Kim Warren on Strategy
Strategy insights and living business models
Corporate Portolio Management
Just been made aware of CPM – may be useful to strategic management. It seems to have come from the challenge of deciding and managing multiple, large-scale projects in sectors such as defence, IT and construction. Curiously, although there is what looks like a substantial professional body – the CPM Association – I could find little else on it, not even a Wikipedia entry.
The terminology may be a bit confusing, because ‘portfolio’ in strategic management usually refers to the set of businesses in a multi-business corporation, and the word ‘corporate’ generally refers specifically to companies made up of multiple business units – so Ryanair is a ‘company’ or ‘business’ and Shell is a ‘corporation’. CPM seems to refer to the portfolio of projects, whether within a single business unit or across a multi-business firm.
There may be a few important links for strategic management.
- The topic must clearly dominate the strategic management of firms who are largely engaged in delivering projects to clients … which projects to bid for, how much to invest, how to price, how to build and sustain staff, experience and capability, and so on. I don’t see much on this in the usual strategy books and frameworks.
- It must also be a vital element of strategic management in firms for whom large projects are a major part of what they need to do to function – oil and mineral companies, for example.
- It seems also to be significant specifically in the R&D and product development functions in e.g. pharmaceuticals or car making. And of course it is critical in IT.
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