Leading Successful PMOs

How to Build the Best Project Management Office for Your Business

Peter Taylor

• Publisher: Routledge
• Year: 2016
• Print ISBN: 9781409418375
• eBook ISBN: 9781317106807
• Topic: Business
• Subtopic: Project Management
• Index: Business

Many organizations profit hugely by utilizing a Project Management Office (PMO); it means they achieve benefits from standardizing and following project management policies, processes, and methods. However, building an effective PMO is a complex process; it requires clear vision and strong leadership so that, over time, it will become the source for guidance, documentation, and metrics related to the practices involved in managing and implementing projects. Leading Successful PMOs will guide all project based organizations, and project managers who contribute to and benefit from a PMO, towards maximizing their project success. In it, Peter Taylor outlines the basics of setting up a PMO and clearly explains how to ensure it will do exactly what you need it to do - the right things, in the right way, in the right order, with the right team.

1 The Meaning and Purpose of a PMO

In this chapter we:

• explore the various definitions of PMOs;

• ensure that we all have a common understanding of what a PMO can (and can’t) be; and

• appreciate who the stakeholders are likely to be; who it is who is most interested in your PMO being a success.

PMO ‘JEOPARDY’?

Let me start in the spirit of that classic US game show ‘Jeopardy!’1 …

Answer: ‘A PMO.’

Question: (and therefore actually the correct answer; that is just the way it works on the game show, trust me – or look it up) ‘What is the department or group that defines and maintains the standards of process, generally related to project management, within an organization?’

Applause from the audience and smiles all round.

Yes, the Project Management Office (PMO) in a business or professional enterprise is typically the department or group that defines and maintains the standards of process, that are generally related to project management, within the organization.

But I am afraid it is not that simple.

The abbreviation, PMO, can stand for Programme Management Office (confusingly also a PMO) or Portfolio Management Office (increasingly confusingly also a PMO). There is even talk of a Project Office (PO), a Project Control Office (PCO), a Central Project Office (CPO), and a Project Support Office (PSO). Up to you to choose – what do you have in your company? What are you leading? What are you part of? What is it that you are currently planning?

You may well have a completely different flavour of PMO from the above.

The PMO strives to standardize and introduce economies of repetition in the execution of projects and is the source of documentation, guidance and metrics on the practice of project management and project execution.

It is also the body that links business strategy to the projects that such strategies require.

Organizations around the globe are defining, borrowing and collecting best practices in process and project management and are increasingly assigning the PMO to exert overall influence and evolution of thought to continual organizational improvement.

Many PMOs will base project management principles on accepted industry standard methodologies such as the PMBOK2 or PRINCE2.3

There are as many variances in the structure, format and focus of PMOs as there are definitions of the term.

PMO Types

Typically there are five basic types of PMO:

1. a Departmental PMO

2. a Special-purpose PMO

3. an Outreaching PMO

4. an External PMO

5. an Enterprise PMO

It should also be noted: the ‘enterprise’ structure can apply in more than one of the first four categories.

Type definition aside, a PMO is a group or department within a business, agency or enterprise that ‘owns’ the kind of project-based activity that cuts across the operational activity. The primary goal of a PMO is to achieve benefits from standardizing and following project management policies, processes and methods. Over time, a PMO will become the source for guidance, documentation and metrics related to the practices involved in managing and implementing projects within that organization.

WHY INVEST?

Why do businesses invest in a PMO?

On the one hand, companies of all kinds face the continued fallout from the most recent global recession which has placed an added burden on projects and project managers delivering expected benefits.

On the other, we are part of a dynamic, resourceful and ever-evolving commercial world that demands change as part of its survival; change demands projects, and projects demand project managers.

History is littered with significant project failures (witness some of the statistics of the CHAOS4 report analysis of IT project success, and more often failure5), yet there are also spectacular project success stories linked to the maturing practice of project management.

Those projects that will be commissioned in the future, as well as the ones that are allowed to continue in the current challenging climate, will be expected to deliver greater business benefits, endure closer scrutiny from senior management and are likely to face far more pressures to deliver. There is no longer any room for project failure; projects that are approved need to succeed.

And who will be under the most pressure? You guessed it, the managers responsible for those projects.

Right now our projects, and our project managers, need the help, support and guidance of a good PMO and a ‘good’ PMO has to be led by a ‘good’ PMO leader.

The good news is that PMOs are in demand.

In their ‘The State of the PMO 2010’6 report, PM Solutions stated that: ‘The upward trend is unmistakable, both in sheer numbers of PMOs and in the rising organizational clout. In our 2000 research on “The Value of Project Management”, only 47 per cent of companies had a project office. In 2006, our research on “Project Management: The State of the Industry” showed that 77 per cent of companies had PMOs; “The State of the PMO 2010” research shows that 84 per cent of companies have PMOs.’

This is excellent news; it suggests the battle to establish the value of the PMO has, for the most part, been won.

This book is therefore less about the business justification of a PMO and more about being the very best that you can be as a leader and a contributor to a successful PMO; making your PMO the one that really delivers.

PROGRAMS, PROGRAMMES AND PMOS

To avoid confusion, it is important that we all have a common understanding of project and PMO terminology.

To that end we should all align our language when it comes to Projects and Programmes,7 Portfolios and PMOs.

It can be a very confusing world when we talk of projects and programmes and portfolios and PMOs so I am going to open with the simplest of explanations which I am hoping you will accept for the purposes of this book.

Project Management is all about doing something (a project) in the right way and the ‘right way’ is all about method and discipline and quality and control.

Programme Management is all about doing those things (the projects) in the right sequence or order.

Portfolio Management is about doing the right things.

Which leaves the PMO; and which I think of as doing all the above but with the right team (the right things, in the right way, in the right order).

Hopefully that helps.

If you prefer a more detailed explanation:

Project management

Project management is the discipline of planning, organizing, securing and managing resources to bring about the successful completion of specific project goals and objectives. It is sometimes confused with programme management, however technically that is actually a higher-level construction: a group of related and interdependent projects.

A project is a temporary endeavour, having a defined beginning and end (usually constrained by date, but can be by funding or deliverables), undertaken to meet unique goals and objectives, usually to bring about beneficial change or added value. The temporary nature of projects stands in contrast to business as usual (or operations), which are repetitive, permanent or semi-permanent functional work to produce products or services. In practice, the management of these two systems is often found to be quite different, and as such requires the development of distinct technical skills and the adoption of separate management.

The primary challenge of project management is to achieve all of the project goals and objectives while honouring the preconceived project constraints, or at least in managing the adjustments of these constraints through a disciplined process. Typical constraints are scope, time and budget together with an over-arching consideration of quality.

Programme management

Programme management is the process of managing several related projects, often with the intention of improving an organization’s performance. A programme of projects can help a company achieve one or more of its strategies. The individual projects within it have varying end dates but the programme ends when the strategy has been reached.

There are two different views of how programmes differ from projects.

In one view, projects deliver outputs, discrete parcels or ‘chunks’ of change; programmes create outcomes. Thus, a project might deliver a new factory, hospital or IT system. By combining these projects with other deliverables and changes, the associated programme might deliver increased income from a new product, shorter waiting lists at the hospital or reduced operating costs due to improved technology.

The alternative view is that a programme is nothing more than either a large project or a set of projects. In this second view, the point of a programme is to exploit economies of scale and to reduce coordination costs and risks. The project manager’s job is to ensure that their project succeeds. The programme manager, on the other hand, may not care about individual projects, but is concerned with the aggregate result or end-state. For example, in a financial institution a programme may include one project that is designed to take advantage of a rising market, and another to protect against the downside of a falling market. These apparently opposing projects fit together in the same programme.

Portfolio management

Project portfolio management (sometimes referred to as PPM) is a management process designed to help an organization to register and view information about all of its projects. Once it has the visibility (you can’t manage what you don’t measure) then this allows such organizations to sort and prioritize each project according to certain criteria, such as:

• strategic value

• cost

• impact on resources

• tactical need

A PPM-driven organization will have, typically, a portfolio/project dashboard representing the overall health and status of each project.It should be noted that the projects and/or programmes within a given portfolio may not necessarily be interdependent or directly related to each other. For example, in a services-supplying company the portfolio will mainly record customer project activity with little relationship between the individual projects.

PMOs

The PMO in a business or professional enterprise is the department or group that defines and maintains the standards of the business processes, generally related to project management. The PMO strives to standardize and introduce economies of repetition in the execution of projects. The PMO is the source of documentation, guidance and metrics on the practice of project management and execution.

A good PMO will base project management principles on accepted, industry standard methodologies, as well as government regulatory requirements as app...

Table of contents

• Cover Page
• Dedecation
• Title page
• Copyright Page
• Contents
• About the Author
• Foreword by Chris Walters
• Foreword David Ayling-Smith
• Acknowledgments
• Reviews for Leading Successful PMOs
• Introduction
• 1 The Meaning and Purpose of a PMO
• 2 What Makes a PMO Successful?
• 3 Being a Successful PMO Leader
• 4 Starting a PMO
• 5 The Final Frontier
• Appendix 1 PMO Leaders’ Checklist
• Appendix 2 An Insight into the Minds of Your Project Managers
• Appendix 3 PMOSIG
• Appendix 4 International Project Management Day
• Appendix 5 PRINCE2
• Appendix 6 Manager or Leader?
• Appendix 7 Some Further PMO Reading
• Appendix 8 Some Useful PMO Blogs and Podcasts