Projectification in Strategic Business Management

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Initial roots of project management application trace into the sectors of manufacturing, military and construction (Brown, 2007, p.1). Project management evolved as a tactical instrument to assist the carrying out of individual projects and programs, such as construction of new building facility, execute new hardware or software initiatives (Wessels, 2007, p.1).

Formal frameworks for project application as a tool for large military organization efficacy were applied in the 1950’s (Brown, 2007).

Some of these early works in project management were published in 1954.The traditional project management practice involved operational performance and achieving set time and goals. It involved a process of building consensus on objectives and obtaining buy-in from organization management and its employees (Wessels, 2007).

The management by objectives dealt with description of objectives and drawing timeframes for their fulfillment and evaluation. In the contemporary world organizational challenges and the evolution of cutthroat competition has driven project management into a new paradigm shift (Shenhar et al. 2000). Strategic orientation of the business outfit is at the heart of prosperity in the modern industrial society.

According to Shenhar et al. (2000), project strategy fuses the organizational outfit and the traditional project plan (p.1). It allows the organization to achieve strategic objectives such as venturing into new markets, increasing revenues, cutting down organizational costs and providing shareholder with greater value for investments through better returns, among others.

Firms face day-to-day decision making hurdles in order for them to stay significant within their lines of operations (Rumelt et al., 1991).

Project management has proven to be useful tactical tool for executing project outfits (Wessels, 2007). Projects are essential to the development and continued existence of organization in today’s world. They give in return value for investment through improved business operations.

Projects provide a strong tool for creating new products for the market and enable the organization to acclimatize with changes occurring within the market environment (Wessels, 2007). Some of the organizational solutions that strategic project management would bring on board include package the organization needs based on vision and mission as well as understand capacity to field project teams to effect change.

In addition, provide criteria for investing on the best project in terms of value addition for the organization, eliminate any weakness areas that may face the project as well as provide a perpetual assessment and evaluation scheme for project investment.

Executing strategic process involves two levels of engagement: formulation and implementation. Much of the information on strategic process has narrowed into the aspects of strategic formulation vis-à-vis strategy implementation. For successful achievement of organizational project intentions, there is need for effective and efficient implementation structures.

These structures include components of information systems and relationship that advances implementation and execution of subdivided activities. Among the more significant conditions for the successful implementation of strategy is to make sure that decisions made by managerial staff are consistent with the organization’s goals and objectives.

The test of triumphant strategic management is anchored in managing the pressure that exists between creative modernism and predictable aim achievement.

This tension occurs by integrating boundless opportunities with managers’ limited interest; implementing with parallelism the top-down strategies as well as bottom-up strategies with objectivity; creating indicators in the environment while maintaining innovativeness and controlling actions while simultaneously allowing the organization to gain creativity and innovative ideas.

The four elements that need to be delineated within the project strategy include product labeling and establishing its competitive advantage, business perspective, the project extremes and strategic focus (Shenhar et al., 2000). Product labeling and establishing its competitive advantage forms the initial base on which to built strategy, define terms and outline plan (Shenhar et al., 2000).

This is the basic component of every product generated from the project. Project product deals with developing the product parts and product life. This brings on board the aspect of competitive advantage (Shenhar et al., 2000). While some projects may last for a while, the product may remain for a longer period. The project product is tailored to make more gains than project.

The fundamental blocks of product definition are objectives, competitive advantage and value, product vision, product type, cost effectiveness, product characteristics and project scope (Shenhar et al., 2000).

The objective describes the initial motivation for having and requiring the product. Initial steps in defining the objective involve identifying the buyer, client and the potential consumer of the product (Shenhar et al., 2000). There should be a framework to clarify what they need? What would help them? In addition, how to address the needs of target groups sufficiently, through the product in question (Shenhar et al., 2000).

Product vision stipulates the product value and a brief description of the competitive advantage. The vision should be stated with clarity and use of emotional terms. The product vision is meant to provide the product some market impetus. Classifying product type is an essential step in product definition (Shenhar et al., 2000).

Product definition will articulate the perspectives: how well is the market versed to the product and product complexity. The cost effectiveness of the product element is the gauge showing relation the product performance has with product cost (Shenhar et al., 2000).

Product appearance element describes the technical and functional qualities manifested by the product. This profiles the product in terms of acquisition cost, operation cost, ease of use, dependability, maintainability, serviceability, compatibility and so on (Shenhar et al., 2000).

In addition, it details the product functions, activities which the product can do and the various in which the product can be customized efficiently (Shenhar et al., 2000). Product characteristics detail the technical specifications defining the product. Business perspective expounds the product expectations on what it will achieve and what the organization anticipate it will do (Shenhar et al., 2000).

The perspective aspect details the transactional requirements and potential market achievement of the product. Additional information that can be added to the perspective is the projected sales and progressive trend for a specified period (Shenhar et al., 2000).

Project scope definition delineates boundary for the work, which needs to be done and to categorize the project type. This stipulates the outcome of the project, the work to be done as well as what closely relates to the project that will not be included into the project (Shenhar et al., 2000).

Project scope provides the structural breakdown of the project. Project type has four-dimensional perspectives: market uncertainty, pace, technological uncertainty and organizational complexity (Shenhar et al., 2000).

There is need to stipulate for each project its style and strategy (Shenhar et al., 2000). Strategic focus is meant to create the mindset and course of action for behavior in order to achieve product competitiveness and value addition.

The appropriate strategic focus is streamlined to give a competitive advantage based on guidelines for the project management (Yeo, 2002). Thus, achieving activity orientation and create conditions that makes the competitive advantage a reality.

Factors that shape the project complexity within the information systems include how well is the product marketing tools achieving the sales objective, what is the spatial coverage of the sales mission and how will the sales process integrate the customer desires (Shenhar et al., 2000).

Moreover, how well is the organization equipped to foster the achievement of the sales objective as well as what is the structure in place for coordination.

Generics of project strategies entail advantage in cost, time and product as well as customer focuses. In terms of cost advantage, the product should achieve cost effectiveness; ensure that the project product makes some savings in every step of the process. Cost indicators and constant screening are important in achieving the cot advantage.

The time advantage gives the product a distinction of demand with other like products in the markets. This advantage defies time constraints such as delay and efficiency in process flow. Time advantage is achieved through implementing short-term plans that may overlap along the process chains. Product advantage is meant to achieve the quality of the brand for the product.

This advantage markets the unique competitive features of the product. This is achieved through constant revisiting of product quality and performance. Customer focus functions to serve specific customer needs. This is based on the understanding of customers’ taste, behavior and ways in which their problems would be solved.

According to Rumelt et al. (1991), five forces link economic perspective to research program for strategic management.

These are the need to interpret performance data; the experience curve; the organization challenge of perpetuity of profit making; the evolutionary nature of economics as well as advancement of business economics in the academia (Rumelt et al., 1991). These forces undergo day-to-day reconfiguration and each continuously faces the practical and intellectual challenges.

Among the important decision support tools for achieving strategic management in organization is the balanced score card (Martinsons et al., 1999). Many business managers supplement financial auditing data with goal related aspects.

This is the bases of the concept of a scorecard. These are meant the corporate achievement through focusing on the organization’s client, inbuilt business systems as well as learning and advancement. The scorecard concept I tailored for managing business functions, structure organizational functional cells and personal projects.

Organizations adopt the concept of the scorecard to align their operations to new strategies while necessitating the need for cost saving, advancing the goal creating more opportunities and customer base as well as value adding the products of the organization. Martinsons et al. (1999) stipulate the guidelines for information systems in an organization.

There is need to raise awareness among the managerial staff especially regarding the information system. The organization has to accumulate and interpret data on the following: corporate strategy, the organization’s specific objectives related to the information the system to be build. The organization should provide the potential metrics related to the balanced IS scorecard perspectives.

The organization should evidently define the specific objectives and goals of the information system docket and its functions. Prepare a guiding framework for receiving comments on the scorecard for the information system and appropriately make the recommendations functional. The scorecard developers should strike agreement with the organization management on its adoption.

Promulgate the scorecard to the relevant stakeholders. The scorecard should exhibit harmony between the corporate level strategy and the information systems strategy as well as have well-specified goals that relate both.

Strategies within the project framework that may be implemented in dealing with complexity include technical composition of the project team based on the required skills, incorporating the consultants and venders to enhance the project existing expertise as well as organization’s team bonding through meetings and appraising the progress made.

Responsibilities of a project manager entail ensure development as defined within the metrics, outlining feasible threats of the project, ensure advancement toward deliverables within time and resource constraints, supervising meetings as well as negotiating for resources meant for the project implementation.

Strategic factor markets are the markets from which the project manager gets the materials and resources required to implement the strategies agreed on. In doing an analysis of the monitory expenditure of implementing project strategies, a project manager has to consider whether strategic factor markets are in favor of the implementing the strategies.

To ascertain whether these markets are favorable to implement the strategies adopted one condition has to be satisfied. The condition is that, the cost of the resources must be almost the same as the economic value of them after they are used in the implementation (Barney, 1986).

Imperfect competition in a strategic factor market arises when firms involved express dissimilar expectations as regards to the value of a given strategic resource. Imperfect completion in turn can result in a firm obtaining above standard economic performance form a given combination of strategic resources and the corresponding implementation strategies (Barney, 1986).

Dissimilar expectations of firms on the economic value of strategic resources can be associated or linked to other imperfections of strategic factor markets. The first of these imperfections is a single firm controlling all the needed resources for implementing a strategy (Barney, 1986). The second imperfection arises when a single firm controlling all the unique resources for implementing a strategy.

The third imperfection arises when implementation of a particular strategy attracts only a small number of firms. The fourth imperfection is because of a group of firms or just a single firm having access to cheaper capital than the rest (Midler, 1995). To develop better expectations to counter imperfectness in strategic markets firms have to do an analysis of two aspects.

The first aspect is the competitive environment they are in and the second is the skills and capabilities unique to the firm. Of these two however, expectations that are more accurate are a product of the analysis done on the second aspect.

Project management in an organization set up may face intricacies. The technical head in a strategic project management setting may be derailed into politics of adopting projects from lower project management level by preference rather than by constructive merit.

The technical head in most cases fails in this way because of lack of comprehensive consultation, guidance and support between decision makers at different level of handling projects. Information cascading may result to forgoing of the better project option. The competitive nature of project bidding may be the requisite recipe for the project options succumbing to politics.

The technical bench of strategic project management should exhibit acumen and discerning ability in decision-making process well above the traditional project management in order to achieve successfully set overall organizational goals. Strategy building may constantly be dynamic and progressive thus needs adaptive, rigor and vigor in thinking and approach.

There should be project leadership and proactive team play driven by efficiency and efficacy on the project responsibility. While this may be prudent at strategy planning stage, implementation stage may be characterized by inefficiency or ineffectiveness.

In order to achieve to achieve efficiency and efficacy in project strategy ample time and adequate resources are required. For progressive value, addition from the strategic positions taken by technical team may require enhancement training.

Renault adopted the project model to enhance results based on management of time, product quality as well as cost control (Midler, 1995). Their approach was to apply skills on department strategies while lowering the powers of the overseeing project coordinator. This was less effective in the operations.

This revealed that in the automobile industry project based management especially in the Western world were less competitive than their peers in Asia continent were (Midler, 1995). Japanese automobile production management have proved to be competitive than the project management approach of the Western world.

Renault’s project management was developed to enhance the organization’s financial situation in the short term and this proved ineffective (Midler, 1995).

The project models have a high degree of irreversibility in decision-making process from lower ranks upstream than vice versa. This makes it difficult for those at the implementation level (low rank players) to make direct improvement on the project yet they are well versed with project products.

The knowledge of the project product reduces from lower to higher ranks. The degree of freedom of maneuvering the project improves in the opposite direction. Another project limitation is that of sustaining progress when there is a changeover of project team. The project process requires build up of project knowledge and skill throughout.

When project players involved at the beginning are meant to hand over to another team to complete the remaining part, indication are that the project may be at risk. This is because it is likely whether the incoming team may understand give and takes as well as trade-offs by the initial team. Actually, there is a fear that they may not fully commit themselves on what had been agreed upon by the other group.

How the standards of the project progress are applied, need constant revision; it is misguiding to consider that project players will seek to the conventionally accepted project criteria if they are themselves are scrutinized independently based on criteria only partially associated with their work.

Take for instance a car-manufacturing firm with several different models being worked on at different plants of the project. In such a case, the upstream involvement of plants on the project assessment of the performance of the each plant could be arrived proportional to the number of the personnel.

In this setting, support staff indirectly involved in the project (e.g. the supervisor) may be overlooked in the completion of a project product (a release of a new car model) especially in the project productivity indicator (Porter, 1982).

The interest in the concept of strategic management is on the surge (Artto & Dietrich, 2002; Dolby, 2008). The degree in which the managing of project strategy makes a value addition to the organization interests proves its worth in terms competitiveness. Thus, need for clarity when describing and executing the strategy’s objectives for a particular project.

Describing the best strategy (e.g. product strategy) for the project at the initial stage and marrying it with the larger business strategy gives impetus to achieving success. There is need for mastery in how the organization seeks to state their project strategies in order to give it a competitive edge above other products that are within the market.

The economic performance of firms does not rely solely on market success, but also, on the cost of achieving the contents of the strategy. In scenarios where the cost of implementing the strategy is higher than the benefits accrued out of it, then the performance of the strategy efforts are below economic expectations.

Works Cited

Artto, K., & Dietrich, P. H., 2002. Strategic business management through multiple projects. The Wiley Guide to Project, Program & Portfolio Management. Web.

Dolby, Nadine, 2008. Research in youth culture and policy: current conditions and future directions. Social Work and Society. Web.

Barney, Jay, 1986. Strategic factor markets: expectations, luck, and business strategy. Management Science. Web.

Brown, Erick, 2007. Strategic project management. Web.

Martinsons, M., Davison, R., & Tse, D., 1999. The balanced scorecard: a foundation for the strategic management of information systems. Scandinavian Journal of Management, pp. 71–88. Web.

Midler, Christophe, 1995. Projectification of the firm, the Renault case. Scandinavian Journal of Management, 11 (4), pp. 363-375. Web.

Porter, Michael E., 1982. The contributions of industrial organization to strategic management. The Academy of Management Review, 6 (4), pp. 609-620. Web.

Rumelt, R. P., Schendel, D., & Teece, D. J., 1991. Precis of strategic management and economics. Strategic Management Journal 12, pp. 5-29. Web.

Shenhar, A. J., Poli, M., & Lechler, T., 2000. A new framework for strategic project management. Stevens Institute of Technology. Web.

Wessels, Deborah, 2007. The strategic role of project management. PM World Today, IX (II). Web.

Yeo, K. T., 2002. Critical failure factors in information system projects. International Journal of Project Management, 20. Pp. 241-246. Web.

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Projectification in Strategic Business Management

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