What Is Strategy?

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By Jen L. Skrabak, PMP, PfMP

Most portfolio managers are aware of the importance of aligning their portfolio to the strategy of the organization.

But what exactly is strategy?

Strategy is commonly misunderstood. Sometimes it is used to denote importance or criticality, for example, a “strategic program.” Other times, it may be used to convey an action plan—an organization may say that their strategy is to launch a new key product.   

In reality, however, strategy does not denote importance or complexity; rather, it represents the collective decisions that enable the organization to amplify its uniqueness in order to win.

It’s important to think of strategy as having three components:

Definition: The intent of the organization over the long term. 

Plan: Clear, concise and compelling actions expressed through a strategic plan and roadmap. Visualization helps to articulate the strategy, and align it with objectives and measurements. Frameworks and tools such as a strategy map, balanced scorecard and activity map help plan the strategy.

Execution: How the organization will achieve its defined plan through its portfolios (and corresponding programs and projects). The portfolio represents the decisions that the organization has made in order to execute on the strategy.

What Strategy IS and IS NOT

IS

NOT

Future/Long term (3+ years)

Current/Short term (1-3 years)

Different

Improvement

A unique position relative to competition

An endeavor to improve operational efficiency

Responsive to environment

Static

The strategy should define for the organization and individuals:

-Where are we going?

-Why are we going there?

-What’s my role?

In my next post, we’ll discuss how to align portfolio management to strategy.

Posted by Jen Skrabak on: August 19, 2016 07:04 PM | Permalink

Comments (11)

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Interesting...

Some enterprises have short live spans. For instance some mines have a life of mine on a few years - 5 or less. How does "3 years" fit into that? Is strategy not relevant to that such operations?

thanks for sharing it, I agree totally

Thanks to all for your comments.

Charles, thanks for sharing your example. For the mine, I see it as a product or project within a portfolio. Although that product/project's life span might be 5 years, isn't it part of an organization's larger strategy to be bigger and better? The strategy would be how to get there.

Thanks for Your article
Strategie should be Share to what level in the organisation in your opinion.

Thanks for your question Vincent. The strategy itself can be at various levels - organization wide, business unit, department, PMO, project/program, etc. I would say that everyone should understand all of the above levels, and if you are developing your strategy at the PMO or project/program level, be sure your entire team, stakeholders, and sponsor embrace it, and also understand the broader alignment to the organization or business unit.

Thanks for sharing

Thanks for the good article.

In theory the strategic plan of an organizarion is the plan in order to get its objectives achieved by taking into consideration it's mission and vision.

Thanks for the article,very interesting.

Thanks for your comment, Jorge. Yes, I agree - the organization Strategic Plan should provide the 'how' - based on the mission, vision, values, including outlining objectives. The Portfolio Strategic Plan should cascade from that and outline how the Portfolio would align with the overall organization.

Interesting view on the subject

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