Programme and Portfolio Management - Essay Example

Programme and Portfolio Management 1.0 Introduction The success of a business organization depends on the level and extent of internal strengths so that such multiple but integrated tasks as control, rationalization and utilization of its strategically important resources can be carried out to achieve predefined productivity targets and the more desirable corporate objectives through competitive advantage. Thus strategy can be defined as “A planned course of action undertaken to achieve the goals and objectives of an organization. The overall strategy of an organization is known as corporate strategy, but strategy may also be developed for any aspect of an organization's activities such as environmental management or manufacturing strategy” ((Hendry, 2000, www.dictionary.bnet.com). The organization constantly develops its strategically calibrated resource base – capital assets, skilled labor force, supplier networks, strategic alliances, marketing networks of intelligence, financial resources, strategic operations, management processes and international Human Resource Management (HRM) practices (Andrews, K 1994). The average organization grows from strength to strength by adopting capability enhancement strategies that have little parallel elsewhere in the industry. Thus strategically impervious core competencies have been built around this formula or framework of strengths and weaknesses. It’s a paradigm of a priori elements of which the dispensation is characterized by a very highly valued and rare VRIO – value, rarity, inimitability and organization – resource framework. However its competitors haven’t altogether given up hope on defeating Google at its own game one day in the future. Strategic project management process of a first mover in developing difficult-to-copy resources might still lack some essential strategic elements in its management strategy. Strategic management processes involve careful planning for the future growth and marketing possibilities. The level of competition coming from other competitors must be taken into consideration. 1.1. Research objectives Research objectives of this paper include the following. To identify the possible existence of a policy and design level convergence between and among the immediate variables – e.g. project portfolio management process and implementation strategy – in the current literature on the subject of project programme and portfolio management. To build a theoretical and conceptual contingency model on the existing parameters of project programme and portfolio management literature. To identify and analyze the existing policy level disagreements among consultants on the subject of effectively designing and implementing project portfolio management programmes at the organizational level. To articulate a strategic response to the project portfolio management related learning outcomes. 1.2. Research problem What is the extent to which the existing literature successfully identifies the variables and problems of strategic project management related programmes and outcomes? What are the policy and design related obstacles faced by such project planners and managers in the execution process of reconciling strategic goals of the organization and project management related obstacles? What significant contributions have been made by the existing literature on the subject to enable new researchers to understand the prevalence and extent of disagreements among different theoretical schools on a single set of convergence parameters? Finally why and how some modern researchers have failed to make suggestions for a more realistic contingency model building effort? 1.3. Hypothesis Time and again project management teams and the organizational strategists have been faced up with the ever difficult task of successfully reconciling the organization’s strategy and project management tasks. There is very little published literature on the subject due perhaps to the problem of neglect on the part of researchers to investigate as to why and how the sphere of project portfolio management has been evolving in the recent past and how it has been influenced by pure project management tasks that invariably tend to be single in nature and outcome. Therefore this researcher has felt the need for a limited but a thoroughly analytical effort to identify and investigate some very significant variables that have impacted on the successful outcomes of the project portfolio management and programme related aspects. 2. Literature review 2.1. Defining Strategy Micro level activities of the organization has been developing its strategically calibrated resource base – capital assets, skilled labor force, supplier networks, strategic alliances, marketing networks of intelligence, financial resources, strategic operations, management processes and international Human Resource Management (HRM) practices. The companies has been growing from strength to strength by adopting capability enhancement strategies that have little parallel elsewhere in the industry. Firm’s strategically impervious core competencies have been built around this formula or framework of strengths and weaknesses. It’s a paradigm of a priori elements of which the dispensation is characterized by a very highly valued and rare VRIO resource framework. Strategy is all about direction and achievements that have to be made in the long term. The average organization does it by taking advantage of its resource capabilities in a competitive environment, so as to meet the needs of markets and to assure stakeholders of their demand for progress. Business strategy at firms has been determined not only by the external strategic operational and competitive environment but also the internal factors such as international HRM practices, value chain management, supply chain management, corporate social responsibility (CSR), corporate goals and so on (Chia, 2004). Firms have successfully managed their business strategy despite a series of reversals suffered due to the current global economic downturn. 2.2. The importance of Strategy for Organizational Performance Business strategy is basically determined by the efficient resource management techniques that have been adopted in order to face off competition in a highly competitive environment. A micro level activity of the firm has to face more threats on a day-to-day basis from its rivals so that efficient resource utilization and rationalization to enhance capacity would be much more desirable from the viewpoint of strategic competitive strength (Bradford and Duncan 2000). Rivals depend on their brand image and promotion strategy to increase sales while much of their competitive edge consists of pricing and quality policies. Strategic long term goals such as market share, profitability, an increase in the share price, quality improvements, customer satisfaction and brand loyalty have to be achieved by adopting such strategies as good internal and external communication practices, employee relations, good motivation strategies and HRM practices, sound financial management including positive cash flows and better overall performance metrics. For example many writers show that there are good and bad business strategies and practices being adopted by companies in the process of planning and design of management and business strategy. Many organizations depend on the available information to make such decisions. This is strategically a bad business practice because information asymmetry often misleads managers and their subsequent decisions based on such imbalanced information could be wrong. Previous researchers have particularly focused on the operational environment of the firm and that can be divided in to strategic competitive environment and strategic operational environment. The former consists of such theoretical and conceptual frameworks involving competitor behavior, competitor strategy, market structure, industry structure, government and global regulatory regimes, quality improvement and management and expansion or integration strategy among other things. On the other hand the latter includes all operational structures within and without the organization, supplier networks, public relations, communication strategy, employee relations, HRM practices, corporate social responsibility, marketing strategy and so on among others. However its competitors haven’t altogether given up hope on defeating firm at its own game one day in the future. Micro level activities of the firm are concerned with developing difficult-to-copy resources. Strategic management processes involve careful planning for the future growth and marketing possibilities. The level of competition coming from other competitors must be taken into consideration. 2.3.The Strategy development process According to Mintzberg, Ahlstrand & Lampel (1998) most of the pioneering concepts of strategy came from the military. The word “strategy” literally means “what generals do,” referring to the mapping out of military strategy in order to create the best opportunity to win the battle. Or, on the other hand, strategy can be defined as an art of fighting a war and winning it. Strategy development facilitates setting up a framework for finding direction, and facilitates the determination of the criteria for day-to-day decisions. It helps answer the questions: “Where are we going?” and “How are we going to get there?” When there are clear answers to these two questions, the path taken can be specific and purposeful. Fletcher et al. (2003) in their study suggested that the strategic development process is based on four phases including, preparation, planning, resource development and implementation. Preparation- Before any process can start, basic preparation should be done. This is inclusive of making a commitment to planning, enlisting suitable people, accumulating data, getting the needed commitments, allocating appropriate calendar time, and determining the process to be utilized. Planning- During the planning phase, or the actual development phase, the strategy is devised. All kinds of meetings are held that lead organization employees to process the information and make decisions concerning strategic objectives, goals, and action plans. The direction for the organization is set with particular actions that lead to satisfying the desired intention. Resource Development- when the plan has been done, the resources needed for implementation must be identified. This phase is inclusive of identifying both existing resources and new resources that must be secured and also deciding how these resources are to be allocated. All of the resources would not be present at the beginning of implementation. These resources will include: The allocation of members to programs, activities or events planned The development of a budget that resources the objectives, goals and action plans The development of a calendar which consists of the objectives, goals and action plans Implementation- The last phase of strategy development is implementing the vision, taking action, and making it happen. Past studies have shown that the most common point of breakdown of strategy development is when implementing. There are many instances, within the corporate world, of organizations that started the process but never completed it. 2.4. Strategy as Practice According to Bodley-Scott & Brache (2005) resource-based view of organizational success is determined by the internal strengths of the organization which is about controlling, rationalizing and utilizing the available resources to the maximum benefit of competitive advantage. In recent years social scientists have been scrutinizing the practices of scientists, accountants and architects. Now it is the turn of strategists. Thus firm’s own resources consist mostly of capital, trained personnel and networks in the form of strategic intelligence of markets, finances, operations, techniques and HR management› Visit Amazon's Craig S. Fleisher PageFind all the books, read about the author, and more.See search results for this author Are you an author? Learn about Author Central . Whittington in his influential writings suggested that strategic processes and systems within the organization should involve all management functions and corporate decisions. For instance internal organizational arrangements for communication, quality management, internal value chain management, employee relations, HRM function, budgetary control, cash flow management, motivation and so on will have to be aligned with organizational goals. A company would have to take into consideration the competitive environment and available strategic choices. Reay, Golden-Biddle & GermAnn (2006) point out that organizational strategic change or change management has become a very important aspect in the modern day management practice. Further he shows that strategic change is desirable when everything else has failed to ensure the continuous survival of the business. If organizational change were focused on improving critical success factors related to financial management, Human Resource Management (HRM), employee relations, supply chain management, quality management, marketing and corporate social responsibility (CSR), then the organization would have to face considerable resistance. However according to the critics there should be a link between micro level activities including multiple strategizing activities and events and behaviors within the firm as well as macro levels of analysis. Modern approaches to managing the project process are determined by the various project related outcomes such as the impact on socio-economic developments. There is also a greater degree of stress on the relevance and importance of projects on the society. The conceptualization process involves not only the capacity development for project management, but also a thorough examination of industry-centric implications. There are three aspects related to modern project planning process. The design and planning process of the project involves setting goals and estimating costs. For example project related objectives must be identified and defined at the very beginning. Setting goals involves management of the entire project portfolio with emphasis on industry related constraints. The project includes a typical five phase sequence of activities as the above diagram illustrates. However when project goals and cost estimates are considered by different participants, there would be much less agreement than was initially thought. 2.5. New directions in theory and concept According to(Tampoe, M 2001) the existing conventional conceptual models on managing projects show that they take work schedules, value generation for the customer and critical path analysis much less into account in the process of managing and programming the project. Thus delivery related bottlenecks further delay the delivery, increase budgeted money and reduces quality (Tampoe, M 2001). However Tampoe doesn’t point out the existence of a negative correlation between delays in work schedules and motivation of staff, especially managers. Bradford and Duncan (2000) paid attention to the fact that efficient project portfolio management depended on a number of endogenous and exogenous variables that are directly associated with supply chain and value chain management processes. For instance the endogenous variables such as resource mobility between two operations or projects and the swiftness with which resources could be switched between two uses could affect the project portfolio management related outcomes, especially the delivery schedule parameter. It’s here that the programme management issue plays a pivotal role. As for exogenous variables government regulations could have such a far reaching impact on successful ends. The cost and quality parameters are then essentially influenced by these variables Functional requirements such as the flow of information in to and out of the project have to be carried out by experts because it is the most important aspect in the planning process. For instance successful project planning requires certain functions to be integrated in to the project domain. A feedback process has to be initiated by the staff to reinforce the whole consultative process (Kemp, 1995). Even though the project portfolio might be considered to be a smaller one some of the design and planning features would require a very high level of coordination of the project were to be completed within the shortest possible time period. In fact internal space design parameters need to be worked out in conformance with exact measurements because the process of matriculation and calibration involves a lot of pre planning. According to (Kemp, 1995) project portfolio management process requires synchronized delivery. Despite this success costs have to be reviewed upward at every phase because material costs and labor costs would rise with marked volatility. Cost overruns might preclude information flow from the biased and prejudiced project portfolio managers. As a result private projects have a greater capacity to accommodate cost overruns while public projects might not have this advantage. Overall the increasing requirements for extra resources have to be met with additional provisions. In addition to this there is also the need for an environmental impact assessment. An Environmental Impact Assessment (EIA) is undertaken in order to evaluate the impact of the project on the immediate environment. The management team should identify the endogenous environmental factors before the project is to be executed at project premises. That would be chosen on the principle of creating positive outcomes to employees, customers and other related stakeholders. The prototype experimentation would be successfully avoiding cost overruns in the implementation phase and as a result testing of equipment after the installation would be very successful. 3. Research Methodology The methodology chapter of this study consists of primary and secondary research segments. The primary research segment consists of a survey to be administered to 10 interviewees and a questionnaire to be handed out to 30 odd participants/respondents involved in project portfolio management related policy design and implementation at management consultancies. The secondary research segment would consist of both internet based research and library centric research. A considerable amount of diverse literature on the subject of project programme and portfolio management would be studied and analyzed in order to arrive at the conclusions. Similarly there will be a considerable amount of effort to identify the path of the literature growth trajectory so that project management related learning outcomes – correlations, regressions, variances and co-variances – would be delineated in a systemic manner to adequately address the implications tentatively referred to in the research problem/questions. The primary research material will be analyzed to produce supporting evidence. 4. Recommendations • New research efforts on the subject should strategically focus on project portfolio programme related reorientation including managing diverse portfolio tasks based on constant positive returns on investments. • The Project management teams should also consider introducing structural changes to the organizational and management structures. For example the existing vertical organizational and management hierarchy must be converted in to a horizontal department level hierarchy so that both the resource planning allocation processes in the entire portfolio would be executed with much greater efficiency. Conclusion In the process of carrying out project portfolio management and related programmes managers should concentrate on managing the entire portfolio with a degree of flexibility and knowledge of complex processes and tasks involved. The existing literature on the subject does not provide a conclusive convergence on the various variables that directly impact on the outcomes. However there are some good efforts by some researchers on the subject to identify and treat the subject with good outcomes such as those related to building a policy design and model building. strategic management practices have increasingly been sought to be aligned with a number of organizational objectives including market share growth and positive HRM and other practices. However the extent to which such objectives can be achieved through proper strategic management programs and project management processes depends on a number of other factors. References 1. Andrews, K 1994, Concepts of Corporate Strategy, 3rd edn, McGraw-Hill/Irwin, Ohio. › Visit Amazon's Hugh Macmillan Page Find all the books, read about the author, and more. See search results for this author Are you an author? Learn about Author Central 2. Bradford and Duncan 2000, Simplified Strategic Planning, Chandler House, London. 3. Bodley-Scott, S & Brache, A 2005, Implementation: How to Transform Strategic Initiatives into Blockbuster Results, McGraw-Hill, New York. 4. Chia, R 2004, ‘Strategy-as-practice: reflections on the research agenda’, European Management Review, vol.1, pp.29–34 5. Dougherty, D 2004, ‘Organizing practices in services: Capturing practice based Knowledge for innovation’, Strategic Organizations, vol.2, no.1, pp.35-64. 6. Dunford, R & Jones, D 2000, ‘Narrative in strategic change’, Human Relations, vol. 53, no.9, pp.1207-1226. 7. Hendry, J 2000, ‘Strategic Decision Making, Discourse, and Strategy as Social Practice’, Journal of Management Studies, vol.37, no.7, pp.955-977. 8. Mintzberg, H, Ahlstrand, B, & Lampel, J, 1998, Strategy Safari: A Guided Tour Through the Wilds of Strategic Management, The Free Press, New York. 9. Reay, T & Golden-Biddle, K & GermAnn, K 2006, ‘Legitimizing a new role: Small wins and micro processes of change,’ Academy of Management Journal, vol.49, pp. 977–998. 10. Kemp, RL 1995, Handbook of Strategic Planning, Cummings & Hathaway, New York. 11. Tampoe, M 2001, Strategic Management: Process, Content, and Implementation, Oxford University Press, Oxford. 12. Fletcher, A, et al. 2003, ‘Mapping stakeholder perceptions for a third sector organization’, Journal of Intellectual Capital, vol. 4, no. 4, pp. 505 – 527. Read More