The stages of a project within the strategic planning discipline provide a step-by-step approach to generating and implementing an effective strategy, for either a corporation or strategic business unit (SBU). Implementing a framework for generating a project planning cycle, complete with strategic objectives, implementation methods, and assessment, is a primary responsibility of strategic managers.
- Initiation: The initiation stage includes generating the idea, assessing the feasibility and profitability of the project, conceptualizing the operational benefits and bottom line, and getting approval and resources. This stage should determine the scope of the operation.
- Planning and Design: Planning and design, which follows the initiation stage, brings the project under the microscope by assessing the smaller details. This stage includes predicting the time investment, costs, specific resources required, and the necessary inputs to achieve the outputs forecasted in the initiation stage. This stage is the most strategic in nature, mapping out the business processes in sufficient detail to effectively accomplish the required objectives.
- Executing: The simplest stage in theory, and perhaps the most complicated in practice, the execution stage involves the integration of all inputs identified in the planning and design stage to construct the actual end product or service. This integration should be in line with the established framework hypothesized in the first two stages.
- Monitoring and Controlling: This could be thought of as the perfecting phase, where analyzing the efficiency and quality of the project cycle from a strategic perspective allows for the optimization of the operational processes. Monitoring the operation for ways to increase value can redirect the strategic planning cycle back to planning and design stage (as shown in the previous figure). This stage allows the process to run internally in a cyclical fashion, constantly adding improvements to capture more value.
- Closing: The project management cycle ends with the determination that the project no longer captures value and should be harvested or divested. This stage is the other possible result from the controlling and monitoring phase, where instead of being redirected back to the planning and design phase, the assessment shows that value is now being lost, and it is no longer profitable to continue the process.Therefore, the project cycle is closed.
This step-by-step process highlights each feasible step in the project management cycle. By appropriately incorporating each step of the model into the planning stage, managers can effectively forecast the deliverables and avoid losing value through accurately assessing the margins that will be produced in a given strategic initiative. This allows for informed and knowledgeable decisions to be made at each relevant point in the operation.