Integrating strategic project management

In this extract from the manuscript of the AMA Program and Project Management Handbook (AMACOM, New York, 1992), Dr. John R. Adams and Michael Thomas offer timely comments on integrating strategic and project management, drawing from Dr. David 1. Cleland's conditions for applying project management for accomplishing a given task. The article develops the theme that the implementation of strategic plans depends on the concepts and processes of project management.

Paul C. Dinsmore

INTEGRATING STRATEGIC AND PROJECT MANAGEMENT

Dr. John R. Adams and Michael Thomas
Western Carolina University, Cullowhee, North Carolina

On the surface, the concepts of strategic and project management would appear to compliment each other remarkably well. Yet the idea of using projects as a major methodology for implementing strategic plans is clearly foreign to the vast majority of modern business executives. This idea seems particularly poignant when the possibility is considered that the project manager might have significant contributions to make in accomplishing the organization's strategic objectives.

The project management literature has long identified specific sets of conditions under which project management should be implemented as a means of accomplishing the required task. These conditions have been summarized recently by Dr. David I. Cleland (Cleland, Project Management: Strategic Design and Implementation, p. 39) [1], who states that a project management process should be used

1. When outside pressures require that intensive attention be focused on two or more different kinds of organizational tasks simultaneously, e.g., functional groupings around technical specialties and project groupings around unique customer needs [1].
   This is exactly the situation described in Figure 1. The model for strategic implementation shows an overall corporate objective being broken down into subobjectives and sub-subobjectives as appropriate for the different divisions, departments, and other subunits of the organization. Clearly, a wide variety of organizational functions and technical specialties must be brought together and integrated to satisfy the particular needs demanding the organization's attention. It is the specialized skill of the project manager that draws these multiple organizational units into a cohesive and temporary project team, specifically focused on accomplishing the stated objective and turning the final product over to functional units for use on a continuing, repetitive basis.
2. When tasks become so uncertain, complex, and interdependent that the information-processing load threatens to overwhelm competent managers [1]. Again, this seems to be the situation facing most large organizations in today's environment. Major pressures from the environment are becoming ever more difficult to predict over any significant period of time, and the requirement to react rapidly to changes in the environment is becoming ever more demanding. As businesses assume an ever broader national and international perspective of their markets, and as the products and services being provided become ever more sophisticated and complex, the volume of data that must be processed into information in order to make viable decisions becomes increasingly voluminous and demanding on competent, functional managers. The data analysis workload frequently reaches the point where it becomes impossible for the line managers to maintain their normal functional duties and provide reasonable attention to changing their work processes over time. Organizations have reached the point where the process of modifying the organization itself requires the concentrated management attention that can be provided only by competent, committed, well-organized and knowledgeable project teams.
3. When the organization must achieve economies of scale and high performance through the shared and flexible use of scarce human resources [1]. Automation, computerized information systems, rising expectations of customers and clients, and the necessity to react much more rapidly when the environment changes are combining to make it both possible and necessary toreduce the levels of management in the organization, with middle management being the major target for personnel changes and reductions (Peters, Thriving on Chaos). Yet the demand to be productive in the middle management area is increasing, not decreasing. These forces combine to make it absolutely essential for organizations to achieve economies and high levels of performance through the flexible and shared use of the middle management human resources available to it.

Project management is specifically designed to integrate activities across the traditional organization's functions and boundaries. It is precisely these boundaries which normally inhibit functional groups from working together efficiently. The project team's effort at integration is specifically designed to draw from the skills and abilities already existing in the organization, while not detracting unduly from each individual's “normal” job. Doing so demands a closely coordinated team effort which multiplies the impact of each functional unit's efforts and coordinates them toward the single objective required at the corporate level of the organization.

Figure 1. Model for Strategic Implementation

In integrating activities across organization boundaries, project management breaks down the scope of strategic objectives and goals into increasingly smaller units until the point is reached where they can be effectively managed within individual work packages. These work packages contain well-defined portions of the end goal to be achieved, and these subobjectives can be assigned to that unit of the organization best able to deal with the scope and technical complexity involved in the task. The integration of these individual work packages is, of course, the primary function of an effective project organization at work.

By involving many functional units in achieving the organization's objectives and goals, project management aids in communicating senior management's vision of the organization's future throughout the organization's structure. The focus is on results, rather than on developing procedures to reinforce the existing structure. This results-oriented perspective broadens the view of those associated with the project and emphasizes a dynamic adaptation to the changing requirements, rather than the bureaucratic stability of the organization's structure.

Finally, the project management process as depicted in Figure 2 inherently assesses the risks involved in the project and the progress achieved in accomplishing the strategic plan so far. This management process also provides for adjustments and contingencies which can be used to overcome the inevitable, unforeseen variances and obstacles which could otherwise threaten accomplishment of the organization's goals.

It is for these reasons that the process of project management is so well adapted to the implementation of strategic plans. As more organizations recognize the inherent relationships between strategic and project management, we can expect to see a more detailed blending of the two concepts into an overall process of strategic management which can be expected to make the organization significantly more adaptable and competitive in meeting the needs of our society.

CONCLUSION

The implementation of strategic plans, and hence strategic management, depends on the concepts and processes of project management. In the past, managers generally failed to consider project management as having a role in the strategic management process. As a result, the usefulness of project management to strategic management has been obscured. It has therefore been accepted theory that senior management specifies defined objectives for the project manager to accomplish, while the project manager's task was simply to accomplish those objectives. The result was that the project managers, not understanding their potential impact on the organization's strategic objectives, seldom questioned the project's objectives or concentrated on how that project integrated with other corporate actions to create required organizational capabilities.

Figure 2. Four-Phase Model of the Project Management Process

As the mutual dependency of strategic and project management becomes more clear, it becomes more obviously crucial that project management skills be brought into the strategic management process at a much earlier stage than now occurs in most organizations. An early entry into the strategic management process will provide project managers with a bread overview of the organization's strategic objectives, and this added perspective will allow them to better aid in developing methods for achieving those objectives.

It is only through knowing what ultimate purpose the organization is trying to achieve that project managers can best integrate their activities with those of the project and the functional organization to improve the efficieny, effectiveness, and speed with which the organization's defined objectives can be accomplished.

Dr. John R Adams is a professor of project management at Western Carolina University and director of its Master of Project Management Degree Program. He has been active with the Board of Directors for the Project Management Institute for over fifteen years. A frequent contributor to the literature of project management, his book Management By Project Management has been used as a basis for courses and workshops in Australia, Canada, Japan, and throughout the United States and has been translated into Japanese. Dr. Adams holds the Ph.D. in business administration from Syracuse University, an MBA from Florida State, and a B.S. in electrical engineering from the University of New Hampshire. His practical management experience includes over twenty years of applied research work with U.S. Air Force weapon systems development projects.

Michael Thomas is a graduate assistant in the Master of Project Management Degree Program at Western Carolina University. Mr. Thomas holds a Town Planning Degree and has over twenty-four years of project management working experience in town management, factory management, and in the iron and steel industry. As such, he has been responsible for projects dealing with the construction and commissioning of a continuous pipe coating facility, the desire and installation of hydraulic systems, and for ‘the preservation“and renovation of over 300 eighteenth-century period homes.