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The Project Management Office. It just sounds official, doesn’t it?
Not all organizations have a project management office, or PMO. And not all should. But it’s definitely a good idea for larger organizations that are running many projects.
Why? Because a central office that handles most or all of an organization’s projects can create – especially over time – solid, repeatable practices based on project successes. Thus, hopefully increasing their chances of a higher percentage of project successes in the future. First, let’s examine the Project Management Office roles and duties it is intended to perform.
What is a Project Management Office?
Essentially, a project management office (PMO) is a central place to make sure company standards, procedures and practices are being followed to ensure projects are successful. According to the Project Management Institute (PMI), a PMO also “facilitates the sharing of resources, methodologies, tools and techniques”.
There are many benefits of implementing a project management office. The Project Management Institute's 2017 Pulse of the Profession Survey found companies that utilized a PMO had 38% more projects meet their strategic business goals and experienced 33% fewer failed projects.
A PMO can be especially useful to provide common practices and standards for organizations running multiple projects at multiple locations. It is also helpful to measure the effectiveness of the project management methodology being used, by accumulating project metrics.
Project Management Office Roles and Responsibilities
Every PMO is different. It depends on the size of the organization, the business environment, project management methodology used, and the stakeholders’ needs.
However, virtually all PMOs share some key roles and responsibilities.
The key project management office roles and responsibilities are to:
- Provide a structured governing project management body
- Provide a central repository for all projects and project information
- Provide a centralized management structure for all project management functions
- Provide project portfolio reporting capabilities
- Outline a well-defined project management process or methodology
- Mentor and train an experienced and competent staff of project managers
An organization with a project management office in place has the benefits of one central hub for all project management functionality. All projects can and should be run through this office, and all project managers should report through it. The PMO should be its own separate entity with a staff, a budget, and a mission. The best PMOs are well-defined and freestanding organizations within their companies or business units.
So how do the roles and responsibilities of a PMO differ to those of a project manager? A project manager is responsible for meeting specific, unique project objectives, while the PMO is focused on broader process, program or business goals.
PMO responsibilities may involve program scope changes to leverage opportunities, optimizing shared resources across projects, or managing methodologies and metrics. On the other hand, a project manager’s responsibilities may involve controlling the assigned resources and managing the unique project constraints to achieve project objectives.
Common PMO downfalls and concerns
Once an organization has created a PMO, then they have a mature, successful project management practice, correct? Not even close. While a PMO can offer many benefits to an organization, there are also downsides.
In my experience, many companies with PMOs still see project failure rates well above 50%. And PMOs within mature organizations still fail – sometimes more than once. I worked at one Fortune 500 organization that went through several iterations of a PMO without ever truly getting it right.
PMOs fail for many reasons – lack of communication, lack of senior management support, lack of experienced and skilled project managers, lack of solid processes in place, and yes…even lack of funding. In this next section, we’ll examine what I believe to be the key steps to take to ensure that you have the best possible foundation for your PMO going forward and, therefore, your best chances at project success for your organization.
Steps for an effective PMO
An organization looking to experience the best possible chances for success for the projects they take on, and the customers they manage them for, may want to look at creating a well-defined project management office to oversee the entire PM functionality. Or, if they have a PMO structure already in place but are continuing to experience repeated project failures or frustrations, a PMO reorganization may be in order.
Either way, these next four key concepts are what I consider to be the main building blocks to PMO effectiveness and project management success:
Obtain senior company leadership backing
I’m going to start off with this one because I feel strongly that this is the most critical factor for PMO success. Our senior leadership makes the decisions on budgets, projects, who stays and who goes, etc. Because of this, their buy-in on the project management office and its place and importance in the organization is of utmost importance.
If these company leaders do not see the value in the project management office and do not promote it as a viable entity, then it will not survive. Major projects may get assigned to other departments, funding for the PMO will be limited or non-existent, and the ability to staff the PMO with good PMs and structure it with good processes will be severely limited. Executive leadership must be on board…otherwise, the PMO is doomed to fail and projects will fail with it.
Ensure strong leadership
Too many times the PMO Director ends up being a project manager who just happens to be leading the project management office. That’s really a bad call unless your organization and PMO is very small. The director needs to be a well-connected leader in the organization. One who can knock down obstacles for the project managers on their projects. But that person needs to not be overloaded with 5 or 6 of their own projects. It’s understandable that a leader like this may be in high demand for a very visible project or to assist a PM on a troubled project with a high profile client, but that needs to be the exception, not the rule.
Hire experienced project managers
Seeking and hiring PMP certified project managers is a good place to start, but it should definitely not be the only hiring objective. PMP certification can help ensure that your project managers are using best practices to manage projects, have a good foundation of project management knowledge, and are using a common language when communicating across projects.
However, it is still only a supplement to down-in-the-trenches project management experience. The PMO must contain several project managers with experience in leadership roles and many successful projects under their belt. That said, it’s still also a good idea to a have a mix of junior and senior level project managers allowing the more senior project managers to mentor the junior staff as your organization seeks to grow its own PM talent.
Implement templates and repeatable processes
Your well-stocked PMO full of both experienced and eager to learn project managers needs templates, processes, and policies to follow. In short, they need a good project management methodology to lead the way. Time – and money – must be allocated to putting this in place before the PMO can successfully take off. Otherwise, your project successes may just be luck and potentially rare.
Just as you must allocate enough time and money up front in a project to plan, you must also do that with the PMO. A consistent process with reusable templates for project plans and documents will give your project managers the tools they need to run successful projects that will allow you to see that success repeated in a higher percentage of projects going forward.
If you are thinking of implementing a PMO at your organization, or improving one that’s already there - I hope these steps for a successful PMO will help you in your efforts.
With mentoring, coaching and support predicted to gain more importance in project management in 2018, a project management office is a vital way for many companies to provide support and impart expertise, especially to their newer project managers.
While they aren’t for every company, and aren’t without their flaws, the bottom line is this: is our PMO helping or hurting our mission of landing, executing and closing out successful projects? Just because it's there doesn't mean that it is providing benefits.
Over to you – what are your thoughts? Do these steps match up well with your own experiences? Share what you would add or change in the comments.