Projects Inside

Organizations
Project Management I • Module 2
Chapter 20
A Brief Review of Strategy

Selecting Projects that Align with Strategy

Organizational Culture and its Impact on Projects

Putting Project Selection in Context
• We have an idea—
but we’re not quite
ready to start
defining the
project

Project selection occurs

here BEFORE defining
Putting Project Selection in Context
Project Management Process Groups
Project Management Initiating Planning Executing Monitoring and Closing
Knowledge Areas Controlling
Integration Management

Scope Management

Time Management

Cost Management

Quality Management

Human Resources Management

Communications Management

Risk Management

Procurement Management

Stakeholder Management
Putting Project Selection in Context
Project Management Process Groups
Project Management Initiating Planning Executing Monitoring and Closing
Knowledge Areas Controlling
Integration Management

Scope Management

Time Management

Cost Management

Quality Management Outside the scope of PMBOK

Human Resources Management

Communications Management

Risk Management

Procurement Management

Stakeholder Management
A Quick Review of Strategy
Three steps to developing strategy

Assess the need Conduct a

Choose strategic
for strategic situational
alternatives
change analysis
Strategy: Assess the Need For Strategic Change

• Is there a need to change?

• Be aware of competitive inertia
• “a reluctance to change strategies or competitive practices that have
been successful in the past.”
• Seek out examples of strategic dissonance
• “a discrepancy between a company’s intended strategy and the
strategic actions manager taken when implementing that strategy.”
Strategy: Conduct a Situational Analysis
• Consider your firm’s internal environment
• Strengths
• Weaknesses
• Distinctive competence
• “what a company can make, do, or perform better than its
competitors.”
• Core capabilities
• “the internal decision-making routines, problem-solving processes, and
organizational cultures that determine how efficiently inputs can be
turned into outputs.”
Strategy: Conduct a Situational Analysis
• Consider your firm’s
external Frameworks / Approaches to complete
environment analysis

• Opportunities
• Political • Competition in the industry
• Threats • • Potential of new entrants
Economic
• Social into the industry
• Technological • Power of suppliers
• Environmental • Power of customers
• External / Employee • Threat of substitute products
• Legal

PESTEEL Porter's
Analysis five forces
Strategy: Choose Strategic Alternatives
• There are numerous competitive strategies, depending
on the “level” at which the firm chooses to compete
• Strategy: decisions or plans designed to impact
favourable factors for the desired outcome
Corporate-level Industry / Business Firm-level
strategies -level strategies strategies
• Objective of the • Satisfy customers • Often tactical
organization, • Distinct product / • Guided by
allocation of service overarching
resources, strategies
coordination of • Operational
units
Projects Implement Strategy
• Projects drive the realization of change
• The pace of change is increasing, and firms are being
forced to adapt—or die
• Adaptation is at the core of strategy
• Projects realize firms’ desired adaptations
Project Selection Aligns Resources With Strategy

• Purposes of Project Portfolio Management (PPM):

1. Align project selection with strategy
2. Assign limited resources based on priorities
3. Optimize deployment of resources across projects
• Think of it as the equivalent of managing a portfolio of
financial assets with differing rates of return and risk
Organizational Culture Primer
• Organizational culture
• “a system of shared norms, beliefs, values, and assumptions
which binds people together, thereby creating shared
meaning.”
• What does it do for organizations?
• Provides a sense of identity for its members
• Helps legitimize the management system of the
organization
• Clarifies and reinforces standards of behaviour
Organizational Culture Primer
Member Identity Job ↔ Organization
Team Emphasis Individual ↔ Group
Management Focus Task ↔ People
Unit Integration Inter ↔ Dependent
Control Loose ↔ Tight
Risk Tolerance Low ↔ High
Reward Criteria Performance ↔ Other
Conflict Tolerance Low ↔ High
Means-End Orientation Means ↔ Ends

Open-System Focused Internal ↔ External

Organizational Culture & Project Selection
• Organizational culture influences project selection
criteria, e.g.,
• More risk-averse organizations choose different projects
from risk-tolerant organizations
• More highly-integrated organizations may choose riskier
projects because they work more effectively across
organizational boundaries
End Mod 02
References
• All page references are to:
• Verzuh, E. (2015). The Fast Forward MBA in Project Management (5/e).
Hoboken, NJ: Wiley
• Additional references
• Larson, E., & Gray, C. (2014). Project Management: The Managerial
Process (6/e). New York, NY: McGraw-Hill
• Williams, C., Champion, T., & Hall, I. (2018). MGMT (3/ce). Toronto, ON:
Nelson
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