Russell D. Archibald
PMP, PMI Fellow

PMI-Texas Connection 2001
Sept. 14-15, 2001 Houston, Texas.
Published here March 2002.

Abstract | Challenges | Full Power | Business Strategies | Objectives
Portfolio Management | Process | Principles | Key Roles | Planning & Control
Team Working | Improvement | Integration | Internet | Conclusion

Implementing Business Strategies Through Projects

Strategically managing the growth of a company, agency, institution, or other human enterprise requires:

  • A vision of the future of the organization at the top level;
  • Consensus and commitment within the power structure of the organization on the mission and future direction of the organization;
  • Documentation of the key objectives and strategies to fulfill the mission;
  • Planning and execution of specific projects to carry out the stated strategies and reach the desired objectives.

Objectives are descriptions of where we want to go. Strategies are statements of how we are going to get there. Strategies are carried out and objectives are reached, when major growth steps are involved, through execution of projects and multi-project programs. Projects translate strategies into actions and objectives into realities.

It is important to recognize that objectives and strategies exist in a hierarchy—and not just at one level—in most organizations. A useful way to describe this hierarchy is to define three levels:

Level 1: Policy
Level 2: Strategic
Level 3: Operational

Figure 2 shows how the strategies become objectives at the next lower level in the hierarchy, until at the operational level projects are identified to achieve the operational objectives. Unless the higher-level objectives and strategies are translated into actions through projects, the plans will simply sit unachieved on the shelf. The linkage between strategic and project management is also shown in Figure 2. Strategic managers set the future course of the organization. Project management executes the specific efforts that achieve the growth strategies. The managers of these projects are acting for and representing the project owners, and receive their direction through the project sponsors.

Figure 2: The heirarchy of objects, strategies and projects.

Figure 2: The heirarchy of objects, strategies and projects.[6]

Two broad classes of organizations can be identified: First, those project-driven organizations whose primary business is in fact made up of projects. Examples of this class include architect/engineer/constructor, general contractor, and specialty contractor firms; software development firms who sell their products or services on a contract basis; telecommunications systems suppliers; consultants and other professional services firms; and other organizations that bid for work on a project-by-project basis. Growth strategies in such organizations are reflected in the type, size, location and nature of the projects selected for bidding, as well as the choices made in how the required resources will be provided (in-house or out-sourced) to carry out the projects, if and when a contract is awarded or the project is otherwise approved for execution

The second category of organizations—those that are project-dependent for growth— includes all others that provide goods and services as their mainstream business. Projects within these organizations are primarily internally sponsored and funded. Examples include manufacturing (consumer products, pharmaceuticals, engineered products, etc.), banking, transportation, communications, governmental agencies, computer hardware and software developers and suppliers, universities and other institutions, among others. These organizations depend on projects to support their primary lines of business, but projects are not their principle offering to the marketplace. Many of these sponsors of internally funded projects are important buyers of projects from project-driven organizations.

In both of these types of organizations, projects are the primary vehicles for executing their growth strategies. For this reason the project management capabilities of organizations are crucial to their current and future success.

Unleashing the Full Power of Project Management  Full Power of Project Management

6. From Archibald, Russell D., Managing High-Technology Programs and Projects, 2nd Ed, 1992, John Wiley & Sons, New York, 9.
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