Do You Need a Project Management Office (PMO)?
In the hunt for greater efficiency and more effective project management, companies are increasingly employing project management offices (PMOs). But what is a project management office, and how exactly can it add value to your business?
In this article, we’ll explore the ‘what’, ‘when’ and ‘why’ of PMOs to help you evaluate the best solution for your needs.
What is a Project Management Office?
A project management office (often used interchangeably with ‘program management office’ or simply ‘project office’) is a team or department that establishes, maintains and ensures standards for project management throughout an organisation. The PMO may be internal or external to a company, but they focus on maintaining best practices and up-to-the-minute project status in one spot.
PM Solutions Research reported that 85 per cent of businesses had a PMO in 2016, with particularly significant growth in manufacturing firms using project management offices (93% in 2016 compared with 78% in 2014).
You might think of a PMO as the regulatory commission tasked with standardising the execution of a project. It guides projects and develops metrics for project management and performance. The PMO can monitor and report on active projects, giving progress updates to stakeholders along the way.
What are the Key Duties of a PMO?
How does a PMO fit into your organisation? What duties will it assume? PMOs can provide the foundation for successful project delivery, by providing expertise, governance, execution support and transparency. Let’s look at a few key duties of project management offices.
A PMO will ensure the right people are using the right information to make the right decisions. Tools might include peer reviews, audits, the development of appropriate project structures and effective accountability.
Without accurate and timely information, business leaders struggle to make informed decisions. A PMO facilitates organisation-wide transparency, so everyone has critical information.
How much time is wasted “reinventing the wheel” every time a new project begins? Since PMOs document lessons learned and offer templates and best practices from the past, new projects can begin with greater efficiency.
With team members working here and there, poor communication can stall progress and impede project success. A PMO helps to facilitate project teams so everyone can do his or her job more effectively. The project management office streamlines process and bureaucracy, offering training, guidance and quality assurance.
A PMO also manages all documentation produced by the project, which is used to create a project history. With standardised documentation available, your organisational knowledge increases and compounds, paving the way for more efficiency upon the completion of each project.
What are the Benefits of a PMO?
With an understanding of the duties and responsibilities of project management offices, let’s look at the benefits enjoyed by companies that use them.
The PMO Provides Guidance
With a PMO at the ready, you have a group to align each project with the company’s overall mission and strategy. With guidance from the project management office, you can work within the boundaries of your long-term plan while staying focused on today’s projects. Ultimately, this guidance leads to more efficiency and growth.
Your Business Will Stay on Track
Projects have a momentum of their own, and sometimes a big project can cause your business to veer away from its long-term goals. A PMO acts like an external mechanism to deliver projects successfully.
Because the PMO uses metrics-based assessments, it can help keep projects on track and forewarn you when scheduling and budgeting issues threaten to interfere with the project’s success. Instead of running off the rails, you can quickly get back on track before the issue leads to project-ending problems.
Maintaining the Big Picture
Most businesses have several projects going on at the same time. The PMO has an acute understanding of the links between those projects. They understand how the projects may affect each other in terms of resources, budgeting, personnel, scheduling and so forth.
Therefore, a PMO provides your business with a bird’s-eye view of the big picture. When all of your company’s work plays out on a larger canvas, you can see how small moves can have significant repercussions for other projects.
The PMO Facilitates Productive Communication
Your project management office has the ears of your stakeholders in ways you might not, so they’re vital in facilitating communications. If you need help making sure your project is delivered and understood, a project management office can answer the call.
Share Resources Throughout the Organisation
When you use a PMO, you facilitate the sharing of resources throughout the business. Instead of trading and begging for resources from another project, the PMO can oversee resource distribution. In other words, your project management office can increase productivity and harmony at the same time.
Signs You Need a PMO
The benefits are significant, but how do you know if your business is ready for a PMO? The following tell-tale signs indicate that your organisation needs the assistance of a project management office:
- Your projects lack transparency
- Significant discrepancies appear in project results
- A high percentage of your projects are delayed or cancelled
- You struggle to predict project costs accurately
- No one seems to “own” projects at your organisation
- There’s not a clear business case for some of your projects
- Your company has a feeling of “every product team for itself”
- Customers don’t know what to expect
- Stakeholders are frustrated by a lack of information.
If you recognise any of these signs, it’s time to look into a PMO for your organisation. Please talk with us about how a PMO can help your business to operate more efficiently and effectively. To see how we work, download this case study regarding a PMO we established to support the delivery of seven major national reform projects.