Strategic Planning

Abstract

This paper examines the application of strategic planning characteristics from prior strategic planning research to project management. Drawing from prior research in strategic planning, strategic information systems planning and strategic manufacturing planning, this research combines strategic planning characteristics derived from a rational approach with a second set of adaptive characteristics to create a comprehensive model. The resulting “rational adaptive” approach is then assessed empirically to evaluate its relevance to PM and whether it is associated with increased project success. In addition, the “rational adaptive” approach is mapped to established PM tools/techniques. Findings indicate that PM is captured by varying degrees of a rational adaptive approach, which is positively correlated with PM success and use of PM tools/techniques. These results suggest that strategic planning characteristics can be effectively incorporated into a generalized PM framework, yielding potentially useful insights regarding the relationship of PM behaviors to eventual project success.

Introduction

The use of projects in organizations has increased steadily over the last several decades. Although there has been some indication that projects are becoming more successful, there is still evidence that a substantial number of projects do not meet goals or expectations (Allen et al., 2014). McKinsey and Company (2012) found that, on average, large information technology (IT) projects “run 45 percent over budget and 7 percent over time, while delivering 56 percent less value than predicted.” The Standish Group’s CHAOS Project, which tracks IT projects over time, shows limited progress in successful project completion over the last two decades. (http://www.standishgroup.com).

With this increasing use of projects yet limited project success, examination of PM success and failure continues to be an area of considerable interest (Allen et al., 2014). Leybourne (2007) reviewed the changing emphasis of PM research, recognizing a number of areas that have been examined in the past: identification of critical success factors, evaluation of specific PM methods, and assessment of PM tools/techniques. Although findings from such studies have certainly contributed to the PM field, the research has been limited to a narrow set of constructs. As Leybourne (2007) discusses, it may be time to move beyond them.

Several authors have pointed out the lack of theoretical underpinnings in PM research (e.g., Drouin and Jugdev, 2014; Killien et al., 2012; Parker et al., 2015; Patanakul and Shenhar, 2012) recommending application of theory from related disciplines to advance PM as a field. Drouin and Jugdev (2014, p. 64) state that use of existing theory and constructs will “foster credibility of the findings” but the “current state of theoretical evolution in PM hampers researchers in using well-developed concepts to investigate by operationalizing constructs with existing valid and reliable instruments or items from instruments.” Examples of such research are studies by Drouin and Jugdev (2014), Killien et al. (2012), and Parker et al. (2015), which adapted the resource-based view from the strategic management field within a PM context.

The current study applies strategic management theory— specifically, strategic planning characteristics (SPCs)—to develop an expanded and more generalized PM approach. The research combines SPCs derived from a formal (“rational”) approach to strategic planning with a second set of adaptive SPCs to create a comprehensive model. The resulting “rational adaptive” approach is assessed empirically to evaluate its relevance to PM and whether it is associated with increased project success. In addition, the “rational adaptive” approach is mapped to established PM tools/ techniques. Findings indicate that PM is captured by varying degrees of a rational adaptive approach, which is positively correlated with PM success and use of PM tools/techniques. These results suggest that SPCs can be effectively incorporated into a generalized PM framework, yielding potentially useful insights regarding the relationship of PM behaviors to eventual project success.

The paper is organized as follows. Section 2 reviews the relevant PM and strategic planning literature and develops the conceptual framework for this study leading to articulated hypotheses. The research methodology is described in Section 3 followed by the results of a practitioner field survey in Section 4. Implications of research findings are discussed in Section 5. Sections 6 and 7 conclude the paper by summarizing contributions and limitations of this current study with suggestions for follow-on research.

Discussion

This study was undertaken to determine if the SPCs identified in strategic management, SISP, and manufacturing strategic planning are applicable in a project environment and capture at least some aspect of the PM approach used in organizations. In addition, this study assesses whether the rational adaptive approach in a project context replicates the positive association with success observed in

other fields. Examination of the use of SPCs in a PM context is not only a natural fit, it also heeds the call to incorporate theory from more established fields into PM research. Prior PM research has captured some aspects of the degree of formality, comprehensive- ness, participation, and intensity, but none has captured them consistent with strategic planning research.

A central question of this investigation is whether the combination of these four characteristics reflects the actual adoption of a rational adaptive approach. The lack of purely rational or adaptive planning approaches in the sample (Fig. 1), and significant correlations between the SPCs (Table 5) provide clear support for a hybrid PM approach that varies from “not rational adaptive” to “highly rational adaptive,” which is consistent with prior research addressing SISP/SMP. This idea has been proposed in the PM literature (e.g., Patanakul and Shenhar, 2012; Rostaldås, 2008), and the current results are consistent with findings by Tasevska et al. (2014), who observed a high level of formality, comprehensiveness, and participation in project planning as part of the “business case” construct.

This study also assesses whether a more rational adaptive PM approach is associated with greater project success. Multivariate and univariate analyses of groups exhibiting different levels of rational adaptive planning support this hypothesis (Table 6). When each dimension of success is examined individually, a more rational adaptive approach is associated with greater success on all dimensions except “meeting cost goals” and “technical specifica- tions.” One possible explanation for the lack of significant difference in meeting cost goals may be that decisions relating to project budgets are more likely to be influenced by external stakeholders (Hallman and Keizer, 1994), so the approach used by the project team may not have as much of an effect. The lack of significant difference between the low and high rational adaptive groups in meeting technical specifications may be due to external factors such as technology advances, which could be more influential in terms of meeting technical specifications than the PM approach. Each of these relationships raises interesting questions for future research to obtain a better understanding of these results.

Finally, the relationship between PM approach and use of tools/techniques (as PM practices such as integration, scope, time, etc.) was evaluated using the rational adaptive groups. As expected, the results indicate a significant difference between the set of PM practices as a whole across varying degrees of rational adaptive planning (Table 6). Univariate results show that significant differences exist between the low and high rational adaptive PM groups for all PM practices except for the procurement group, providing very strong support for the third hypothesis. One possible explanation for the last finding is that many organizations manage procurement as an independent process, limiting project team member involvement and adaptation of procurement protocols (Indelicato, 2015).

To obtain a more granular view, correlations between each SPC and each PM practice were examined (Table 7) (given multivariate and univariate results, procurement is excluded from this discussion).

• Formality: Formality reflects the structured nature of planning by policies, procedures, and written PM standards in the PMBOK® Guide that includes use of specific tools and written documentation. Thus, this relationship was expected to not only be significant and positive, but to also be the strongest among the SPCs. That time and cost practices have a lower correlation than the other practices may reflect increased attention to PM practices outside of the long-established triple-constraints (Besner and Hobbs, 2006; Papke-Shields et al., 2010).
• Comprehensiveness and Participation: The results for use of tools/techniques and these two SPCs are essentially the same with no significant relationship between each of them with cost and time practices. One possible explanation could be that project managers’ “training, experience, and comfort with these traditional dimensions” leads to limited identification and evaluation of options as well as participation (Papke-Shields et al., 2010 p. 659). PM practices related to scope, quality, communication, and risk are generally more open-ended, potentially benefitting from increased participation and diverse input. A structured approach to evaluating alternatives in these areas would be more imperative given the variety of options available (Rostaldås et al., 2014).

• Intensity: This SPC resulted in the fewest significant relationships, which is somewhat counter-intuitive. This result combined with the formality observed in each area implies that tools/techniques are being used initially but several decisions are not necessarily being revisited. One area related to greater intensity is project scope, which makes sense since organizations continue to monitor and adjust scope over time to avoid scope creep (Papke-Shields et , 2010).

Limitations and future research

Several limitations exist in this study. Four commonly referenced strategic planning characteristics examined in a number of fields were included in this study; however, this is not an exhaustive list. The opportunity to expand the SPCs to include others from strategic planning as well as identify some that are more specific to PM exists. The counter-intuitive results with respect to intensity are also a source of future research in trying to understand how the reported intensity is achieved. Could it be that tools/techniques other than the ones included in this study are being used?

A second limitation is the sample size, which was sufficient for the statistical tests performed to examine the relationships in this study but was not sufficient to establish causality. Causality, if it exists, would provide a clearer picture of the relationship between the rational adaptive approach and PM tools/techniques—does taking a more comprehensive approach lead to the use of certain tools/techniques or does the use of those tools/techniques facilitate comprehensiveness in decision making?

A third limitation is the sample, which comes from one geographic region so it may be more homogeneous in terms of the approach. While this is advantageous because it may reduce the effect of potential extraneous variables, it may also limit the generalizability of the results. Similar findings from prior studies in other fields using data from disparate geographic regions support the relationship of PM approach and success, providing evidence that a rational adaptive PM approach may, in practice, be widely applicable.

With the introduction of SPCs in the project context, there are numerous opportunities for future research. What other tools/techniques that would enhance the understanding of the rational adaptive approach? Given increasing use of agile PM, is the rational adaptive approach applicable? Conforto et al. (2010) observed benefits of simple, iterative, visual, and agile techniques along with more “traditional” PM best practices such as standardization that reflect a rational adaptive approach. Another area to examine is the relationship between a rational adaptive approach and use of project software—specifically, is a rational adaptive approach embedded in current PM software or could it be in the future? Aspects of formality are already found in project software, but could intensity be built into PM software such as using alerts to trigger increased monitoring?

Conclusion

The field of PM has been evolving for decades. Although there are indications of improvement in terms of project success, there are still high rates of failure reported and thus a continued interest in identifying what contributes to project success. This study contributes to this line of research by identifying a PM approach and relating this approach to enhanced project success. But the current study differs from many before it in two ways: (1) a more generalized approach is examined, and (2) it is based on theory from strategic planning research, as recommended by a number of researchers in the PM field.

Using planning characteristics identified as important in the strategic planning literature, this study demonstrates the presence of a rational adaptive approach to PM that combines formality and comprehensiveness associated with rational planning with participation and intensity associated with adaptive planning. It differs from prior work as the rational adaptive approach in a project context broadens understanding of what contributes to a successful project compared to the focus on specific PM methods or tools/techniques that have been examined in the past. This reflects Leybourne’s (2007) discussion about the evolution of PM research. Segars et al. (1998, p. 303) argued that focusing on specific frameworks, methodologies, or tools, as had been done for SISP, resulted in a narrow focus while “planning activities in organizations can be more accurately conceptualized as systems of behaviors, agendas, or process dimensions.” The strong relationship between many tools/techniques and the rational adaptive approach lends credibility to the approach since these tools/ techniques have been a mainstay in project management. The rational adaptive approach also reflects CSFs under the control of the project team, avoiding those CSFs external to the project environment.

The findings of this study contribute to the field of PM both in terms of research and practice. The inclusion of SPCs from strategic planning in other fields provide opportunities for future research in this area as well as an example of adapting theory from more established fields to advance PM research. From a practitioner’s perspective and as Segars et al. (1998) discussed, the set of steps found in the prescriptive PM methods in the past tended to be somewhat rigid and may or may not work well in a specific organization (Svejvig and Andersen, 2015). Given the relationship between the rational adaptive approach and the use of tools/techniques that are already established in most organizations, a more generalized approach allows practitioners to and manage projects in ways that improve implementation and enhance successful outcomes.