One of the biggest trends in project management over the last decade (at least) has been the implementation of the Project/Program Management Office (PMO). There is perhaps no other buzzword in PM that creates more excitement and generates more debate than the PMO. In fact, I have seen several companies that embarked on implementing a PMO at the same time as attempting to introduce the concepts of project management within the organization.
Interestingly enough, there is very little common ground as to what a PMO is and what function it might serve. While several articles and books have been written on the topic, including in PMI publications, there is still a wide range of roles and responsibilities for this entity within organizations. The PMBOK guide has the following definition:
A project management office (PMO) is an organizational unit to centralize and coordinate the management of projects under its domain
In practicality there seems to be little standardization to what is meant by this term beyond this definition. It often is a crapshoot that is adjusted to mean just about anything. Even when the acronym itself is used, there are some organizations that use it to refer to a person as opposed to a corporate department. Throughout my career I have encountered several types of project based entities within organizations that were all referred to as “PMO”. They include:
- Project Office: a temporary department created to support a single project.
- Program Office: a temporary unit supporting the work of multiple projects within a program.
- Projects Support Office (PSO): an administrative unit supporting multiple but unrelated projects with activities such as scheduling, minute taking, estimating, report generation, etc…
- Departmental PMO: a unit supporting projects within a function in the organization such as a marketing PMO or an IT PMO. This unit may have some limited governance and/or oversight responsibilities.
- Corporate Projects Department: a unit that acts as a watch dog to audit the performance of projects
- Enterprise PMO: a unit that oversees inter-departmental projects and sets PM standards across the enterprise
- Center of Excellence: a unit that provides guidance and mentoring on PM matters in the organization without any direct oversight of projects.
It can become quickly apparent that one of the most important aspects of undertaking the launch of a PMO, or practicing project management within organizations, is to clarify terminology and come to agreement that produces a common understanding for the words “Project/Program Management Office”
Now that I’ve outlined the complexity and confusion associated with PMOs, I want to shift focus to talking about PMOs in SMBs. The first issue that SMBs need to tackle is to gain a solid understanding of the type of projects that they are undertaking within the organization. If the projects are external customer engagements, the rules of the game will be very different from internal strategic transformation initiatives. For external customer engagements it may be that the best type of unit is a PSO. However, for the purpose of brevity and focus I will not expand on project organizations dealing with external customer projects.
I do however want to focus on the type of organizational department that is responsible for supporting corporate transformation or implementing strategy. This type of organization is most suited to be referred to as a PMO or an enterprise PMO.
In this context, it is important to identify the specific organizational needs associated with launching a PMO. these requirements typically can be related to the following needs:
- aligning annual departmental/employee goals and objectives with strategy
- prioritizing initiatives and projects based on return on investment & degree of alignment
- planning change endeavors in an effective, consistent, and positive manner
- achieving the targeted business objectives defined on projects as part of the annual budgeting
- tracking progress on key organizational efforts to ensure a clear understanding of performance
- coaching and mentoring key staff involved in driving change within the organization
In light of these requirements the type of PMO that is needed within the organization is one that blends the role of monitoring and oversight with coaching and mentoring. A PMO in SMBs can serve in the following capacity with the below listed roles:
- Center of Excellence (COE): provides an organizational home for the development and implementation of the framework for project management within an organization.
- PM Profession Custodian: builds a profession for Project Management within the organization including Career Path, Development Support, and community building.
- Governance, Alignment, and Reporting: provides the mechanisms to report and track progress on projects, programs, and portfolios; govern project activities; and align execution activities with corporate and operational objectives.
It is possible, depending on the size of the organization and the resources available for a PMO in an SMB to address the above mentioned roles. However, from a pragmatic standpoint it may be easier to address one or two areas only. Additional factors that will have a direct impact on the role of PMOs in SMBs are the following questions:
- Will the PMO have project management staff housed within the department or will the project managers be spread across the various departments?
- Does the organization have full time project managers who are dedicated only to projects and not departmental activities?
- Will the PMO be directly responsible for managing projects or will it simply set the guidelines and provide oversight
As I try to bring this post to an end I want to emphasize that the most important exercise that the SMB needs to undertake is assessing organizational project management needs. This will enable the PM professionals to design a PMO that supports organizational strategy and bridges well with organizational culture/process.
Finally, the primary conclusions that I reached in dealing with PMOs are the following:
- Not all organizations need to launch and implement a PMO. Organizational needs may not dictate the necessity of having a PMO.
- The effective practice of project management is not based on having established a PMO in the organization.
- Common terminology can make or break a PMO
I hope that you enjoyed these observations related to PMOs and I welcome your input especially if you have direct experience with PMOs in SMBs.