Aligning projects with business strategy can produce tangible and intangible benefits to organizations, according with the research study published in 2008 and conducted by Athabasca University with the sponsorship of the Project Management Institute.
The organizations are looking to become more competitive, efficient and profitable and they will need a business and project management experts working together to attain the business goals. Both, business and project management experts will work towards aligning projects with business strategy.
Under the new approach, new metrics to define project success or failure need to be in place. Project must deliver benefits to the organization and budget or schedule variations may be justified by slight changes in the business strategy. There will be no room for projects originated in functional areas if they are not aligned to the business strategy. Project managers and their teams must become more strategic and take responsibility to deliver results during and at the end of the project.
What is the value for the organization to aligning projects with business strategy?
The Athabasca University research was conducted in more than 60 organizations around the world and had the cooperation of more than 45 researchers who conducted over 400 interviews. The research results showed that among the tangible benefits the organizations:
- Saved money and resources
- Increased profitability
- Retained customers
- Increased market share
Among the intangible benefits, the organizations:
- Attained strategic goals
- Improved corporate culture
- Improved quality of life of their community
The research highlighted that intangible benefits have a direct relationship with the maturity level of project management. Project financials and financial metrics were not available or were not provided by the surveyed organizations.
The traditional approach to project management considers projects as independent units and its success or failure is based on metrics usually associated with financial ratios. With the new proposed approach, aligning projects with business strategy, projects are no longer independent units and will enable benefits, either tangible or intangible, to the organization.
As a practitioner who had the opportunity to work under both approaches, you may experience that under the traditional approach your role as project manager was more challenging and functional areas’ resistance to change was higher. When projects are aligned to business strategy, the majority of the functional areas are engaged and willing to participate in the project to produce the expected benefit and achieve the business goals.