Organizational Strategy
Organizational strategy is the long-term plan an organization follows to achieve its mission, vision, and goals, serving as the foundation for portfolio, program, and project selection decisions.
Explanation
Organizational strategy defines where an organization wants to go and how it intends to get there. It encompasses the mission (why the organization exists), vision (the desired future state), goals (measurable targets), and the strategic initiatives chosen to achieve them. Every project should trace back to one or more elements of organizational strategy.
Strategy is typically set by senior leadership and translated into actionable initiatives through portfolio management. Projects that align with strategy receive funding and resources; those that do not are deprioritized or canceled. This ensures the organization invests in work that moves it toward its goals rather than consuming resources on low-value efforts.
For the exam, understand that project managers need awareness of organizational strategy even though they do not set it. This awareness helps them make better decisions about scope, stakeholder engagement, and change management. Questions may ask about the relationship between strategy, the business case, and project authorization.
Key Points
- •Encompasses mission, vision, goals, and strategic initiatives
- •Drives portfolio and project selection decisions
- •Set by senior leadership and executive management
- •Project managers must understand strategy to make aligned decisions
Exam Tip
When a question asks why a project was authorized, trace the answer back to organizational strategy. Projects exist to advance strategic objectives.
Frequently Asked Questions
Related Topics
Strategic Alignment
Strategic alignment is the practice of ensuring that projects, programs, and portfolios are directly linked to and supportive of the organization's strategic goals and objectives.
Value Delivery System
The value delivery system is the collection of strategic activities, portfolios, programs, projects, and operations that an organization uses to create, deliver, and sustain value for its stakeholders.
Business Need
A business need is the underlying problem, opportunity, or requirement that justifies the initiation of a project, serving as the foundation for the business case and project charter.
Project Selection Methods
Project selection methods are the techniques organizations use to evaluate and choose which projects to pursue, including mathematical models (NPV, IRR, BCR) and comparative approaches (scoring models, peer review).
Test your knowledge
Practice scenario-based questions on this topic with detailed explanations.