Now that we’re firmly in the New Year, strategic goals and objectives are set for 2022. Departments within the company are now working on projects and initiatives to help the company achieve these goals.
Getting to this point is an accomplishment in its own right, but this is also where many strategic goals meet their demise.
There may have been careful planning during the strategy setting phase back in the late summer and fall where risks, opportunities and even the chances of success for a particular goal were flushed out.
But what about projects and initiatives for reaching the goal the goal?
Many mistakenly believe that project management handles this dilemma, but this just isn’t true…
The official definition of project management from the Association of Project Management can provide clues for understanding this. It defines project management as [emphasis added]:
…the application of processes, methods, skills, knowledge, and experience to achieve specific project objectives according to the project acceptance criteria within agreed parameters. Project management has final deliverables that are constrained to a finite timescale and budget.”
Notice this definition is very silo-focused by referring to only one project.
Most managers are going to do a great job of understanding risks and opportunities to projects within their silo.
However, as my traditional risk management and ERM comparison article explains, focusing on a particular silo rather than taking a birds eye view can create risks in other areas, leading to wasted time, resources, and frustration. This same concept most certainly applies to strategic projects and initiatives.
To avoid or minimize this issue with strategic initiatives and increase the chances of successfully accomplishing goals, the company must take an enterprise or “portfolio” approach to managing its projects. By contrast, the Association of Project Management defines portfolio management as (emphasis added):
…the selection, prioritization, and control of an organization’s programmes and projects in line with its strategic objectives and capacity to deliver. The goal is to balance the implementation of change initiatives and the maintenance of business-as-usual, while optimizing return on investment.”
Wow – what a difference!
One of the central themes of the definition of “portfolio” management is to the idea of merging the strategic projects or initiatives into the day-to-day operations of the company.
In other words, you need to know – Are your people adequately prepared to handle both?
Getting started with a portfolio approach to strategic projects is not rocket science.
Fortunately, moving from the silo-based project management approach to an enterprise “portfolio” approach doesn’t require a lot of specialized skills.
A portfolio dashboard is one such tool you can develop to gain this birds-eye view of your company’s strategic projects…you can even start with a small number of your most significant projects, like 5.
This dashboard can be set up to include information on external stakeholders, specific roles and responsibilities, departments that need to be involved, and of course, due dates or targets.
With the portfolio dashboard in hand, decision-makers may learn that four of the five initiatives will impact a specific stakeholder, so special care will be needed to ensure clear communications at deliberate times. Or they may learn that one department has a role to play in three of the projects, so steps will need to be taken to ensure they have the resources they need to merge the project in with their day-to-day responsibilities.
A RACI chart is another tool companies can use to understand roles and responsibilities and set clear expectations for an individual project.
Using this breakdown will allow for better planning as you and decision-makers will easily be able to see where someone is approaching overwhelm or when resources will be strained. All for the purpose of being proactive!
The portfolio dashboard and RACI charts are a great way to get started with a comprehensive view of your company’s projects and initiatives. However, as your comfort level grows, so do your options for understanding risks and opportunities to successfully completing projects and achieving strategic goals. Monte Carlo simulation, modeling, and GANTT charts are just a few examples of these more advanced tools.
Keep in mind – these efforts are not about minimizing harm or preventing failure but about ensuring the company is successful in its endeavors. As we’ve discussed elsewhere, this is ultimately what a risk manager’s job is all about.
You’ve helped executives and other decision-makers understand risks and opportunities to the goals themselves. Don’t let them and departments in your company drop the ball on the 1-yard line with the projects and initiatives aimed at accomplishing these goals.
Does your company take a portfolio view of projects? Or do you analyze them one-by-one?
This topic is especially relevant right now as you’re likely in the midst of projects for this year’s strategic goals. To share your questions, thoughts or experiences, please don’t hesitate to leave a comment below or join the conversation on LinkedIn.
If you would like to comment privately, you can email me directly at firstname.lastname@example.org.
Lastly, if your company is struggling to meet strategic goals and could use an outside perspective to understand and address the problem, please contact me to discuss your specific situation today.