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“Operations keep the lights on, strategy provides the light at the end of the tunnel, but project management is the train engine that moves the organization forward.”
Joy Gumz, renowned project management professional
Joy’s got a great point. However, keeping that train on the tracks sometimes requires more than a single conductor. Sometimes, it needs a whole office of them. Or even multiple offices.
As your agency grows, you may reach a point where having a handful of project managers working as peers isn’t enough. If your project managers are struggling to keep up and keep their efforts aligned, a project management office (PMO) could be the solution you need.
What is a project management office (PMO)?
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PMO stands for project management office. As a side note, depending on the company (and the level that these groups operate within a business), the “P” in PMO can have different meanings.
The term can represent project management, program management, or portfolio management. But in general (and for the purpose of this piece), we’re going to stick to the good old-fashioned version: project management office.
The primary purpose of a PMO is to provide support and oversight to ensure that projects align with the agency’s strategic goals, are executed efficiently, and deliver value. In other words, PMOs act like project managers, except it’s an entire office of team members dedicated to the role instead of a single person.
PMOs provide their organizations and teams with support, mentoring, standardization, and project management best practices to ensure success and improve project efficiency.
They create guidelines and keep track of adherence to standards to ensure that projects meet a high standard and are aligned with the organization’s overall strategies.
So, the project management office serves as a kind of quality control monitor within projects. This group defines and maintains standards for project management within their organization.
The 3 types of PMOs
There can be more than one PMO in a company. Enterprise-sized organizations tend to have a PMO in each department and an Enterprise PMO (EPMO) to maintain standards across departments and regions.
There are also different styles of running a project management office: supportive, controlling, and directive.
Supportive
This type of PMO exercises a lower degree of control, choosing instead to support teams and project managers as they manage and execute their projects. Supportive PMOs may provide templates, documents, guidance, and best practices but leave most execution to teams and project managers.
Controlling
In addition to providing templates and documents, PMOs that use a controlling style may audit a project to ensure that the project managers and teams adhere to their standards. Controlling PMOs are more hands on, exerting a noticeable degree of control over their teams and project managers.
Directive
When a directive PMO gives instructions, you’d better listen. These PMOs exercise the highest degree of control of the three and may be seen as having more authority. Directive PMOs take a direct approach to resource management and resource allocation and tend to monitor project performance closely.
Don’t let the titles fool you: Ultimately, all PMOs should (first and foremost) support the organization and its project managers and teams.
Unfortunately, in the past PMOs have moved into organizations and become rule-enforcing tyrants. But a good PMO works with the team and has the organization’s best interest in mind. So — whether a PMO is supportive, controlling, or directive — the office (and the people who staff it) should always serve and help the project team.
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Key roles and responsibilities of a project management office
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Though the responsibilities of the PMO and individual project managers overlap somewhat, the project management office is far more than a group of “super project managers.” These are a few of the key responsibilities most PMOs focus on.
Aligning team members with projects
PMOs help to establish the culture and values of the broader organization as well as the values and identity of individual projects. They also educate team members in all these areas, helping to align team members philosophically with the projects they work on.
The PMO may look at team members’ competencies to guide decision-making that places the right people on the right projects.
Providing updates for team members on current projects
While most day-to-day project updates come from the assigned project manager, broader project updates (such as those affecting the project lifecycle), forecasts, or changes to companywide priorities usually come from the PMO.
Managing and allocating resources to the team
PMOs allocate resources to teams at a broader scale based on priorities that transcend individual projects. A single project manager likely has access to only certain resources, while the PMO has greater authority to reallocate resources in more dramatic ways.
This responsibility is key no matter which project management methodology an organization, team, or project uses.
Defining workflow processes, maintaining project archives, and testing tools
Speaking of project management methodologies, the PMO has a central role in determining which methodology makes sense for the organization or various divisions or teams. The project management office also defines workflow processes within those methodologies and requires teams to follow those processes.
The PMO also holds primary responsibility for maintaining project archives, and researching and implementing testing tools.
PMO staff: Who’s on the team?
Successful project management offices need a mix of skills and roles to keep organizations and teams following, supporting, and executing the company’s strategies.
The typical PMO consists of around nine total members. These members are usually highly experienced professionals who started out in less strategic roles in other departments. About half have their PMP certification; the other half are leaders and managers in the organization with significant job experience.
Here are a few common PMO roles within a PMO team:
PMO director
This is the head honcho, and it’s a critical role. They oversee large projects within a department and any projects that cross divisional boundaries. PMO directors keep an eagle eye on all areas of the organization and the progress of its projects, and they oversee the other positions below.
Project and program managers
While PMO directors run the show, we’re big believers in the power of a great project manager. Project managers are responsible for the success of individual projects from concept to delivery. They plan, budget for, and manage their assigned projects and provide leadership, guidance, and support to the project team. Program managers take a broader view than single projects, looking at the long-term trajectory and vision of a set of projects: If project managers are like set directors or art directors on a film set, program managers direct an entire production unit.
IT project manager
A well-staffed PMO needs at least one tech-savvy team member. Most PMOs include an official IT project manager, who oversees the technical or IT elements of a project. The IT PM also collaborates with other IT professionals and staff to create any new piece or system of software needed for the project. IT PMs often build and manage websites and databases and are responsible for implementing software integrations.
Project support team
The larger the organization or division, the more capacity the PMO will need. Project support staff focus on specific elements of project management that, on smaller projects, might all be handled by the project manager. Roles include project scheduler, project planner, and project controller.
PMO coordinator or analyst
This multifaceted role keeps track of metrics like time, team members, and budgets. The PMO coordinator also oversees knowledge management. (That’s fancy business speak for noting and storing important information like project records, standards, methods, and lessons learned in a project database.) If this team member doubles as the PMO analyst, they’ll make sure that project metrics and statuses are always readily available to the project manager via presentations, charts (from Excel or a more specialized project management solution), and detailed statistics.
Change control analyst
Some PMOs include a change control analyst who helps teams quickly adapt when business stakeholders change project direction. On smaller projects, PMO teams can get by with a few spreadsheets tracking and controlling changes or a dedicated project management software solution like Teamwork.com. But for large projects, having a dedicated team member to help you switch gears can be a big help.
Benefits of having a PMO
The role of the PMO is vital. This office is responsible for aligning projects to a business’s overall strategy and goals. They navigate risks, manage talent, identify expected project benefits, and maintain these benefits after the project ends.
Creating a project management office can drastically improve productivity and bring greater clarity to your project management process. Check out these surprising data points that reveal the value of having a PMO:
89% of organizations had at least one PMO in 2020, and 50% had more than one.
That same study finds that 72% of respondents envision the scope of services continuing to increase within PMO.
Businesses that fail to value project management (and PMO) see 67% more projects fail than those that do.
Implementing a PMO brings more than just support to your project teams. PMOs achieve a range of other benefits, including the ones below.
Drastically improves productivity
Just as project management is important for improving productivity by getting all your resources aligned and on the same page, instituting a PMO takes that productivity to the next level. Now even your various project managers gain that same level of support, ironing out processes and improving outcomes.
In other words, a PMO makes your efficiency-makers (your project management staff) more efficient.
Allows teams to reach budget goals
Staying on budget within a project is a constant challenge, and a lone project manager may feel like they don’t have the authority or the resources to make it happen. PMOs implement policy and direction at a macro scale and bring that missing element of authority, helping teams stay on budget (or reassess the budget when needed).
Helps improve customer satisfaction
The more organized and cohesive your project management strategies, the better your teams can meet customer needs and the more satisfied your customers will be.
Reduces the number of failed projects
Projects fail for all sorts of reasons, but those reasons do exist. In other words, projects don’t fail out of nowhere. A more robust approach to project or program management has the power and the capacity to figure out those reasons and solve them before they result in project failure.
Lets teams reach goals & milestones faster
With clearer, more consistent policies and oversight in place, teams don't have to deal with countless points of decision and bouts of uncertainty. With renewed focus on what to do, when, and how, teams can reach goals and milestones faster than before.
Measuring the success of a PMO: KPIs to consider tracking
Creating a PMO office can be a big investment. To make sure you’re getting a good return on your initiatives, it’s important to measure the success of your PMO office on an ongoing basis.
Here are some KPIs you can use to measure and track PMO success, as well as some additional methods for determining what makes for a successful PMO:
KPIs for PMOs
There are a range of KPIs you can track to measure the success of your organization’s project management office. Some of the most important KPIs to keep visible on your dashboards include:
Project delivery metrics: These KPIs measure the success of the PMO in terms of on-time and on-budget project delivery. They’re based on key factors like project completion deadlines, budget adherence, and scope fulfillment.
Quality metrics: Quality metrics evaluate the PMO's effectiveness in delivering high-quality project outcomes. They consider factors like the accuracy of deliverables, adherence to quality standards, and customer satisfaction.
Operational efficiency metrics: Operational efficiency metrics gauge the effectiveness of the PMO's processes, focusing on areas like resource utilization, project cycle times, and overall productivity.
Strategic alignment metrics: These KPIs measure the degree to which projects align with your agency’s strategic goals and objectives. They assess how well the PMO contributes to the organization's overall strategic direction and success.
Risk management metrics: Risk management metrics evaluate the PMO's ability to identify, assess, and mitigate risks associated with projects. These KPIs shed light on the effectiveness of the PMO’s risk mitigation strategies and the impact of unforeseen issues on project outcomes.
Regular review and improvement of PMO performance
Along with tracking the right KPIs, it’s also a good idea to regularly review your PMO’s performance using other methodologies. You can then use your findings to establish a process of continuous improvement. Here are a few ways to go about this:
Regular performance reviews: You’ll want to conduct periodic assessments (quarterly, semi-annually, or annually) to evaluate PMO performance. Be sure to review KPI data and compare it against targets and industry benchmarks to help you identify areas for improvement.
Continuous improvement process: Use the findings from your performance reviews to implement a process of continuous improvement. You can also encourage feedback from team members, stakeholders, and clients to identify other areas for enhancement.
Adapting to change: You need to be adaptable and flexible enough to change PMO strategies in response to evolving business needs and project environments. You’ll also want to update KPIs as necessary to align with these changing objectives and market conditions.
Training and development: Investing in the training and development of PMO staff can dramatically improve the performance of your project office. It also makes it easier to incorporate new technologies and methodologies as needed to enhance efficiency.
Communication of results and learnings: Effective communication is a key requirement for continuous improvement. You should always share performance review outcomes with stakeholders and team members and use the results to either advocate for necessary changes or celebrate successes.
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A PMO case study: 7-Eleven
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There are plenty of examples of companies that have used a PMO to successfully improve project outcomes, but one noteworthy case study is that of 7-Eleven’s IT department.
In 2004, 7-Eleven decided to create a PMO for its IT department — due to the fact that over 50% of its IT projects were failing to meet schedule or budget objectives.
The PMO the company established is still in operation today, thanks to the outstanding results it delivered. Following its establishment in 2004, 7-Eleven’s rate of IT projects delivered on schedule and on budget rose dramatically. By 2010, both metrics had climbed from 50% to nearly 100%.
For more details on this case study, you can check out this excellent article from the Project Management Institute (PMI).
Give your PMO powerful tools to better organize and manage projects with Teamwork.com
The project management office is an important group with wide-ranging responsibilities, one that more and more organizations are establishing and investing in. As your project management and PMO functions mature and expand, your PMO team needs a better set of project management tools to keep project information organized, visible, and accessible.
Teamwork.com is the ideal solution for project management offices, offering the perfect balance of powerful big-picture visibility and granular data-rich detail. From specific complex projects to an organization-wide view, Teamwork.com has the tools and the depth that PMOs need.
The best part? You don’t even have to take our word for it! You can see it for yourself to determine whether Teamwork.com is right for your PMO needs.
Get started with Teamwork.com for free!
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