The Strategic Realization Office: Innovation’s New Best Friend
Organizations today must do more than execute on strategy—they must focus on continuous innovation. That’s leading progressive organizations to rethink how they turn strategy into reality.
Project portfolio management (PPM) became mainstream a few years ago as the process for turning strategy into execution. That has led to a number of improvements, but it has also created a number of challenges. Those challenges have encompassed everything from too much portfolio work being driven “bottom-up” to difficulties in evolving and adjusting the portfolio when new opportunities and threats arise. As a result, progressive organizations are implementing a new concept: the strategic realization office, or SRO (sometimes strategy execution office or simply strategy office). In the next few blog posts we want to look at the SRO in a little more detail, exploring how it supports organizational success.
The concept of the SRO is to create a dedicated function that allows organizations to do more than simply execute on a defined strategic plan. It recognizes that the highly disruptive, fast-moving environment organizations exist in today requires an approach that is adaptive, progressive and focused on growth. Advancements in technology combine with rapidly changing customer demands to continuously drive innovation, while competitor actions create constant threats to success. In this climate, organizations cannot rely on cost reduction and efficiency to drive long-term success; they must focus their strategic efforts on growth. In today’s world, consistent, substantive growth only comes from the ability to innovate continuously, and that’s where the SRO comes in.
The SRO owns organizational strategy. It facilitates organizational planning and ensures that all strategic activities are driven from the top of the organization. In practical terms, this means:
- Working with the C-suite and related executive roles to define the goals and objectives for the next period, ensuring that they align with the long-term strategic roadmap.
- Managing the ideation and proposal development processes with department and functional leaders to develop proposals for initiatives that will deliver on the strategic goals.
- Owning the portfolio modeling approach that will ultimately generate the strategic portfolio.
- Facilitating enterprise-wide business agility to ensure that the long-term vision, immediate goals and portfolio all remain in alignment.
The business agility element of this is critical. This is the ability of the organization to pivot quickly and with minimal disruption when the external environment the organization operates within creates threats or opportunities that require adjustments. Modern businesses must be built with the expectation that such adjustments will be required, and they must be structured to allow them to occur as seamlessly as possible. That only happens when the need to change is identified quickly and the changes are implemented smoothly. That in turn requires effective management, and that’s the role of the SRO.
In the next post we will look in more detail at the SRO’s role in portfolio management, but to close this first post, we have a warning about the dangers of bottom-up planning. While most organizations will claim they plan from the top, in many cases this is simply a case of setting the goals. The work that is defined and approved to meet those goals is often sourced from operational levels, often as an attempt to connect already identified needs with organizational goals. Whether it is projects sourced from an IT ticketing system, departmental process improvements or any other of a hundred different sources of projects, these initiatives consume resources at an alarming rate.
At best, there is only nominal awareness of how much time, effort and money is spent on such projects, and rarely will the benefits to the organization be effectively tracked. In almost no case will those solutions drive the innovation and growth that must be the foundation of strategic work in today’s organizations. For this reason alone, organizations should be investing in an SRO—although there are substantially more benefits than that.
To learn more about improving performance, read the white paper Strategic or Bust: Why Project Execution Needs to Change.