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In organizations with short product life cycles, it is interesting to note that frequently participating in strategic planning and implementation includes participants from all levels within the organization. However, in perhaps 80% of the remaining product and service organizations, top management pretty much formulates strategy and leaves strategy implementation to functional managers. The fact that these objectives and strategies are made independently at different levels by functional groups within the organization hierarchy causes manifold problems. There may be some logical explanations for this apparent void. Missions, objectives, and organizational strategies set by top managers tend to lack specificity, give only general direction, and set major constraints; frequently resource availability and allocations are not part of the equation at this level. Top management assumes that if the strategic plan is given, the plan will be implemented. However, can middle managers of different functional areas interpret and understand what to do? For example, the strategic plan seldom tells which project has first priority. Regardless, within these broad constraints more detailed strategies and objectives are developed by the next level of managers. This process filters down the organization until specific projects are identified. At this point some of the painful problems created by this approach begin to raise their ugly heads-projects are not getting done on time or within budget; resources are not adequate; some projects do not contribute to the major objectives and strategies of the organization as a whole. Because clear linkages do not exist, the organizational environment becomes dysfunctional, confused, and ripe for ineffective implementation of organization strategy and, thus, of projects. Well documented by researchers, these phenomena are categorized as the "implementation gap." The implementation gap refers to the lack of understanding and consensus of organization strategy among top and middle-level managers. If this condition exists, how is it possible to effectively implement strategy? The problem is serious. One study found that only about 25% of Fortune 500 executives believe there is a strong linkage, consistency, and/or agreement between the strategies they formulate and implementation1. Another large study found that middle managers considered organizational strategy to be under the purview of others or not in their realm of influence. It is the responsibility of senior management to set policies that show a distinct link between organizational strategy and objectives and projects that implement those strategies. The research of Fusco suggests the implementation gap and prioritizing projects are still overlooked by many organizations. He surveyed 280 project managers and found that 24% of their organizations did not even publish or circulate their objectives; in addition, 40 percent of the respondents reported that priorities among competing projects were not clear, while only 17% reported clear priorities. The link between strategy and projects cannot be overlooked if the firm intends to compete in today's turbulent, competitive world. PREV: Implement
Strategies through Projects 1. Steven W. Floyd and Bill Wooldrifge. "Managing Strategic Consensus..." Academy of Management Executives, vol. 6, no. 4 (1992), pp. 27-39. |