The Project management discipline has provided the ethos for delivering projects. As an enabler, the Project Management Office (PMO) has acted as the governance body ensuring adherence to the approved methodologies, providing tools and support, all geared at enabling successful project delivery. With the advent of automated project delivery practices, the agile movement, digital transformation, and other specialty fields, the PMO function now seems to be under significant threat - the threat of extinction.
This threat is even more imminent for PMOs that cannot clearly show the value they bring to their organization. More than ever before, the PMO business function needs to be strategically aligned to the customer and business to maximize their contribution to the organization's overall Return on Investment (ROI).
PMO leaders need to examine to see they can salvage their business and its future secured. A thorough assessment of the value proposition would have to be performed by both internal and external parties. As part of that analysis, PMO leaders need to answer the following questions.
- Is your PMO function adding strategic value to your organization, and is the PMO's value recognized?
- Is your PMO focused on delivering a spectacular customer experience?
- Does your PMO have the right level of authority (senior executive sponsorship) required to function effectively?
- Does your PMO have a unique selling point?
- Is your PMOs' strategy focused on:
- Outcomes, not just outputs?
- The end product?
- Delivering solutions that target the customer's present and future needs?
- Realizing business benefits?
- Driving strategy realization?
The answers to the questions above would determine the need to reinvent your PMO or stay the course.
The Challenges of the PMO
The PMO faces challenges like any other business unit in today's business climate. Still, their existence gets questioned because most PMOs cannot show their value to the organization.
According to the Association for Project Management (APM), fifty percent or more PMOs have failed during the first three years of their existence. Perhaps even more disturbing, only 33 percent of PMOs reach their full potential of delivering value to the organization.
Guy Jelley, CEO of online Project Portfolio Management (PPM), goes further to say that "while 90 percent of large enterprises have active project management offices, around half close down and only to be resurrected a few years later at massive effort and cost."
In some other cases, when the PMO gets resurrected, it is subsumed under other functional business units, i.e. records management, thereby putting in more layers of obscurity to an already challenging function.
With all the challenges plaguing the PMOs mentioned above, leaders need to proactively map out steps to insulate their PMOs from becoming obsolete. The good news is, the PMO function is now becoming more mainstream. More organizations are starting to realize the value a strategic PMO function brings to the organization.
The Strategic PMOs Delivering Value
Over the years, the PMO function has evolved and morphed into delivering varied services within the organization. Over the past decade, the organizations' perception of the PMOs has been a support and administrative function (paper pushers) and bureaucratic bottleneck with no value-added, which has resulted in business and project leaders viewing PMOs as impediments. It is important to note that the PMO is a business function just like any other business unit, i.e., sales, IT, marketing, or HR, and should strategically align both to senior management and organizational strategy.
The PMO must have clearly defined customer-centric annual goals, objectives, and a business plan that describes how they would achieve their goals and objectives. The need for a customer-centric target cannot be over-emphasized, especially in today's highly competitive business climate. Now, more organizations are realizing the benefits and bringing back the function to the fold. This epiphany that PMOs can be strategic and an invaluable asset to the organization has set the stage for the process to help drive the organization's alignment to its strategic objectives, achieve business growth and positively impact the bottom-line.
Lending credence to the paragraph above, the Project Management Institute (PMI) in the Pulse of the professional 2017 stated that: "The strategic role of the PMO and EPMO is vital. The PMO is responsible for aligning the project portfolio to strategy, monitoring progress, optimizing strategy delivery, navigating risk, driving benefits realization, enhancing governance and managing talent. Champions recognize the strategic importance of the PMO—81 percent have a PMO, compared to 59 percent of under-performers."
How does the PMO sustain its relevance to be a much-trusted partner and a strategic powerhouse for the organization? To stay relevant, PMO leaders need to continuously build their core competence, have a sound understanding of the business operation and continually focus on the bigger picture. The PMO sustainability is attainable, but one needs the backing of senior leadership to be successful.
PMO leaders must be able to lead and influence with or without authority. They must never lose sight of who the "customers" are. The realization of the importance of the "customer" leads to PMOs taking the customer experience from business as usual to the spectacular! Overall, PMO's needs to focus on value delivery and strategic alignment in their organizations. If your PMO is already strategically aligned and delivering value, maintain that focus and improve upon it.
Strategic PMO showcasing customer experience (CX)
In a previous article of mine, Increasing ROI through Enhanced Customer Experience, we see that organizations have not fully leveraged CX's value. An added push for organizations to evolve comes from the growing customers' needs and expectations, mandating a re-enforced focus on CX to gain strategic advantage. It should not be any different for the PMO organization to refocus, reinvent and realign.
From the PMO's perspective, the customer experience (CX) is the overall relationship between the PMO function and the other business units. To make the CX exceptional, the PMO must collaborate to solve problems, develop solutions, and improve results. It is a by-product of good relationships with the business (customer and end-users). The absence of these "relationships" make the PMO redundant!
How Strategic PMOs Generate Business Value
When the PMO is effective, they help deliver more value for the customers and the broader organization because of the following:
- PMOs are business outcomes enablers. They help project managers and teams execute projects that benefit the business by providing tools and support to ensure that the project manager is successful.
- The PMO function would provide oversight for projects with interface with the business from strategy creation to project prioritization through benefits realization guaranteeing the highest value projects get selected for initiation. The PMO will see the end-to-end process supporting and facilitating through the different stages—focused on the customers' need and business benefits, which tie back to the customer-centric, customer service approach.
- PMOs are the project delivery centre for excellence. They train, coach, guide and support teams to deliver the highest value while minimizing disruption to the organization.
- PMOs help the project management team adapt to changing environments, never losing sight of its business case.
Overall, strategic customer-centric PMOs are never paper pushers or bureaucratic bottlenecks; they are strategic partners that help attain business value.
Becoming a strategic customer-centric business PMO
For PMOs to become a strategic customer-centric business function, PMOs should consider the following:
- Executive sponsorship and PMO structure - Executive sponsorship for the PMO is a must. On the organizational chart, the PMO should report to senior leadership, which will ensure that they have senior leadership backing. Without this direct link to senior leadership, the PMO can never survive. The PMO structure should align with the organizational strategy and trace back to the corporate vision.
- PMO's oversight and mandate - The PMO must have a mandate, and that all business units across the organization should understand the mandate. PMO should have an overarching oversight of projects and be involved in business development, project conceptualization, project selection, and funding decisions. They should provide key performance indicators and success measures of the project. Furthermore, they should track and drive results based on the right data with metrics around customer value ranking high on the prioritization list. The PMO provides oversight to ensure that the project management team delivers on the agreed deliverables on time, on the budget to expected quality standards.
- The PMO must adapt to new technological trends in the industry - PMO must be up to date on technological trends to ensure businesses stay relevant. Consumer habits have changed dramatically, reflected by the adaptation seen throughout companies and organizations across the globe. Enterprises are continuously involving with more and more people turning to digital solutions meaning the PMO needs to ensure that digital transformation is on their road map as part of gaining an edge against going extinct. PMO should embrace agility and continuously evolve and be abreast with improved industry changes to stay relevant.
- Employ the right people, have the right team - According to Sybil F. Stershic, "The way your employees feel is the way your customers will feel. And if your employees do not feel valued, neither will your customers." With the right staff, the PMO can deliver on its strategy. The PMO team could include the portfolio managers, program managers, project managers, business analysts, and PMO support staff–depending on your organization's roles for delivering projects and programs. The PMO team has to be aligned. The customer's culture and mindset have to be front and center and understood by the group. The PMO team members are advocates and change agents for communicating the organization's value and role. Training should also be provided to the existing team members to fully align their focus and integrate them into the new customer-centric culture from the hiring process to on-boarding and continuous development of the PMO team. Overall, remember that the PMO employees are the ones on the front line delivering the customer experience, so equip them for success by providing all the tools they need to succeed, so treat your employees right!
- Map out the customer journey from the customer's perspectives - To provide anything of value to the customers, seek to know and understand your customers' value, which means knowing your customer, their needs and their success criteria. A journey map is an excellent tool that can help capture the customer's experience journey. The PMO needs to keep in mind that the journey mapping process should not be a one-time event. Instead, it should evolve as the products, services, touchpoints, and customer's needs change. The real customer experience is immensely valuable to uncovering the key issues and helping the PMO map out services that address the customer's needs. The journey map also helps the PMO uncover the customers' points of friction and any duplicated process not adding any value to the organization that creates inefficiencies. Overall, the right information will help the PMO in creating a better experience for customers.
- Assess your PMO's maturity - The PMO needs to understand its maturity level compared to other PMO functions in the industry and how their customers perceive them. A maturity level assessment will be required to assess the PMOs' maturity using key industry indicators. The assessment results will help map out where your PMO has gaps that impede it from being a strategic value-add. A roadmap example below can be employed to determine the stage you are in on the customer-centric transition journey. An industry example for assessing organization maturity is Forrester's evaluation with 16 indicators for evaluating its maturity. PMOs maturity assessment requires an in-depth evaluation of the team and its leadership, including assessing core competencies, strengths, weaknesses, opportunities, threats/risks (SWOT) analysis and three-sixty (360) degree feedback. The PMO would have to decide whether to address the identified weaknesses and put plans to address the threat or capitalize on their strengths and opportunities as part of their unique selling point.
[Figure 1: A customer-centricity guide. Source: Redwizard.com]
- Develop a roadmap with your customer's input - A management principle that has proven viable is developing solutions with the end users being part of the process. In creating the PMOs' future state roadmap, the solution needs to be developed together with the customer. In developing the roadmap, the PMO will identify its strategic objectives and priorities. The customers' needs and preferences would determine the PMO's value proposition strategy for the future state. The approach could either focus on showcasing the PMO's strengths and opportunities or improving the identified weaknesses. PMO should set strict timelines for the goal accomplishment and milestone tracking with a steering committee in place backed by an executive sponsor to oversee overall delivery.
- Listen more and build bridges by treating your customers as partners - As the saying goes, "he who pays the piper dictates the tune." The customers are the ones that keep the PMO in business. Thus, the PMO needs to collaborate with the customer to establish guiding principles to be followed. These steps will ensure strategic alignment, transparency, predictability, reliability and ultimately increase ROI. Without a doubt, as a PMO leader, you need to ensure that your PMO imbibes a customer-centric culture, your team is fully equipped with the right tools and training, and understands the importance of providing an unparalleled customer experience.
- Communicate, communicate, communicate! - What is the point of having a great value proposition without telling anyone about it? The PMO needs to communicate and share information via multiple channels and media, numerous times to varied audiences and stakeholders. Once the PMO team has identified the products/services offerings that deliver value to the customer, the PMO needs to flesh-out the communication strategy. The communication strategy should capture stakeholder groups and their communication needs, which will become part of the stakeholder engagement plan. The PMO's communication to the customer needs to be tailored to the specific stakeholder group's communication needs and kept simple in easily understandable formats. The communication between the PMO and the business stakeholders should not be a one-time event, primarily when advocating and marketing the PMO services; instead, it should occur regularly. As part of regular communication, regular checkpoints should be in place to validate that the PMO services are still valuable to the business. The PMO should continuously evolve based on feedback as part of continuous improvement.
- Ensure appropriate measurement metrics are in place - The PMO will need to put measurement criteria and metrics in place as checkpoints and markers to meet their goals. These metrics enable the PMO to understand where improvements are required and bridge the gaps. According to Lord Kevin, "if you cannot measure It, you cannot improve it." It is important to measure at set regular intervals as the project progress. To capture significant improvements, the PMO should never resort to implementing lessons learned after project completion. PMOs should measure customer satisfaction throughout the process. Having the right set of key performance indicators (KPIs) reflecting how your organization realizes value will ensure that the PMO understands the customer's demands and tailor strategies to focus on what matters.
It goes without saying. For a PMO to stay relevant, it must be strategic and with a customer-centric focus. The PMO needs to be seen as a strategy realization office where its activities are directly traced to the corporate goals and objectives. The goal is to ensure that your PMO delivers value providing the organization with the end to end oversight from idea conceptualization to idea implementation. Also, contributing to strategic portfolio planning, project execution, project handover to operation and benefits realization. The PMO would have full visibility from Idea conceptualization (Strategy creation) through to execution of those prioritized projects to benefit management.
According to Guy Jelley, "Adopting this mindset is a journey. Better managing the relationships between the PMO and the customers (internal and external) will keep everyone engaged and determined to achieve success. This shift will not happen overnight. Chances are you will falter and fall back into the project tick box mindset when overwhelmed and under pressure. Don't give up! Consider the alternative - another PMO closed within three years."
More importantly, a mindset shift is critical for the PMO team to become more customer-centric, adding value to the organization and positively impacting the bottom line. PMOs need to embrace agility and keep evolving, and it should be a continuum, never a destination! Make building relationships a top priority as you continue on this journey and ensure your PMO has a clearly understood purpose agreed upon and backed by the business, preferably a c-suite executive sponsor. So, do make sure everyone in your PMO is working together to make it a success. The success of the PMO is validated when achieving the goals and objectives agreed with leadership.
Remember, the PMO exists because of the customer, so if the customer does not see the PMO function's value, then, understandably, it would spell the beginning of the end to that PMO. With a customer-centric focus strategically aligned, delivering a compelling customer experience and applying all the steps outlined in this article, your PMO will be part of those that got it right!