The Intersection of Strategic and Project Management

1. The Intersection of Strategic and Project Management E.L. Owens, Jr. Ed.D, PMP, CPPM Without a vision the people project will perish

2. What brings me to this issue? • Several interviews with senior v.p.’s directors, and clients • Teaching over 9,000 students project management • Current market miscomprehension of the difference in project management and project coordination • A perceive lack of authority given project managers based on senior management ignorance of the role

3. Outline • Strategic Management Process • Strategy to Project • Project Management Process • Project to Process • Implications

4. “ Only 30 percent of projects come in on time schedule, and/or budget!” PMI Research Conference 2009 The Intersection of Strategic and Project Management

5. Strategic Management Process What are the implications to our firms?

6. Know the Vision and Mission of your enterprise or business unit. Will this project aid the theory of your business? Are the objectives clear and do you have clarity of purpose? Are you organized based on your purpose? What are the dominate strategy formations? Strategic Management Process Based on Strategic Direction

7. Strategic Management Process OWENS’ STRATEGIC MODEL FOR RE-ENGINEERING TURNING VISION INTO ACTION 06/05/06 Planning On Purpose INFORMATION RE-ENGINEERING M I S S I O N Enterprise’sCompetency GOALS INFORMATION STRATEGY PLAN BENCHMARKING GRANDSTRATEGIES Sphere ofInfluence BUSINESSAREAS ANALYSIS BUSINESS SYSTEMS ANALYSIS ExternalCustomer OBJECTIVES BUSINESS SYSTEMS INTEGRATION OPERATIONS RE-ENGINEERING FUNCTIONAL STRATEGIES STRATEGIC RE-ENGINNERING Market Assessment V I S I O N ACTION PLAN Program B Strategic Plan Tactical Plan Tactical Plan Tactical Plan OPERATIONAL PLAN Enterprise’s Culture Operational Plans Operational Plans Operational Plans Operational Plans Program A PERFORMANCE PLAN Projects Processes Project Team Processes Projects Processes Views of Future RESULTS Chaos Process Projects Program C DESIRED BEHAVIORS Leadership Values REAL ORGANIZATIONAL VALUES QUALITATIVE -CONCEPTUAL QUANTITATIVE – TASK ORIENTATED

8. Strategic Management Process Portfolio, Program , and Project Narrative

9. Strategy to Project FIGURE 2.1

10. Theory of the Project Projects have the greatest chance of success when they emanate out of: Strategic Plans Best Practices Been Given Thoughtful Reflection Strategy to Project

11. Strategy to Project Strategic Plan Tactical Plan Tactical Plan Tactical Plan Operational Plans Operational Plans Operational Plans Operational Plans Projects Processes Project Team Processes Projects Processes Chaos Process Projects Program B Program A Program C

12. Strategy to Project Congruence Model Informal Organization Desired Why? Inputs Outcomes Systems Environment Formal Strategic Work Outputs Process History Choice Organization Resource Capabilities People Define the Problem • Where you want to be: • Key deliverables • Stakeholder analysis • Communications Plan • Strategic Impact • Competitive Posture Project Definition Gap Statement Project Hypothesis Project Plan to get there Transformation - WBS Outputs

13. Strategy to Project Needs and Wants Why am I here! Why am I here! Why am I here! Why am I here!

14. Strategy to Project

15. Project management is the leadership art and operations science of organizing the components of a project, whether the project is development of a new process, product, service, policy, strategy, or experience. A project is a one time, multitask effort with a clearly defined start and end date. A project is not something that is part of normal business operations. Projects are owned by a sponsor and managed by a professional practicing project management(P3M). It's typically created once, it's temporary,and it's specific. A project consumes differentcapital resources (human, financial, materials,equipment, and time) based on assumptionsand constraints. Project Management Definition Strategy to Project

16. Project Management Process PMI Project Phases PMBOK 4th ed. P3M Effort

17. Project Management Process Key Project Elements for Success Scope Quality Risk Resources . Cost Schedule Requirements

18. Project Management Process Change Management Business Framework Who? What? Where? When? How? Why? How Much? How Risky? What Value? PM manages the orchestration of change across layers of a business framework

19. Leadership/Ownership Project to Process Project Mgmt Program Mgmt

20. Four Functions of Organizational Culture Project to Process

21. Change Management Project to Process The different “constituencies” go through various stages of reaction to change, at different times. Letting go > real curiosity > experimentation > insight (AHA!) > change New Processes New Competence Practices Certainty Denial AHA! Shock Experimentation Anger Curiosity Fear Acceptance Confusion Surrender Endings Neutral Zone New Beginnings

22. Product/Process Cash flow Profit New Development Tb Tf Tr Tp Tv Tpb Te Project to Process Delivered Process To Project Effort To= opportunity cost Tp= perceived Tb= begin Tf= frozen spec. Tr= released Tv= volume ramp up Tpb= payback positive Te= end of life

23. Project to Process PM Network Diagramming Tool Set

24. SPI = BCWP (EV)/BCWS (PV) Scheduling Efficiency Shows how much work has been accomplished for each dollar worth of schedule to date. CPI = BCWP (EV)/ACWP (AC) Cost Efficiency Shows how much work has been completed for each dollar actually spent. This is the more common ratio used Earned-Value Analysis Project to Process

25. Investment Returns The difficulty with cost benefit analysis is that some of the costs and most of the benefits will occur in the future, while the development costs must be paid in the present. We try to determine what each of the future costs and benefits are worthnow (their present values) so that valid comparisons can be made. Therefore a clear sense of the project ROI, ROA, and ROE is essential for understanding the firms strategic viability. Project to Process

26. Learn from the Effort Lessoned Learned A summary of mistakes avoided and risk managed. Actions are defined to ensure success. Reflection of difficulties encountered and insights turned into gains. Project to Process

27. Some PM Perceptions Implications • PM or P3M (Professional Practicing Project or Program Management) • Is there a distinction? • PM or Task Jockeying • The team leadership narrative • Method maturity match to culture • What is the right amount of rigor? • Role between sponsor and P3M • Fidelity: the quid pro quo – referent power Law of Reciprocity

28. Power of Access and Agendas Having a seat or impact at the strategic decision making table. -Boman & Deal Implications Power & Influence

29. Improper P3M assignment will frustrate the project team and enable scope creep. Can the P3M stand up to the forces embedded in the plan! Assigning the Project Manager Implications

30. A Systems Model of Change Implications Figure 16-1

31. Project System View Implications Congruence Model Informal Organization Desired Inputs Outcomes Systems Environment Strategic Choice Formal History Outputs Work Process Organization Resource Capabilities (Nadler, 1999) People

32. Implications Vision Mission Objectives Programs and Projects

33. PM Bibliography Bolman, Lee G. and Deal, Terrence E. Reframing Organizations, San Francisco: Jossey-Bass, 1997 Gray, Clifford F. and Larson, Erik W. Project Management-The Managerial Process Boston : McGraw-Hill, 2003 Kerzner, Harold. Project Management 8th ed. Ohio: Wiley & Sons, 2003 Lewis, James P. The Project Managers Desk Reference. Boston: McGraw-Hill, 2000 Nadler, D.A. & Tushman, M.L. (1980) A model for diagnosing organizational behavior. Organizational Dynamics, 9 (2), 35-51 PMBOK Guide. A guide to the Project Management Body of Knowledge. 3rd ed. Newton Square: Project Management Institute, 2004 Senge, Peter M. The Fifth Discipline: The Art & Practice of the Learning Organization. New York: Currency, 2006 Schwartz, Peter, Art of the Long View. New York: Currency Doubleday, 1991 Strategy to Project