyone can see them. If a priority can’t get a straight answer to “what does this displace,” that’s the tell, it hasn’t earned its place on the short list yet.
Steve Jobs used a version of this same test when he returned to Apple in 1997. He famously simplified a sprawling product range around a brutal two-by-two, consumer and professional, desktop and portable, cutting the line by around 70 percent. Every product he removed had someone who could argue, correctly, that it made money on its own terms, which is exactly the trade-off the Displacement Test forces into the open.
Example: Cutting a FY Priority List From 10 to 4
Picture a leadership team walking into FY planning with ten items on the table: cost discipline, AI adoption, customer experience, retention, market expansion, process simplification, leadership capability, cybersecurity uplift, product roadmap, and operating model redesign. Every one defensible. None of them wrong. This is a composite, built from the pattern I see across FY planning rooms, not one specific client’s list.
Run each through the Displacement Test and the list moves fast. Operating model redesign would displace almost everything else for a year and deliver slowly, so it’s parked for next year, not abandoned. Leadership capability and process simplification get folded into how the surviving priorities are delivered rather than run as separate line items. Market expansion is real, but this year’s capacity is already spoken for, and the test says so before the budget round does.
What survives: cost discipline, retention, AI adoption and product roadmap. Not because they scored highest on a spreadsheet, but because each one named, out loud, what it would take from something else, and the leadership team decided that trade was worth making. That’s four priorities with named owners, not ten with none.
How Do I Make The Short List Stick?
Cutting the list is the easy part, comparatively. Keeping it cut through September, when the old priorities start sneaking back in as “quick wins” and “just one more thing,” is where most plans actually die. I hold the line with a mechanism, not a memo, which is really the Displacement Test run again at every check-in.
Every survivor on the short list needs one named person accountable for it, not a committee, not a working group. At the first leadership check-in after the plan is signed off, I ask a blunt question: has anything visibly stopped, started or changed because of this priority. Not “is it in progress,” not “have we had good conversations about it,” visibly stopped, started or changed.
If nothing has moved, the decision hasn’t been believed yet, by the team or by the market watching what the organisation does. I call this quiet failure mode the Invisible No: nobody overturns the short list, it just gets crowded out one reasonable exception at a time. By the time anyone notices, it’s July again and the same twelve priorities are back on the slide with new dates.
Signs Your FY Plan Has Too Many Priorities
- Every function can name its own priorities, but nobody in the room can name the organisation’s.
- No one can say what has actually stopped.
- Every initiative has a sponsor, but not every priority has an owner.
- The plan depends on the same handful of people being available for everything.
- The first review meeting is full of updates, not trade-off decisions.
If two or more of these are true of your leadership team right now, the list is longer than the organisation’s actual capacity to deliver it, whatever the FY plan document says.
What To Do In The First 48 Hours
Cutting the list means nothing if nothing visibly changes once the room empties. In the 48 hours after the priorities are agreed, something has to be different that a reasonably attentive employee would notice without being told to look for it.
Before anyone leaves the room, the leadership team should be able to answer: what is the one thing that stops this week, not eventually, that people will notice is gone? Who is the named owner of each surviving priority, by person, not by function? What will be different in the next Monday leadership meeting, on the agenda, in the metrics reviewed?
A plan that can’t answer those three questions before the room empties isn’t a decision yet. It’s an intention with a due date.
The Real Decision Behind The Plan
Setting priorities for the new financial year was never really about picking good initiatives. Any organisation can find twelve of them without trying, each with a sponsor, a history and a promise attached. The actual decision is choosing which good initiatives don’t get resourced this year, saying so plainly, and putting one name against each of the ones that do.
If your leadership team is heading into the new financial year with ten priorities and the capacity for four, that isn’t a planning problem. It’s the exact moment an annual kickoff or offsite needs to create real decisions, clear ownership and visible trade-offs, not another slide with everyone’s favourite initiative still on it. That’s the room I build with Execution Intelligence™.
Book a time with me directly to talk through what that would look like for your leadership team’s FY kickoff or offsite.
FAQs
How many priorities should a leadership team have?
Three to five, in most cases, depending on scale and complexity. Research from Leinwand and Mainardi and separately from FranklinCovey both land close to that number, and in my experience the exact figure matters less than the discipline of actually arriving at one.
How do you set priorities for the new financial year?
Start by asking each executive to write down the organisation’s top three priorities alone, without conferring. Compare the lists, they almost never match, then run every candidate priority through the Priority Displacement Test before it earns a place on the short list.
What is the difference between a goal and a priority?
A goal is where the organisation is heading. A priority is where it actually spends its time, budget and best people this year to get there. A plan can have one ambitious goal and still fail if the priorities underneath it were never narrowed enough to be resourced.
How do you decide what not to do?
Run every candidate priority through the Displacement Test and ask what it costs, not just what it’s worth. If nobody can say what an initiative displaces, it hasn’t earned its place, whatever the business case says.
Why do annual plans fail after kickoff?
Usually because nothing was actually cut. The FY plan keeps last year’s priorities and adds new ones on top, the calendar fills back up with business as usual within weeks, and by the time anyone notices, the short list was never short.
How can an executive offsite help set priorities?
An offsite forces the trade-off conversation to happen live, with the whole leadership team in the room, instead of being negotiated slowly and invisibly across a dozen one-on-ones. That’s the difference between a plan that was decided and one that was merely circulated.
What should happen in the first 48 hours after priorities are agreed?
Something has to visibly stop, start or change that a reasonably attentive employee would notice without being told to look for it. If nothing does, the decision hasn’t been believed yet, by the team or by the people watching what the organisation actually does next.
AJ Kulatunga works with executive teams, CHROs, CFOs and transformation leaders on turning decided priorities into delivered ones, through Execution Intelligence™ and The First 48 Hours.
