An interesting survey was just published in the May Edition of PMI Today. This survey was based on results from about 1700 surveyed PMI members as they answered questions regarding the state of project management within their organizations. The survey caught my eye because the headline shows that more projects were completed on time and within budget than when the survey was last completed in 2006. What I found even more interesting was that, at least according to the sample size of this study, there was a marked increase of centralized project management offices (PMO): 37% of respondents had PMO’s versus only 30% in 2006. Now while this survey was conducted before the economy had this little meltdown during the last couple months, things were not exactly rosy either. The fact that more and more companies have been steadily adding resources and taking the effort to create PMO offices is a good sign, both for future of professional project managers, but also for the companies that deploy them. It is also clear from the study that those organizations using professional PMO’s had more projects completed on time and within budget than those that didn’t have such offices within their organization.
Lets discuss some PMO basic frequently asked questions.
What is a PMO?
-A Project Management Office is most often a department within an organization that specializes in project management and execution. Most often, it is comprised of professional project managers that can be assigned to projects anywhere within an organization, or for very large companies, perhaps within a certain company division or department. The very nature of the PMO ensures that more consistency is achieved during project execution, most often including the use of standardized tools, reports, and methods. As I discuss in the post “Project Management Standardization: Its effects on Project Delivery”, standardization of process is clearly and qualitatively linked to better outcomes for the organization.
How do you go about creating a Project Management Office?
-A Project Management Office is most ideally created by executive order. The most effective project management offices have authority directly from the top. A PMO without a clear executive mandate is only setting the organization up for friction, and potentially failure, as turf battles between powerful department directors and project managers with limited authority are almost guaranteed to become an issue and impact project delivery.
What are the benefits and drawbacks of using a centralized PMO?
Creation of a PMO most often also:
· Gives more authority and executive mandate to Project Managers, usually increasing their effectiveness.
· Creates more standardization of process within the organization
· Allows cross-pollination of ideas and best practices as project managers move on to different projects within different departments
· Increases visibility of all project statuses across the institution, and is a good foundation for Program Management best practices.
· Opportunity to deploy web-based project management software such as BaseCampHQ, Central Desktop, or Daptiv and to gain the full benefits of the messaging, file sharing, reporting, and program management features that this software can offer.
Of course, creating a centralized and professional PMO also has some drawbacks:
· Lack of department specific information when managing a project (i.e. specific resource and staffing information, working styles, and other norms)
· In a matrix organization, despite the PMO mandate, project managers may still lack resourcing authority can create difficulties during project execution.
· Staffing a PMO adequately requires an upfront cost that must be justified (as dept managers, directors, or part-time project managers may have been used before the PMO was created).
In other words, executives must know the true value of a PMO and be committed to its creation in order for a PMO to be created in the first place. As more real data about the positive impact that PMO’s have on projects and organizations is captures, I believe we will see more and more PMO’s created. I bet during the next iteration of this survey, despite the bad economy we are having now, we will continue to see growth in Project Management Offices.
