Gartner’s February 2008 report “PMOs: One Size Does Not Fit All” found that there are very high rates of failure when setting up a PMO. Success or failure depends largely upon two aspects:
- How closely the PMO’s mission and objectives are linked to the real needs of the organization, and
- How well the role of the PMO is matched to the maturity of the organization.
As Project Partners has written in prior whitepapers and presentations (See Return on Investment – Building the Business Case for Project Portfolio Management and Return on Investment – Building the Business Case for Professional Services Automation), you should not attempt to become a Level 5 organization immediately – you need to evolve.
Benchmarking your organization’s maturity
As we have stated in the whitepapers referenced above, and as Gartner states in their 2008 report, the key to setting up a successful PMO is to first understand where your organization fits in the “Maturity Model” and then to organize a PMO structure that fits in your organization’s maturity model. The main goal should be to continuously maturing your organization’s PMO, moving up the scale from Level 0 to Level 5. The optimum level of maturity is recognized as being the level that delivers your organization’s strategic objectives most effectively and efficiently, and for many organizations that does not necessarily imply you must reach Level 5.
|Level 0: Nonexistent – ad hoc||Level 1: Initial – reactive||Level 2: Developing –emerging discipline||Level 3: Defined –initial integration||Level 4: Managed –increasing efficiency||Level 5: Optimized –enterprise-orientation|
|People||Staff assigned to projects on a first available basis. PPM activity limited to interests and actions of Individual managers.||Priority projects get appropriate staffing: everything else is “first available.” Nascent PPM leader role – primarily still an individual manager focus.||PMO(s) established. Programs increasingly managed in-house. Project staffing/ resource capacity issues begin to be addressed.||PPM leader role formalized and Increasing specialization trend beginning. Shared resource pools formalized.||Network of PPM leaders exist companywide in a federated model. Centers of excellence improve workload management. Capacity planning enabled.
||PPM leader role formalized and Increasing specialization trend beginning. Shared resource pools formalized.|
|PPM Processes||Projects are assigned to line or staff managers. No formal PPM processes beyond high-level budgeting, except as provided by outside vendors.||All internal processes centered on management of critical projects. Vendors are often responsible for large initiatives.||Project processes in place. PMO(s) organized. Emerging Understanding of PPM. Risk now reviewed.||PPM function established. Projects are approved on a portfolio basis. Enterprise architecture (EA) functions involved.||Similar projects managed as Programs. Portfolio is actively maintained.||Portfolio extended beyond IT. Comprehensive PMO. Pipeline managed in real time.
|Technology||Intermittent use of project schedulers, spreadsheets and other point tools on a “by project” basis.||Project scheduling tools and milestone reporting adopted.||Project collaboration and team workspaces supported.||Portfolio tool is in place. Reporting dashboards||Workflow added to toolset. Business users adopt tools as useful.||Single, integrated system supports reporting, Collaboration and analysis.
|Projects done without formal cost, benefit or risk valuation.||Projects have budgetary estimates, Actual cost can be estimated. Some benefit statements.||Project cost and labor hours captured. Estimate of benefit made for each project.||Costs are captured and forecast. Benefits are identified and related to strategy in the portfolio.||The portfolio is modeled and Appropriately optimized, factoring in risk. Benefit realization is tracked.||Programs have their own financial resources, and full life cycle. Costing is available.|
|Typical Tasks Performed||
|PMO Structures Mapped to Maturity Levels||Individuals
|Project Management Office||Portfolio Office,
Centers of Excellence,
How can you improve Organization/PMO maturity?
- Establish a vision. In order to know whether or not your efforts are successful, you must be able to articulate what will be different about your organization after you’ve launched the PMO
- Process. Adopt project management methodology, institutionalize its use within your organization, assign owners for every process, and use it and improve upon it continuously.
- PPM software. Introduce PPM software which enables more efficient and effective project, program and portfolio management delivery and support processes
- People Power. Expand project managers’ communications and interpersonal skills.
- End Result Driven. Encourage project manager certification, but manage, appraise, and promote based upon the end results achieved by project managers.
- Management Buy-In and Support. Strengthen involvement and support by executives and the leadership team by giving them what they need in order to be engaged, make effective decisions, and appreciate and support the project management maturity needs of the organization. Often this can be achieved via executive-level PPM software reports and/or dashboards.
- Project Planning/Execution. Developing effective and detailed plans at the beginning of the project; execute the project according to plan established.
Reporting. What is not reported is not measured. Use scorecards and dashboards to keep everyone informed and involved.
Where does your organization fit in the maturity model?
In order to know what the focus of your PMO should be, you need to first conduct an honest assessment to determine where your organization presently fits in the maturity model.