The Strategic Program Management* questions on the PgMP^® certification exam constitute 15% of the exam or 25 questions.

These questions relate to the Program Strategy Alignment domain within the Standard for Program Management—Third Edition (2013). The emphasis is to ensure that the program initially supports and continues to support the organization’s overall strategic goals and objectives.

Before the program is chartered, this area is important to make sure the program should be pursued in the organization. Therefore, time and attention are needed to perform an initial assessment of the program by defining its objectives and requirements to make sure they are in alignment with the organization’s goals and objective. A high-level roadmap or timeline for the program also should be part of its business case before the program is officially approved. A mission statement should describe why the program is important. Also, justification for the funds that will be required is needed. Exam questions will emphasize key parts of the program’s business case.

Before the program is approved, the sponsor must identify key stakeholders who will be involved in and/or affected by the program and consult with them to make sure the program is one that supports organizational objectives, is feasible, is in line with the organization’s priorities as stated in its portfolio, and is aligned with the organization’s strategic plan. Exam questions may focus on key stakeholders and how to best ensure their support for the program.

Specific benefits for the program also should be part of the business case and are part of this domain even though benefits management is another domain in the exam. Benefits are the outcomes of the program and in identifying them, a cost-benefit analysis, market analysis, and other research should be conducted. By doing so, a high-level scope statement can be prepared along with a high-level benefits realization plan. It is important to keep in mind that programs are established because through a program greater benefits can be delivered than if the projects, subprograms, and other work in the program were managed in a standalone fashion. A benefit means an improvement to the running of the organization, and benefits can be either tangible ones, which can be quantified, or intangible ones, which are qualitative and more difficult to measure. Both types of benefits should be documented and included in the program’s business case. Some benefits will be realized while the program is under way, while others may not be realized until the program has been completed or even after the program has ended.

As well, there are more constraints when managing a program than a project, and these constraints, such as regulations, standards, sustainability, cultural considerations, geographical considerations, politics, and ethical concerns, must be considered before a program is approved. Questions will focus on the impact of the various constraints that will affect the program to help decision makers decide whether or not to approve it.

This domain introduces the program roadmap, which is progressively elaborated during the program, but serves as a graphical, chronological representation of the program’s intended direction. The roadmap is helpful to determine whether the program should be approved and also to review it periodically as one way to determine whether or not the program remains aligned with organizational strategies.

Within this domain, environmental assessments often are conducted, including analysis used to assess the business case and the initial program plan. These analyses include comparative advantage analysis; feasibility studies; strength, weakness opportunity, and threat (SWOT) analysis; assumptions analysis; and use of historical information. Enterprise environmental factors require consideration.

Strategic program management also involves evaluating integration opportunities, which means considering resource requirements, facilities, finances, assets, processes, and systems in the various program activities, including the non-project work, so they are aligned and integrated across the organization.

Once the program is approved, then the initiation process begins.

This area covers a substantial volume of material. You should study the contents regarding the Program Strategy Alignment domain in the Standard, but recognize now it contains a far broader treatment.

Following is a list of the major topics in the Strategic Program Management domain. Use this list to focus your study efforts on the areas that are most likely to appear on the exam.

Project, program, and portfolio definitions
Program management definition
Subprogram, component, and program activities
Business value
Relationships between—

• Program management and portfolio management
• Program management and operations management
• Program management and project management

Program factors

• Organizational process assets
• Enterprise environmental factors
• Environmental analyses
  • Comparative advantage
  • Feasibility
  • SWOT
  • Assumptions
  • Historical information
  • Assess validity of the business case and the program plan
• Environmental assessments

Organizational strategy and program alignment Strategic planning

• Feasibility
  • Readiness
  • Preliminary scope
  • Preliminary benefits realization plan
• Vision
• Mission
• Portfolio management
• Customer-focused programs
• Internal programs

Initial program assessment

• Objectives
• Requirements
• Risks
• Organizational benefits
  • Market analysis
  • Cost/benefit analysis
  • Financial and non-financial
  • Funding requirements

Program business case

• Costs and benefits
• Problems or opportunities
• Business and operation impact
• Alternative solutions
• Financial analysis
• Intrinsic and extrinsic benefits
• Market demand or barriers
• Potential profit
• Social need
• Environmental influence
• Time to market
• Constraints
• Authority, intent, and business need philosophy

Program mandate

• Use with business case for program approval
• High-level charter—costs, milestone schedule, and benefits

High-level program plan

• Vision
• Mission
  • Stakeholder concerns and expectations
  • Establish program direction
• Goals and objectives

Program roadmap—high level

• Intended direction
• Chronological
• Relationship between program activities and expected benefits
• Dependencies
  • Major milestones
  • Link to the business strategy and planned work
  • Decision points
• End point objectives, challenges, and risks
• High-level view of the infrastructure and component plans
• Difference between the schedule
• Preliminary estimates
• Set a baseline for program definition, planning, and executing
• Tool to help in program execution and benefit delivery
• Usefulness for governance
• Validation and approval from the executive sponsor

Program objectives

• Regulatory and legal constraints
• Social impacts
• Sustainability
• Cultural considerations
• Political climate
• Ethical concerns
• Stakeholder alignment
• Program deliverability

Integration opportunities and needs

• Human capital and human resource requirements
• Skill sets
• Facilities
• Assets
• Processes
• Systems
• Align and integrate benefits
• Exploit strategic opportunities for change

INSTRUCTIONS: Note the most suitable answer for each multiple-choice question in the appropriate space on the answer sheet.

1. Assume you are working for an organization, ABC, which has about 500 people in it. Recently, your executives attended a one-day training program that presented an overview of portfolio, program, and project management. When the CEO, CFO, and CIO returned from this session, you were tasked to provide a list of all of the projects under way in the organization for their review. When you reviewed all the projects before giving the list to the executive team, you recommended to them that some of the multiple projects under way be managed as a program. This is because—
   1. Deliverables are independent
   2. A collective capability is delivered
   3. Resource constraints affect projects
   4. Greater benefits would result
2. You met with the members of the Executive team in your company ABC. They were impressed with your knowledge of program management, and since they had attended the one-day seminar, they told you they wanted to make sure every program they set up supported the organization’s strategic goals because—
   1. The organization’s strategy is a result of its strategic planning
   2. The organization’s strategy affects how its vision will be achieved
   3. Different clients, suppliers, and technologies are included in each program
   4. Benefits and outcomes may affect the entire organization
3. Working to improve the maturity of an organization’s work in program management there are a number of items one can do. In the early stage of such an initiative, one recognizes the influence of the program by the needs of the organization’s portfolio, an example of which is—
   1. Timelines
   2. Stakeholder expectations
   3. Risk tolerances
   4. Escalated issues
4. Moving into a program environment is a major change for organizations especially in ones in which people are more used to working on projects. Programs have a broader scope, tend to be more complex, and may last for many years. This means it is necessary to—
   1. Focus on benefits management
   2. Exploit strategic opportunities for change
   3. Recognize the vision reveals the organization’s truest intent
   4. Focus on market changes
5. You are one of many project managers working on the new plasma screen development program. Your project has not yet started, but the program manager is anxious to have it begin as soon as the program starts. But before you can receive the go-ahead to start, it is necessary to—
   1. Create a schedule and identify risks
   2. Define the expected benefits in the business case
   3. Have a business case and a program mandate
   4. Identify the key stakeholders and determine their level of influence
6. Assume you are the program sponsor for this new program on the new plasma screen development to replace all existing LCD screens and enhance plasma’s screens so they can be viewed in 4-D. As you worked to obtain approval for this program, you decided to contribute to the body of knowledge available to the decision makers so you—
   1. Held a focus groups
   2. Consulted with experts for suggestions based on work on previous programs
   3. Conducted a customer acceptance review
   4. Prepared a feasibility study
7. Assume you are working in a Fortune 500 company. Recently, your company hired an outside OPM3^® Certified Professional to conduct an Organizational Project Management Maturity Assessment of its program management practices in terms of the standardize, measure, control, and continuous improvement areas. Organizational program management relates to program management because it—
   1. Has an approach to foster a sustainable competitive advantage
   2. Has a program management office (PMO)
   3. Has an emphasis to harmonize project and program components
   4. Has a focus on developing and implementing plans toward a common goal
8. As you work to prepare the business case for the new plasma screen program, you recognize it is essential to identify potential benefits that will accrue from establishing this program. You have assembled a team of stakeholders and plan to interview them for their opinions. You want to point out how and when this program’s goals will be pursued. It is documented in the—
   1. Program plan
   2. Benefit realization plan
   3. Business case
   4. Program roadmap
9. You are preparing the business case to obtain organizational leadership approval for a new program to implement a company-wide customer relationship management system to better manage sales activities and leads. You have been meeting with many people as you work to prepare this business case, and already you have heard a lot of the more than 600 salespeople in your company object to it. Your business plan therefore should clearly address—
   1. The technical feasibility of the program
   2. Intrinsic benefits
   3. How generally accepted methods of change management will be used
   4. How the return on investment will be calculated to demonstrate success
10. Assume you are working for the Motor Carrier Safety Administration in your government, responsible for the regulation of motor carriers in your country. You are a senior executive in this Administration, and you are getting ready for a meeting with the Administrator of the Agency and the other senior executives to review new programs and projects for the next budget cycle to be part of the overall portfolio. You have suggested that a program be established to consolidate various projects that require overhaul of existing regulations. Such a program is—
    1. One with major resource assumptions
    2. Preceded by the development of a roadmap
    3. A catalyst for change
    4. One with a parent-child relationship with the Agency’s portfolio
11. Realizing that before you meet with the Agency Administrator and the other members of the senior staff that funding is limited, especially with your President’s mandate to reduce spending at the federal government level by 50%, that you need to estimate the high-level financial benefits of your regulatory overhaul program to ensure it receives approval from your Agency Administrator and the other senior leaders. You need to establish a constant reminder of the objectives and the program’s intended benefits so you prepare—
    1. A program vision
    2. A financial framework
    3. An analysis of the net present value
    4. An analysis of the internal rate of return
12. You are a member of your organization’s Product Portfolio Committee. The head of your enterprise program management office (EPMO) recommends that a program be undertaken to develop a series of products for the next-generation automobile to be run using helium. In deciding whether or not to approve this program, of the following, which one is the most important for your committee to consider—
    1. Proposed schedule
    2. Benefits
    3. Feasibility studies
    4. Key resources
13. You are a member of your organization’s Product Portfolio Committee. The head of your enterprise program management office (EPMO) recommends that a program be undertaken to develop a series of products for the next-generation automobile to be run using helium. An important consideration of your committee is—
    1. Sustainability
    2. Regulatory issues
    3. Market analysis
    4. Key resources
14. You are a functional manager in your organization, the head of the Department of Engineering, and a member of the Selection Committee for new programs. At the committee meetings, you review potential programs. One key factor that you consider as to whether to approve a program is—
    1. Who will be the program manager?
    2. What are the funding requirements?
    3. What is the source of program funding?
    4. What are the next steps to get the program started?
15. As a result of all of your hard work and diligence to get your program started, and based on the business case that you developed, you have received approval form your Portfolio Review Board, which consists of your organization’s senior leaders, to proceed to initiate your program. However, you now should—
    1. Define how the program aligns with the strategic plan
    2. Define your program mission statement
    3. Establish a high-level roadmap
    4. Prepare individual plans for components
16. You are on the program planning team to develop a program for the next generation of drugs to combat joint disease. The executive sponsor has asked that you prepare a comparative advantage analysis to—
    1. Show “what-if” analysis
    2. Proceed with benefit analysis and planning
    3. Issue the program mandate
    4. Assess feasibility according to constraints
17. Assume you are a member of your agency’s Program Selection Committee, and the Committee has just met to determine which programs and projects it should pursue. Your program to develop the next generation Air Force radar system was approved. Since you now have the authorization to proceed, your committee then has to—
    1. Develop a program budget
    2. Identify and receive the key resources needed for planning
    3. Establish the rules for subcontractor selection
    4. Identify the feasibility studies that need to be conducted
18. As you worked to obtain approval for this Air Force radar program, you realized the necessity of conducting a SWOT analysis. Its analysis then—
    1. Focuses on factors outside of the program
    2. Assists in benefits identification
    3. Helps to develop the program charter
    4. Helps establish meaningful measures to assess program performance
19. You are a member of your insurance company’s Program Selection Committee. You are considering a number of programs to pursue. Each has identified benefits that support your company’s overall strategic plan, but you need to select the one with the shortest payback period. Program A is estimated to cost $100,000 to implement and have annual net cash inflows of $25,000; Program B is estimated to cost $75,000 with inflows of $20,000; Program C is estimated to cost $225,000 with inflows of $80,000; and Program D is estimated to cost $275,000 with inflows of $90,000. You recommend that your company select—

    Program A NPV at	Program B NPV at	Program C NPV at	Program D NPV at
    5% = $2,399	5% = $2,105	5% = $6,400	5% = $4,065
    10% = $3,112	10% = $1,254	10% = $3,275	10% = $1,852
    15% = $1,402	15% = $1,001	15% = $1,679	15% = $925

    NPV = Net Present Value

    1. Program A
    2. Program B
    3. Program C
    4. Program D
20. You are a member of your manufacturing company’s Program Selection Committee. You are considering a number of possible programs to pursue. Each one has identified benefits that support your company’s overall strategic plan. Data are available on four possible programs, but you can select only one because of resource limitations.

    Program A IRR	Program B IRR	Program C IRR	Program D IRR
    42%	40%	36%	33%

    IRR = Internal Rate of Return

    Based on this information, you recommend that your company select—

    1. Program A
    2. Program B
    3. Program C
    4. Program D