Project Management Office

Project Management Office (PMO) Guide

A project management office (PMO) is a group or department that defines, maintains and ensures project management standards across an organization. A PMO can either be internal or external. They can also be referred to as a program or project portfolio management office, but they're different types of PMO. Let's quickly explain the differences:

A project management office keeps documentation on projects and offers direction and key metrics in the execution of the projects under its governance. Through guidance, the PMO helps organizations get a return on their investment and add value to their stakeholders through projects, programs and portfolios. This is executed with the help of project portfolio management tools, which provide data and insights into projects and programs across an organization.

The PMO doesn't always focus solely on standards and project management methodologies. They can also be part of strategic project management by facilitating, or even owning, the project portfolio management process. In this capacity, they can monitor and report on active projects and portfolios to top-tier management and foster strategic decision-making.

A project management office is meant to operate as a centralized and coordinated management hub for all the projects, with the aim to create efficiencies between projects — as well as merely defining standards in the project management process.

Project Management Office Roles and Responsibilities

One can think of a project management office as a regulatory commission that seeks to standardize the execution of projects in order to maintain productivity. A PMO offers guidance to project managers and develops metrics on the practice of project management.

Most project management offices share these common roles and responsibilities:

  1. Strategic Planning and Project Governance: This involves defining project criteria, selecting projects that align to business goals and advising management with cost-benefit ratio.
  2. Defining the Project Management Methodology: Defining the project management methodology that will be used on a project, such as waterfall or an agile framework.
  3. Best Practices: This includes standardizing and consolidating best practices and processes across departments to manage and deliver projects.
  4. Common Corporate Culture: Here, the project management office sets common project culture through communication and training on techniques, methodologies and best practices.
  5. Resource Management: PMOs manage and allocate resources across projects based on priorities, schedules, budgets and more.
  6. Creates Project Archives, Tools and More: The PMO provides administrative support and invests in templates, tools, software and more to better manage projects.

PMO Types

No two PMOs operate in exactly the same way, but they can be generally divided into three PMO types:

  1. Supportive: A supportive PMO collects all projects in an organization, supplies best practices, templates, training, but with a low degree of control.
  2. Controlling: A controlling PMO checks if the project management tools, processes and standards are being applied in the projects, with some degree of control.
  3. Directive: A directive PMO maintains a high degree of control in the project management process within the organization.

What Makes a Good PMO Manager?

A good PMO manager oversees the team members in the project management office and takes responsibility for the quality and value of each project under its care. This involves collaboration with project managers and reporting to the executive staff of the organization.

PMO managers succeed by facilitating project planning, analysing financial information, modifying processes and ensuring proper documentation for the projects they're overseeing. This is done by both focusing on details and keeping an eye on the big picture.

Naturally, a PMO manager has to function under pressure, have strong interpersonal skills and be able to juggle different projects.

Project Management Office Functions

Project management offices have been around since the 1800s, though their function has evolved over time. They began as a type of national governance of the agricultural industry, and by 1939 they were beginning to be referred to as project management offices. What we know as a PMO today wasn't in existence until the 1950s, and now they are a dynamic entity used to solve specific issues.

In general most PMOs act as the backbone of a successful project management approach in any organization. They offer support and information and ensure project and program success. These are the main PMO functions.

What Is PMO Software?

PMO software is used to create efficiencies when organizing the process of a project, program or portfolio under the governance of a project management office. This includes every phase of the project: initiation, planning, execution, monitoring and closure.

Some of its functions include analytics, tracking, planning, resource allocation, prioritization, scheduling and reporting for business insights. Project management software also aligns to its organisations and industry's standards.

PMO software should be flexible, with the ability to adapt to changes and stakeholder expectations. It should be able to manage and analyse teams, while providing collaborative features. A project management software for a PMO should have:

Since project management software is used to manage more than one project, having program and portfolio dashboards to get a high-level view of performance is usually part of the features set.

On Premises vs Online PMO Software

On Premises PMO software applications tend to be more expensive and require installation; and training can take additional time for everyone to learn it. Online project management tools offer more entry points in terms of price because they have multiple-tier subscriptions. But which is right for you?

Both have advantages and disadvantages.

The on premises tool is almost always going to operate more quickly, since it's not at the mercy of an internet connection to determine how fast you get your data. There're also no delays if the internet goes out. The desktop is a closed system, which can be networked to other computers in the office, but because it's not online, your work tends to be more secure.

However, online PMO software has made great strides but speed still lags; but depending on your connection to the internet the difference can be negligible. But these are still considerations when shopping around for a software that fits your PMO needs.

Essential PMO Tools

There's a lot of ground to cover when discussing PMO tools: the demands on PMO software are broad and complex. PMOs need basic project management features such as resource management, task management, workflow management and planning tools, along with more advanced project portfolio features.

In addition, teams need to be able to collaborate and take control over their ongoing projects, as they all impact one another. This ensures that you're keeping project processes standardized and meeting business goals and objectives.

Here are some essential PMO tools that no project management office should be without.

Real-Time Project Management Software

The first step in any successful PMO software is that it works in real-time so you can see what's happening as it happens, and teams get to collaborate.

Project Portfolio Management View

PMOs have lots of projects to manage. These projects are not isolated, and most complement each other. Therefore, it's crucial that PMO software has a portfolio view to see all projects on one screen to be able to quickly note how they relate to one another.

Project Portfolio Roadmap

While a high-level view is good to track progress, if you're dealing with standardizing processes and making sure every task is meeting the requirements across all projects, then you must have more detailed data.

Resource Management

Resources for a project include staff, equipment, materials and more. That's just for one project. Resource management at the PMO level will help you manage those resources to keep your projects moving forward.

Workload Management

Workload management is a window into a team's tasks to make sure there are no imbalances. Team workloads vary. If you're not keeping a close eye on who is tasked with what, teams can find themselves overworked or underworked. Neither is good for productivity or morale.

Team Management

There are many ways the PMO looks after their organization, from roadmaps that gather all the tasks of multiple projects on a shared timeline to looking at your projects through the lens of resources. But your most important resource is your teams, and PMOs need a team management tool that provides transparency into their work.

PMO Reports

Reporting is one of the key tools for tracking progress. You can look at the projects from a high-level dashboard view or drill down for more detailed data with reports. Reporting keeps projects on track and stakeholders updated on progress.

How Does a Project Management Office Benefit Your Business?

Now that you know more about what a PMO is and what it does, we can examine why an organization should have a project management office and how a PMO benefits the organization as a whole.

The PMO Offers Guidance

First, when you have a PMO you have an agency to align the project, program or portfolio with an eye focused on the future strategy of the organization. This allows you to work within the boundaries of a long-term plan and therefore be more efficient in your decision-making thanks to project management office guidance.

Helps Keep Projects on Track

They also act like an external mechanism to ensure project success. Due to their metrics-based assessment, they can help keep projects on track and alert you when scheduling, budget and other scope issues are threatening to derail the project. That way you can act quickly when issues arise — before they become potentially project-ending problems.

PMO has a Big Picture View

When you're working on a portfolio of projects, the project group has a keen understanding of the links between those projects. They are aware of the dependencies that can impact one another. This provides you with a bird's-eye view of the work that is often not part of your purview, putting your actions in play on a larger canvas, so you can see how a small move could have larger repercussions.

Helps with Communications

They can also be seen as another arm of your communications plan. They have the ears of your stakeholders in ways that you might not, and therefore can facilitate communications with them, both freeing you up for other work and making sure your message is delivered and understood.

Project management governance can help with communications across the board, too, as they often have working relations with other parts of the project or program participants that you might not be connected with.

PMO Shares Resources Throughout the Organization

Setting up a project management office allows for the sharing of resources. If your resources are limited but your projects aren't, a program management office can strategize the use of those resources across your project or program to best use them productively.

When you have your projects aligned to a business case and strategy, there are many benefits from support to portfolio management, centralizing training and project management tools, as well as mentoring. Of course, a project management office alone is not enough. You need good people, proven processes and supporting technology to get the most out of it.

How to Set Up a Project or Program Management Office

You're probably wondering how you can set up a PMO in your organization. Think of it as another project. So, therefore, you're going to follow a similar process:

You'll need to find someone to back it, ideally someone in management with knowledge of change management. That person must totally understand the venture, be fully onboard with believing in its benefits and then actively promote the process of setting it up.

Step 1: Analyse the Situation

First, analyse the current situation by checking the project management methodologies, processes, and tools that are being used for any signs of weakness. Also, do the same analysis with any ongoing projects. You'll want to create a complete and up-to-date informative project list, prioritised, if possible, to determine who is working on what.

With this information you can document the project management majority of the organization, which is crucial paperwork to refer to later on as you apply improvements to the system. But remember, be delicate in your report and do not neglect the positive, as the process can get very political. No one is served by ruffling feathers.

Determine the goals of the project management system by getting a stakeholder analysis. First, you have to identify the stakeholders and find out what benefits they're looking for. Stakeholders can include management, executives, project managers, controllers, even staff members. They're all going to want to see what the value is, so you have to make that clear from the get-go.

Step 2: Design the Plan

Begin by defining its areas of responsibility, hierarchical position and competencies. What's its mandate and services? For example, is the PMO a service unit providing tools as required or is it set up for training and support of project managers to ensure project quality?

There are many areas that a PMO can find itself responsible for, some of which are sketched out in the list below:

Don't overload your project management office from the start. That's a recipe for disaster. To ensure you're productive, stick to just one or two areas of responsibility. Your stakeholders might want to overload it with too many responsibilities and tasks, so speak with them about realistic goals and practical paths forward.

Remember that the PMO is a new entity in the organization, so it's going to take time before it's commonplace. There will be a learning curve. Make sure all employees are introduced to the PMO and briefed on what it's responsible for. This provides clarity and promotes its services so people use them.

Step 3: Implement the Plan

Just as you would in any other project plan, proceed step-by-step, provide the IT infrastructure and finalize the PMO staff training. Focus on change management, as this is one of the foundational tasks. And you want to cement organizational buy-in, so it doesn't hurt to reiterate the beneficial reasons for implementing it.

When you're communicating the PMO's areas of responsibility, you can do so on the company's intranet or whatever platform or venue is best. However you disseminate this information, be sure to include these three things:

Once you're in operation and internal staff has assumed full responsibility, if it has been set up by an external consultancy, the new project office has to persuade all stakeholders of the benefits it brings. This usually results in the following phases:

Final Thoughts on PMOs

As noted earlier, a PMO's success depends on appointing the right person to promote it. Sometimes they're going to have to demand unpopular changes, so the only way for them to be successful is with backing from management, and with clearly defined responsibilities and competencies.

Then there's the culture in the organization, and it will likely take time for the project management office to settle into this establishment smoothly. For this transition to occur successfully there must be transparency in the project environment. Therefore, how transparency is applied in the company culture is going to either help or be a hurdle.

But once the PMO has been established and it begins to benefit your projects, you'll find it an integral part of the organization as a whole. It helps support success and provides an overview for project managers who might not always see the whole picture, allowing them to do better work for their company and for their teams.

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