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Aligning Projects with Strategy

Posting Date: February 07, 2007

Aligning the company's portfolio of projects to maximize their contributions to strategic objectives takes a highly coordinated effort. It requires more than the old "grenade over the wall" approach, in which the business planning staff identifies and characterizes the project and then tosses it to an uninformed and uninvolved project management group that is supposed to complete the project. As any primer on modern management says, folks have to "buy in"—everyone must be engaged with the project before charging ahead.

The concurrent engineering approach to managing projects is based on this theory of buy-in. Yet, the need to link corporate strategy to projects is sometimes overlooked, perhaps because of fine past performance by both business planning people and project management people. Normally, both groups do sterling jobs in their respective areas. But just think what these talents could do if they worked more closely together!

Here's a checklist of questions for senior executives and sponsors to help make sure the corporate projects are aligned to corporate strategy:

Is the corporation committed to using project management strategically? In most companies, hundreds of projects are underway at any given time—transformation projects, continuous improvement programs, plant expansions, maintenance fix-ups, worker empowerment, resizing, outsourcing, and quality-of-life projects. Managers, who in the old days supervised people or acted as information brokers between lower and upper corporate levels, now serve as project managers, or as managers of project managers. Since the nature of a manager's work has changed, there must be corresponding corporate commitment to the art and science of managing projects. Things have changed and corporate policies statements must reflect those changes. The project policy statements might address timing or the use of principles and techniques.

Is there a policy of formally preparing project charters? Since projects are the means by which corporate strategies are executed, it is critical that they be guided by the original corporate philosophy, strategy, and intent. Project charters are the instrument for doing this. This charter, with the participation and approval of upper management, should answer the basic question, "In what ways will the project enhance overall corporate objectives?" The charter should also cover such topics as objectives, relationships of stakeholders, methodologies, project management philosophy, scope statement, principal interfaces, and a brief project management plan.

Is there synergy between the business group and those responsible for project implementation? To avoid the grenade-over-the-wall-syndrome, there needs to be early involvement by project implementation people. While this principle may seem sound, the practice of it presents a challenge. First, business planning people may prefer to plan without the help of perceived "outsiders." Then, there's a good likelihood that the right project people might not be sitting about just waiting to brainstorm and analyze the early stages of a business proposal. Finally, there's the effort required by senior management and sponsors to articulate the relationship between the business planning people and the project management office.

How can senior management make sure that projects don't wear away from the chartered objectives? Maintenance events, programmed into the lives of a project, are a way to keep the project aligned with corporate interests. One classic method is the two-day project management audit. This audit typically compares on-site practice against the project management plan, which is the road map for project implementation. If the audit is expanded to include the project charter and senior management sponsorship issues, this will ensure that questions of strategic project alignment are addressed. The audit can also be used to pinpoint the need for strategic adjustment, if some of the original premises have changed as the project evolved.

Excerpted, with permission of the publisher, from Winning in Business With Enterprise Project Management, by Paul C. Dinsmore. Copyright 1999, Paul C. Dinsmore. Published by AMACOM, a division of American Management Association.