Rules about implementing a PMO

Implementing a PMO is a SIGNIFICANT undertaking for any organisation. Is the implementation of a PMO really worth it?

To start this post we have to clarify a few concepts. All of the specific definitions given may be contested but for the purposes of this post, I would like to utilize these descriptions as a foundation.

Definitions:

Project – A project in business and science is typically defined as a collaborative enterprise, frequently involving research or design, which is carefully planned to achieve a particular aim. Projects can be further defined as temporary rather than permanent social systems that are constituted by teams within or across organizations to accomplish particular tasks under time constraints. (wikipedia.org)

Program – A group of related projects, subprograms and program activities that are managed in a coordinated way to obtain benefits not available from managing them individually. (pmi.org)

Portfolio – Projects, programs, sub-portfolios, and operations managed as a group to achieve strategic objectives. (pmi.org)

Assumption:

PMO (Portfolio/Program/Project Management Office) as a concept is used interchangeably to denote any organisational construct that attempts to govern, administer or standardize project (used singularly to denote inclusion of Portfolio/Program/Project Management throughout this article) related activities with the intent to improve the success, benefit realization or efficiency obtained from these efforts.

Discussion:

There are two very contradicting, but real, statistics related to the project management industry/discipline. The first is the unquestionable advantage that disciplined project management provides in achieving short and medium-term goals, affecting change, mobilizing resources and converting resources and effort into value. The second undeniable reality is an alarming failure rate of projects. Much has and can be said about the failures, and it is probably one of the most enduring sources of research for professionals and practitioners.

I wish that I could sever PMO’s from these statements, but unfortunately, I could not do it with a clear conscience.

Most of the PMO’s I have been exposed to are an attempt to overcome the realities like – governance practices afforded only lip-service, resources over-allocated and multi-tasked, project sponsors invisible and project commitments made without proper planning or justification – “normal” project management environments.

Online Business Cycle

The Rules:

  • A PMO cannot address business problems from outside the business. If you have a problem with squirrels, putting down all the rats you can find will not solve the problem. Similarly, addressing problems with project governance will not be solved by implementing a PMO; it would probably just make things worse. If you have a business problem, resolve it using the appropriate business methodologies and practices.
  • Project Management maturity cannot be achieved by implementing a PMO – Teaching a seven-year-old all the principles of medical diagnostics does not make a doctor. Management maturity and skills can only be achieved through – exposure, training, hiring, failure and other similar actions. Only by learning from mistakes and responding in a prevention orientated way, will organizations gain the experiences which then provide maturity.
  • PMO’s do not provide instant results – You cannot build an ocean liner by converting a houseboat. The design, implementation, and embedding of a PMO consume resources (hopefully high-quality i.e. expensive resources) that can only be recovered on in the tactical or strategic realm. The PMO will have to steadily grow into a value-adding entity OR the organization has to realize that value is obtained from combining benefits yielded by contributing processes at least in the early life stages of the PMO.
  • PMO’s don’t survive cold boardroom air exposure – A losing team can be inspired by the addition of a single player, but it will not overcome dependency on that player until the original team members acquire new skills. Implemented PMO’s HAVE to permeate every level of the organization involved in project management, and it has to become the unquestionable mechanism of choice from the executives to the shop floor – every man and his dog have to understand their contribution or requirement. If it is only used and promoted by senior staff it will die.
  • PMO’s work like web sites – Any programmer can develop the Google landing page in a matter of minutes. However, one millimeter behind the screen there are servers, and processes that consume vast resources that allow Google to conduct the search, filter results and respond with relevant information. This is also true of PMO’s – setting up an office, hiring people, setting down standards and processes is the landing page; getting those processes and standards to work and return relevant results will consume vast resources, require hard work and know-how.
  • PMO Accountability – PMO’s cannot be held accountable for project execution success if they have no say in which projects get selected, who the project managers are and which project manager is executing which project. Beating the teacher because of a high failure rate of a poorly defined course.

The achievement of a working PMO is the pinnacle of project management. The benefits that can be achieved through getting it right can be compared to the introduction of production line manufacturing into the automobile industry.

The implementation of a PMO can easily be likened to changing an automobile manufacturer that produces handcrafted wood frame vehicles into a production line that produces metal frame vehicles. Many different things will have to change. Think of the impact the following concepts will have on the business culture of the organization experiencing the change – tolerances, specialization, supply lines, parts inventory, production floor management techniques, quality control and assurance, production throughput management, process sequencing, etc.

Summary:

Implementing a PMO is a SIGNIFICANT undertaking for any organization irrespective of size or market and should be considered in the order group of implementing a project management production (not just assembly) line into the organization.

business_stats

Is the implementation of a PMO really worth it?

Ask any major automobile manufacturer.

– Unquestionably and Irrevocably –

YES

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Portfolio, Program and Project Management

From a distance, it seems that people use these terms interchangeably. They do however represent many different undertakings.

Trying to steer away from the “official” definitions provided by the various project management institutes and organizations I hope to explain it in a way that would be easily understood, and can be agreed upon by all professionals in the field.


Definitions:

Project Management – the discipline of planning, organizing, motivating, and controlling resources to meet specific goals. A project is a temporary undertaking with a defined beginning and end (usually time-constrained, and often constrained by funding or deliverable), undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value. The temporary nature of projects stands in contrast with business as usual (or operations), which are repetitive, permanent, or semi-permanent functional activities to produce products or services. In practice, the management of these two systems is often quite different, and as such requires the development of distinct technical skills and management strategies. (http://en.wikipedia.org/wiki/Project_management)

Program Management – the process of managing several related projects, often with the intention of improving an organization’s performance. In practice and in its aims it is often closely related to systems engineering and industrial engineering. (http://en.wikipedia.org/wiki/Program_management) I would like to add that it could temporarily include the management of areas that are business as usual (or operations). Programs are also focused on obtaining business benefit observable from outside the program environment.

Portfolio Management (Project Portfolio Management) – centralized management of processes, methods, and technologies used by project managers and project management offices (PMOs) to analyze and collectively manage a group of current or proposed projects based on numerous key characteristics. The objectives of PPM are to determine the optimal resource mix for delivery and to schedule activities to best achieve an organization’s operational and financial goals ― while honoring constraints imposed by customers, strategic objectives, or external real-world factors. (http://en.wikipedia.org/wiki/Project_portfolio_management)

Just looking at these definitions does not distinguish large projects, from small programs, portfolios from very large programs and so on. So let’s look at what is different and then we should be able to tell them apart.

Finite Focus Components Related Objective
Project Yes Functional Delivery Yes Single
Program Yes Strategic Objectives Yes Multiple
Portfolio No Strategic Intent No Varied

This will give us some basis for comparison.

  • Portfolios do not have an end date
  • Portfolios are entirely strategic
  • Portfolios contain projects, programs, and operations that do not require a specific relationship to each other
  • Portfolios don’t intend to reach a specific strategic objective, but rather address a strategic value or intent
  • Programs have a specific strategic goal that it must satisfy
  • All components in a program are included to deliver or contribute to reaching a measurable strategic goal (Could be more than 1)
  • Programs may temporarily include the management of operations
  • Programs have a start and end date within which they have to deliver on the agreed objectives
  • Projects deliver a specific outcome (product, result)

Example:

A specific aircraft manufacturer has a project portfolio in which they intend to enhance the organization’s image, improve service delivery and secure the medium and long term financial future. Within this project portfolio, a program exists to design, develop and implement the manufacturing of a new aircraft. The program contains many projects, one of which is concerned with the building of the manufacturing facility in which the aircraft will be built.

Now that this picture is becoming clear -> I have a gift…

Sorry I simply had to include this graphic J it just keeps on growing…

Please ask questions, offer differing views and comment at will.

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Have a great day.