There is more to effective project management than meeting deadlines, budget, and scope. Achieving strategic goals and delivering real value is only possible through competent project management that is guided by and aligned with an organization’s strategy.
In today’s fast-changing business environment, organizations formulate and execute a strategy to meet new challenges, improve service delivery, align their employees to vision and mission, align projects and activities to strategy, and deliver value for customers and stakeholders. Unfortunately, many of these strategic efforts fail to acknowledge that the delivery process is as important as the strategic plan.
While project management takes a project from its starting point to its end, strategic project management looks at the big picture. It links the project to how it benefits the company’s efficiency and competitiveness. Strategic project management involves a holistic approach to solving organizational challenges. Moreover, it is also a philosophical approach to business success, along with adapting senior management strategic thought to a process.
When to use Strategic Project Management
A project is considered strategic if it links to an organization’s strategic objectives intending to improve performance. These projects are drivers of key performance indicators (KPIs), have a clearly defined business plan, budget and responsibilities are discussed at a leadership level. A strategic project, entailing the bulk of the workforce may dictate a need for retraining, and processes may have to be redesigned to keep the standards of operations at a high level. Examples include major overhauls of systems, consolidations of operating companies, or the purchase or spin-off of business units.
Organizations using Strategic Project Management range from individual investors to private organizations, corporations, or government agencies. All these organizations are interested in value creation – value is created when there are tangible market-recognized results from the strategic decisions made.
Examples of Strategic Projects
Agencies going remote
According to a benchmark report from PMI (Project Management Institute), 23% of agencies went remote in 2020, primarily because of COVID-19. This transition needed a massive effort, and many teams were required to coordinate and work together to avoid work disruption. While each team worked on their projects, each project was aligned with the common business strategy of ensuring a smooth transition. Appropriate resources were allocated to make this transition. HR, Operations, and IT teams had to work overnight to put the policies, processes, and infrastructure in place. Finance teams had to carve out a budget for work-from-home equipment. Some teams had gone remote temporarily. But as the pandemic stretched out, they had to adjust the timelines for remote work projects. Others discovered that remote work allowed them to hire from the global talent pool. They could hire more skilled people at a lower cost. As a result, they reworked their business strategy to match this new bandwidth. It’s fair to say that not all businesses could have “knowingly practiced” Strategic Project Management during the remote transition, but those that did realized the benefits that strategic project execution offers.
Reviewing vendor service offerings
Many business owners and management intend to make vendor or service-offering related changes, but because they are so busy, they plod along paying for services that do not fully meet their needs. As companies grow and change, so do their needs. Oftentimes their back-office functions in particular can no longer keep pace in a way that supports current and future business growth requirements or potential. For example, this may be of particular issue for many small to mid-market businesses owners who receive accounting-related services that only provide after the fact, partial and not necessarily relevant financial information, making it unnecessarily difficult to make crucial decisions on time. All vendor service offerings should fully meet business needs. Otherwise, it is a poor use of financial resources. This strategic project should be on every business owner’s annual list.
Revamping information systems and technology
In conjunction with reviewing vendor service offerings, taking an inventory of all information systems and technology should also be on any organization’s strategic project list. Advancements are always taking place, and as the business grows or changes, it creates the potential for the systems/applications and technologies we use to also require changes. This is not to suggest jumping ship annually with all vendors or service providers. Only make that move when significant gaps exist and existing offerings cannot sufficiently support the business currently or going forward. As with the vendor service offerings mentioned above, it may be time to either implement required enhancements if available internally or outsource to specialized service providers. Careful planning and selection is the key to finding solutions that are scalable to grow as an organization grows.
Strategic Project Management is very important and provides multiple benefits to organizations as it defines its growth path. There needs to be a close, symbiotic relationship between strategic project management and management ‘on the ground.’ That’s why it’s an integral part of strong project management leadership skills.
Poor project management and stakeholder commitment can hinder the execution of even the most well-designed strategies. Strategic project management takes traditional project management principles and practices to another level that improves strategic alignment, informs resource allocation decisions, operational planning, and helps mitigate risks. Strategic project management makes strategy leadership everyone’s job, not just the C-suite. Great strategic project leadership focuses on aligning project and portfolio management with strategy, helping coordinate clients and teams, forming a vision for success, and keeping everyone on track.