Project-Driven Technology Strategy
Robert N. McGrath, Ph.D. / PMP
Available on Amazon and Barnes & Noble
Are you unsure about which way your business
should go ?
- Economic Philosophy: "Entrepreneurship is the Essential Fact of Capitalism."
- Entrepreneurship is about elevating - not maximizing
- a prudent investor's risk/return comfort zone.
- Entrepreneurship can happen in any organization regardless of industry, market, technology, age,
in the 20th century, Economist Joseph Schumpeter called Entrepreneurship "the essential fact of Capitalism,"
including the systematic corporatization of entrepreneurship as an economic phenomenon.
- In Capitalist doctrine, Capital ultimately
equates to Technology. To pool capital is to invest in technology. Even Marx saw this.
- If a capital investment does not deliver
a fair return to the true owners, managers have failed the firm and its investors.
- The "I" in
ROI refers to the true owners as investors, to whom managers owe a binding, legal, fiduciary responsibility.
- Strategic Philosophy: Competitive Advantage
means Organization-wide and Organization-specific Superiority.
- Winning isn't everything, but losers get fired.
- A Business Strategy is the way an organization
seeks to realize its vision and accomplish its mission.
- Creating and Sustaining a Competitive Advantage should be the goal of every Business Strategist.
Value Added is the best and specific measure of Sustainable Competitive Advantage.
Competitive Advantage is very rarely seen, especially in technology-driven industries.
- Any strategy should have a unique
value-proposition. Otherwise it cannot claim Sustainable Competitive Advantage.
- Industrial Economics explains profitability.
Appropriability explains firm-specific profit.
- Strategists need to identify firm-level and firm-specific competencies,
capabilities and routines that are
- Difficult to imitate / copy
- For a Capability to be sustainable, it must also be Dynamic.
-- is -- human knowledge and competence.
- The appropriability (e.g., defensibility = profitability) of a technology is key to its potential
for competitive advantage.
- Appropriability depends on the dynamics of knowledge transfer.
- Tacit knowledge is essential to creating
and sustaining a competitive advantage.
- Market and Industry Philosophy
- Consumers don't need technologies; they have needs which technologies
- The Performance / Price ratios of competing products provide the best insight about their adoption, diffusion,
Technology must co-evolve with Process Technology in order to produce a commercially-successful total product.
- Almost all industries subsume many
products and their evolutionary product life cycles.
- Industry evolution includes institutional (governmental, industrial, commercial,
etc.) markets prior to early consumer niches.
- Organizational Philosophy
- "Organization" applies to everything from the unplanned results of the "invisible
hand" to active managerial discretion within firms.
- The econom-ic reason we organize is to affect economic-al value transactions.
- The rareness of complete, timely, riskless,
and cost-free information - i.e., perfect information -- is why we organize.
- An organization is a "nexus of contracts"
that balances costs and risks of opportunistic behaviors.
- As managers follow these truths, they determine the structure of internal Value Chains and external
- The nature of competition is shifting from the firm to the Supply Chain, where the firm is one unit in
a value-adding system.
- Appropriability and Profitability are characteristics of Supply Chains that must be optimized at the firm-level.
- Project Management: A Dynamic Capability
- A project is strategic if it has an effect on
Competitive Advantage. Capital Projects first and foremost represent a risk taken with investors' capital.
- Capital Projects can present conflicts
of interest between managing the Value Chain v. the Supply Chain.
- The stronger the link between a Capital Project and firm-level EVA, the greater the justification
for using ROI.
hurdles should be derivative of the firm's capital structure, with the fiduciary, legal, and ethical implications therein.
Project Management challenge is an opportunity to add value, as opposed to manage value-added.
- The organization of a Projectized firm
is as important as any other form of economic organization.
- A PMO should help create and manage a Project Portfolio for synergistic effects that will add
value and increase overall EVA.
- A PMO should itself, by managing itself, become or become a part of an organization-wide Dynamic
Dynamic PMO must be a Learning Organization and center for Knowledge Management and Project Management Maturity.
- Global Project Management
- Govern-ance, not govern-ment,
is the real organizational issue as it concerns global technology transfer.
- This applies especially to the governance of
intellectual capital, which is the key "factor of production" in innovation.
- Firms, not nations, are proper units
of economic competition.
- Yet firms generally are not successful globally if they are weak at home.
- Technological innovation should be
managed where advanced economic factors are most productive.
- Global Projects are almost always Capital Projects.
- The flow of Capital in the global context
follows the same principal as in the Industry context - it will always flow to the firm that serves it ... best.