Final answer:
The first step in prioritization based on value, cost, and risk involves considering all available options and performing a Cost Benefit Analysis to evaluate each option's costs against its benefits.
Step-by-step explanation:
The first step in prioritizing based on value, cost, and risk starts with considering the options available. This means assessing all possible alternatives that could be taken in any given scenario.
After identifying these options, a decision maker must evaluate them against the parameters of cost, benefit, and risk to determine which choice offers the optimal balance. To quantify the impacts of a decision, one often conducts a Cost Benefit Analysis.
This process involves constructing a T-shaped chart where costs, such as monetary investment, effort, and other sacrifices, are weighed against benefits like financial return, time savings, experience gained, and other improvements.
After defining what constitutes costs and benefits, a rational individual or organization will opt for an action if the perceived benefit exceeds the cost.
If the cost outweighs the benefit, the action will likely be dismissed. This requires a thoughtful analysis that might consider quantitative measures—such as happiness or satisfaction levels—in addition to qualitative aspects.
In practical terms, you may also consider the 5 W's (Who, What, Where, When, Why) to clarify your objectives and assess the value, as subjective as it may be.
Additionally, one should understand what others are doing regarding the issue at hand and whether building upon existing work or charting a new course would be more effective.
By laying out all possibilities and exploring their implications, the best course of action can be evaluated and selected.