Transformation of Corporate Strategy into Project Strategy - Literature review Example

Transformation of Corporate Strategy into Programme/Project strategy al Affiliation Transformation of Corporate Strategy into Programme/Project strategy Introduction The formulation and implementation of corporate strategies is among the most talked about and researched issues in businesses management. Cooperate strategies are normally created to enable organizations be able to articulate their corporate goals and objectives. These strategies usually form part of the strategic business goals and are geared towards the attainment of the visions and goals of that particular business. This only happens when the plans are well formulated and implemented. Various vehicles and channels are used to help transform the corporate strategies into project ones to enable the organizations to achieve its strategic initiatives. The choice of the approach or channel that is used in the achievement of these initiatives varies from one organization to another. It is also influenced by the environment in which a particular business is operating in. Translating or transforming corporate strategies into project/ program strategies involves the use of highly structured management models (Artto, Lehtonen & Saranen, 2001). These structured models and processes are meant to facilitate and aid the identification the major value delivery processes as well as the main and vitals businesses processes that help the organization to operate effectively. The translation and transformation of corporate strategies into project strategies can be a complex process that entails interrelated decisions, which directly and indirectly affects the key activities of the organization or business. Portfolio management, program management, competence and training management are the four key approaches that are used by organizations to make this change. Portfolio Management Approach Portfolio management is one of the key approaches used to change strategies from corporate to project. Hill & Jones (2001) say that project portfolio management should not be confused with the primary management of new acquisitions. The use of portfolio management transforming corporate strategies into project strategies entails portfolio planning. This is meant to help manage a group of brands or products. Project portfolio management involves aligning the resource demands of a project and the available resources. The goal of this is to help in achieving a given set of strategic goals that are attached to the corporate strategies of a particular organization. When it comes to making the transformation of strategies through portfolio management, the main concern is choosing the right project rather than doing the doing the project right. According to the Project Management Institute (2013), the leap that companies take from tool and technique centered project management to portfolio management is a major challenge faced. This is in terms of the standards, the best available practices and the generally accepted knowledge that guide the process. When using portfolio management as an approach for the change, a generic portfolio management program consisting of three stages is normally used. The first stage in this approach is the solicitation stage.This is meant to ensure that the portfolio program or project is evaluated as a critical strategy. In addition, the stage involves ensuring that it is in line with the organization’s corporate objectives and strategies. During this phase, a business case for that particular project that is made up of the details of the project is usually produced as an output of the tender process. Project Management Institute (2013) indicates stat in the portfolio management approach, the evaluation of the relative value of a particular project is done at the solicitation phase. The next stage in the generic portfolio management program is the prioritization stage. This occurs only after the project has been selected. Snowden & Cabinet Office (2011) state that a scoring system is usually used at this stage to know the project that is to be given a priority to ensure that the corporate strategies of the business are directly translated into the project strategies. Prioritization of a particular project is done against or with respect to other projects (APM Programme Management Specific Interest Group, 2013). The final processes or stage in the portfolio management is the allocation of the resources. The allocation process depends on the availability of the resources. When the resources are available, it is allocated to that particular project to allow it to proceed. The framework that is used in translating corporate strategies to project strategies needs to be set at the corporate level. It is from here that it is filtered down to the project level. Portfolio management is a channel through which the overall transformation of corporate strategies is done. It supports the implementation of the chosen corporate strategies at the project level in order to help achieve the set goals and objectives. Portfolio management is an endeavor meant to deal with uncertainties that surround the achievements of the goals of the business. According to Reiss & Raynor (2012), project portfolio management gives an avenue through which an organization can constantly, consistently and objectively evaluate proposed projects. This in turn helps in ensuring that the proposed projects are aligned to the limited pool of resources, thus, translating the corporate strategies and goals into project strategies. This consistent and objective evaluation also helps in the process of making the effective use of the available resources in a way that ensures that the corporate and the project goals of the organization are achieved. Portfolio management is an approach that is suitable for both small and large businesses. This is especially the cases when an organization or business deals with both internal and external client projects. Program Management Approach The program management approach of translating corporate strategies into project strategies is a discipline and practice that is quickly gaining popularity. This is witnessed and shown by the fact that most of the organizations are resorting to the use of program management to be able to transform the corporate goals and strategies into project goals and strategies to ensure that the objectives of the organization or business are achieved (Turner 2009). The approach is a fundamental avenue or method that helps in ensuring that a business is able to get maximum benefit from the integration of the various project management activities. It is characterized by a more iterative method as opposed to a one shot method. Moreover, this approach involves the strategic reflection on the corporate and the project goals that the organization intends to achieve. According to Knutson (2001), organizations easily transform their corporate strategies to project strategies by learning from the projects that it has implemented and delivered. Program management approach involves managing interrelated projects. This entails configuring the related projects into a program that facilitates the achievement of strategic objectives of the organization. The management approach is used in large organizations to facilitate the implementation of strategic initiatives that an organization is involved in. In the approach, the program management tends to transcend that of other related projects.This facilitates the handling of uncertainties and ambiguities. Thiry (2010) notes that the main benefit of the program management approach in the transformation of corporate goals and strategies into project goals and strategies is the alignment between the strategies and the project in question. The management method is made up of four major stages. The first stage in the approach is the identification stage, where the program is first identified, defined, and the established. It is the initial stage of the approach; hence, it needs to be done with a lot of care so that the approach is aligned to the project and the corporate goals of the organization. The second stage of the program management approach is the management of the program that has been identified, defined and established. The third stage is the delivery of the benefits where the key benefits that are associated with the program are aligned with the corporate goals and strategies. The final stage of the approach is the closing of that particular program (Archer & Ghasemzadeh, 2009). The environment of the program management technique is one where the programs emanate from the corporate strategies, business strategies and initiatives. There is an iterative hierarchy of the programs, the project itself and the businesses operations that cascade from the programs. In this approach, the objectives and strategies of the program in question are created and then aligned with the objectives and the key strategies of the organization or enterprise. Archer & Ghasemzadeh (2009) is of the view that program management is an approach that helps manage and coordinate projects that have shared objectives and aims. It also deals with the delays in the projects. In this approach, programs created to be used may include products, brands and platforms. These are managed in order to deliver business value to the company and thereby helping achieve the corporate goals and objectives. About 70 percent of large organizations use program management approach to transforming corporate strategies into project strategies (Turner, 1999).This is used to implement changes in the organization. Some companies tend to prefer using a single, fully integrated program management process to implement the intended transformation. This approach has been heavily used in aerospace and financial industries. In the aerospace industry, program management is positioned primarily as a way of managing a number of similar projects. On the other hand, in the financial sector, the method focuses on the management of several interlinked projects in order to achieve business benefits. According to Turner (1999), program management is usually done using a set of common processes referred to as integrated program management. The development of the program strategies and aligning them to the corporate goals and objectives is, therefore, done at the beginning of the project. Competence and Training Management Approach Another common approach that is used in changing the corporate goals and strategies into project strategies is through competence management and training management. Transforming the corporate strategies into project strategies requires long-term and major changes in the competence of the members of an organization or business (Turner, 1999). Transformation of the strategies to project strategies also require the availability of a very competent staff that has clear definition and understanding of their roles, duties, responsibilities and accountabilities. This is why the competence and training management approach continues to be used to translate the corporate responsibilities into project responsibilities. Competence is viewed to be role specific. This approach has a framework that defines the skill requirements of the vital jobs in the organization that are related to a particular project, program or portfolios. The roles and the accountabilities that are defined in competence management approach are prescriptive and tend to describe the functions as well as tasks that are to be performed by individual members and teams. They also describe what the incumbent individuals and teams will be held accountable for in relation to the project and the attainment of the corporate objectives and goals of the organization or business (Artto, Lehtonen & Saranen, 2001). This may involve the definition of the roles, the responsibilities, experience, knowledge and skills of the project management teams. When using competence management approach to help in changing corporate strategies into project strategies, the organization extensively specifies the roles and the responsibilities for the various members of the project management team. This is done within the lifecycle of that particular project. Ref indicates that the companies that try to use this kind of approach to translate its corporate strategies into project strategies focus on incorporating the roles as well as the responsibilities within the business itself and within the programs and project management processes. In some cases, the competencies that are associated with a particular project are linked to specific generic management processes and the key and vital processes in the project. Competence management approach is usually intended to serve several functions. The approach acts as the primary point of contact between the customers and those that are responsible and accountable for the project (Snowden & Cabinet Office, 2011). The second function is that it helps in delivering the committed business case and giving the organization the necessity information that is not only used in managing the business but also in aligning and transforming the corporate strategies and the project goals. Competence and training management approach is also intended to help in establishing and developing WBS and all the other work related packages that are necessary for developing and delivering specific programs. Finally, this approach helps in the development of program budgets and reviewing of the progress of the project against the plans. This is intended to help in identifying the corrective actions that need to be taken so that the corporate objectives are achieved in the project. It agrees on and initiates the required program changes as well as reallocation of resources depending on the needs and the requirements of a particular project. Competence and training management addresses two major phases in a business. The first phase is the envision and engage phase where the company‘s needs and objectives are specified with respect to the project that is in question (Snowden & Cabinet Office, 2011). The second phase is the engagement, transformation and optimization phases. In this phase, training measures are normally identified and the gaps that exist noted. This is meant to facilitate learning transfer and help fill these identified gaps. Comparing and Contrasting the Three Approaches Program management, portfolio management and competence and training management are the three common approaches that are commonly used in transforming corporate strategies into project strategies today. Each of these three processes has its specific characteristics that differentiate them from each other (Knutson, 2001). Program management approach is characterized by focus on managing projects that are related and are associated with common business benefits. This therefore means that the related projects aligned with the corporate goals and objectives of the company to form programs. This strategy is, therefore, suited for large organizations that want to implement strategic initiatives and projects. On the other hand, portfolio management approach focuses on the portfolio planning. It entails managing of different portfolios such as brands and products. It is in this case suitable for use in both small and large organizations especially in cases where there is a limited pool of resources. This approach is focused on prioritizing the projects through grading systems to help identify the one that should be given the resource first. The final approach is the competence and training management approach. This approach focuses on the roles, responsibilities and accountabilities of the teams involved in the projects. This approach is thus suitable for use in various organizations both small as large. Despite the differences that exist among the three approaches, there are some clear similarities that also exist in the three approaches. Program and portfolio management approaches use a similar set of common processes in an integrated program to facilitate the transformation of the corporate goals into project goals. The other similarity is that the three approaches are process oriented, and they try to align the corporate goals and the objectives of the project objectives (Knutson, 2001). The other similarity is that there is usually a high level of interconnectedness between the corporate goals and methods. This is in addition to the hierarchy of objectives and strategies at the various levels and stages of the three methods of transforming corporate strategies to project strategies. References List Archer, N. P., & Ghasemzadeh, F 2009, ‘An integrated framework for project portfolio selection’, International Journal of Project Management, vol. 17, pp.207–216. Artto, K.A., Lehtonen, J. & Saranen, J 2001, ‘Managing projects front-end: Incorporating a strategic early review to project management with simulation’, International Journal of Project Management, vol. 19, no. 5, pp. 255–264. APM Programme Management Specific Interest Group 2013, Introduction to programme management. Association for Project Management, London. Hill, C. W. L., & Jones, G.R 2001, Strategic management: An integrated approach, 5th ed. Houghton Mifflin Co, Boston. Knutson, J. 2001, Succeeding in project-driven organizations: People, processes, and politics. John Wiley & Sons, Inc, New York. Project Management Institute 2013, The standard for programme management, 3rd edition. Project Management Institute, London. Snowden, R. & Cabinet Office 2011, Managing successful programmes, 4th ed. Stationery Office, London. Reiss, G. & Raynor, P 2012, Portfolio and programme management demystified: Managing multiple projects successfully, Routledge; New York. Thiry, M. 2010, Programme management, Gower Publishing Ltd, London. Turner, J. R. 2009, The handbook of project-based management: Improving the process for achieving strategic objectives, 2nd ed. McGraw-Hill, Maidenhead. Read More