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project-managers-strategizing-and-brainstorming
Nicky ClarkeNovember 21 20225 min read

How to align your projects to strategic goals

Blog post series
Do the right thing - Blog #4

If we're NOT doing the right projects, how can we change that and what’s the impact of doing the wrong projects?

What does doing the wrong project cost a company?

“Organizations lose $109 million for every $1 billion invested in projects and programs.”

  • Money lost

The PMI study shows that on average organizations waste 9.9% of every dollar due to poor project performance, and that around one in three projects (31%) do not meet their goals, 43% are not completed within budget, and nearly half (48%) are not completed on time. 

Alarmingly, executive leaders may be out of touch with this reality, as 85% surveyed said they  believe their organizations are effective in delivering projects to achieve strategic results. These factors are leading to colossal financial losses for businesses around the world, with a significant broader macro-economic impact.

  • It's distracting

Pursuing opportunities that do not prove successful not only drains resources but distracts from working on those projects that will be winners - the reason for doing projects in the first place. If we knew for certain that our projects were guaranteed to be successful, the level of motivation and cooperation from everyone involved would sky-rocket. There is no greater feeling than knowing you're working on something associated with ensured success.

  • Frustrated employees

Linked to the point above, if your team are unmotivated and constantly working on doomed projects, or frustrated with manual mundane tasks, then you stand the risk of losing them. Intelligent project management is needed more than ever. Repetitive tasks are eating our productivity alive.

54% of workers spend 5 hours a week on uncreative tasks.

  • Bad reputation

One of the irreparable consequences of poor project management is a bad reputation in the organization and in the market. If there is a project manager failing several projects because of poor project management implications, their reputation in the organization will hamper over time. Similarly, an organization creating bad results will have a hard time acquiring new clients or projects.

  • Sustainability risk

An organization with several failing projects cannot survive long. Organizations initiate projects to create products, have advancement in the market, and make a profit. Failing projects will cause a monetary loss for the organization and may even cause bankruptcy in the long-term.

  • It lowers the success rate

Estimates of project failure rates vary, but not one of them is encouraging. Probably the most discouraging estimates come from Gartner Group, which claims that over 70% of network management projects fail to meet their original objectives. Regardless of the specific reason, the failures are consistently attributed to the early project phases.

 

Strategic alignment is critical for project success

 

Infographic - Link between project success and strategic alignment

 

What is strategic alignment?

Strategic alignment is the process of aligning an organization’s decisions and actions such that they support the achievement of strategic goals.

According to research from the Economist Intelligence Unit (sponsored by the Brightline Initiative):

Strategic alignment is the not-so-secret weapon that the top 10% use to make sure they do hit their goals.

Strategic alignment is a measure of how well your project supports the strategic goals of your organization. Strategic alignment often means different things to different stakeholders within your business, and this is what makes it seem difficult to deliver.

How does strategic alignment help?

You have to use strategic alignment to make business decisions, maintain focus and support your projects.

  • Project prioritization and selection

If you have a clear picture of the strategic alignment to your live and potential projects, you make the project prioritization and selection process much easier. Basically, you give leadership and stakeholders the information they need to make better, more balanced decisions and reduces the temptation to take on too many projects.

  • Resource allocation and scheduling

When you have a clear picture of which projects add the most value, you can make better and quicker resource allocation decisions. If you have to choose between a project that’s well-aligned and one that’s not... easy! This makes resource planning easier too.

  • Portfolio health checks

Use your strategic alignment scores for each project, along with project risk and performance data, to actively manage your portfolio towards success. Regularly diagnosing the health of an investment portfolio ensures the most important projects are being supported and that they deliver their investment.

SharpCloud Benefits Realization Dashboard

 

  • Ensure C-level engagement

Having a C-level sponsor is a key requirement for success, but the first step is to motivate them to get involved in the first place. That’s where strategic alignment helps. If you start every conversation with a reminder of the strategic benefit of this project, and if the project really IS important (which it is if it’s well-aligned), then motivation will not be your problem.

The sponsor garners support from other senior executives, and provides ongoing direction as the effort unfolds.

  • Better benefits realization

If you’ve measured a project’s strategic alignment, you can use that information to drive the project execution. Start with the strategic goals you’re trying to achieve then work backwards through what needs to happen to get there, what your key decision points are, what resources you need…this refocusing on the goals delivers a much more coherent project plan and allows team-members to make better decisions because everything is focused on benefit, not on features.

Case Study - Rhianna Warden - Network Rail

  • Improving scope management

And if everything is focused on benefit and not on features, that improves scope creep management. You can use your “strategic goals” to evaluate the value of and change requests. Change requests that don’t improve the ability to achieve your goals should be deprioritized. Those that support the strategic intent of the project should be emphasized.

  • Delivering Change Management

This is the ability to actually implement organizational change, so you realize the benefit of the project. Being clear and transparent about the strategic goals of your project lets you engage with stakeholders, to get them involved in the change management process.

Read more here on how to achieve strategic alignment

 

Top down bottom up approach

Silo thinking is one of the greatest stumbling blocks for strategic alignment. Free flow of real-time information both horizontally between teams and departments and vertically from top management all the way to front line employees and vice versa is key.

Outdated spreadsheets, documents and slide decks, and constant searching for the latest information will only limit alignment between departments. Strategy software can help to facilitate efficient communication within the organization. 

Be more agile

A company of the future is one that understands the changing dynamics between the company, its employees and customers and can deal with constant change by creating flexible, agile and decentralized environments that can execute autonomously, yet are working to achieve a shared, clear vision.

If done correctly, strategic alignment is a business investment that can positively influence organizational alignment; improving efficiency, effectiveness, and profitability.

 

Hot to do the right thing and pick the right projects

Next blog, we look at how to pick the right projects.

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