There are two reasons a programme management office (PMO) or enterprise programme management office (EPMO) exists: to advance project efficiencies and track records, and to advance enterprise project portfolios. Both are vital components in successfully achieving business and IT strategy.
According to industry estimates, nearly two-thirds of PMOs fail. There are numerous reasons for failures, although some raise their heads more often than others.
PMOs fail when they do not attempt to prioritise projects. A common error is to select projects not critical to the business' overall strategy. These projects are typically spearheaded by business units with the corporate political power and influence to win the budget and resources.
This results in organisations investing money into PMOs that fail to deliver benefits. PMOs thus need to more carefully select projects that directly benefit the business' overall strategy.
A PMO that does not have responsibility for, and control over project selection, inevitably allows non-core project committees with political clout or budget to continue operating.
The result is decentralised and fragmented project selection and execution. Duplication of efforts and misused budget also affects the bottom line and leads to poor morale within the organisation.
The challenge is to implement an effective PMO and avoid these pitfalls, by establishing a PMO that falls into the one-third minority that get it right. One consistent reason for a successful PMO is that the PMO is set up for the right reason.
A PMO is often established in reaction to a reoccurring set of problems in the organisation. These could include overruns on budgets, overdue schedules and non-delivery of results to the business. These problems encourage senior management to institute better controls and designate a person or team to manage the overall project execution process.
However, too many PMOs are established as a reactionary plan and are not designed to make any real impact on projects going forward. They are initiated with good intentions, and are created to help management establish the issues and assess the damage with respect to failing projects and customer complaints. Such tactical positioning guarantees the PMO will be viewed by the internal organisation as the enemy.
In addition, the PMO is oftentimes the liaison between management and the business unit requesting the project. Sooner rather than later, the business units grow tired of the repetitive "update" reporting and unfulfilled promises of completion - the only result a tactical PMO can deliver, since it has limited scope and authority outside of its immediate department, often struggling to implement any real change.
So how do you fix it? What are the practices common to the successful PMOs?
Get your PMO on track. To achieve any real results the PMO should focus its attentions on the project team first and on management second.
PMO dictatorship does not lead to success, however. The PMO needs to gain the trust of the project team to achieve the best results. Regular meetings and discussions covering issues with the team will assist the PMO to understand problems at all levels of the project.
Effective PMOs also do not ask their project teams for information and reports that do not directly benefit the project. With greater insight, the PMO manager can discuss strategic issues that influence the whole enterprise, rather than individual project risks and issues. Furthermore, PMOs that provide project teams with the right tools and practices to hit the ground running make a difference right away.
The PMO's primary focus should be results-driven during the first 90 to 180 days of establishment. A PMO should concern itself with reporting formats and control processes later. Often those processes improve as a natural by-product of a well-managed and executed project. In the long term, it is a good idea to re-engineer enterprise management practices. Generally, senior management, the project team, and especially customers, are looking for much overdue relief in the form of results.
An effective PMO should continually search for ways to make the project teams' jobs easier. A PMO is an investment like any other and takes time to bear fruit. It should be allowed to mature over time, since it needs to walk before it runs.
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