CHAPTER 3

Case Study: How a Business Group in a Global Financial Services Company Moves Strategy into Projects

The group is part of a large, complex company with operations in a number of countries and continents. The process of moving strategy from the corporate to program and project level within it is very involved. A business enterprise model or an equivalent does not appear to be used and the way the group's business management processes interconnect with the global project management processes is not visible to the same level of detail as that used in the global project management process. The stages and processes used by the group to translate corporate strategy into project strategy for major (strategic) programs and projects and to manage this through the project lifecycle are outlined in Figure 3.1.

Moving Corporate Strategy and Business Strategy

Business units within the group develop business plans annually, as indicated in Figure 3.2. Business strategy is derived from corporate strategy and the group investment plan using a strategy development process. Business units also develop strategy plans and align business strategy to the corporate vision, mission, strategies, and objectives using the same process, and identify the strategic programs and projects to be pursued to achieve the objectives of the business unit.

The company defines a program simply as a natural grouping of projects and uses the basic structure as shown in Figure 3.3.

The global project management process, used to manage programs and projects, is outlined in Figure 3.4 and comprises the following stages:

• Define operational vision
• Plan solution
• Mobilize program
• Manage program execution
• Close out program.

Define Operational Vision: Moving Business Strategy to Project Strategy

A strategic program or project that is contained in the business unit strategy plan—and authorized to proceed—is managed in accordance with the global project management process. Figure 3.2 shows that the business unit's (organization's) direction (i.e., its vision, mission, strategies, and objectives) are confirmed, endorsed, and authorized by management. During this process, the program or project's vision, strategies, objective, and critical success factors are defined and aligned with the organization's direction; a letter-of-intent is developed to document these.

Figure 3.5 shows the process in more detail. It indicates how business strategy is translated into program or project strategy and when the two strategies are aligned. The objectives and timetable for the project are determined during the project engagement process, as are the project's benefits and indicative costs. The direction of the business unit is confirmed and documented as a hierarchy of directions and includes vision, strategies, and objectives. These are used to drive the program's operational direction, which defines the vision, strategies, and objectives of the program or project. The alignment of the business direction with the program's operational direction is then checked and confirmed. If it is not confirmed, then the program vision may need to be changed. The output of this process is a program operational direction that is consistent with the business direction. The availability of resources determines if and when the program can proceed; the program is prioritized accordingly. The approach for delivering the vision and the letter-of-intent is decided, and a project management plan is created for undertaking the plan solution stage of the program. The letter-of-intent (reflecting the program operational direction) is compiled and is effectively a proposal for funding the plan solution stage of the program and the development of a business case for it.

Plan solution: Moving business strategy into programs and projects

Once a letter-of-intent is approved (which reflects the strategy for the program or project), a business case for the project is developed using the plan solution stage of the project management process, as outlined in Figure 3.6. The business case is the key deliverable of the stage. Developing a business case, in many companies, is one of the most critical activities leading to the approval of a project. How well a potential project fits with the strategy of the business is a critical factor in determining its selection. How the business case is assembled, and the degree to which it reflects business strategy, usually influences the outcome of the approval process.

Figure 3.6 shows that the business case process involves some of the key activities associated with project strategy management identified in the literature review, such as project requirements, scope management and scope definition, and the development of associated plans and documents, including the following:

• Definition management plan;
• Initial project briefs;
• Project scope management plan;
• Project requirements and deliverables;
• Project WBS.

The process also confirms the program or project's operational vision, including strategy, and uses it to drive the scope planning and definition, and develop a WBS for the project.

The business case document contains, among other things:

• The program operational vision;
• The relationship with the business strategy plan;
• Program/project organization structure;
• Risk and resource plans;
• Delivery plan;
• Project briefs;
• WBS.

In summary, the plan solution stage develops the program or project operational vision into an integrated and complete program or project and presents it as a business case. The business case is then subject to an approval process.

Mobilize Program: Moving Strategy Within Programs and Projects

Upon approval of the business case, the project is prepared for execution using the mobilize program process outlined in Figure 3.7. This process takes the results of the previous planning processes, particularly the confirmed operational vision and business case—containing the business strategy and project strategy—and incorporates them into the project management plan. This practice is similar to that described in the PMBOK® Guide (Project Management Institute 2000), but differs from the latter in that there does not appear to be a requirement to provide a description of the project management approach or strategy in the form of a summary of the individual management plans.

Project strategy as a term and activity is not mentioned in the project management process from this point onward. However, the way in which the project is to be managed—in other words, the project strategy—is covered in detail in the following sections of the project management plan:

• Project objectives
• Project schedule
• Project budget
• Resource plan
• Risk management plan
• A complete set of project briefs.

The program or project business case is also maintained during the mobilize program process to ensure that it is accurate and up-to-date and that a process is in place to ensure that changes are properly controlled. For example, changes to the project scope that arise while developing or updating the project management plan could impact the business strategy and the project strategy—as defined in the operational vision—during the define operational vision and plan solution stages. Managing project strategy through the business case in this way is effectively a closed-loop process and extends to the close of the project (see Figure 3.4).

One example of how strategy may change during this stage is when unforeseen problems arise, threatening the operational deployment (release) of the new capability being delivered, and consequently necessitating a change in release strategy. Figure 3.8 shows that the project management process provides this capability; changes affecting or involving release strategy are incorporated in an update to the project management plan and then in an update to the release management plan. Changes affecting the project scope and the business case during the manage program execution stage are controlled using the same process shown in Figure 3.7.

A number of key project management activities or practices are used in managing the execution of a program or project. These are as follows (and as shown in Figure 3.2):

• Managing time;
• Managing costs;
• Human resource management;
• Managing risks;
• Managing procurement;
• Managing quality;
• Communications management.

Adding to this list Project Scope Management (undertaken during the plan solution stage) and Project Integration Management (carried out during the mobilize program stage) shows that the global project management practices reflect all nine of the project management Knowledge Areas (Project Management Institute 2000); however, none of these practices explicitly deal with project strategy.

Close Out Program

At the close of a program or project, a review of the baseline and most recent versions of the operational vision, management plans, and business case is undertaken and the findings are documented in a lessons learned report of the program or project. The effectiveness of the program or project strategy to achieve the objectives of the program is an important element of the review. A program close report is also put together, in which the business case is validated to confirm the extent to which the expected benefits are being delivered and is likely to cover strategy.

Roles, Responsibilities, Accountabilities, and Competencies for Moving Strategy

The roles, responsibilities, and accountabilities for the tasks and deliverables identified in the project management process are described extensively throughout the process documentation. Those required for the activities involved—moving business strategy into programs and projects and managing project strategy (as summarized in the preceding figures)—are also clearly specified. A family of job descriptions is also used to define the roles, responsibilities, knowledge, skills, experience, and competencies for project management staff within the group.

The role and purpose of a global program director are expressed in terms of leading and coordinating the resources required to implement a strategic change program for the organization. This involves, among other things, using project management disciplines, ensuring that initiatives are aligned to organizational strategy and values and that the operational vision is delivered on behalf of the sponsor. A program normally involves multiple projects and working across lines of business and function. The emphasis on leading and coordinating resources to implement strategic change in the job description endorses the point made in the literature review, namely that it is a fundamental responsibility of project management to effectively manage and/or coordinate whatever company resources are at its disposal, using well-structured project management processes, practices, and methods, as well as professional project management staff.

A global program director's responsibilities include the following strategy-related areas:

• Global strategic direction of the program and its alignment with the business unit's vision, direction, and priorities;
• Business case management;
• Release management of change program operational implementation;
• Definition management - aligning the solution to the business unit vision and ensuring the solution remains aligned;
• Management of the implementation of the solution and its scope, resource, and schedule requirements;
• Development of program plans to reflect all progress, change, and problematic issues.

To effectively discharge these responsibilities, a global program director typically possesses the following knowledge, skills, and experience:

• Business and commercial management
• Task management
• Planning and organization
• Project management
• Time management
• People/relationship management, including leadership.

The behavioral competencies for the role-holder, relevant to program and project strategy, are as follows:

• Strategic thinking
• Conceptual thinking
• Innovativeness
• Analytical thinking.

The knowledge, skills, behavioral competencies, and experience required for project managers in the company fall into similar categories as those for a global program director, but the levels of each are within the context of a project and not a program; accordingly, they are at a commensurately lower level.

Conclusions

Programs are important vehicles for implementing corporate strategy and for implementing change within the group; programs are also seen as delivering business benefits. There is a clear process path to move corporate strategy through business unit strategy and into program and project strategy. But the management of program and project strategy is through an unexpected route. The front end of the project management process translates business strategy into program and/or project strategy and confirms the alignment of the two. From that point, however, when the scope of the project is planned and defined, project strategy is no longer mentioned in the project management plan, even though the business case for the project—which contains the operational vision and strategy for the project—could be included in it. Integrating project strategy management throughout the project management process, and not just at the front end or in the business case, and making it a core project management practice, would in all probability improve the performance of the project team and the outcome of the project.

The strategy for the project is managed and maintained through the operational vision within the business case and is in force until the close of the project. But the business case approach and process is sometimes perceived within the group as too bureaucratic and cumbersome; it is, therefore, not liked. This may adversely affect the management of project strategy and hinder the take-up of some projects. The global project management process is extensive and very detailed, and it is available on the company's Intranet. But for some, it may be too complicated and difficult to understand and use; it may, therefore, not be widely accepted within the group.

The range of practices used in the project management process does not include more recent (and relevant) practices such as portfolio management, value management, or knowledge management.

The roles, responsibilities, and competencies for managing program and project strategy are prominent within the project management process and within the family of job descriptions; there is a high degree of correlation between the two. Expressing the role and purpose of a global program director and project manager (in terms of leading and coordinating the resources required to implement a strategic change program for the organization) is an excellent way of describing the role of program management staff and powerfully demonstrates the role of project management within the group—and to the world at large.