The Successful Project Management Office
Posted by Brad EgelandThe varieties of Project Management Office (PMO) models seems nearly endless. I’ve joined companies that already had them, helped organize one for a company I was already at, and consulted with smaller organizations who were just trying to get their PM processes off the ground. I believe there is no guarantee for success with any model. It’s how the organization values the PMO and the role of the PM, in general, and how the supporting organizations interact with the PM that plays a significant role in the PMO organization’s success.
In general, the PMO is the central organization that is staffed with skilled delivery Project Managers providing oversight and leadership services during the planning and execution of the projects within an organization. Whether all projects go through the PMO or just the most visible or the projects with budgets higher than ‘x’ dollars, that’s up to the individual organization.
The main tasks of the PMO and the PM in preparation for and during an engagement are:
- Project Planning
- Project Scheduling
- Risk Analysis
- Project Tracking
Project Planning
Project Planning may be undertaken by another entity – senior leadership or Sales – but I fully believe that the PMO and the assigned PM should be an integral part of this process. Sadly, that is not always the case. Project Planning involves the estimation of the size of the project and the timeframe and resources it will demand. The outcome of the Project Planning activities are usually a price to the customer and a project that is ready to be kicked off.
Project Scheduling
The act of Project Scheduling – or creating a detailed project timeline – may actually initially take place during the sales process as a way to show the customer that the organization understands the undertaking and has the resources and the timeframe to perform the work. This is another reason why PM involvement in the sales process is critical. In simple terms, Project Scheduling is the act of breaking the project down into detailed tasks, mapping them out with a project scheduling tool such as ProjectOffice.net or MS Project and setting milestones and performance indicators.
Risk Analysis
Risk Analysis should be performed by the PM team – lead by the Project Manager – and preferably with solid input, if not outright involvement from, the customer side project team. Risk Analysis is the act of identify potential project risks based on known and anticipated factors, weighing their probabilities, identifying possible risk mitigation actions, and putting them into some device or spreadsheet for on-going tracking purposes.
Project Tracking
Project Tracking becomes the sole responsibility of the Project Manager. This involves on-going weekly status reporting, leadership of weekly status meetings, monitoring and revising the detailed project schedule/plan, monitoring the team’s execution against it, and all the necessary communication that makes those tasks possible. Project tracking can be made much easier by using workforce management software, which can record how much time is being spent on each seperate task.
All successful PMOs feature four basic components:
- The right processes
- The right tools
- The right people
- Executive level organization support
I’ve seen PMOs with the right people, the right tools – or at least visions for building or acquiring the right tools – and seemingly the right processes, yet they have failed because executive management did not share the vision of the importance of the PMO in the organization or they didn’t stay with it long enough to help ensure success. I guess I would have to say from a personal standpoint, that may be the key ingredient. You can always hire different people. You can bring in consultants to help define better processes or identify better tracking tools. But without the executive-level support, none of it will happen or at least it won’t succeed.
Conclusion
The PMO is more than the staff that performs the project activities of planning, scheduling, communicating with the customer or ensuring the project delivery. Successful PMOs make an impact on organizational success by performing the following tasks:
- Aligning project delivery with strategic business goals and priorities
- Requiring that every project have an effective PM
- Implementing an appropriate PM methodology
- Consistent management and oversight of the project portfolio
- Obtaining and maintaining company leadership support
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Brian Heath says:
brad
youre dead right there and after setting one up (or rather improving existing one) in Iraq with litle support accross the org & zero from HQ & havinG to do everything manually (which is a good learner for local staff) I’d say politics & egos are biggest hurdle plus ’saving face” or “it’s my job” & losing sight of customers 9internal 7 external) & that mnay projects are business projects not IT projects & the business sponsor should run it with the PM & PMO. As you say a centralised for major cross-funct business projects or decentralised model (IT PMO, Tech PMO, Comm PMO) which seems to be way most telcos are going) is up to organisations.
linked in: brian heath
John Shaffer says:
I agree with the mechanisms outlined to set the framework for some type of structured methodology, however, the fundamental business reasons to have a repeatable and sustainable platform is return-on-investment. I have been involved with some very good PMOs and very poor PMOs. In my experience, when the process and mechanics becomes the ultimate goal, the returns are dismal. Studies have indicated that the average ROI for PMOs is as low as 2 1/2%. Not a good business decision.
ROI for a PMO can have many forms:
1. Reduced direct cost for PM.
2. Increased internal capacity to offset outsourcing core skills.
3. Significantly reduced cost overruns
4. The list goes on.
When developing the structure, the business value should be the definable goal.
http://www.ApexPMsolutions.com
Bruce says:
The best way to ensure executive support for any project (including setting up a Project Management Office) is to create a Project Board consisting of:
- 1 x Executive who has overall responsibility for the project achieving its goals (or organisational benefits)
- 1 or 2 Senior Users who will represent the ultimate users of the project outcomes (or products). In the case of setting up the PMO this may be senior project managers.
- 1 or 2 Senior Suppliers who will represent the group who will supply the solution (e.g. develop the PMO).
By creating this project board you ensure buy-in from both executive management as well as from the key users and suppliers of the project.
Kind regards,
Bruce
http://www.e-lm.com
Deepu Sugathan says:
The problem with PMOs is that it is almost never part of the business change management function (this does not even exist in most organizations) and are setup to manage projects for functional or sub-functional organizations. This also means that it is almost always part of the Operational functions. What this means is that even when the projects are completed successfully, the results may not be of much use to the bigger organization.
All projects are discreet changes and should add up to where the business wants to be strategically, even if the changes are operational improvements. Thus every project dollar will have the best chance to fulfill its strategic potential.
Without this approach, a PMO will always be tough to justify for no fault of its own. With the executive management completely focussed on the financials, on a quarterly basis, there is no time to think about how to make the organization operate better. The lack of any reporting about the operating state of the business, to match the financial statements does not help. So, I don’t see much hope. :(
PMP says:
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D. Patrick Howard says:
Brad, et al.
This a an excellent synopsis of what a PMO’s function is. I would go further by saying that a Project Management Office (PMO) is general terms is a group within an organization that has a primary goal of maintaining standards of process as it relates to project management. The PMO is tasked with standardizing redundant tasks and introducing economies of repetition in the execution of projects. As with most tasks that follow a process, repetition and adherence to standards can reduce mistakes and increase the
quality of the outcome. As the saying goes, “practice makes perfect.”
To accomplish this standardization, the PMO is the source of documentation, guidance and measurements on the practice of project management and execution.
So, how would a healthcare PMO differ from that of a typical PMO?
Lets consider it a given that a successful PMO will use industry standards methodologies and tools, such as PMBOK, Agile or SCRUM. Those best practices relate to the art and discipline of managing projects on the broadest of terms. The collective knowledge of project management can be applied to many disciplines and business models.
What makes a PMO within a healthcare organization’s IT shop successful?
For a PMO in a healthcare business to achieve peak effectiveness, the group must have specific
knowledge of healthcare subject matter. Healthcare is rich with government regulations
which constantly change the landscape of IT. New legislation is written almost daily which mandates changes in healthcare organizations. The IT departments and PMO within healthcare organization must constantly stay informed of these changes and navigate the treacherous waters of implementing changes in existing enterprise systems.
The language and nomenclature of healthcare is vast. Commanding the lingo of healthcare as it relates to information technology projects can take many years to master. An experienced and seasoned healthcare PMO has these environmental aspects of healthcare woven throughout the DNA of its members. In integral part of the PMO is the ability to analyze the requirements of the healthcare business. The seasoned healthcare PMO has members that are fluent in the dialect and
acronyms of the business of healthcare. This knowledge and understanding is critical in
reducing misunderstandings and acts as a filter to the technical side of the IT function.
Verbal and written communication skills are critical to successful PMO function.
Knowing the healthcare parlance enables the members of the PMO, from business analysts to project managers to grasp key concepts and translate those concepts into action. It is also important to mention that the lack of understanding of healthcare phraseology and terminology can lead to disastrous work estimation mistakes, wasted time and money.
In summary, I believe that an outstanding healthcare PMO has a solid foundation in
project management best practices. Built on this foundation is a group of seasoned professionals that have invested significant time learning the business and language of both healthcare and information technology.
How are PMO’s specifically adapted for success within your organization?
I am the COO of Pranagy Unlimited LLC. Pranagy Unlimited is an industry leader in health care technology project management services. You can learn more about me by visiting his LinkedIn profile: http://www.linkedin.com/in/dpatrickhoward
Brad Egeland says:
D. Patrick – Thanks for commenting. I agree completely with the ideas you posted. As for healthcare – I don’t think it really matters what the industry is, as long as the PMO has good, repeatable practices and processes, and good templates and documentation in place, then it translates well into whatever industry your organization happens to be in.
Thanks again.
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