Another project failure? Time to align projects to strategy

Alright, let’s make this quick - I know this hurts. As a profession we still fail far too often. Project failure is a major source of waste and frustration in most organizations. Here are a few interesting nuggets of information:

• In Wellingtone’s 2017 UK survey, only 37% of responding organisations reported mostly or always completing projects on time. ¹
• In PMI’s 2017 research, a lack of clearly defined objectives and milestones was the most frequently identified factor behind failed strategic initiatives (37%). ²

But before diagnosing failure, it is worth asking what project success or failure really means. A project’s delivery performance is only part of the picture.

Why projects fail

So, let’s turn an eye towards the causes of project failure. There are so many studies sponsored by different people with different interests, but across those studies there are some common causes of project failure. The leading contenders include:

• Insufficient resources
• Poor executive sponsorship
• Scope creep
• Poor risk control
• Poor governance
• Poor alignment to strategy

This is where the fishbone chart comes in. We imagine the head of the fish as the failed project and the causes of failure become the ribs of the fish. Like this...

Strategic alignment is critical for project success

PMI’s research found that projects whose identified benefits were well aligned with strategic goals had stronger outcomes than those where alignment was weaker: ³

• 57% more met their goals and business intent
• 50% more finished on time
• 45% more finished within budget

Let’s revisit the fishbone diagram to see why. Now what we do is go down each of the ribs and ask, once again, why? I’ve put in some typical answers to this second-level-of-why.

And this is where we get to the point of this blog. When you do this, one factor keeps cropping up again and again on various ribs: strategic alignment.

To understand the connection between project success (and failure) and strategic alignment, it is important to recognize the following:

• If you don’t measure the strategic alignment of your projects, you can’t prioritize
• If you can’t prioritize, you can’t allocate resources
• If you can’t measure strategic alignment, it’s hard to “draw a line” on your portfolio… and you end up with too many projects
• If you understand what the project is FOR (it’s strategic goals), it’s easier to manage scope
• If you’re delivering projects that really are important to your execs, they will stay engaged

What IS strategic alignment?

Strategic alignment is a big topic but don’t worry, we have a handy Guide to Strategic Alignment. In summary, strategic alignment is a measure of how well your project supports the strategic goals of your organization.

It is NOT return on investment or net present value. Increasing financial performance may be ONE of your strategic goals, but others might include growing market share, reducing customer churn, reducing your order-to-cash time, etc.

There is a problem, however. Strategic alignment often means different things to different stakeholders within your business and this is what makes it seem difficult to deliver.

Strategic alignment is not a magic bullet. Just calculating a score doesn’t solve the problem of project failure. You have to USE strategic alignment to make decisions and to maintain focus. Here are seven key ways to use strategic alignment that will support your projects:

1. Project prioritization and selection

By making sure you have a clear picture of the strategic alignment your projects (both live projects and potential projects), you make the project prioritization and selection process much easier.

Essentially, you give the exec stakeholders the information they need to make a better, more balanced decision and lets you kill, once and for all, the temptation to jam in too many projects!

2. Resource allocation and scheduling

When you have a clear picture of which projects add the most value, you can make better, quicker and less contentious 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.

3. Portfolio health checks

You can now use your strategic alignment scores for each project, along with project performance data, to actively manage your portfolio towards success. You can implement health-checks at every governance meeting to ensure the most important projects are being supported and that they deliver their value.

4. Ensure exec engagement

Okay, you still have to train your execs to be good sponsors, but the first step is to motivate them to get involved in the first place. That’s where strategic alignment is a real game-changer. 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.

5. Better benefits realization

If you’ve measured a project’s strategic alignment, you can use that information to drive the project execution. Start at the end, 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.

6. 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.

7. Delivering Change Management

I’m not talking about scope management here, I’m talking about the ability to actually implement organizational change so you realize the benefit of the project. This is a real value-killer if you don’t do it right. Again, 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.

Getting started

This is not just bluff and smoke. In PMI’s 2017 research, champion organisations completed 88% of projects on time and 90% within budget, while 92% met their original goals and business intent. ² View this infographic to see the detail.

And the biggest difference between high performers and the rest?

They focus on strategic alignment.

A great way to get started is to do a portfolio health-check. Take a look at your portfolio and plot it on this map.

You’ll quickly find out which projects should, and should not, be there and where you need to allocate resources to deliver real value.

If that means stopping work already under way, see why weeding projects from a portfolio can be difficult even when the case for change is clear.

If your portfolio health-check raises difficult questions about which projects deserve support, bring the situation to a Decision Review. We’ll work through what is competing for resources, what is constraining the choice and what may need to change:

Start with a Decision Review →

However you do it, commit to it. Get your portfolio aligned to strategy and do it quickly.

None of us want projects to fail or to miss their intended target. As much as I like fishbone diagrams, I’d rather not have to use them to diagnose the causes of project failure.

References

1. Wellingtone, The State of Project Management Survey 2017, Project Performance section. ↩
2. Project Management Institute (PMI), Pulse of the Profession 2017, “Driving Organisational Decisions and Outcomes” ↩, ↩
3. Project Management Institute (PMI), The Strategic Impact of Projects: Identify Benefits to Drive Business Results, 2016, Figure 5, p. 15. ↩