Quick Reference:
PMO stands for Project Management Office. Consider it your key to more streamlined workflows, better visibility and communication across projects, and higher quality deliverables.
PMOs have three stages: Project Intake, Project Execution, and Project Close.
Your team or org might want a PMO if you're looking to improve forecasting and capacity planning, increase accountability and ownership of projects, execute better project or product launches, and add replicable efficiency to your project pipeline.
ROI is essential to adoption. If you're looking to implement a PMO in your org or team, take the time to run a cost benefit analysis and set up a business case for your PMO.
We've got more PMO content coming. Keep an eye out for the next installment of our PMO Best Practices series focusing on PMO Implementation.
In case you haven't heard, we work with PMOs...a lot. We've guided clients through both the process of building a PMO from the ground up and updating their existing PMO to match their current needs. So we know a thing or two about PMOs.
But we're wondering...do you?
We're willing to bet that you have a process for managing your workflow or projects, but you might not consider it a full-fledged PMO. If you're interested in setting up a PMO for your team, or want to revamp an outdated PMO, you're in the right place!
We're kicking off 2023 with a blog series dedicated to all things PMO. Starting at the beginning, this article will highlight what a PMO is, why it pays to set one up, and how it can address common challenges related to workflow inefficiencies, communication breakdowns, and ineffective product launches.
Read on to learn more about PMOs, and head to our contact page to get in touch about dusting off your PMO for more streamlined and successful projects.
PMO 101
PMO stands for Project Management Office, and it’s sometimes also referred to as PPM or Project Portfolio Management. PMOs are used to standardize the intake, execution, and prioritization of projects. Standardizing the project process allows organizations to focus on their highest impact projects, and lay the groundwork for successful project execution.
We work with clients to set up new PMOs and update existing PMOs to match current needs. In our experience, having a PMO that's up to date and effective can help your team or organization get clear on roles and responsibilities, manage interdependencies proactively, and work smarter – not harder.
Structure & Stages of PMO
There are a lot of ways to view or approach a PMO structure, but for a very high level understanding of a PMO workflow, we like to break the process down into three stages:
Project Intake
Project Execution
Project Close
Project Intake
This stage describes the process of a project coming into an organization or team. When building or adapting a PMO, it’s important to understand the project intake process. How exactly do project ideas or leads come into your team? How do they get approved to move into the execution stage? Who determines the project priority, and assigns the project to a team? These are helpful questions to build out a clear picture of the intake process.
Notice here that the intake process also includes an estimation of project ROI. We're big advocates for staying connected to ROI throughout the project journey; at the beginning, we recommend estimating a target ROI which can be revisited when the project ends. Understanding the accuracy of your ROI projections can also help your organization become more effective in capacity planning and scope management, so projects consistently deliver on quality while staying within your ideal time frame and budget.
Tracking Project Execution
This is the stage of a project journey where the actual project work takes place. While a team executes on the project, a PMO can help stakeholders get visibility and track the status of the project. This keeps stakeholders informed, and is essential for project managers to stay connected and determine when the project is ready to go live.
Project Close
At this stage, the hard work of executing on the project is over – now what comes next? Wrapping up or closing a project often involves a review process and a handoff of deliverables.
Again, this is a place to assess ROI. What is the actual ROI from the project, and how close is it to your initial estimate? As you accumulate data on your ROI estimate and ROI actuals over time, you'll have a better sense of the cost and value of your project workflows. That means more accurate forecasting and capacity planning for your team and organization.
PMO Roles & Responsibilities
In setting up a structured PMO for your organization or team, there tend to be three basic roles or levels that address the above stages:
The Requestor
The Reviewer
The Doer
Requestor
This team or individual initiates the project request or intake process. If there is a project intake form, this is likely the individual who fills out the form, and is a key stakeholder as they are invested in the project coming to fruition. In terms of visibility, it is essential that the requestor can view the status of the project during its execution phase, and is brought into an approval process as the project comes to a close. This ensures that the project is completed fully and addresses the requested deliverables.
Reviewer
The reviewer is often a resource manager, and ferries the project request through both the execution and closing stages. Once the project is requested via the intake process, the reviewer assesses the request, assigns resources to it, and manages the prioritization of that project. Throughout the project, the reviewer will likely have access to the status updates of the project.
Doer
The "doer" comes into the project in the execution stage. They're essential to diving in and completing the project to match the requested deliverables, and will continue to have visibility of the project as it moves through the completion stage.
How PMOs Help
Now that we have a sense of the high level workflow and stakeholders of a PMO, we can address exactly why PMOs are useful. There are a host of benefits to having a PMO for your organization, department, or team, but the easiest way we can summarize it is that PMOs help streamline projects and produce better results.
Adding a PMO to your workflow can help to:
Increase project transparency
Better prioritize projects based on impact and resources
Improve consistency and quality of project execution
Build accountability for teams and individuals
Provide visibility and roll up views for individual projects and across projects
Introduce governance for projects and teams
Track and analyze execution for future process improvements
Is a PMO the Right Fit for Your Team?
While there are many benefits to setting up or updating a PMO, we're willing to bet that you're reading this because you're looking to address a problem. In fact, the main driver for many of our clients to adopt a PMO is that they're encountering a specific challenge with their current project management process.
Take a look at the list below and consider: is your team or organization struggling with any of these issues?
Inaccurate resource forecasting & capacity planning
Maybe your team or organization has a process for forecasting and capacity planning, but the forecasting isn't accurate. Or maybe there is no process for estimating resources needed and allocating them as appropriate. A PMO can help your team or organization get a better understanding of capacity, where resources are, what resources are needed, how to allocate those resources.
Low visibility on project status
We often see this challenge in organizations that are scaling rapidly, or in teams that have grown quickly. Maybe the team or individuals feel clear on their own projects, but there isn't a greater visibility for stakeholders who are outside the execution aspect of a project. When stakeholders aren't informed, they can't accurately assess capacity and resources, and have little ability to manage project scope until risks become issues.
Some common symptoms of a visibility problem are when PMs forget which projects are going on at the same time or assign projects to team members that are already at or beyond capacity. We think of visibility as being about more than just status updates; it's about getting the right information to the right people at the right time.
Poor scope management
When projects come in over budget, lag behind schedule, or are not delivering on quality, you have a scope management problem. But don't worry – a PMO can help!
Lack of accountability & ownership
This is a common challenge in both new and mature PMOs. Accountability and ownership can fall short when your team or organization looks at project management through the lens of individuals rather than roles.
For example, if someone on your product team wants to initiate a marketing request, they might intuitively reach out to someone on the marketing team they know well – let's call that person Jim. Jim might already be working at or beyond capacity, so he might not have the bandwidth to properly address and reassign the project request. The result here is that the request gets lost in the shuffle, and the product team doesn't get what they need from marketing.
But instead of focusing on individuals, we recommend using a PMO to build out team roles. With clear and defined PMO roles in place, individuals or teams can move through a project request or inquiry process that sends essential information to a defined reviewer. This way, the project gets assigned to who is the best fit and has the capacity for it - rather than getting lost in Jim's email.
Poor Communication Across Projects & Managing Dependencies
Poor communication happens when different teams or departments overlap on a project but don't have consistent communication streams, and often don't even use the same terminology to describe projects. It can feel daunting to try and standardize communications, but trust – it's worth it! Building a PMO with standardized terminology, processes, and a clear framework can help bridge the gap between teams and improve communication.
Poor Project/Product Launch
Ever had a launch that was very expensive, and performed poorly? We've seen it time and again with clients. Prepare for better project launches in the future with a tailored PMO.
Articulating the value of a PMO
While we find frequent success with building and implementing PMOs for clients, we also understand that a PMO isn't the right fit for everyone. When considering whether or not to invest in a PMO, it's incredibly helpful to determine and articulate the value of that proposed PMO.
To do this, start with a CBA (Cost Benefit Analysis). Consider how much the PMO will cost – or if you already have a PMO in place, the cost of updating it – and consider how much value the PMO will bring to the organization or team. What's the ROI on improving your process? Is the cost, effort, and duration something your organization or team can support?
You can also create a business case for your PMO, whether you're looking at a singular project or a project portfolio.
To create a PMO business case, define on the problems that you're trying to solve. Do those problems align with the challenges we mentioned above? Are there any assumptions you're making about what the PMO will achieve? What risks are involved in updating or building a PMO? Take your time really digging into these questions to determine if a PMO is right for you.
Once you know what problems you're trying to address, you might also consider some PMO-related alternatives.
For example, sometimes moving an existing PMO to a new tool is enough to improve efficiency and streamline your process – and we can help with that_! If you don't have a PMO, are there ways that your team could start to utilize pieces of a PMO process and collect data on how it improves your workflow? Adding dashboards into your tool is a great example of starting to move towards process efficiency without planning a full PMO build.
Start Where You Are
Whether you have an existing PMO that needs an update, or are building a PMO from the ground up, we can guarantee that your work involves some kind of process. It might not be as structured as the organization we present here, but we are firm believers that every organization can start where they are to build a tailored PMO that serves their needs.
The key is to dig in and get curious about how your team or organization executes on progress. From there, you can begin to discern where there are gaps or needs in your process, and start to implement a PMO that supports your organization.
Stay tuned for the next blog in our series, PMO Best Practices, Part 2: Implementing A PMO to dive into the next stage of putting your PMO into action!
Quick Reference:
PMO stands for Project Management Office. Consider it your key to more streamlined workflows, better visibility and communication across projects, and higher quality deliverables.
PMOs have three stages: Project Intake, Project Execution, and Project Close.
Your team or org might want a PMO if you're looking to improve forecasting and capacity planning, increase accountability and ownership of projects, execute better project or product launches, and add replicable efficiency to your project pipeline.
ROI is essential to adoption. If you're looking to implement a PMO in your org or team, take the time to run a cost benefit analysis and set up a business case for your PMO.
We've got more PMO content coming. Keep an eye out for the next installment of our PMO Best Practices series focusing on PMO Implementation.
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