Many Project Managers need to work with a Project Management Office. And, when it’s your first time, you wonder what you can expect. And for some, this can lead to the recognition that a PMO career is an appealing option. So, in this guide, I will survey everything you need to know about a Project Management Office.
This will be one of our biggest Guides yet. So, buckle-up, as I set out to cover:
There are as many definitions of a PMO as there are PMOs. So, let’s start with a couple of trustworthy sources, the Project Management Institute (PMI) and the Association for Project Management (APM).
A management structure that standardizes the project-related governance processes and facilitates the sharing of resources, methodologies, tools, and techniques.
An organisational structure that provides support for projects, programmes and/or portfolios.
I like to keep things simple.
A PMO is a group that serves the needs of Project Managers and project teams.
They can do this in a number of ways that we’ll look at in more detail shortly. But which of those ways they select will be different wherever you look. The selection should arise from the needs of the project community within the organization.
The most common activities are:
I discuss all of this in my short video, What is a PMO?
As I discuss in the video, we equally find Project Management Offices, Program Management Offices, and Portfolio Management Offices. These may genuinely operate at different levels in the organization. However, they may also be different names for largely similar internal organizations.
Projects, Programs, and Portfolios are often contracted into the convenient acronym, P3. This leads to the term P3MO or, indeed, P3O. While I shall use the term PMO and Project Management Office as the generic term throughout this article, I shall sometimes use P3 as a shorthand for Projects, Programs, and Portfolios.
Broadly, the answer is yes. And that is why I will stick with the term Project Management Office in this article. Because that is my primary focus.
Project Management Office
The focus is on support for project management teams. They offer standard tools and processes for project delivery. They often have an additional focus on project assurance.
Program Management Office
The focus is on support for program management teams. They offer standard tools and processes for program delivery. They often have an additional focus on governance.
Portfolio Management Office
The focus is on forming and overseeing a balanced portfolio of projects and programs and supporting project and program management offices.
We have a couple of articles about Project Assurance:
Building and maintaining a PMO is a substantial investment for an organization. So, they will need to see a return on their investment. We’ll look at that in a moment.
Often, there is. And that need arises from a recognition that there is a pattern to a series of failures. If there is a case that a PMO can be an important part of finding or implementing the necessary solutions, then that creates the need.
In an organization where projects run well, there is a real risk that a PMO will be nothing more than an overhead. It would need to work doubly hard to demonstrate true benefits that exceed its costs.
But here’s the thing… If we create a PMO to fix a set of problems, and it does: what next? Now the projects are running well, do we still need the PMO? That’s going to be a tougher question for a PMO community to answer.
So, let’s see what the benefits are. First, we will look at the benefits to the organization (it is paying for the PMO, after all!). Then we’ll turn to the Project and the Project Management Community.
Certainly, if you have a PMO and now your Projects repeatedly finish on time and within budget, that is a benefit. But the skeptic will ask ‘how instrumental is the PMO in that success?’
There are other benefits a PMO can bring, that cannot be ascribed as easily to the efforts of individual Project Managers and their teams:
Project Managers and project teams tend to be fiercely proud of their successes. So, anything that can help them (and does not get in their way) will be welcome. A good PMO can provide them with:
So, with all these benefits to be had, and with a recognition that every PMO is different, let’s look at the range of roles a PMO can fulfill.
Many authors categorize these under three headings that reflect different operational priorities for the PMO. However, these headings are of most use to us now for classifying the roles. Because all but a few PMOs in the real world take a blended approach that combines elements of all of these.
The three operational modes are:
The aim here is to be as helpful as possible to the projects and project teams the PMO serves. They provide:
In this model, there is a lot more enforcement of preferred approaches and a move from ‘good practice’ to ‘best practice’. This may be driven by genuine regulatory needs, but may equally be a result of the organizational culture.
Here we see a bigger emphasis on governance and, as a result, more resources allocated to data gathering, analysis, and presentation. Many of the chosen methodologies will focus on meeting this need for good governance and a consistent data set. Tools like Discounted Cash Flows and Earned Value Management may become mandated.
Additional things this form of PMO may provide include:
A directive PMO becomes responsible for the projects in its portfolio. It often provides its own Project Managers to lead them. If not, the Project Managers are accountable to the PMO.
Now, we see the PMO supplying:
Another way that we see different PMO models is the level of the organization at which they operate.
The earliest PMOs were single-project or single-program PMOs. These formed a central office function to serve a single large project or program with administrative support, resource management, communications management, data-gathering, and reporting.
At the next tier, there may be a regional, divisional, functional, or multi-project PMO, serving projects or programs across a specific portion of an organization. This would centralize a number of additional functions across a range of projects providing some consistency, support, shared resources, and economies of scale.
An Enterprise PMO (EPMO) serves a whole organization. It will often have a Portfolio Management remit, to ensure that projects align with organizational strategy and objectives. They will also have a clear focus on value and, for this reason, I am attracted to the term VMO or Value Management Office, coined by Hélio Costa in his Fleks methodology.
An EPMO or VMO will either be led by a C-suite executive or its director will report to one. The EPMO director will have the authority to make strategic and tactical decisions across the portfolio.
There is one further variant on the PMO we must address. This is that of a Project Management Center of Excellence. This form of PMO has a limited remit to define project management standards, policies, processes, procedures, methods, and tools that all project teams across an entire organization will use. In support of this, it may also:
In setting up a new PMO from scratch, the first decision is likely to be ‘an incremental or a big bang approach?’
Whilst it may be possible for a seasoned PMO executive or consulting team to build a fully formed PMO from nothing, my assessment is that an incremental approach is far more likely to provide continuing beneficial returns on investment. In addition, it will be easier for its proponents to garner internal support and counter the inevitable resistance.
This is not a complete checklist. Rather, it should give a sound impression of the kind of process you are likely to adapt and follow. I have divided it into two stages.
There are two aspects of running and optimizing your PMO. First, we’ll look at raising its maturity level. Then, I’ll address the operational review.
In the first part of the two-part article that PMO expert Peter Taylor wrote for us, Taylor describes a simple 5-part Maturity Model for PMOs:
This is a journey. At any point, you can expect aspects of your PMO to be at different maturity levels. Your first priority is to bring the trailing capabilities up to meet the standard of the majority in the middle. Then, you can start to lift more of them to meet the level of the best. Finally, you can start to increase the levels of capability in some areas to the next maturity band, and thus repeat the process.
As well as maturing your PMO offering, you must keep its service portfolio relevant to the needs of its clients and the sponsoring organization. And yes, I do appreciate that there may well be conflicts between these two stakeholder groups!
Here are some essential things to keep under review:
I talked above about the benefits of a PMO. And, for hard-nosed executives, your PMO will need to continue to represent good value for money. Arguably, the Chief Financial Officer or Finance Director will be looking at one measure ahead of all others: Return on Investment, or ROI.
ROI = Net Benefit / Total Cost
Net Benefit = Total Benefit – Total Cost
Cost is (relatively) easy to measure. And most organizations will have their own approach to apportioning fixed costs and overheads to teams and initiatives like a PMO. But, what are the measures that will contribute to assessing the total benefit?
The kinds of performance indicators you will need to gather will be things like:
I always say that Project Management is a brilliant core competency that is a springboard for a great number of different career paths. And one of those is a PMO career.
For Project Managers used to long and unpredictable hours – and maybe a lot of travel, PMO work can often offer greater stability and predictability. For some people, ad at some stages in life, this will be very welcome.
However, for others, a PMO role can seem dull. What matters is what suits you.
At the start of a career, however, junior PMO roles can be a fabulous place to learn core Project Management skills, and to observe and learn from experienced Project Managers. You can also observe multiple projects with a wide range of challenges at the same time. This can truly multiply your rate of experiential learning.
Within the PMO career path, there are many roles. However, I shall focus on five: four of which are taken from the excellent House of PMO publication, ‘The PMO Competency Framework’.
The PMO Director is the figurehead of the PMO and therefore needs to play the role of an inspirational leader. This does not mean they need to be a charismatic individual. But they must inspire confidence in the PMO from among:
Indeed, they are the senior-tier champion of the practitioners. Their principal focus is upwards in the organization, working at the board level to understand, interpret, and possibly help shape strategy. This means working with the PMO Manager to shape PMO strategy in response. They are the interface between the PMO team and the Projects community on the one hand, and the Enterprise strategy and leadership on the other.
The PMO Manager is the day-to-day leader and manager of the PMO team. As such, they need to be a mentor and coach to the PMO team – and to senior Project managers in their community. They must also champion the PMO’s services and approach, while listening to the feedback that will allow them to adapt and improve the PMO continuously.
The PMO Manager will also be the face of the PMO to various departmental and functional teams and will negotiate with them and deliver reports. Stakeholder engagement will be a large part of their role.
The three support roles I identify are:
A couple of years ago, Nicole Reilly wrote an excellent article for us: Setting-up PMO 3.0 |The Project Management Office in the Age of Digital Transformation. I won’t rehearse Nicole’s comments on the history of PMOs (through v.1 and v.2) nor her speculations about their future.
Here are my thoughts.
Undoubtedly, PMOs will need to adapt to the future needs of their organizations – and to the new ways of conducting enterprise transformation. This is likely to mean an ever-increasing focus on, and success at, delivering value from Projects, Programs, and other initiatives.
At the same time, this will also mean adapting to the need for ever-faster delivery and speed-to-market or speed-to-user of new products, processes, and services.
So, PMOs will continue to need to innovate – but while keeping firm oversight of their projects and programs. I expect that this innovation will lead to a marked evolution…
The big driver to the evolution of PMOs will be Artificial Intelligence, AI. Indeed, PMOs are where we are likely to see the first big implementations of AI in Projects. This is because AI is good at assimilating and using large data sets, and PMOs are where these data sets are collected and are at their largest. I expect PMOs to use AI to support planning, resource scheduling and optimization, data analysis and reporting, and much more.
If AI can prove its value to PMOs, then PMOs will be able to prove their value enough to progress up the food chain to become Enterprise PMOs and VMOs with an ability to participate in strategy development and delivery. More and more, we will see seats at the top table for PMO Directors.
If you are interested in or employed within a PMO, there are places you can go, learning materials you can access, and qualifications you can take.
The House of PMO offers accredited courses in PMO skills. They set the standard and the syllabus for their PMO Essentials range of courses. They work with APMG International to assess individuals through examinations against those standards.
The four accredited courses are Essentials for PMO:
Axelos (the home of PRINCE2 and Managing Successful Programmes – MSP) offers Portfolio, Programme and Project Offices (P3O®) Certification, at two levels:
Our website has several valuable free resources, featuring world experts on PMOs:
From Peter Taylor (The Lazy Project Manager), a two-part series
A review of the concept of PMO 3.0, from Nicole Reilly:
And two video interviews:
Two indispensable references for serious PMO professionals are:
The three PMO books I most recommend are:
I love to hear perspectives from my community, so please do comment below and I will be sure to respond.
Dr Mike Clayton is one of the most successful and in-demand project management trainers in the UK. He is author of 14 best-selling books, including four about project management. He is also a prolific blogger and contributor to ProjectManager.com and Project, the journal of the Association for Project Management. Between 1990 and 2002, Mike was a successful project manager, leading large project teams and delivering complex projects. In 2016, Mike launched OnlinePMCourses.
Do You Know How to Pluck out the Perfect Project Name?
Project Management Formulas: How to Get a Grip on the Math of PM
Working with a PMO and Building a PMO Career – with Curtis Jenkins
PMO Competency Framework: A Conversation with Lindsay Scott of House of PMO
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