Strategic Project Management: The Role of the Project Success Pyramid in Today’s Businesses
Introduction
According to the PMI discussion board, approximately 75% of corporate projects fail to meet even one baseline objective. Some others estimate it’s as high 94%. Even more shockingly, according to Capterra, approximately 30% of project have no baseline at all!
“It was a great idea, it was just badly executed.” How many times have you heard that or something similar? In reality, we know that the quality of execution is the only factor that validates the quality of the idea. Executed well, a “mediocre idea” can be a game changer. Conversely, if executed poorly, the “best idea” isn’t worth a dime. We have seen it for ourselves as well. Software projects scrapped shortly after release and large-scale construction projects running billions of dollars over budget with no end in sight. Some would argue they were poorly planned. Others would say poorly executed. But perhaps the distinction between the two is more fluid than we once thought. Is there a way to assess the value of a project connected to the company strategy? Can the information gathered during that process inform how the project is executed? What are the critical factors involved in project success?
Agile methodology would encourage us to engage in rolling wave planning, remaining iterative in small phases that allow us to keep plans this side of the horizon, and re-planning for the next phase after progress has been made in executing what is immediately in front of us. Waterfall methodology mandates a detailed work breakdown structure with each work package carefully planned and budgeted for and all work cumulates to the completed project. Whichever camp you’re in (or even if you straddle the two and work in a “hybrid” manner), you’ve seen projects fail using your chosen methodology.
This article doesn’t pick sides.* Instead, this article aims to answer a two-part question: What makes a project worth embarking on in the first place and how can we isolate critical success factors in these types of projects to place the appropriate emphasis on the most important aspects?
What is a Strategic Project?
A strategic project is a discrete work package with a defined endpoint that has a significant impact on the long-term strategic goals of the broader organisation. Simply put, if you were to look back in 5 years, the projects that you could definitively say were responsible for the company’s current position, were impactful strategic projects. This is a marked distinction from tactical projects, which are important in executing the company’s vision and delivering day-to-day benefits. In fact tactical projects should only exist as sub-projects of the strategic work that a company has embarked on. These definitions help us answer the first part of the question. If a project has a strategic impact on the company, it is likely worth significant resource allocation. If it does not then it is either tactical, meaning it should align with one of the strategic projects, or it is superfluous and shouldn’t have any resource allocation.
Below is an example of the three, as pertaining to one strategic objective at WHSmiths:
Strategic Project: The high street retailer divesting its locations to reallocate resources and invest in new locations in travel hubs, positioning themselves as the go-to shop for commuters and travellers.
Aligned Tactical Project: Developing geolocation tracking within the store’s customer app and sending promotional offers to customers when they are near one of the new locations.
Misaligned Tactical Project: Creating mixed-reality demonstrations of products in-store to enhance customer engagement.
Given the three examples, the first is wholly relevant and connected to a clear strategy. This project should be pursued with significant resources and will be a pivotal point in the company history. In fact the retailer has implemented this strategy successfully, opening 126 new stores in 2023, closing 13 and posting revenues of nearly £800m (~$1.02bn) more than 2021.
The second, should only be considered in relation to the first and may be compared to other tactical projects to decide the order in which they should be pursued, if not simultaneously. In isolation this project may create some success for the company but we don’t know what that would look like or even how to necessarily measure it. Furthermore, if it isn’t aligned with the strategy then not only would the results be somewhat random, they could be counterproductive. The worst part is we wouldn’t even be able to identify that until it was too late. The third project has no relevance whatsoever to the strategy alluded to in the first project and unless there is another strategy that the company is pursuing, it shouldn’t even be started. That’s not to say it isn’t a good idea. It might be. But they shouldn’t spend millions to find out.
In summary, understanding the strategic value that a project has is crucial in knowing whether to pursue it further. Having this alignment from the beginning feeds into the quality of the execution that will validate whether or not it is a “good idea”.
What is the Project Success Pyramid and why is it important?
The Project Success Pyramid (or PSP) is a framework created by Weekes Global Consulting to identify the critical success factors of innovative projects. With each level building on the previous, with decreasing impact provided the foundations below are solid, the PSP breaks project success factors into discovery, setup, communication & alignment and personnel.
Starting with “Discovery”, the project baselines are established including rudimentary big-picture questions such as “What is the company uniquely excellent at?” and “What business are we really in?”. Far from being esoteric and abstract, these questions form the framework to help us decide how strategic, if at all, the project-in-question will be. Other questions surrounding the current & desired state, company objectives, success criteria and desired impact continue to build the parameters for the importance and alignment of the pending project. Discovery continues to decompose broader questions into granular questions like “What value should the end user get from this action?”, “how will the end user interact with the steps required to get their value?” and “What do we need to be able to do to actually build this?”. Addressing these questions in business, design and technical terms gives those involved in the project the answers they need to estimate the time and effort required to execute. This in turn gives the project leader the answers needed to create a roadmap and project parameters. Most importantly, this acts as a conduit between the high-level strategy and the granular requirements necessary to execute.
Building on a solid base of comprehensive discovery and having all of the components in executable-sized chunks, the next critical success factor is project setup. Ensuring that the project infrastructure is sound, the workflow is clear and there is a minimum amount of friction to get something from concept to completion is crucially important. This should all be set up before any execution begins and the more detailed the better. In an increasingly global and remote working environment, even working days and hours need to be clarified, let alone access to repositories and coordination of tools. These don’t need to be mandated, just agreed upon.
In our experience these two factors; discovery and setup; account for roughly 70% of the success of a project. The rest comes down to communication protocols, stakeholder alignment, reporting structures and hiring the right personnel. Of course, having the right people can make a huge difference to the outcomes of a project but setting them up for success allows them to “work the system” rather than have to fight against it.
Conclusion
Identifying whether a project has high strategic value answers the first concern; if a project is worth starting. Understanding the purpose of the broader organisation and it’s objectives provides the necessary context for ensuring all legs are moving in the same direction. At the other end of the spectrum, the top of the PSP, your project will require expert execution and communication to ensure the right things are done at the right time and all involved are appropriately informed and consulted with perfect alignment to the strategic goals that the project is set out to achieve. In between is the foundation of the PSP that bridges the gap between the high-level strategy of the organisation and the granular activity required to execute it. The discovery, in part, assesses whether the project does provide strategic value for the organisation and underpins all project activity with the strategic goals of the broader organisation. The other critical success factors are then stacked on top of a comprehensive discovery. This approach drastically increases the chances of project success, both in isolation and for the company’s bigger picture.
*Disclaimer: The majority of my projects have been easy to work on incrementally and to iterate through challenges so I primarily operate using agile methodology. However, the advice in this article applies equally to waterfall-style projects.
