How do you rank your projects by strategy alignment?

Guide your project selection and prioritization by focusing on projects that have the potential to significantly enhance the core objectives outlined in your organization's strategic plan. Look for projects that align closely with the mission and values of the organization, ensuring that they contribute meaningfully to its overarching goals. Prioritize projects that not only generate short-term gains but also promise sustainable value and positive outcomes for stakeholders over the long term. This approach ensures that your resources are channeled into initiatives that resonate deeply with your organization's strategic direction and create a lasting impact.

There are some tools to help define the organization's strategy and SWOT is one of them, but in my opinion all companies should adopt OKRs and KPIs. This must be clear and be deployed at all layers of the organization, including at the point to define it, the leader must involve the team to best define the activities and deliveries necessary to achieve that KPI. Clear measures must be adopted so that it is possible to monitor goals throughout the current year.

Based on my experience:- 1. Define your organization's strategy. This includes your mission, vision, values, goals, and objectives. Identify the strategic objectives that each project supports. 2. Evaluate each project's contribution to your organization's strategy. How much will each project help you achieve your strategic goals? You can use a strategic alignment matrix or a balanced scorecard to help you with this evaluation. 3. Rank your projects based on their strategy alignment. You can use a variety of methods for ranking your projects, such as the Analytic Hierarchy Process (AHP), the Weighted Scoring Method (WSM), or the Pairwise Comparison Method (PCM).

?? In my experience, strategy clarity is foundational for effective PPM. Once articulated, several methods can be adopted to rank projects. ?? Strategic Fit Evaluate alignment with the organization's strategy. Prioritize projects supporting key objectives. ?? Value Contribution Assess potential value, whether monetary or strategic advantage. ?? Risk vs. Reward Balance benefits against risks, preparing mitigation plans if needed. ?? Aligning projects with strategy necessitates a holistic view. By considering fit, value, and risk, you can ensure optimal portfolio performance.

Critical to the define phase of the project is to articulate and define your strategic intent with the relevant stakeholders from inception (through and inclusive process - example through ideation workshops). Through this engagement it’s critical to define what is the definition of done, what does success look like, the KPI’s of measurement should not be project based (time,cost,scope) but related to measuring the achievement of the business objective. For example if I’m implementing a technology in operations and the objective is to improve our mean time to repair, then the measure of success should relate to the adoption of the solution to achieve a target relating to the desired MTTR that was estimated through the new to-be process.

?? A thorough portfolio assessment is key to aligning with strategic goals. ?? Project Impact Analysis Assess project potential impact on strategic goals, considering returns, market influence, and long-term benefits. ?? Resource Utilization Review Examine resource allocation, including manpower, budget, and technology, and reallocate for optimal alignment. ?? Interdependency Mapping Identify project interdependencies, prioritize accordingly, and manage shared resources. ?? A comprehensive assessment of your project portfolio is vital for ensuring strategic alignment and maximizing resource efficiency.

Spend time taking a hard look at projects with delayed starts or little traction if most members of the project team have “day jobs” on top of working on projects in the portfolio. It’s not an easy decision to cancel a project in the portfolio when funding has been approved yet if a project is on hold or delayed and just won’t happen. Cutting a project loose sooner than later can free up funds for other projects in the portfolio that have more traction, are trending “green” and have a higher probability of deliver success.

Evaluate your current portfolio and identify the projects that are aligned with your strategy and the ones that are not. Use a portfolio management framework to align your project portfolio with your strategy. Prioritize your projects based on how well they align with your organization's strategy and vision.

Regularly reviewing our project portfolio and assessing our progress in strategy execution is crucial. It helps us determine if we're hitting our targets and if our projects are contributing to overall success. It's not just about current profits; we need to gauge their future potential too. Also, consider whether our projects are fostering team growth by offering opportunities to develop new skills. This all ties into team quality and engagement. By reviewing our project portfolio, we can make informed choices to strike the right balance between immediate goals and long-term development.

For many portfolio managers, strategies and projects may be simply be assigned with the objective to move forward within current constraints. Having a clear understanding of the capabilities and constraints, trade-offs and dependencies is imperative to begin to schedule and plan resource allocations. At the end of the day, a portfolio manager must be focused on the 'art of the possible' and be ready to communicate available opportunities and constraints.

Defining criteria for portfolio selection is a crucial point in ensuring that the portfolio is aligned with the organizational strategy. The main stakeholders must be involved in this definition to ensure the correct criteria and correct weighting. Another point is to ensure that projects that are not mature have a lower score than a project with much greater maturity.

Strategic alignment allows organizations to prioritize suitable projects that will help them reach long-term goals faster and channel the company’s resources in the right direction. The PMO plays a critical role in forming standard project selection criteria to keep everyone on the same page. It means that viable projects with better ROI and also its relevance to the business strategy. It ensures that every project you work on should help you climb up the ladder to achieve these goals. If projects do not meet the organization goals, there will be a waste of resources and adversely affect the bottom line. Therefore, prioritizing and selecting a project is one of the most important factors affecting the portfolio’s strategic alignment.

I categorize my projects based on impact, urgency, and complexity. Projects that are high-impact, very urgent, and relatively simple will always be prioritized first, closely followed by more complex projects that are also high-impact and urgent.

Another category can be infrastructure/ one - time setup for new initiatives that would then need funding in the future from other funding sources when there is a limited period of funding. Maybe consider a pilot category to try some new things to see if they have enough benefit to expand or make scalable or not pursue and review lessons learned.

Prioritize your projects based on their strategic value and priority. Group your projects based on relevance and similarities. And mostly use some easy-to-understand tool to visualize your portfolio clearly.

I personally prefer to define two types of criteria. Projects that are directly aligned with a financial return, use calculations such as payback, NPV and IRR, however for regulatory projects, security, etc., which are more aligned with other areas, the use of a matrix with a weighting of criteria is an option that goes very well.

I’ve tried forced ranking and comparison to have a sequential order and prefer groupings of high and medium for larger dollar and longer duration projects. Then smaller, less dollar, shorter duration projects “below the line”. You need to manage those differently as there can be many in this grouping; they might not need as much executive oversight and review and most likely can be successful using a project management lite approach and set of processes.

Ranking our projects provides a systematic approach for making well-informed decisions in project management, thereby enhancing our capacity to optimize outcomes and achieve success aligned with our strategic objectives. This process facilitates efficient allocation of resources, guaranteeing that projects of the utmost strategic significance receive the essential attention and resources they require.

The first and most important criterion for ranking your projects is how well they align with your organization's strategy and vision. It is essential. And based on my experience it has always been crucial when my stakeholders were informed and aligned with the priorities and next steps.

Use the Pareto Principle: "Roughly 80% of consequences come from 20% of causes" (Wikipedia). Similarly, 80% of your organization's strategic gains come from 20% of your projects. It will be very clear what projects fall within that 20%. Pick those and focus the majority of your efforts on them.

Involving experienced team members in this and all above-described activities is crucial. Without them, aligning the project portfolio with our strategy might miss the mark. Their insights and understanding of projects and strategy ensure a comprehensive and effective review process. This expertise leads to informed decisions and a portfolio that truly reflects our strategic direction. Experienced team members maximize the value of these efforts and contribute significantly to our project success.

Review the higher priority projects with the project manager and executive sponsor to get a one page status slide with the RAG by common project metrics for the projects in the portfolio. Review the projects with the smaller team groupings periodically in a comfortable setting and then more formally with the Steering Committee monthly with Executives representing the portfolio. As a project portfolio manager your “value add” is to add your perspective on project status reported…to support when agree and provide an alternative perspective based on your experiences and your view across the entire portfolio relative to trends, issues and successes that the individual project manager most likely doesn’t have exposure too.

Of course, reevaluate your project portfolio to make informed decisions about potential reallocation of budget and resources. And again, collaborate with stakeholders to ensure that you end up with the right portfolio.

In my professional experience, ranking projects by strategy alignment is critical for efficiency, effectiveness and efficacy I prioritize projects based on their direct impact on strategic objectives, focusing on cost-effectiveness, timely delivery(just-in-time delivery) and sustainability. This approach provides an uninterrupted incorporation of logistics operations with overall business objectives, propelling continuous modification and client satisfaction.

My greatest learning experience over the past 18 months is that the government sector project portfolios, with defined spending periods, certainly have some different business drivers than private sector project portfolios. If you are moving from the private sector to government and want to chat about that transition, feel free to connect and we can discuss further.