Practices of strategic alignment in and between innovation project portfolios

Abstract

Strategic alignment of project portfolios concerns the match between projects in the portfolio and the organization’s strategy. It is often considered either as a selection criterion when creating the project portfolio or as a performance indicator when assessing success. Organizations pursue optimal strategic alignment while retaining responsiveness to changes in the environment. The problem guiding this study is the need to understand how strategic alignment occurs in practice in the work of project portfolio management in the context of multiple project portfolios. We explore large firms’ practices of strategic alignment and cross-portfolio interplay in the innovation project portfolios of three industrial firms. The findings reveal social, mechanistic, and structural practices of portfolios’ strategic alignment and sharing, synergy creation, and boundary-spanning practices in cross-portfolio interplay. Strategic alignment is reported as a dynamic, continuous activity in the work of managers and personnel, with versatile practices that drive both efficiency and renewal.