Strategic Project Management Alex S Brown PMP Mitsui

Strategic Project Management Alex S. Brown, PMP Mitsui Sumitomo Insurance (MSIG USA) Session ADV 09

What is a Project Nightmare? • • Over budget? Late delivery? Poor quality? Even worse: on-time, on-budget, great quality, but delivering something your organization does not need

Case Study • Mitsui Sumitomo Insurance Group USA – 400 -person subsidiary of MSI Japan – Property & Casualty insurer, mostly commercial – Largest book is the US risks of Japanese companies • One-person Strategic Planning Office

Session Overview • What is strategic planning at MSIG USA? • How does project management complement strategic planning? • How do senior executives participate in projects and strategy at MSIG USA? • What project management trends support strategic planning?

What is “Strategic Planning”? • Definition debated for years among academics and business leaders • Typically a one- to five-year plan at MSIG USA – What projects to launch, what to continue – Align with medium- and long-term business plans from USA and Tokyo

Key Concepts for MSIG USA • Executive Steering Committee – Was an actual committee in the past – Changed to become the President and CEO – Approve changes, provide executive oversight • The Strategic Plan – By definition, a collection of projects – Projects are essential to strategy at MSIG

What is the Strategic Plan? • A collection of 15 to 25 active projects, plus more planned for the future • Monitored by a Strategic Planning Office • Authorized by top management • Cross-departmental impact • Relevant to medium- and long-term plans

Strategic Planning Office • Combination of a corporate planning function and a PMO • “Project Portfolio Administration” function • Mentor all project managers • Audit and monitor budgets, schedules, results

Partial Organization Chart CEO Office of the CEO President SPO and others Underwriting, CIO, Ops, Finance, others Internal Audit

How Project Management Complements Strategic Planning • Strategic Planning provides ideas • Project Management achieves results • Projects drive strategic changes • Feedback loop for continuous change

Strategic Planning – Ideas • Projects are based on ideas and objectives • Strategic planning creates them – SWOT (Strengths Weaknesses Opportunities Threats) – Competitive Analysis and other studies – Market share goals – Vision statements

Project Management Achieves Results • How to execute strategy? • Project management provides a robust way to execute change • Assign project manager, defining accountability and responsibility • Avoid creating strategy that is never realized or even attempted

Project Results Drive Change • Each project advances one or more strategic goal • Some projects investigate an issue, creating new strategic goals at the end • Some projects fail, but all are relevant • Failure often uncovers key information

Continuous Feedback Loop Organizational Plan Updates Strategy Ideas Change Projects Staff Feedback and Ideas

Events that Join Strategy and Projects • Project start-up • Project closure • Budget and resource authorization • Resource conflicts and priorities • Organizational crisis and strategic change

Project Start-Up • Most strategic moment of a project is right when it is authorized • Strategy helps answer, “Why should we do this? ” or “What is the goal? ” • PM helps you climb the ladder, strategy helps make sure it is on the right wall

Project Closure • A time to gather new ideas • Teams see unsolved problems and issues • At MSIG these ideas become new project proposals • Ensure that good ideas are not lost • A gift to the strategic planner

Budget and Resource Authorization • Projects constantly fight for resources and funding • Tying projects to strategy allows PMs to explain their need in strategic terms • Examining all project resource requests in terms of strategy helps eliminate “pet projects”

Project Prioritization • Often project conflicts arise, requiring a decision • Organizational strategy can provide a more relevant way to score and rank projects • Strategic planners are accustomed to scoring systems to set priorities, and can help design an appropriate system

Crisis and Strategic Change • Any crisis or critical event causes project uncertainty • Strategic planners face uncertainty as well • These times call for coordination – Practical, tactical ideas from project managers – Industry trends and top-down perspectives from strategists

Involving Senior Management • Tie project management to something they must do • Decision making • Training • Constant reinforcement

Project Management Tied to Strategy • At MSIG USA, medium- and long-term plans were required by Tokyo • Project management easy to support as a way to implement these plans • Project practices have become an ordinary way of doing business for executives

Decision Making • At MSIG USA, projects have become a way for executives to see progress more clearly • Each status report is a chance to provide input • Provided a formal, documented decisionmaking process • Easier for senior managers to control

Project Management Training • Over 10% of the staff, including senior management, was trained in project management • Many managers accepted roles as project managers or sponsors • Middle and senior management reinforce training by using the terms regularly

Constant Reinforcement • Projects appear everywhere now – Company intranet – Bimonthly reports to senior management and staff • Continuing education for project managers • Projects are now normal business

Trends in Project Management Related to Strategy • Project Management Maturity Models • Standards and Books • PMI Goals and Marketing

Project Management Maturity Models • An explosion of models • Hard to measure process maturity without organizational strategy • OPM 3: “Transform Strategy into Results” • Executive-level focus of these models encouraging project managers and strategists to meet and talk

Portfolio Management Standards and Books • How long can we focus on “selection”? • Strategy encourages “start up” and “creation” • Design new projects to fill voids in the portfolio • Do not just select projects from a fixed list

Many Books “Selection-Focused” • Standard for Portfolio Management (PMI) – “priority” & “select” appear 70 times – “new component” appears 10 times • New books account for the creation of the project and organizational strategy – Heerkens, The Business-Savvy Project Manager – Dinsmore & Cooke-Davies, The Right Projects Done Right!

PMI Goals and Marketing • PMI is promoting project management at the executive level – “Worldwide, organizations will embrace, value and utilize project management and attribute their success to it. ” – “Making project management indispensable for business results. ” • Achievable in partnership with strategists

Summary • MSIG USA made “project management” inseparable from “strategic planning” • Reinforced from start-up to closure • Strategic planning and project management support and reinforce each other • Industry trends support integrating them

Challenge: Link Strategy to Project Management at Your Organization • How could the MSIG USA example help? • What can you change? Whose help do you need? • Are your projects already strategically aligned? If not, why not? • PMI has set a vision for all of us – achieve it in your organization!

Contact Information • Alex S. Brown, PMP Mitsui Sumitomo Ins. (MSIG USA) • Phone 908 -229 -0202 • Email alexbrown@msigusa. com or alexsbrown@alexsbrown. com • Session ADV 09 • Website http: //www. alexsbrown. com