THE PMO VALUE PROPOSITION—WHY HAVE ONE?

Organizations establish PMOs for a variety of reasons but with one core benefit in mind: improved project management in terms of schedule, cost, quality, risk, and other facets. PMOs have many potential roles in aligning work with strategic goals: engaging and collaborating with stakeholders, developing talent, and realizing value from investments in projects.

PMOs can take multiple forms. Understanding how PMOs are utilized in organizations as well as assigned roles and responsibilities sheds light on the range of benefits PMOs can deliver:

• Some PMOs provide project management guidance that supports consistency in how projects are delivered. These PMOs may provide guidelines, templates, and examples of good practices along with training and coaching. Standardized approaches and tools promote a common business picture across projects and facilitate decisions that transcend individual project concerns. This type of PMO often exists in organizations that are just starting to improve their project management capabilities.
• A PMO may offer project support services for planning activities, risk management, project performance tracking, and similar activities. This shared services model of a PMO often exists in organizations with independent or diverse business units that want support with delivery while maintaining more direct control over their projects.
• PMOs can be part of a department or business unit and oversee a portfolio of projects. Oversight can include such activities as requiring a business case to initiate a project, allocating financial and other resources to deliver the project, approving requests to change project scope or activities, and similar functions. This type of PMO provides centralized management of projects. This structure exists in organizations that have departments with multiple projects and that deliver strategically important results, such as IT capabilities or new product development.
• An organization may have an enterprise-level PMO (EPMO) that links implementation of organizational strategy with portfolio-level investments in programs and projects that deliver specific results, changes, or products. This structure exists in organizations with well-established project management capabilities that are directly linked to achieving organizational strategy and broad business objectives.
• Organizations with flatter structures, customer-centered initiatives, and more adaptive delivery approaches may adopt an Agile Center of Excellence (ACoE) or Value Delivery Office (VDO) structure. The ACoE/VDO serves an enabling role, rather than a management or oversight function. It focuses on coaching teams, building agile skills and capabilities throughout the organization, and mentoring sponsors and product owners to be more effective in those roles. This type of structure is emerging within organizations adopting more decentralized structures where teams need to respond quickly to changing customer needs.

PMOs may be layered. For example, an EPMO may have subordinate PMOs and VDOs that reside within specific departments. Such layering supports strategic alignment at the EPMO level and specific project management capabilities within the departmental PMO or VDO.

The formation of any type of PMO or VDO is based on organizational needs. Key influencers that help to shape the PMO or VDO include the types of projects being delivered, the size of the organization, its structure(s), the degree of centralized/decentralized decision making, and corporate culture. As organizational needs change over time, PMOs and VDOs evolve in response. For example, a PMO may transform into a VDO or the PMO may be closed after fulfilling its charter.