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Align your strategy with your organization’s activities: Implementing a Strategic Management Office (SMO)

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CHALLENGES

● Business division had +300 projects ongoing in the entire organization ● No prioritization of projects and visibility to their impact and status ● When risks aroused, they were often reported as issues 2-3 months later to senior management ● Increasing pressure from Group CFO to understand capital project impacts on cash and EBIT quarter

ACTIONS TAKEN

● Created a bespoke methodology to rank strategic projects ● Applied uniform valuation methodology to all initiatives Selected 30 projects out of 300 that would deliver about 70% of total company’s cash in the next 5 years ● Clarified roles, responsibilities and milestones for every selected project ● Structured SMO governance with weekly updates Built SMO tool to calculate the impact of risks/issues on cash/EBIT

RESULTS

● Increased communication between departments ● Achieved quicker identification of problem roots and solutions ● Estimated 3% increase in EBIT after 12 months driven by prioritization and effective response to issues ● Evolved culture to a more performance-driven organization with clear accountabilities
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