PMO - What is it?

A Project Management Office (PMO) is an entity that defines, and maintains the processes related to Project Management in an organization.

The above given definition is very simplistic, and does not cover the complete scope of PMO. First, the way I look at it, I consider it as a Program Management Office, and not Project Management Office. Second, I consider scope of PMO is not confined to definition and maintenance of processes; instead it should also include facilitation, implementation, enforcement, evaluation and improvement. Therefore, I would rather define it as, "A Program Management Office is an entity that defines, maintains, facilitates, implements, enforces, evaluates, and improves processes and activities, required to run programs / projects effectively within given constraints".

Having said that let me enlist the activities that a PMO should be doing;

a) Program Management - All processes and activities that will help alignment of projects with organization strategy, i.e. prioritization, portfolio creation, resource allocation, implementation and support, along with all other attributes, as defined in the definition of PMO.

b) Portfolio Management - Establish a portfolio of projects as per priority, and assign resources to execute and manage the portfolio.

c) Project Management Processes / Methodologies / Activities - Define, Maintain, Facilitate, Implement, Enforce, Evaluate, and Improve processes and methodologies.

d) Training - Support, guide, and train project managers in executing the projects. Provide necessary training, through identification of needs of the individual and organization.

e) Infrastructure - Investigate, pilot, and institutionalize necessary tools and methods required for effective program management.

f) Governance - Provide necessary guidelines, support, facilities and services to govern the programs / projects from set principles, objectives, and goals perspective.

g) Implementation - Decide whether you want it to be either "Consulting" or "Centralized" kind of structure. Formulate your plans and execution as per structure needs.

h) What better to govern a Program than "Benefit Relaization"? The reason being,
1) It provides the required focus,
2) Helps in optimal allocation of resources, and
3) Reduces the risk of faliure.

The last point is important because, one seldom selects a program on the basis of ROI alone. As the ROI presents the immediate / potential "financial" gain or loss. However, an organization needs to look beyond "Financial Measures"; therefore, it is imeperative for an organization to include other factors too, like, market, competitor, customer, internal processes, environment etc.

Yes, you may argue that those are subjective factors; however, those are critical influencing factors. All these factors would have an affect on an organization's current and / or future capability; hence, would need a due consideration during selection process.

Though, this analysis is originally proposed by McFarlan, from IT application's investment perspective. However, it can very well be extended to this scenario, i.e. assessing the impact of the program on organization's capability (current vis-a-vis future).

Current (High) / Future (High) - It is stratgeic investment, and has to be taken up.
Current (High) / Future (Low) - It is critical for survival / current position maintenance.
Current (Low) / Future (High) - It is critical for organization's future standing; may help in turning around the company's future.
Current (Low) / Future (Low) - Low impact on current and future capability; a no brainer.

It is true that how a PMO should be structured, is a call that any organization has to take; however, it should be in line with organization needs, as each structure has its own merits and demerits. Similarly, an organization cannot afford to choose only one or few of mentioned aspects of PMO, provided they understand, and are sincere about PMO.

The previous sentence may sound harsh; however, it is true that there are many organizations where PMO's responsibilities have been confined to "servicing" PM resource requests. Unfortunately, even that is not diligently. In few other cases, it is confined to "audits" alone; however, the PMO responsibility should be visualized more from a governance, rather than audit / compliance perspective.

To summarize, one should understand what PMO is NOT;

1) It is NOT an entity to service PM resource requests; it can be handled by resource team, or should be one of other activities, and should not be the only activity.

2) It is NOT meant to do audits, you have many other ways to do that; instead, focus on governance.

3) PMO is NO longer a "Project Management Office"; it should rather be seen as "Program Management Office".

4) It may have overlapping responsibilities with other support groups; however, under NO circumstances it can delegate those responsibilities to those groups when it come "Project Management" resources. For example, Training and Resourcing are the activities usually managed by "Learning" and "Human Resources" entities; however, in case of PM resources, PMO has to work with support groups to get it done.

5) PMO CANNOT just either be a defining, facilitating, implementing, governing, or managing entity; instead, it has do all those activities, together.

6) It should NOT be a one time activity; instead, it should be an on going, and continuously improving activity.

7) It CANNOT either be an administrative or bureaucratic entity alone; as suggested, it has flavor of both. However, it has much more to perform than activities around these two attributes alone.

8) Certification or no certification is an individual opinion; however, certification cannot be a "guarantee" for expertise.

Therefore, the success of PMO depends on top management's understanding, and seriousness. If they have understood it correctly, from its scope, benefits, and responsibilities perspective, I do not see any reason as why it would not deliver the results for which it had been constituted.

PMO Evaluation

As true for any process, unit, entity, or methodology, we need to ensure that the PMO is performing. So, how do we measure the performance of a PMO? I personally feel that a PMO should be evaluated against following parameters;

1) Program's alignment with organizational strategy, and its contribution.
2) Program / Project performance against budget / cost, benefits, and schedule.
3) Overall customer satisfaction (across projects).
4) Improvement as compare to previous year (cost, cycle time, quality, service etc.).
5) Skills development (of resources)
6) Maturity from predictability of capability perspective.