A healthcare organization’s mission is to improve patient outcomes. How do you ensure that the projects across various departments ultimately serve that overarching goal? The answer: aligning projects and portfolios.
Just 57% of projects are “highly aligned to strategy,” according to the Project Management Institute (PMI). Yet strategic alignment in project management is essential for business transformation and growth. You must ensure you’re completing the right projects, the ones that further your strategic goals, and prioritize them appropriately, staffing them accordingly.
Proper project portfolio management leads to business strategy alignment. On the flip side, when projects are misaligned to strategy, the deliverability of high-priority projects is at risk.
You might under or overutilize resources. Or, you could see silos across your organization. Communication and collaboration may suffer. And, most importantly, you won’t meet your organizational goals and produce transformational change. That kind of change is essential for your organization to stay competitive and be successful.
What’s the true cost of failed projects—and how much of that is due to misalignment? More to the point, how can you overcome challenges to derive greater value from your projects and ensure they are intertwined with your goals and vision for your organization?
Discover the hidden costs of project misalignment, and learn how PPM helps PMOs improve strategic alignment, resource use, and overall impact.
What Is Strategic Alignment in Project Management?
Recently, MIT made headlines with a bold claim that 95% of generative AI pilots receive “zero return,” despite $30–40 billion enterprise investments. The report, The GenAI Divide: State of AI in Business 2025, finds that a misplaced focus or lack of alignment is a major contributing factor: While 50% of GenAI budgets are allocated to sales and marketing, back-office automation offers better ROI.
Strategic alignment involves assessing your business to find the good and the bad. It means ensuring that the various facets of your organization all have a purpose within the larger schema.
In a project management context, strategic alignment refers to how projects work together in portfolios or programs to achieve greater goals. In order to meet these goals, you must align your initiatives with your mission-critical objectives.
Henderson and Venkatraman’s Strategic Alignment Model addresses each part of the organization, ensuring harmony between all elements. The goal is to ensure every project and program connects with real value, which helps teams and managers prioritize resources to ensure success. Ultimately, you will see streamlined project execution and greater overall alignment.
Why Is Strategic Alignment Important?
The consequences of misalignment can be dire: products may not make it to market, business growth is slowed, and it can even lead to bankruptcy in some cases, research shows.
On the other hand, highly aligned organizations increase revenue 58% faster and are 72% more profitable than misaligned orgs, according to LSA Global.
That’s the overarching advantage of strategic alignment. But there are many other benefits as well. For example, you will see better PMO prioritization and project prioritization, more stakeholder buy-in and engagement, greater consistency across projects and portfolios, and enhanced creativity and innovation.
The PMO produces more value and ensures that this value reverberates across the organization. You will produce less waste and ensure greater productivity and adaptability to change. What’s more, everyone involved is working toward the same goals.
Challenges in Project Alignment and Signs of Misalignment
Before you can address problems in strategic alignment, you need to be aware of what you’re looking for. If you’re facing challenges in project alignment, you will likely see some or all of these more complex warning signs. They are a clear indication that you must take action to prevent these problems from escalating. Here are some signs of strategic misalignment:
Your overarching goals are at odds with lower-level projects.
You’re facing conflicting or inconsistent goals or priorities. Competing priorities and goals can prevent you from reaching any of these objectives.
Moreover, there is a lack of long-term vision. Your approach is reactive rather than proactive. You deal with urgent matters without planning for the long term. Plus, you’re focusing too heavily on projects that no longer support current business goals. Resources are tied up in low-impact initiatives, and you’re focusing on outdated issues rather than on timely market needs.
It’s understandable that you want to deliver immediate results, but this may be preventing you from looking toward the future.
Executives and stakeholders don’t understand project value.
Leadership is not in agreement as to how projects support each other and the larger strategy. Even if they do understand the strategy and project roadmap, they want to focus on the projects that are most important to them. These and other factors mean a lack of team or stakeholder buy-in.
Stakeholders don’t “get” why project alignment is important. They don’t see how projects fit into the bigger picture. They don’t know why they need to support your larger goals.
There are silos within the organization.
Groups work in silos and don’t communicate properly. Collaboration is fragmented, preventing real coordination.
Discrete projects don’t serve the entire organization, just individual departments or singular efforts. They aren’t tied to your big-picture goals, just smaller or short-term objectives. There is no larger framework connecting your projects to the business.
There is a lack of consistency and prioritization.
Roles and responsibilities are undefined, and there are no clear expectations. There is also a lack of accountability and improper resource management. You’re over or underutilizing resources without understanding the consequences.
Additionally, you lack a consistent method to prioritize based on strategy. This leads to goal misalignment. Projects are not weighted according to their true value, and resources are not allocated properly.
How to Ensure Successful Strategic Alignment
Without strategic alignment, you can’t ensure that your projects or even comprehensive portfolios will deliver value to the entire organization. Your efforts on individual initiatives may be wasted. So, what can you do to ensure successful strategic alignment?
Establish a project evaluation framework to prioritize and align projects.
Creating a prioritization framework allows you to ensure adherence to organizational goals and larger strategies, fueling better project portfolio governance and resource management. You will be better able to distribute resources according to your priorities and allocate resources to the highest-value projects.
Create and monitor KPIs.
Establishing and measuring KPIs and outcome-based metrics lead to better decision-making. Not only will you be able to keep confirming alignment with your overall strategy, but you will also maintain momentum.
Establish strong communication channels.
Update stakeholders and team members regularly, keeping communication open. Ensure everyone involved understands the organizational goals. Confirm that each project ties to these goals and articulate how they do. Always be transparent about objectives and progress.
Involve all relevant stakeholders and team members.
Eliminate silos; they are standing in the way of proper collaboration. Ensure departmental, team, and individual alignment with wider organizational goals.
Use technology to improve processes.
Project portfolio management software like Prism PPM helps you manage projects and processes. These platforms house and produce data and visualizations and offer advanced capabilities, including automation and real-time data-sharing.
Continuously adapt and refine your strategy.
Continue to monitor your strategy to find areas of improvement. Remain adaptable, recognizing that trends and technologies change. You must evolve with these changes. Solicit feedback as well, involving stakeholders and team members. This is also a way to ensure that stakeholders are engaged and bought into the process.
Conclusion: The Value of Strategic Alignment in Project Management
Strategic alignment in project management allows you to establish direction, prioritize projects, and make better decisions. This means you can respond to changes in market conditions, new organizational goals, and priorities.
Strategic alignment kickstarts business transformation, extending the value of individual projects to serve and provide value to the holistic enterprise. Through this approach, you will focus on the benefits rather than the immediate future. Always ask yourself: How do projects feed our mission?
Prism PPM helps you strengthen your approach to strategic alignment and project portfolio optimization. Centralize project requests and ideas, rank initiatives based on your criteria with our Business Value Assessment tool, initiate and deliver projects faster, and manage resources more efficiently. With Prism PPM, you can see the real value and impact of your projects across the organization, manage inter- and intra-project dependencies, forecast risks, and balance workloads. Book a 30-minute consult or a 60-minute demo today.