Which comes first, the project plan or the business strategy? With few exceptions, most executives would say that the business strategy comes first. After all, the project or initiative is derived from the strategy and aims to bring some aspect of that strategy to life. However, the link between any project and strategy cannot be taken for granted.
Big projects can take on a life of their own, with dedicated teams and resources, they can sometimes seem divorced from the rest of the business. They can lose sight of why they were started – of the needs of the business and its key stakeholders.
In a time of accelerating change, ensuring that all projects and initiatives stay connected to the strategic priorities of the business is a major opportunity as well as a challenge for C-suite executives and project leaders alike.
The Business First Test: Here is a quick test of whether your initiative is at risk of Project Myopia. Ask key stakeholders, sponsors and team members to describe the business need that the project / Initiative addresses/must address. That is the ‘Business First’ test: Can project team articulate the business need and related market reality. The next level of that test is can they articulate the expected business impact, business urgency, business complexity and business investment for the project. There is a one-page tool to ensure that everybody is on the same page regarding the business fundamentals of a project
If key people struggle to articulate or align regarding the business need, the likelihood of the project addressing the needs of the business must be called into question. Moreover, there are likely to be challenges in engaging and aligning internal stakeholders and the C suite in general.
Loosing sight of business needs is a constant danger facing any project or initiative. Some projects get started with only a fuzzy understanding of the business need, likely business impact and so on. Others start off fine, but, as they progress, lose sight of why they were created and the business needs they are meant to serve.
Some projects even ‘go rogue’ – finding themselves increasingly at-odds with the rest of the organization. The needs of the business come a distant second to the needs of the project and the self-interest of those running it.
Project Myopia: The risks of is at its greatest when:
Tackling Project Myopia requires putting the business and its needs ahead of the project, department, or function. The table below provides a contrast of the ‘Business First’ versus ‘Project First’ approach to the execution of strategic initiatives.
|Business First||Project First|
|Success measured in terms of Business Impact||Success measured in terms of Project Outputs|
|Deliver on the business strategy/vision||Deliver on the project plan|
|Adapt to changing business needs & priorities||Deliver against a set of pre-defined requirements|
|C-suite strategy conversation is key||Project plan and Gantt Chart is key|
|Cross Functional collaboration is essential||HR or IT Project led by the relevant function|
|Focus is on Business Needs, Impact, Urgency, etc.||It is about Project timeline, budget, tasks, etc.|
|Ongoing Strategic Conversations at C suite are critical||Traditional Project Planning & Review Workshops are enough|
It is not that you don’t need the items on the right – the traditional project-style thinking. These are still important, but they need to be complimented by the business first approach (in the left column).
Take the Test:.
A ‘Business First’ approach to critical projects is characterized by 7 factors – as shown on the left-hand side of the above table. How many of these apply to your specific project or initiative? The number of factors that apply indicates how ‘business needs focused the running of your project is.
Ultimately, the success of any initiative is measured in business terms. For example, does it address a specific business need, further the strategy of the business and impact on its present or future performance.
A project may deliver against the project plan, delivering on time and to budget, yet fail to succeed from a business point of view. This happens more often than you might think.
Data shows that the number one factor behind failed projects is changing business needs or priorities1. This is a point worth emphasizing. More projects fail because of changing business needs, than for any other reason.
The number one cause of project failure is not the skill of the project manager, access to resources, the task list – or any other ‘project management’ related factor. It relates to a fundamental reality of modern business – changing business needs and priorities.
Lost in the detail of a complex project, it can be hard to see the wood from the trees – or project deliverables from business needs. Project leaders are busy trying to get the work done on time and to budget, meanwhile they fail to see that fundamental business needs are changing and changing fast. It is a reality that traditional project management attempts ‘ostrich-like’ to deny.
There is an institutional reason why projects fail to keep pace with changing needs. Top-down bureaucratic structures, approvals committees and multi-year planning cycles, make sticking to the plan, rather than adapting to change, a necessity. With many months invested in getting a project plan signed-off, the cost of updating or rewriting the plan is simply too great. The result is that such projects deliver against an out-of-date specification only to end up missing the mark.
Old-school approaches to project management struggle to adapt to changing business needs. Traditionally, the needs of the business and its stakeholders have been defined at the start of a project. By scorning factors such as ‘scope creep’ they may even be ‘set in stone’. However, the reality, like it or not, is that business needs and priorities are likely to change significantly over the life of a project.
Thereafter, Project Reviews discuss the timeline, the budget, the task list and so on. What they fail to talk about is the evolving needs of the business and how they are being met. In this ‘project first’ view of the world, the project specification takes primacy over the needs of the business or the realities of its market.
Those organizations that fail to set up their project teams for success2 and empower them to adopt more agile ways of working3 are at risk of neglecting the needs of the business. In most cases the people working on the project do not have the authority to adapt what they are doing to better meet the needs of the business.
All projects or initiatives, no matter how complex, start with a business need – or at least they should. Whether it is a digital transformation initiative, a technology project or an HR program, the starting point is the fundamental business need to be served.
An initiative may have many objectives or goals, worded perhaps in the language of the particular department or function driving it. But, in adopting a ‘Business First’ perspective the rationale for a project is expressed in language that the C-Suite and shareholders understand – it describes the project’s expected impact on the performance and success of the business.
This ‘business first’ thinking means maintaining a strategic business perspective – something that distinguishes more innovative leaders4.
Project leaders often complain about the challenge of gaining C-suite engagement. To turn this situation around they need to transform the project conversation into a strategic conversation.
Strategic Conversations involve shifting the focus from the project plan, to the needs of the business and from project deliverables to business impact. It is about connecting the project to what matters most – the needs of the business and the realities of its market. Strategic conversations about projects are key to adopting a ‘Business First’ approach.
Strategic Conversations are the type of important conversations that tend not to happen in the daily busyness of a project. However, they are essential to a modern approach to the execution of strategy and the successful implementation of strategic initiatives5.
Ongoing Strategic Conversations at C suite are critical to ensuring effective execution. They must take place alongside traditional project planning and review workshops.
There is an important clarification to be made: ‘Business First’ does not necessarily mean project or initiative subservience. Projects must sometimes wrestle with the business, its customs and traditions – challenging it to innovate and grow.
In many large legacy organizations, the Corporate HQ can be an effective barrier to innovation. For project leaders it can seem like an ongoing battle to gain investment in longer term initiatives and non-core areas that may be important to the future but won’t help meet this quarter’s number . So, business first does not mean ‘corporate HQ first’.
Those running ambitious ‘business unusual’ projects, involving for example a new technology or a new business or operating model, put the business first by challenging it to look beyond short-term business needs to embrace the need for performance and innovative over longer term time horizons.
Project Myopia is one of the many variables measured by Pitstop Analytics™.