Project Management Office; A Quick Start Guide

This weeks topic will be on Project Management; specifically on the indicators that tell you (as a business) that it is time to set up a Project Management Office, What does a PMO mean, how to go about implementing it, and finally how to ensure that the PMO is effective and efficient.

So lets get started.

1. What is a PMO:

A project is different than operations because projects have a specific beginning and end. Project Management is the application of tools and techniques to ensure that projects get executed the right way and yield the desired results.

A PMO (Project Management Office) is a business unit within an organization that manages a group of individual projects or multiple programs within the organization and monitors and ensure the delivery of the projects or programs.

2. Indicators for the need of a PMO:

The typical indicators of the need for a PMO are:

• Initiatives in the organization are not ending as planned
• There are significant cost over runs
• Lack of control of the tasks within initiatives
• Frustration and confusion among the workforce on the purpose of various initiatives
• Unexpected reactions to implementations

There are many other indicators. However the ones mentioned above are the more predominant.

3. Implementing a PMO; the correct way:

A PMO is not a one person business unit. A PMO is a little more involved than just having one Project Manager within one's organization.

Having clarified that point, the implementation of a PMO involves:

1. Verification of the indicators
2. Management buy-in
3. PMO implementation structure identification
4. Budget allocation
5. Resources identification
6. Workforce buy-in
7. Inauguration
8. Execution

A brief explanation of the above points are as follows:

First the indicators need to be verified to ensure the need for a PMO. This is usually done under the direction of Management. Depending on the organization size, a task force can be created to conduct an analysis and present its findings to the Management or the Management (typically including the CEO, COO, CFO and CIO) can conduct this analysis themselves as well.

Once the indicators have been validated, it is important for the Executive Management (and/or Board) to fully support the implementation of a PMO. It is important to clarify that implementing the PMO will increase costs in the short-term; however the cost will decrease and benefits will increase once the PMO has been established and has gone through a maturity cycle.

Next, the Management needs to decide what powers to give the PMO. This involves understanding the company structure and then deciding how much authority the Project Managers will have over the functional managers.

The structure will determine the budget that needs to be allocated. Some organizations first establish a budget and then conduct the Matrix Identification exercise (i.e. the power of the PMO). There is nothing wrong with this just as long as the organization understands that it PMO success is directly proportional to the budget allocated.

Workforce buy-in involves educating the worksorce on the benefits of a PMO. A PMO typically increases the workload for employees as they will need to perform additional functions during their work to satisfy the PMO requirements as it related to their tasks. Resistance to this can be significantly reduced with the proper training and incentives.

The official launch of the PMO, which includes a PMO Director and several Project Managers, is conducted by an official internal memo and/or press release. This step gives the PMO legitimacy within the organization and should not be skipped.

Finally the PMO goes into the execution phase where it implements Project Management Best Practices as well as the tools needed for running the PMO.

4. Ensuring PMO Success:

This is a very critical piece within the whole PMO implementation process. It is very important to understand that the PMO "will" receive a lot a resistance from the workforce. -And when this happens the Management needs to be strong and re-enforce the longterm objectives and the reasons for the PMO.

Many-a-times, the Executive Management will crumble at the first sign of resistance. When this happens, the effectiveness of the PMO plummets and will never be able to effectively function.

Therefore, the PMO Director and the Management must follow the steps in point #3 (above) to ensure that the resistance has been identified and that at least 80% buy-in has been obtained. Unfortunately, there will always be some people in the workforce that will never accept the PMO and its objectives. This is where the PMO Director's skills as a strong communicator will be put to test.

In summation, a PMO can ensure smooth operations by successful project delivery. However, the way the PMO is formed, implemented, and executed will determine its own success.

Question:

Have you seen the indicators for a PMO in your company? Have you implemented a PMO and if so what have you experienced?

If you need more information on this topic please contact Sal at skk@skkservices.com or visit www.skkservices.com