When too many initiatives generate too few results

What happens when a senior executive, business unit manager or department head adds another project to an already overburdened corporate initiative portfolio?  At most companies, it does not take long before project managers’ focus gets diluted, team members find themselves stretched too thin, and current projects stall or overrun their budgets as the organization tries to accomplish more with a limited resource pool.  Sound familiar?  Unfortunately, this is an all too common phenomenon in many businesses today.  But providing some structure to the way projects get identified and funded can relieve the organization of much of this pressure.

High-performance organizations start by forming a steering committee whose members have both the authority and the breadth of institutional knowledge to see that the projects that best support the company’s goals are reviewed, approved and implemented.  Since a typical project portfolio extends beyond the domain of any one functional discipline, the committee should consist of members with experience across multiple parts of the business, and at both field and corporate levels.  Committee members must also exercise balance to avoid pushing forward with anyone’s own pet projects at the expense of others that may better meet the company’s objectives.

Often, there are many attractive project ideas worth exploring; however, not all are worth funding.  Leading organizations tackle this challenge by developing a process for capturing and cataloging all initiative proposals at the idea stage.  Each proposed initiative has a sponsor—usually the owner of the problem and thus the main beneficiary of the solution—and is supported by a business case outlining the benefits, costs, opportunities, and risks, as well as the interdependencies with other projects.  Of course, there should also be a clear link between each initiative and one or more of the company’s strategic objectives.

Armed with this information, the project owner is ready to justify the merits of his project to the steering committee, who ultimately decide on whether or not to fund it.  This stage is actually the one where companies encounter one of the most difficult challenges—determining how to allocate limited funds among a list of initially attractive projects.  The committee is almost always presented a number of project alternatives that exceeds the resources (dollars, people, capital, and time) available to deliver on them all.  Those organizations most effective at narrowing their investment opportunities utilize a form of prioritization template to weight the various project attributes—strategic, customer, financial, operating and risk—and thus ensure that only those projects that provide the right blend of desired attributes are ultimately approved.

Once a project is approved, the project manager is then responsible for the day-to-day execution activities, including assigning team members to project tasks, procuring materials and supplies, and managing the timeline and budget.  Standard business case and other project management templates should be used so that all projects have consistent documentation.  This simplifies the project manager’s communication of project health and status, as well as the steering committee’s comparison of projects within the portfolio.  With a consistent set of tools and information, the committee can thus hold the project manager accountable for delivering on the benefits promised at the outset.

Companies willing to create a structured and disciplined approach like that outlined above can realize payoffs not only in delivering on their project commitments, but in their ability to focus scarce resources on those opportunities that best support the organization’s strategic priorities.

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