Aligning Projects to Business Strategy / by John Schlichter

In a survey of 400 U.S. CEO's out this month, 65% said the next three years will be more critical than the past 50 years. Complexity, volatility, and uncertainty have been on the rise since the turn of the 21st century, making it more difficult for organizations to execute their business strategies through projects, especially those organizations that have not developed Organizational Project Management (OPM) capabilities. From the outset of the OPM3 program in 1998, we knew that organizations would need help for the foreseeable future to improve their ability to execute business strategies through projects in order to thrive in the exponential world accelerating toward us. This need has only increased over time.

That idea, that projects are the way to execute organizational strategies, was a game-changer for PMI standards, which had not been enlarged beyond addressing the management of individual projects to date. Midway through our development of the OPM3 standard in the year 2000, I asked our team to deploy a survey to gauge how well organizations align their projects to business strategy (such that projects are designed to achieve formulated strategy), the first time PMI sponsored such a survey.In that first survey, we engaged 10,000 professionals and found that only 66% of those surveyed said their organizations align projects to business strategy; and worse, only 25% said their organizations had well balanced portfolios (Schlichter John. PMI’s Organizational Project Management Maturity Model: Emerging Standards. PMI ’01 Annual Symposium, Nashville; 2001). Since 2003, PMI's whole focus has shifted to organizations and their ability to execute business strategies through projects, getting more business value from projects. In that time, we have seen many organizations dramatically improve their ability to execute business strategies through projects, but the opposite trend is also true.

In 2013, a decade after our first survey on project alignment to strategy, PMI started surveying project alignment to strategy annually, reporting that from 2013 to 2016 about half of organizations reported high alignment of projects to organizational strategy, which was slightly worse than our finding a decade earlier. And that metric dipped further from 54% in 2015 to 48% in 2016. In short, a significant number of organizations have not been aligning projects to business strategy, a phenomenon that some may say, on the whole, has not improved for nearly twenty years and appears to be getting worse gradually. What do you think accounts for this trend? Is it because the strategy is missing or outdated? Or because strategies formulated top down are not translated into projects? Or that emergent strategies developed bottom up are not aligned to formal strategies? Is it because projects created top down from strategy and projects proposed bottom up to advance strategic intent are not vetted capably? Is it a failure on the part of executives or on the part of middle management?

There are many questions, but beyond musing upon frequent causes of misalignment and well known opportunities to improve it, the more fundamental question is whether organizations actually are getting worse at this, as PMI suggests, or instead are they actually getting better but just not keeping pace with the exponential future accelerating toward us? This question may be one of the more important ones facing businesses today. As Darwin said, "It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change."