The losses associated with project failures are enormous. Coca-introduction Cola’s of the New Coke in 1985 is a classic example. After successfully testing a new recipe, the beverage giant released the new version. However, the product did not receive the expected response from buyers, costing the company $4 million in development costs and a $30 million loss on back-stocked inventory that could not be sold.
Such disasters are not unique to Coca-Cola. Simply looking back in time reveals that any business — even large enterprises and well-known brands — can fall victim to project failures.
What are the root causes of such epic failures?
The top five causes of project failure, according to PMI’s Pulse of the Profession survey, are changes in organizational priorities (39%), changes in project objectives (37%), inaccurate requirements gathering (35%), inadequate vision (29%), and poor communication (29 percent ).
Poorly trained project managers, attempting too many projects, and a lack of project funding emerged as the top three project management challenges in another survey conducted by Wellingtone.
This is where the value of strategic project management becomes apparent. By tying projects to strategy, teams can set realistic expectations for what can be delivered, when it can be delivered, and at what cost. Without a strategy, projects can derail and spiral out of control.
The importance of strategic project management is echoed in the PMI report as well. It implies that modern projects must be measured in ways other than time, scope, and budget. When planning, running and delivering a project, a higher strategic goal and “benefits, tangible or intangible, should be considered in the equation.”
What Is the Importance of Strategic Project Management or Strategic Planning in Project Management?
In this new enterprise era, project management must be smarter than traditional approaches. Companies must develop a broader vision and approach business planning and project management from a strategic standpoint in order to delve deeper into the root causes of project failures.
Optimal business performance is dependent on high-quality project management, which companies can only achieve by implementing strategic planning in project management. To achieve the best results from strategic project management, organizations must foster a culture that promotes strategic goals.
What Organizations Can Do and How They Should Go About Implementing Strategic Project Planning
Although the initial tasks may appear intimidating, a phased approach will simplify the process and assist you in achieving favorable results in business planning and project management. Here are four key strategies for taking your project management skills from good to great.
Ensure Project Alignment on a Strategic Level
One of the most common causes of project failure is a misalignment between projects and core business strategies. According to studies, when companies implement strategic project management by aligning projects with their corporate strategy, the success rate of projects skyrockets.
How Do You Align Business Objectives With Projects?
Review the findings from completed or ongoing projects to identify project success criteria and prioritization issues for strategic project planning. For example, if multiple projects fail due to resource constraints, you must consider the resources required to complete future projects as a criterion for project viability.
To begin implementing strategic project management, make a list of all your projects and establish the criteria for estimating the impact of each project on departments, customers, and the organization as a whole.
Make strategic project planning to ensure that only projects that are in line with corporate strategies are pursued. Those that are out of sync with corporate goals or have little impact on business plans should be terminated.
Create a Culture that Values Strategic Project Management.
When organizations strategically align projects and integrate strategic project management into their corporate culture, all project stakeholders will understand their role in the project’s successful execution. Developing a corporate culture that includes strategic planning in project management will instill competence in all PM roles.
How Do You Create a Culture of Strategic Project Management?
Companies must design culture-building strategies in order to create a culture that facilitates strategic project planning. This necessitates the formation of specialized cross-functional committees tasked with outlining the processes and approaches required to effect cultural change.
A corporate culture that embraces a strategic project management environment educates the entire organization on the best practices required for efficient project management.
Use the Best Project Management Practices for Strategic Project Management.
Most Project Management Offices are task-driven rather than strategy-oriented, from developing methodologies to identifying project roles and developing tools for implementing training programs.
Despite the fact that organizations generate enormous amounts of knowledge on a daily basis, there is no knowledge management or stakeholder management strategy in place to improve accuracy, budgeting, or resource allocation.
How Can the Best Project Management Practices Be Enforced?
Maintaining project knowledge encourages continuous learning, which helps to avoid making the same mistakes over and over. To ensure knowledge retention, project managers should hold a formal meeting immediately following the completion of a project to document the lessons learned so that teams can apply the new knowledge in future projects.
To improve project performance, develop a strategic project management system.
Organizations’ Project Management Offices frequently use traditional metrics to demonstrate project performance and success, rather than implementing strategic approaches.
How Can Strategic Project Management Be Used to Ensure Project Success?
Create a system for strategic planning in project management.
Determine the resources required and plan ahead of time to avoid project delays.
Check to see if projects are meeting their quality, budget, regulatory, and delivery goals.
Maintain regular meetings and discussions to ensure that strategic project management processes are in place.
Ensure a smooth and successful project launch.
How Can You Benefit from Strategic Project Management?
Companies are looking for talented project management strategists to join their teams. If you want to become a high-profile project management professional, or if your organization wants to upskill its project management team, SPOTO Learning is the place to go.
SPOTO Learning, the world’s leading certification provider, provides excellent Project Management Certification Training, such as PMI-RMP® Certification Training, PRINCE2 Certification Course, and CAPM® Certification Training, which teach the most-popular methodologies for strategic project management.
