Do we need a PMO?

Posted by admin on Feb 28, 2019 12:29:51 AM

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What exactly is a project management office? How does it differ from a project management team? Shouldn’t project managers align themselves to the teams whose projects they manage, anyway?These are all good questions, and ones that often lead organizations to abandon the idea of setting up a formal PMO. In this blog series, we explain what a PMO really is, why it’s an important function, and how to  go about setting one up in your organization.


What is a PMO?

The Project Management Institute (PMI) defines the Project Management Office, or PMO, as “an organizational structure that may be used to standardize the portfolio, program, or project-related governance processes and facilitate the sharing of resources, methodologies, tools, and techniques.”

The PMO is responsible for establishing and maintaining a standard, company-wide set of best-practice project management methodologies, tools and templates. A well-managed PMO will therefore ensure that the entire organization is able to consistently and efficiently deliver successful projects that meet strategic goals.

And, considering the fact that most unsuccessful project fail due to poor communications or a lack of project management training, the PMO’s role in creating a process-driven culture where clear communication and close collaboration are encouraged, cannot be overstated.

A PMO will add the most value to an organization that regularly undertakes complex strategic projects that require careful control of costs, resources and risk.


What does a PMO do?

The PMO is the driving force behind establishing standards, providing training, and managing and reporting on project status including schedules, risks, budgets, quality, scope, and resources across all projects.

With the right support, a PMO can also lead organization change efforts to increase an organization’s overall project capability maturity.

You should expect the PMO to:

  • Clarify the role of projects and project management in the organization.

  • Provide a center of excellence for training, coaching and mentoring a team of competent project managers.

  • Improve resource utilization across the organization by matching project needs with specialized skills, availability, and geographic needs and by helping to balance the workload of project managers and project team members across all projects.

  • Manage and enforce project scoring and prioritization, and aid in selecting and analyzing projects.

  • Serve as a central point of control and communications for risks, issues, and changes across all projects.

  • Develop processes and templates to facilitate the development of project estimates, project documents, project schedules, risk management, issues management, change management, project acceptance and project reports.

  • Create project metric dashboards and scorecards to keep stakeholders informed and for portfolio analysis and decision support with a variety of views throughout the organization.

  • Review and audit projects in the organization as needed, to ensure good project management practices are being applied and key dates are being met and provide training, coaching and mentoring as needed.

  • Provide a central, customer-focused office to care for the concerns of the client, sponsor and stakeholders.

  • Reduce project costs by managing common issues and procurement at the PMO level.

  • Provide consulting to match business goals with appropriate technology solutions.

  • Collect best practices from each successful project to build a knowledge base and increase organizational skills.

 

Do we need a PMO?

Not every company will benefit from a formal PMO. To find out if yours would, ask yourself whether your organization can relate to the following statements:

  • Scope often changes on many of our projects.

  • The company is managing multiple projects with one resource pool.

  • We work with multiple contractors and vendors because of the complexity or size of our projects or as a condition of the bid process.

  • We are required to provide consolidated reports and metrics across all projects.

  • We require a single source for communications to clients.

  • Time to market is a critical factor in completing our programs or projects.

  • We work across multiple geographic locations.


What type of PMO is best?

There are three main types of PMO.

The ‘lightest’ of these is the Supportive PMO. A Supportive PMO plays a consultative role in projects by providing expertise, templates, best practices, training, access to information, lessons learned, and expertise from other projects.  This PMO serves as a project repository and the degree of control offered by this type of PMO is low. Projects and budgets are under the control of functional managers, with PMO simply providing support.

Then we have the Controlling PMO. A Controlling PMO provides support but also requires compliance. Requirements might include adoption of specific methodologies, templates, forms, conformance to governance, and application of other PMO-controlled rules. Reviews are common to ensure compliance. The degree of control provided by this PMO is moderate. For this PMO to work, sufficient executive sponsorship is needed.

And finally, we have the Directive PMO. This is the most ‘formal’ type, providing a team of experienced, professional project managers to manage all projects. Since the project managers originate and report back to the directive PMO, a high level of consistency of practice across all projects is guaranteed. The degree of control by this type of PMO is high. a


Setting up your PMO

In the next article in this series, we’ll offer practical advice and tools for setting up your own formal project management office.

Topics: FAQ, Project Management