Implementing standard practices and procedures. Efficient management of shared resources. How to start a project management office Starting a project management office can be approached like any other project. Step 1: Create the business case A business case should be completed to justify the implementation of a proposed project management office.
The business case will outline the following: The objectives of the PMO The benefits and limitations of the PMO Any risks involved in starting a PMO An estimated cost of implementation A rough timeline or length of the project The potential impact on the business Any other relevant information The business case should include choosing the PMO model to be implemented.
It is generally a knowledge center and a source of best practices, training, and lessons learned. It goes a step further to ensure the best practices and standards are being followed.
It often creates controls and governance standards. Project Managers report directly to the PMO rather than a separate function or organizational group.
Step 2: Assign strong leadership If the project is approved to move forward, the next step is to assign the key team members to manage and execute the plan. Step 3: Create the charter The project manager will now draft the project charter for the creation of the Project Management Office. This will include: The project scope High-level requirements Relevant assumptions Constraints Major milestones Step 4: Follow the project management lifecycle Once the charter is approved, the project should follow the same life cycle as any other project.
Tips for a successful implementation To increase the chances of your new PMO being successful, consider the following tips: Obtain long-term buy-in: The establishment of a PMO will mean a significant, long-lasting change for the organization. In particular, the PMO will support the development of collaborative delivery techniques and strive to increase communication, interaction and collaboration between geographically or functionally distributed workgroups.
As part of its effort to structure business processes and activities, the Project Management Office ensures that a reliable and powerful information technology system is in place and is being used to manage project activity. If warranted, it will choose and implement a new professional PPM software.
Most PMOs these days favor cloud-based solutions that can be accessed anywhere, anytime, on any device. Such project management systems centralize data and provide comprehensive, real-time visibility over what is going on with projects, sharpening the image of project and portfolio status and health.
They also consolidate information about resource availability and future capacity, about interdependencies, and about risks and issues. All that data can be harnessed using advanced analytics in order to speed up and improve decision-making. Having reliable, high-performance IT tools is especially important to meet the needs and demands of the newer generations in the workforce, who expect state-of-the-art digital platforms with strong collaborative capabilities.
The PMO is also in charge of ensuring proper user adoption of the PPM toolset through training, communication and change management efforts. Another rationale behind the acquisition of professional PMO tools is the need to automate activity in order to boost work productivity.
Over the lifecycle of a project, the waste of time, energy and resources is too significant to be ignored. Equipped with the appropriate software, a PMO enables automation of those non-value-added tasks and repeatable processes, which improves the productivity of project delivery. That ability to automate anything and everything that can be automated frees up and empowers project execution teams, limits errors and failures, and minimizes project cycle times.
The organization can get products or services to market faster, ahead of competition, and consolidate its market position. Truly optimizing project cycle times requires that the right resources, with the right competency, work on the most important projects at the maximum utilization rate that can be achieved.
Your PMO will devise and implement a standard process to assess resource availability, to build the right teams, to assign them appropriately and in a timely manner, to adjust resource plans, and then to perform ongoing analysis and trade-offs.
Proper digital PPM tools also support the ability to perform impact analyses across multiple portfolios, helping optimize the allocation of limited resources in order to maximize delivery output and business value. Automating low value tasks and maximizing the utilization rates of project resources across the organization will obviously drive labor expenses and cost structures down, making the business more cost competitive.
Additionally, a PMO will greatly facilitate budget planning and tracking to ensure that every dollar is put to the best possible use. Based on a list of requests and planned allocations, the Project Management Office can make projections on project-related expenses, revenue and cash flows, running cost and budget scenarios at the level of the portfolio. Further down the road, it will re-evaluate the situation, monitoring and analyzing cash flows in order to facilitate budget trade-offs and adjustments.
The selection of the projects to be undertaken should always be based on a set of expectations regarding the value of the project opportunities, their potential contributions to the firm, but also their impacts on resources and their risk profiles. A PMO brings superior clarity and a systematic approach to the project selection process. Well-defined priorities and criteria help evaluate the potential impacts of candidate projects for the portfolio and rank projects ideas and business cases.
Leveraging data analytics that provide insight into project performance, the PMO can also determine which active projects are to be deferred or even terminated. It can, potentially, substitute new projects for failing initiatives. Project Management Offices also focus on building solid and consistent project portfolios, with good balance between various types of projects, taking into consideration the overall impact on budget, resources and benefits. Yet, only very few of them have reached a state with which they are satisfied.
No wonder, since merely setting up a PMO and letting it operate will not lead to sustained success. On the other hand, the companies without a project management office are wondering about the benefits of a PMO or are looking for clear arguments to convince decision-makers.
This series of articles is meant for both groups, with and still without a PMO. In this series including many practical tips, you will learn what you should know about setting up and improving a project management office.
This is the first page of a series of articles. If you are new to the topic, it will provide you with the PMO definition and a few basic answers to these frequently asked questions:. At the end of the article, you will find links to further articles in the PMO series. Let us begin with the definition and the distinction from the Project Office etc. After all, there is a lot of confusion about these.
A PMO is a centralized, permanent organizational unit that is responsible for handling multiple projects multi-project management for an entire company or department within the company. Its responsibilities may include, for example, training, project services, methodology, processes, and PM tools.
It may also have strategic duties, such as providing assistance in project portfolio management. Companies running multiple projects involving various departments having interdependencies often have several PMOs see graphic. Each project management office is responsible for the project management methodology and processes in their respective department.
Experience has shown that having a centralized project management office is especially helpful in situations where:. Individual projects are automatically added to the project list. This list provides the up-to-date and accurate information needed for the portfolio reports management uses to make decisions. Users of agile methods , please note: Establishing a PMO is essential if you have multiple projects running concurrently, even in an agile environment.
Having a complete, accurate list of all the projects is essential for every decision-maker. Our recommendation: Make sure that every single project is included on your project list. Avoid having any stealth projects that secretly steal your resources.
Your primary responsibility as project management officer is to ensure that the list is always complete and up to date!
Our recommendation: In this first phase of establishing a PMO implementation, you need to ask many questions: How helpful have previous project status reports been?
What was their intended purpose for each of the stakeholders? What things were able to be optimized? Take a close look at the training opportunities and career paths available to those involved in project management.
Your findings will help you determine the level of project management expertise in the company. Make sure that you document this. This can help you achieve some quick wins and later clearly demonstrate the improvements and added value. Each of these stakeholders has their own expectations of the PMO. This will let you set the right goals and lead to greater acceptance of your work. This analysis depicts the gap between the current status and the desired status of project management in the company.
The information can then be used to create a prioritized list of recommended actions. You can sustainably close some of the gaps defined in your gap analysis by, for example, defining a PM maturity model that can be introduced in stages. Our recommendation: Complete the quick wins identified on your list as early as possible. The next phase involves developing the concept. The PMO should have a clear understanding of its mandate and the services it is expected to provide. The scope of services is often broad and the stakeholder expectations high.
Possible PMO services can be seen in the following list. You want to avoid over-burdening the organization. Get stakeholder input and agreement on this. This generally includes agile methodology as well as the traditional together with hybrid approaches that combine these two methods.
Our recommendation: Select a senior employee to lead the PMO. Choose someone with good organizational skills and many years of project management experience. Make sure this person also has the truly necessary interpersonal skills.
It can define criteria for the degree of uncertainty in the requirements as well as which solution should be used based on this uncertainty.
A Stacey Matrix can be helpful here. Our experience has shown that this can jeopardize the satisfaction and process stability.
Please fill in the form. The following graphic shows several other methods common to traditional project environments that the PMO may need to consider. The PMO also provides a suitable IT infrastructure , offers training, and assists users in applying the methods and tools.
In traditional as well as agile project environments, the PMO is responsible for ensuring that the required processes are carried out at the right intervals. The right information needs to be made available with a regularity that ensures it is both up to date and reliable enough for good decisions.
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