Article

Strategic prioritization: Identify, prioritize and execute to maximize value

A quick guide to understanding and realizing value on enterprise projects

Aug 30, 2023

Key takeaways

Embrace change for sustainability: Rapid technological changes demand businesses adapt swiftly to remain sustainable.

Unlocking value through projects: Efficiently select, prioritize, and execute projects aligned with your strategy.

Success in agility: Master project portfolio management for market expansion, efficiency, and long-term success. 

#
Business strategy Management consulting

Technological progress and exponential growth in digitization in the last decade have changed the way businesses operate. These shifts—compounded by COVID-19, geopolitical uncertainty, inflationary pressure and re-globalization—have accelerated transformations that were already underway and forced the hand of others who have not yet begun.

Technological progress and exponential growth in digitization in the last decade have changed the way businesses operate. These shifts—compounded by COVID-19, geopolitical uncertainty, inflationary pressure and re-globalization—have accelerated transformations that were already underway and forced the hand of others who have not yet begun.

In fact, the capability to accelerate, transform or modernize businesses quickly is a core capability for companies to remain sustainable.  The days when business models were sustainable for the long term are behind us.

So how do organizations adapt?  How can they capture intellectual input and ideas from inside and outside their enterprise, articulate those ideas into discrete, valuable and executable projects, and then place strategic bets on the ones that drive the highest sustainable value?  

Part of the answer resides inside the businesses themselves—specifically, in the way they rationally formulate and select projects that best align to their strategy and deliver value. 

Companies need a foundational framework to identify, prioritize, execute and monitor projects.  Without it, the number of initiatives will naturally balloon in size, sap the focus and energy of talented people, and diminish resources.  Or worse, the company will spend valuable resources and time on projects that do not support the organization’s objectives. 

To future-proof critical decisions as much as possible, organizations need to evaluate how they can significantly improve the quality of projects they select and build a new process that allows them to execute the best project at the optimal moment while achieving key organizational objectives and goals. This is the essence of project portfolio management and value realization.

When done successfully, it increases the likelihood of appropriately funded projects that are completed on time and on budget and that align with business objectives.

Projects are then approved not based on who has a relationship with senior management, or which senior manager can unilaterally call the shots. Projects are approved that drive agreement through broad socialization and transparency.  Support can therefore be garnered, and a rational case can be made so the most valuable projects are self-evident.  

So where should businesses begin? 

  1. Start with strategy.  The first step is to have a clearly defined and communicated enterprise strategy, including business objectives, goals and vision. A clear strategy enables the organization to create decision criteria against which all projects are measured. If the company’s strategy needs updating, then start there.
  2. Define the criteria and process. Next, managers must create project selection criteria that are transparent. They must consistently adhere to those criteria. The project portfolio management process must also be trusted and add value over time. If it does, it will more than pay for itself. Therefore, consistency is key. Managers must walk the talk for everyone to follow.
  3. Measure and control. Lastly, managers must regularly monitor and measure projects and validate that they align with organizational objectives and goals, delivering measurable value. Organizations that master the ability to consistently select the right projects, course correct when needed, and cancel in-flight projects when required will outperform their peers. 

These are general guidelines that outline the process that, if followed consistently, can help businesses make efficient use of resources and effectively execute their enterprise strategy and business objectives.

There is of course more complexity involved in bringing this to life in a business, but the essence it seeks to achieve should not be complicated for its own sake. It needs to be a process that is understandable and rational if it has any chance of getting adopted.

In today’s rapidly changing business environment, organizations that successfully do the right projects at the right time are more likely to enter new markets, capture greater market share, retain their customers, optimize their processes, and enjoy long-term success. To get there, organizations must utilize a consistent project portfolio management process to identify, prioritize and execute projects. It begins with establishing a clear enterprise strategy and creating transparency in a decision process that is effective through being relentless in measuring project performance and value.

RSM contributors

Additional insights that may be of interest