2. Goal-setting and projects

2.1. Approach according to Law on Strategic planning and decisions on Project management

Russian legislation approach to government strategic planning is based on the classic strategic management. Thus, analyzing the legal base of the modern state strategic planning, we can see that premises of fundamental strategic development management and views of design and planning schools have a strong connection. This allows to identify the opportunities and constraints of effective work of the strategic planning system generated by the requirements of the current Russian legislation, as well as to give grounds for defining complementary tools adaptable to the environment for which the classical approach is not productive.

According to the Federal law on strategic planning in the Russian Federation strategic planning system of socio-economic development in the Russian Federation covers two stages: (a) elaboration of basic strategic planning documents, which form the basic provisions of the state policy and (b) implementation and control of the state policy (level of formation of state policy and the level of implementation of state policy).

Basic documents of strategic planning are focused on strategic forecasting, goal setting and planning. According to the Federal law “On strategic planning in the Russian Federation” goal setting documents on the federal level are regarded to be the following:

• annual speech of the president to the Federal Assembly (in fulfilment of the speech the president issues decrees);

• strategy of social-economic development (elaborated every 6 years; ‘contains a system of long-term priorities, goals and objectives of public administration aimed at ensuring sustainable and balanced socio-economic development of the Russian Federation’);

• national security strategy of the Russian Federation, state policy framework and other documents in the sphere of national security;

• strategy of scientific and technological development;

• sectoral strategies;

• spatial development strategy;

• macro regions strategy of social-economic development;

Besides goal-setting functions, such as forecasting and determining priorities, strategic planning system includes implementation mechanisms, tools of monitoring, control, programming and planning.

Strategy of socio-economic development of the Russian Federation is prescribed to be a basis for the formation and adjustment of the list of state programmes of the Russian Federation.

State programs are still the only implementation mechanism of state policy Expenditure part of the state budget is formed on their basis.

According to the law state program is a strategic planning document, containing a set of planned activities linked by objectives, implementation timelines, performers and resources and instruments of state policy, providing the framework of key state functions achieving the priorities and objectives of state policy in the sphere of socio-economic development and national security of the Russian Federation.³⁴

However, state programs have proved to be an inefficient tool of state policy.

On the 25^th of May 2017 Prime Minister Dmitry Medvedev at the meeting with members of the government stated that only 18 state programs out of 37 are performed effectively. They considered the question of the federal budget execution for the year 2016. Total volume of the federal budget funds for execution of government programs in the past year was provided at 7.9 trillion rubles against 7.2 trillion rubles one year earlier.

Thus, the state program "Accessible environment" has been implemented since 2011 and was extended by the government until 2020. The program provides with adaptation of various social facilities for disabled people - hospitals, museums, theatres, sports facilities, multipurpose centers, etc. Audit of the Account Chamber has revealed that, in spite of increased funding of the state programme in more than 3.6 times, the program has not provide people with disabilities expected help.³⁵And total amount of program funding has grown to 169,4 billion rubles.

According to the Accounts Chamber estimates, in 2017 there are risks of not achieving targets up to 10% in 8 programs, 10 to 20% of the indicators – in 9 programs, from 20 to 30% - in 3 state programs, and more than 30% - in 8 state programs.³⁶

Basic problems of state programs realization are formulated in the Table 3.

Table 3. Basic problems of state programs realization³⁷

	Problems
Goals	The lack of specific goals. They are unattainable. Formal linkage with strategic planning documents and long-term social economic forecast. Because of the fact that sectoral strategies contain outdated goals, as a consequence state program goals are nor actualized
Indicators	Contain more than 2,000 indicators, many indicators are duplicated from program level to a subprogramme level. The timing of the calculation of the indicators goes beyond reporting. Indicators remain the same during the whole period of proram realization. No actualization takes place. Indicators are not concrete, the often contain interval indicators (more, less).
Approval	The need for ongoing formal approval of documents and results, both in their preparation and implementation stage
Participants	The lack of control over participants in the program from responsible Federal authorities and interdepartmental interaction. Sometimes there are too many participants, it complicates procedure of their elaboration and implementation and leads to lack of inter-ministry cooperation.
Budgeting	Planning of development expenditure is a residual following the formation of the public obligations. The distribution is fixed at the level of the Budget of the Russian Federation, there is no management flexibility in frames of the state program
Relevance	The loss of relevance of the state program, as well as the duration of the process of making changes in connection with necessity of issuing the regulation
Regulatory framework	Frequent correction/update of the normative base regulating the development and implementation of state programs, has a negative impact on quality of documents and their practical implementation
Risks	The lack of monitoring and risk management implementation of the state policy

As a result strategies lose their function of goal-setting, and state programs, in contrast, this function acquire.

On the basis of identified failure of introduced earlier mechanisms the government of the Russian Federation implemented the following measures, which alongside with other aims affected strategic planning mechanisms.

At the end of the year 2016 project management principles were presented in the regulation dated 15.10.2016 № 1050 “On the organization of project activities”, which establishes procedure for the implementation of projects (programs) in the main areas of strategic development, and by the decree of the president of the Russian Federation dated 30.06.2016 № 306 “On the Council under the President of the Russian Federation on strategic development and priority projects”.

The regulation establishes the following definitions:

“project is a set of interrelated activities aimed at achieving unique results in conditions of time and resource constraints;

program is a set of interrelated projects and activities which are connected by a common goal and coordinated jointly in order to improve overall performance;

portfolio - a set of projects (programmes), which are connected in purposes of effective management to achieve strategic objectives;

project activity – an activity related to initiation, preparation, implementation and completion of projects (programs)”.³⁸

The 4^th point of the decree says that the main tasks of the Council are:

“a) preparation of proposals to the President of the Russian Federation for the development, implementation and updating of the objectives, priorities and performance in the main areas of strategic development of the Russian Federation, including in the sphere of socio-economic policy, the definition of major tasks, basic approaches to methods, stages and forms of their solution;

b) definition of key parameters for a list of priority projects and programs in the main areas of strategic development;

c) control of goals achievement, priority directions and indicators in the main areas of strategic development”.

As we see, the main areas of strategic development are formulated by the Council under the president of the Russian Federation on strategic development and priority projects and then must be approved by the president.³⁹

After the Main strategic directions are defined federal authorities themselves and/or the Council determine priority projects on each strategic development direction.⁴⁰(Furthermore, projects may exist also on the departmental level, which means that any department may transform its activities/some part of activities into project activities. It concerns usually some long-term Presidential or Prime Minister’s assignments).

As for projects initiation proposals they ‘may be initiated by federal ministries, in accordance with instructions and decisions of the President/the Government, decisions of the Presidium Council and on the basis of established parameters and priorities for portfolio of priority projects (programs).

Proposals for priority projects (programs) can be prepared as a result of the expert/analytical activities and initiated by working groups intentionally formed by the decision of the Presidium of the Council or the project Committee in the respective area.

The list of Council members includes the president of the Russian Federation, prime minister, federal ministers, and other key members of the government. The Council has the right:

a) to invite to attend in meetings federal, regional and municipal civil servants, representatives of public associations, scientific and other organizations;

b) to invite analysts, scientists and experts.

Proposals for priority projects (programs) can be initiated by regional and municipal authorities, public associations, scientific and other organizations.’

Priority project (program) should correspond to the implementation of the state program of the Russian Federation, and be recognized as its structural element. If a priority project (program) affects the scope of several state programs of the Russian Federation, its relevant elements are to be incorporated into them as their respective elements.

According to this regulation, it can be concluded that the main difference between state program and priority project is that priority project is aimed at achieving unique results in some concrete part of the state program.

Strategy for socio-economic development of the Russian Federation is supposed to formulate priorities. Ministry of economic development is responsible for elaboration of strategy of socio-economic development. It collects relevant updated information with the help of the approved form, assesses gathered information, and on the basis of this information elaborates a strategy, if necessary it can organize a working group and discuss a strategy project.⁴¹Any time after considering annual monitoring results changes may be added in the strategy.

In practice ministries send poor quality materials with no strategic view at all, they just copy information from state programs. As a consequence, this mechanism doesn’t work properly yet.

During the implementation of priority projects (programs) corresponding assessment of the relevance of its goals, objectives and methods of implementation are carried out, taking into account existing risks and opportunities to increase benefits from implementation of priority projects (programs). The evaluation should be conducted by the task-setter of the project (programme) with the participation of the expert group in accordance with a master plan of priority project (program), and at the initiative of the customer functional priorities of a project (program) or by decision of the project Committee in case of significant changes of circumstances which affect the implementation of priority projects (programs). The results of the assessment and the related proposals will be considered by the project committee.

2.2. International best practices

Theoretical framework of this thesis and description of the Russian strategic planning and project management experience leads us to the following goal setting process structure.

а) strategic goals and priorities definition, role of project principle in strategic planning

b) priority projects initiation, projects analysis and selection, portfolio formation

c) projects implementation, analysis and assessment of project and strategy implementation

d) administrative support of strategic planning

We will consider international experience in frames of this structure and then make recommendations to the Russian practice.