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Where’s the strategy? Part Two | Project Research Institute

Where’s the strategy? Part Two

Researcher: Tell me how you manage strategically important projects in this organisation. 

CEO: Project management?  If you mean, do we have a Gantt Chart for all our projects, the answer is no.

Admittedly this was a few years ago, but there is still some residue of this thinking.  Is this all PM is to CEOs  – a tool?  If so, then we are going to be very limited in what we, both the academy and the profession can achieve.  In the previous blog, I looked at organisational strategy for PM capability requiring policy, knowledge and mechanisms to enhance capability.  In this one I will look at the role of PM in organisational strategy.  PM includes the tools, but is the whole organisational approach that supports PM, and includes structures, experience and relationships.

There are two elements to PM in strategy: 

  • PM as an operational capability, and 
  • PM as change capability. 

As an operational capability PM is receiving new and welcome attention.  HBR’s recent book on  Strategy Execution

 noted that the journey of strategy from boardroom to marketplace must pass through PM.  This is a limited view of PM – a reactive capability.  How can PM create competitive advantage?  We have seen other functional areas promote their ability to achieve this, notably marketing, but also strategy, finance and HR.  Operations Management is particularly informative in this regard.  

25 years ago, repetitive operations performance in the western world, in terms of time, cost and quality was poor.  Deliveries were often late, prices would increase every year and quality was expressed in % defectives.  Today, we see many high volume operations where delivery slots are allocated in 15-minute intervals (rarely missed), annual cost reductions, and quality assessed in parts per million. For those firms that could deliver these positive changes, they could not only deliver better, but be seen to deliver better.  How, then have they changed the substance of their delivery?  

Firstly, operations were recognised as being strategically important, and received the necessary strategic support.  Secondly, there emerged recognised benchmarks in repetitive operations.  In automotive, Toyota became and are still the benchmark (despite recent publicity ‘issues’) for quality, time to market and not incidentally, profitability.  Lastly, there was a competitive market driving performance improvement. 

Recently, the CEO of the UK’s Associational for Project Management (APM) announced his vision to be that every project succeeds by 2020.  If this is to happen, there is considerable work to be done by the profession, but most importantly by their employing organisations.  The capability to deliver projects has to be valued.  There needs to be realistic assessments of where we are now, where we want to get to (a benchmark) and how we get there.  And this brings us to this second and vital element of PM in strategy – the ability of an organisation to use PM capability to deliver change.  

Perhaps as a PPM community, we ourselves need a little bit of that strategy, and maybe even the odd Gantt Chart too?

 

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