Translating business strategy to action allows the Board to determine the extent to which the project portfolio delivers the organisation’s strategy.
Just as with organisational strategy, circumstances will coerce the deliberate organisational strategy for change into an emergent strategy – the organisational strategy for change must accommodate such flexibility too and is therefore likely to be updated in ‘real-time’.
The evidence set out in a series of Standish Reports clearly shows the incidence of low level s of satisfaction amongst senior management with the alignment and contribution made by projects to the strategy of the company remains a major concern. Very often senior executives complain that they are unsighted by the project portfolio processes being used.
An initial mapping is made between the declared strategy and the project portfolios under management to determine risk-adjusted expenditure and risk-adjusted outturns and outcomes. This process, called ‘brigading up’, groups current expenditures into sets that allows the emergent strategy to be described.
The agreed strategy is decomposed into strategic threads, and the specific foci for management attention are subjected to value management disciplines. The tacit, as well as the explicit, prioritisation practices are discovered and the consequences of the choices made clear in terms of risk-adjusted value returned.
The Board then has a model that reflects the actual alignment of the project portfolios with the strategy, which can be used to do scenario analysis – and to confirm or alter the operational imperatives of the emergent strategy.
Where the portfolio contains tens of projects the option analysis often proves very complex. To reduce this to manageable proportions, tool-based decision-support approaches are deployed: cross-linking dependent projects to prevent infeasible choices, and reducing the offered choices to a range of near-optimum selections based on published criteria.
This clarity identifies the best use of available resources, rather maximum use of resources, and a clear trajectory to the consequences of changing the composition of the portfolio as business imperatives change.
Most organisations find it helpful to call CITI in when it is trying to monetise its vision – or to identify and quantify the benefits. Very often we find that the way the vision has been constructed is blocking the analysis: this may be due to the vision being substituted by a solution or because the separation between the customer value proposition and the business value proposition is incomplete.
CITI’s approach which uses a set of tools to analyse and tease apart related strategic focus areas and our ruthless focus on value has helped many organisations develop stronger commitment and better alignment of its project portfolio. We often have the opportunity to observe, “Show us your portfolio and we will show your strategy.”.
As one of clients said afterwards, ‘For once, it’s tell us your strategy and we’ll select the right portfolio…’
Our approach to business case studies would typically involve the use of the following tools and models: