Building A 'Transformational' PMO

By Meridith Levinson

A report from Forrester Research describes the characteristics of next-generation project management offices with real-world advice from leading PMO directors on how to get there.

As companies begin to re-invest in capital projects post recession, project management offices (PMOs) need to gear up to facilitate these new plans. But that doesn't mean they need to adopt more methodology, documentation and process. In fact, many PMOs would be better served by taking a leaner approach to project management, according to a recent report from Forrester Research.

Today's most successful PMOs—the ones with the sustained executive support that help companies complete projects faster—focus on removing obstacles and delivering project management best practices to the entire company, writes Margo Visitacion, a Forrester vice president and principal analyst serving application development and delivery professionals.

These "transformational" PMOs take a less hands-on approach to project delivery and instead place greater emphasis on portfolio management and establishing useful project management standards for the entire organization. They're called transformational because they enable business transformation through efficient project management.

"Transformational PMOs fully integrate into the company's project planning and delivery," writes Visitacion in the report, Are You Ready To Transform Your PMO? Tackling Today's Challenges To Prepare For Tomorrow. "The EPMO [enterprise project management office] transforms from an enterprise project management office into an enterprise program management office because its emphasis shifts from separate, distinct project planning to holistic, integrated initiative planning and execution."

Visitacion quotes a global enterprise project management office director who says, "We have a global EPMO that provides standards to every PMO...We're not going to manage every project, but we're giving everyone the processes and tools they need to be successful."

According to Visitacion's research, some of the characteristics of transformational PMOs include:

1. Consistency. Transformational PMOs have established consistent, repeatable project management practices that are in use across the enterprise. All projects are held to the same standards and requirements for success. Transformational PMOs have also eliminated redundant, bureaucratic project management practices that have bogged down projects.

2. Transparency. Next-generation PMOs have visibility into the progress and cost of all projects. They also know exactly how resources are being used across projects. They distribute this cost, schedule and resource information to the appropriate stakeholders throughout the enterprise (for example, cost information to the CFO).

3. Flexibility. Transformational PMOs adapt to the enterprise's "specific project and portfolio management needs" as well as to the corporate structure and culture, notes Visitacion. "Organizational structures play a large role in determining project delivery styles," she writes. "Highly centralized or federated organizations benefit from a strong centralized EPMO , while decentralized companies may take a decentralized or latticed approach to their PMOs."

4. Agility. Transformational PMOs employ accelerated and Agile development and project management practices.

5. Educational. Next-generation PMOs sponsor training, and more importantly, facilitate communities of practice to promote project management best practices in their organizations. These communities of practice provide project managers with a forum in which they can share their know-how and draw upon each others' experiences to solve project management problems. Depending on the company, participation in these communities of practice is either voluntary or mandatory. One PMO director quoted in Visitacion's report says that PMO managers at his company meet for two hours every month as part of their community of practice. Visitacion notes that communities of practice help build executive support for the PMO.

To take your PMO to the next level, Visitacion offers the following recommendations:

1. Identify a PMO champion. "The most successful PMO leaders we interviewed report to C-level executives with a program or project management background," writes Visitacion. "This support gives the PMO authority to enforce changes as well as accountability for supporting practices that drive company success."

2. Focus on project managers' careers. Organizations with transformational project management offices take the project management career seriously; they've established career paths for project management professionals. "Formal training and career development with a visible growth path attracts excellence to the PMO and builds credibility with business leaders and management," notes Visitacion.

3. Build communities of practice. Communities of practice give project managers a say in how their companies manage projects.

4. Focus on the metrics that matter. In addition to metrics associated with cost and schedule, transformational PMOs also track criteria that are important to the business, such as customer satisfaction and process improvement. "Practices such as polling key stakeholders to find out what's important to them and coaching project managers at the start of each project enable the PMO to get a realistic view of portfolio and project progress as well as how effectively the process is working," writes Visitacion.

5. Use project management tools. Visitacion advises PMO leaders to identify the right project and portfolio management tools for the organization that will make better use of project management standards and create consistency in the way projects are executed.

6. Achieve quick wins. The PMOs Forrester studied started small—in a single organization, such as the IT department, or with narrow portfolios of projects. As project management became a more systemic practice throughout these enterprises, the PMOs broadened their scope. These PMOs had to demonstrate value within their first six months of existence to maintain executive support.

Now its your turn. Post a comment and share what you think. Agree? Disagree? What else would you add to the recommendations?