Gl-Chapter2-Strategic Planning

7/13/2010

Project Management

Organization Strategy and Project Selection

Haeryip Sihombing

Universiti Teknikal Malaysia Melaka (UTeM)

BMFP 4542

2

Why Project Managers Need to Understand the Strategic Management Process

• Changes in the organization’s mission and strategy

–Project managers must respond to changes with appropriate decisions about future projects and adjustments to current projects. –Project managers who understand their organization’s strategy can become effective advocates of projects aligned with the firm’s mission.

The Strategic Management Process: An Overview

• Strategic Management

–Provides the theme and focus of the future direction for the firm.

• Responding to changes in the external environment— environmental scanning • Allocating scarce resources of the firm to improve its competitive position—internal responses to new action programs

–Requires strong links among mission, goals, objectives, strategy, and implementation.

Strategic Management Process (cont’d)

• Four of Activities of the Strategic Management Process

1. Review and define the organizational mission. 2. Set long-range goals and objectives. 3. Analyze and formulate strategies to reach objectives. 4. Implement strategies through projects

Strategic Management Process

HAERYIP SIHOMBING

1

7/13/2010

Characteristics of Objectives

S M A R T

Specific Be specific in targeting an objective

Project Portfolio Management Problems

• The Implementation Gap

–The lack of understanding and consensus on strategy among top management and middle-level (functional) managers who independently implement the strategy.

Measurable

Establish a measurable indicator(s) of progress

Assignable

Make the objective assignable to one person for completion State what can realistically be done with available resources

• Organization Politics

–Project selection is based on the persuasiveness and power of people advocating the projects.

Realistic...