Program Strategy Alignment Tutorial

Program Strategy Alignment

Welcome to the fourth chapter of the PMI-PgMP tutorial (part of the PMI-PgMP® Certification Training.)
This lesson will help you understand the first of the five program management
performance domains, which is, Program Strategy Alignment.
Let us explore the objectives of this lesson in the next section of the program strategy
alignment tutorial.

Objectives
After completing this lesson, you will be able to:

 Define strategy
 Understand how the strategy of an organization is expressed
 List the tasks involved in strategic program management
 Differentiate tactical approach and strategic approach
 Discuss the processes, artifacts, and activities required to align a program with
the strategy of an organization

Let us begin by understanding the meaning of strategy, in the next section of the
program strategy alignment tutorial.

What is Strategy
A strategy is a long-term plan of action to achieve a goal.
The word strategy has its origins in military missions.
The definition refers to one of the original ideas about strategy. A strategy was used as
a way of deploying various means to support the policies of a nation. One of the central
ideas of strategy is that it refers to a plan to reach a definite goal.
A strategy can also be defined as the science and art of employing the political,
economic, psychological, and military forces of a nation or group of nations, to afford the
maximum support to adopted policies in peace or war. It is the skill of making or
carrying out plans to achieve a goal.
A program manager must demonstrate a focus on the long-term and strategic goals.
Now, we may wonder who defines the strategy of an organization. It is the executive
leadership of the organization which comes up with the overall strategy.
The organization defines the strategy that governs its decisions around the investments
it makes in various portfolios. The program delivers some of the benefits in line with
these strategies.
Let us understand the migration from tactical to strategic in the next section of the
program strategy alignment tutorial.
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Migrating from Tactical to Strategic
One of the fundamental aspects of transitioning from project management to program
management level is the transition from the tactical to strategic. We have understood
what strategic means. Now let us see what tactical is.
While strategy defines the “What,” tactics define the “How.”
In the military, it is said that troops on the ground determine the tactics, while the
generals away from the battlefield define the strategy.
It is an interesting way to think about strategy because as a program manager, one has
to provide the team with a sense of direction as to where the program is headed, and
then trust the troops to come up with the right tactics.
So to become focused on the strategy, perform the following actions.

 Focus on the long-term goals, not just on day-to-day problems and think of ways
to solve them
 Delegate the day-to-day issues. However, delegation does not mean handing it
over to the team. It must be done by standardizing and fine tuning of the day to
day work. This is where the program manager will work closely with the project
managers
 To become strategic, the program manager will have to develop more business
intelligence, because the strategy will be decided based on what is relevant to
the business
 The program manager accepts responsibility and accountability to broader
business goals, rather than specific deliverables within the program.

It is not that deliverables are unimportant – it is just that the program manager needs to
think of the goal and not short-term milestones. It is rightly said that the first step to
becoming a leader is to start thinking like one. So it is important to make this mental
transition first.
In the following section, let us look into the mechanics of translating organizational
strategy into the work of the program.

Organizational Strategy and Program Alignment

Typically, an organization determines its strategy through a planning cycle.
Strategic review
The strategic review is either pre-planned or calendar based, or it can be triggered by a
change in business conditions.
In the strategic review, the organization looks at the vision and mission statements and
translates them into a strategic plan within the boundaries of the organization’s
capabilities and core values.
Creating a strategic plan
The strategic plan is made keeping in mind the business context. This includes market
dynamics, specific requests from customers and partners, stakeholders, government
regulations and mandates, and the plans of the competitors.
Outcomes of a strategic plan
The outcome of strategic planning is the portfolio decisions, i.e., decisions about where
the organization would like to invest its resources. It also provides the program a
definition of the expected outcomes and results that the organization is looking for.
Let us continue with the same in the next section of the program strategy alignment
tutorial.

Organizational Strategy and Program Alignment (contd.)

This diagram given below illustrates how an organization’s strategy is expressed and
gets translated into action.
Vision
At the top level is the vision. Vision expresses the goal of an organization.
Mission
The mission expresses the sense of purpose for the organization. The mission has to
be such that it enables the organization to realize the vision.
The vision and mission translate into a strategy.
The portfolio and strategic planning occur; wherein, the strategy manifests itself in
portfolio decisions. In line with the portfolio, the organization undertakes some
operations and some projects.
Projects are aimed at creating additional value or increasing the overall value of the
organization, while operations are meant to realize or produce the value.
Let us look into the elements of strategic alignment in the next section of the program
strategy alignment tutorial.

Elements of Strategic Alignment

Having understood what strategy is and how it gets manifested, we will now understand
how a program aligns itself with the strategy. We will start with looking into specific
processes and artifacts that result in this alignment.
First, let us understand the program business case.  
Program Business Case
The business case provides an indication of the intent, the authority, and philosophy
behind the program. The basic purpose of the business case is to establish why the
program is needed or being proposed. It gives the direction in which a program is
headed, in order to address that need.
The program manager may participate in the creation of the business case, in
collaboration with the program sponsor and various other stakeholders. The program
manager lays down how the program is beneficial in line with the overall strategy.
The business case, along with the executive mandate to start the program, forms the
key inputs for the establishment of the program charter and to authorize programs.
Throughout the life of the program, the validity of the business case must be reviewed;
is the business case still valid and is it still in line with the strategy of the organization?
Next, we will understand the program management plan.
Program Management Plan
The program management plan provides the program level vision, mission, goals, and
objectives. These are derived from the charter and are the mandate given to the
program.
The plan answers the question, how are we going to achieve these goals?
The program management plan should set up measures that enable us to track whether
and to what extent the program has succeeded in meeting the organization’s strategic
objectives.
Let us now look into various key terms related to strategic alignment in detail.

Key Terms Related to Strategic Alignment

We have referred to terms like vision, mission, goals, and objectives in the previous
sections.
Let us now understand what exactly they mean and the role they play in articulating the
strategy.
The vision is a description of the goal. It describes the long-term direction and future
state.
For example, the vision of a program may be that it aims to deliver a certain financial
outcome (like revenues or margins).
The program vision needs to establish what the goal is, in a way that it should be
possible to answer the question “Have you reached there?” at the end of the program. A
vision will typically be a one-liner.
The mission, on the other hand, answers the question “why do we exist?” It establishes
the philosophy, the values, and the overall environment in which the program operates.
It is typically a narrative in the form of “we shall try to improve the profitability of the
organization; we shall provide rewarding careers to employees; we shall maximize the
returns to the shareholders.”
The goals are clearly defined outcomes that the program is expected to realize. The
outcome could be tangible (e.g., specific deliverables) or intangible (e.g., improved team
morale).
Objectives specify the success measures for the program.
For example, the objective could be an efficiency or productivity figure that the program
strives to achieve.
The goals and objectives are cascaded to the components of the program and form the
basis of component level planning.
In the next section of the program strategy alignment tutorial, let us understand these
definitions better by considering an example.

Example of Strategic Alignment Terms

Let us take the case of XYZ Inc., a healthcare provider.
Look at the section to understand how the vision and mission translate into strategic
goals, which become specific initiatives (or activities – like programs and projects) and
specific success measures (or metrics).
Vision
The stated goal of the organization (expressed in the vision statement) is to become a
top-rated provider of specialized health care services in the United States of America.
Mission
The mission expresses the philosophy and intent. It says (for instance) that the
organization believes in providing an excellent experience to the patients and
caregivers.
It says how it will build the teams based on their professional qualifications and their
passion for health care. It further states that it will provide rewarding careers to the team
members and establish world-class infrastructure.
Strategic Goals
The strategic goals are in the context of mission and vision. The goals expressed here
are as follows:

 One is to establish a nationwide presence (in line with the vision to become the
leading provider)
 The next is to provide a unified experience irrespective of which facility is visited
which means, all the facilities must be integrated and standardized in order to be
able to replicate the experience.
 The last goal is to set a specific goal with respect to the number of customers
and revenue.

To realize these goals, specific initiatives are set up.

The initiatives are as follows:
Standardization of Infrastructure
First is standardization of the service infrastructure. This involves activities like training
for the caregivers, suppliers, and procurement of equipment.
Establishment of Franchise Model
Next is the establishment of a franchise model (presumably to facilitate rapid expansion)
and in turn the setting up of evaluation criteria, standard contracts, and specific design
of facilities to be given to the franchisees.
Running Advertising Campaign
Running an advertising campaign through various media.
Lastly, let us discuss the list of metrics or success measures. Some of the measures
that may be useful are:

 Number and size of facilities

 Number of patients treated per year
 Revenue generated per year
 Customer satisfaction scores

The next section of the program strategy alignment tutorial would detail the tasks
involved in strategic program management.
Strategic Program Management Tasks
Let us now take a quick look at the high-level strategic program management tasks to
understand the workflow involved at this domain level.
Define the Program
The first activity involved in the strategic program management tasks list is to define the
program objectives, requirements, and risks.
Derive the Program
The next task is to derive the program charter with key milestones and cost and time
estimation for approval from the stakeholder.
Identify Organizational Benefits
After the approval from stakeholders, extensive effort is made to analyze the
stakeholder's concerns and expectations and also identify organizational benefits for the
program.
Market and Cost-Benefit Analysis
Following this, thorough market analysis and cost-benefit analysis are done to ensure
the development of program scope and evaluation of program objectives.
Approval from Authority
Soon after this, approval from organizational authorities has to be obtained.
Identify Integration Opportunities
Just before the program is initiated, integration opportunities and needs are identified.
These could include finance, human resource, skill sets and so on.
Using Strategic Opportunities
The last task that winds up strategic program management is using the strategic
opportunities for alteration.
The strategic opportunities are used to make the most of the knowledge gained through
organizational benefits.
Having identified the tasks involved in strategic program management, let us now move
on to understand what the program roadmap is.

Program Roadmap
Program roadmap is one of the critical artifacts produced by the program that depicts its
strategic alignment and sets up a timetable for the delivery of strategic benefits.
A program is a chronological representation of the program’s activities and intended
direction. The roadmap establishes the linkage between the business case (which
represents the strategy) and the work that is planned in the program.
Let us take a look at the diagram below for an example of a program roadmap for the
establishment of a factory.
It is broadly classified into three components (viz. civil works, engineering fixtures, and
testing and commissioning). Within each component, there are sub-components that get
completed at various points in time. We can see that some of the work of the
components and subcomponents happens in parallel while others are in sequence.
Also, notice the timelines at the bottom of the chart, which provide an indication of when
the specific component or sub-component would be ready.
Let us understand environmental assessment in the next section of the program
strategy alignment tutorial.

Environmental Assessment
As we discussed earlier, the organizational and the program strategies are not prepared
in isolation.
They have to take cognizance of the environment within which the organization and the
program do their work. Some of those factors are internal (within the enterprise), and
some are external (outside the organization where the work is getting done). Here are
some examples of these factors.
Business environment
First is the overall business environment. This includes things like business climate,
market dynamics, whether the business is booming or shrinking, etc.
The market represents the health of the overall market, including factors affecting the
broader market, where the organization is placed about other players in the market, etc.
Funding
The funding available for the organization and the program is another factor.
Sometimes, funds are easily available through the organization or financial institutions,
while they may be difficult to get on other occasions.
Resources
Similar to funding, the requirement for resources and the availability of the resources is
also a factor. How the organization is placed within the overall industry is an external
factor.
Health, safety, and environmental issues
Health, safety, and environmental issues may be important in some industries. The
broader economy may impact the organization and the program.
Culture
The culture of the organization is an important internal (enterprise) factor. The
regulatory environment (government or non-government) is another factor.
Growth
The growth of the overall industry, market, or the organization’s goals around growth is
an important consideration. The technology involved, and the organization’s access to
the technology is to be looked into.
Risk
The riskiness of the business and the specific effort are also important. To summarize,
there are a large number of variables that impact the strategy, and we need to analyze
these factors to the device the strategy.
In the next section of the program strategy alignment tutorial, we will discuss some
techniques for environmental analysis.

Techniques for Environmental Analysis

Let us now discuss some techniques for analyzing the environmental factors to guide
the formulation of the strategy.
Comparative Advantage Analysis
This involves comparing the different alternatives to pursue an opportunity within or
outside the organization. It also involves analyzing different scenarios (called “what-if”
analysis).
Feasibility Studies
“Feasibility studies” are vital to establishing the viability of a strategy. Feasibility has to
be established from a financial standpoint (whether we can find the funds and whether
there will be sufficient return on investment), sourcing (who will provide the resources),
the complexity (technical or otherwise), and whether the organization can complete the
work with the prevailing constraints.
According to the outcome of the feasibility analysis, the organization may accept or
reject proposals.
SWOT Analysis
“SWOT analysis” refers to analyzing the strengths, weaknesses, opportunities, and
threats. In SWOT analysis, it is important to have a point of reference, i.e., the goal that
we have in mind, and only in that context can the SWOT be analyzed.
Assumptions Analysis
“Assumptions analysis” refers to the analysis of the various assumptions that have been
made in preparing the proposals; validating their correctness and making sure they are
documented.
Historical Information
Historical information is an important mechanism for knowledge management and
benefiting from the knowledge the organization has gained from past experiences. This
includes lessons learned, past successes and failures, best practices established, etc.
It also provides information about specific artifacts, metrics, risks, and estimation data.
These techniques are important to validate if the strategy evolved is viable and whether
it will work in the prevailing conditions. It forms a key mechanism to ensure that the
program is indeed geared to deliver the organization’s strategic goals.
Let us now summarize what we have learned in this lesson.
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Summary
Let us quickly summarize what we learned in this lesson.

 A strategy is a long-term plan of action to achieve a certain goal. A strategy is

expressed through the program business case, program management plan,
program vision, program mission, and the program goals and objectives.
 The program’s roadmap ties up the specific activities and components within the
program with the overall strategic objectives.
 The program has to constantly assess the internal and external environment to
ensure continued alignment with the strategy and establish the capability of the
program to deliver the strategic benefits.
 The techniques used to analyze the environment include the comparative
advantage analysis, feasibility analysis, SWOT analysis, assumptions analysis,
and historical information.

Conclusion
With this, we conclude the discussion on the first of the five domains, program strategic
alignment. In the next lesson, we will discuss program benefits management.