Developing strategies is much easier than implementing them, which is why many strategies are never successfully implemented, says University of Pretoria (UP) Graduate School of Technology Management project management specialist Professor Herman Steyn.

He adds that project portfolio management is an effective way of implementing company strategy through projects.

This process incorporates methods to select and prioritise projects, balance contradictory objectives, manage risks, assess the workload on key resources, and execute a set of projects that optimises value to further the company’s strategic objectives.

To illustrate his point, Steyn cites a research project by UP project management master’s student Ngeno Mutilitha on a Namibian mining company’s ‘difficulties’ with project portfolio management.

Using Namibia’s volatile mining industry as a backdrop because it “tests the robustness of any strategy”, and under the supervision of Steyn, Mutilitha compared the problems that the company encountered with those experienced by other companies elsewhere.

Mutilitha and Steyn comment that the Namibian company has a “well-established and comprehensive project management methodology, but faces challenges, such as the extreme variability of geological features, which makes the company a high unit-cost producer”.

Further, they note that the grade of the declining resource was “low and variable”, exacerbating challenges in the business environment such as volatile commodity prices and a fluctuating currency.

The company classified its projects into four categories – capital expenditure, stay-in-business, rehabilitation, and research and development. “While portfolio management principles can obviously be applied to all these portfolios, Mutilitha’s study focused on the allocation of stay-in-business funds to projects,” Steyn notes.

“The Namibian mining company’s case differed from cases described in the literature, which typically investigate portfolio management within companies in developed countries.”

Steyn explains that, in Mutilitha’s observation of the type of impediments that hindered value optimisation through projects, Mutilitha prioritised impediments pertaining to organisational project management and project portfolio management.

He says the results of the research project revealed four new impediments – which were not experienced in the developed world – to strategy implementation.

These impediments comprise conflicts between strategic and operational projects, strategic projects being financed by short-term profits, inexperienced project teams and shortcomings in the strategy development process.

Mutilitha’s analysis of the seriousness of the pitfalls indicated that the three most pertinent were the constraints caused by a five-year business plan, short-term thinking and too much emphasis on stay-in-business projects.

Steyn notes that all three pitfalls are borne from short-term thinking, in contrast to the “long-term view taken by companies in developing countries”.

Further, Steyn comments that it was interesting to note the differences in the perceptions of challenges at various levels within the company’s organisational hierarchy.

“Executive managers were more aware of organisational and project portfolio management challenges, while middle managers were much more aware of the shortcomings in project management.”

Aside from improving awareness of the existing, but different, challenges among the levels of management, Steyn notes that the shortcomings in project management and, therefore strategy implementation, can be addressed through training and by companies developing their own project management methodology.

Meanwhile, Steyn states that there is ample opportunity for collaboration between universities and industry.

Steyn affirms that through engagement with master’s and PhD programmes, companies can contribute towards academic research while advancing their own objectives by focusing on company-specific interests.