Throughout the years, thousands of project managers have dedicated countless hours in brainstorming sessions to justify their existence within their organizations. Even more hours have been spent on trying to market their value to the business community.
The opening question at these meetings remains the same: “How do project managers demonstrate value to senior management?” By understanding what really matters to senior management – every one possessing business acumen.
Acumen is a derivative of acute meaning keenness and depth of perception in practical matters. Some say business acumen is knowing the difference between strategic and logistical decisions while others profess it is a compilation of all of our education, skills and experience that transforms us into strategic partners within an organization.
Quite simply, building one’s business acumen is having the intuition and understanding of how your company makes money. Without acuity, and organizations unable—or unwilling—to provide job security, project managers are in danger of becoming irrelevant.
Driving profitability
Typically, management is completely focused on results and performance. Results are how much profit a product or service will deliver to the organization and to shareholders. Performance means how fast a product or service can be delivered to the marketplace utilizing sound strategic decisions.
In an executive’s mind, project managers execute the skills required for producing a project. Many times, executives believes that these skills are not directly related to results and performance, and therefore may think project managers can easily be outsourced.
To avoid being outsourced, project managers must focus their attention on linking their logistical know-how to profitability. Understanding the overall goals of the organization, the annual report and the financials are the first steps in knowing where the organization has been and where it is going. What are the priorities of the CEO and the shareholders? What does the SWOT say? What is the brand statement? What are the most profitable products and/or services the organization produces? What is the current economy?
A thorough understanding of what drives profitability and the expectations of senior management will enable you to make better business decisions—and garner respect.
From operational to strategic
The difference between operational decisions and strategic decisions is to study project management logic versus what drives results and performance. The project manager is a logistician; thinking about the checklist of things to complete in order to achieve success. A strategic thinker asks the following questions:
- How does this project support the vision, mission and strategy for the organization?
- Does the project budget contribute to profitability?
- Does this particular project support a strategy within the business plan?
- Can this expenditure be justified to the CEO and shareholders?
- What results does this particular project deliver to the organization?
Strategic thinkers have an orientation to the whole business picture, rather than focusing on just one part. Do you know how to map out the future of your department? Are you able to focus on building the future? Are your suggestions focused on the direction of your organization’s plan rather than aimlessly shooting at a moving target?
Focusing on business acumen is the foundation for protecting your position and building your name and reputation within the organization.
Return Monday, November 14, 2016 for Part 2
Michele Wierzgac, MSEd, speaker and author, promises that you will leave her solution-driven keynotes and workshops with at least one passionate, life transforming, leadership tool – something that will change the way you seek out a solution and practically apply it without getting stuck.
Email Michele at [email protected] or give her a call at (708) 710-7055!
