Companies today need an efficient strategy process to face the challenges and cope up with the changing world. A part of this strategy process is a company strategy implementation. Implementing the strategy effectively helps in addressing the increasing importance of project portfolio management (PPM). In this article at Strategy Execution, the author emphasizes the need for PPM during strategy implementation.
Importance of PPM in Strategy Implementation
The organizational portfolio is a comprehensive set of change initiatives that helps in attaining the strategic goals. During the strategy implementation, organizations must consider the return on investment, capacity, capability, risk, and the envisaged value of the portfolio.
Matching all your programs and projects to strategic objectives is impossible. Therefore, “it is much more important to focus on the most important projects and programs – the top 20 projects/programs basically – and ensure that these are at least fully aligned with the strategic objectives,” says the author.
Why Things Go Wrong?
One of the main reasons that many companies fail is because they do not have an established portfolio management practices in place. Having established PPM practices helps in addressing various aspects of the portfolio execution cycle, such as resource management, stakeholder engagement, and corporate governance.
PPM helps in managing the risks
For PPM to be effective, you must always link it to the two leading organization-wide processes – enterprise risk management and budgeting cycle. Manage risks from a portfolio management perspective by consolidating the risks of each project. Linking PPM to risk management helps you identify new strategic opportunities and emerging risks.
PPM bridges the gap between change management and operation execution, that is imperative for strategy execution. How effectively a strategy is implemented depends on the PPM maturity of the organization. To know more, click on https://www.strategyex.co.uk/blog/pmoperspectives/strategy-implementation-needs-great-portfolio-management/.