Analysing the Need for a PMO

When it comes to understanding the reasons behind the implementation of a dedicated project management office (PMO), many businesses perceive the role of a PMO within smaller or larger organisations to be trivial as they have never been provided with a lucid explanation as to its core function and outputs. The PMO is sometimes seen as adding yet another layer of bureaucracy, particularly within larger organisations. With stringent processes in place already impeding on progress, what is the logic in assigning yet another level of refinement in order to get things done…?

It’s a reasonable question, yes, but the definition of a project management office has been highly misconstrued by many business professionals. Suffice to say, there is no denying that a PMO does effectively add yet another layer to an organisation – but if successfully implemented, a project management office is capable of accelerating your project output, increasing predictability of outcomes by providing high levels of transparency and yielding miraculous improvements to the base line of your projects.

The door swings both ways with project management offices – when successfully implemented the dividend yield for project success can be enormous, however if the need for a PMO has not been properly scoped and analysed then the impact can be directly adverse and thus disastrous for the organisation.

Therefore the question arises… Who needs a project management office?

There is no definitive ‘yes’ or ‘no’ answer to this much debated question, but on the other hand there are a number of mitigating factors that can help us ascertain whether or not we should look to implement a project management office within the organisational hierarchy:

1. Look at your performance record – If your company is constantly falling short of the deadlines required of their project deliverables, and the structure of your project management processes looks dilapidated then you need to be considering a PMO.
2. Project multitasking – Project multitasking is an unavoidable requirement of virtually all businesses. However if all project resources are currently working at full capacity during project multitasking, and resources being shared across project boundaries are having a negative impact on productivity and project delivery then a PMO should be considered in order to discipline resources allocation and provide solutions.
3. Complexity and time sensitivity - Once you have realised the complexity of your projects and have measured the resource demand against allotted project time deadlines then you will be able to see clearly the need for a PMO.
4. Dire implications for failure – If you find that you are being punished for your project failures – this may come in the form of financial loss, diminished customer loyalty, tarnished brand name etc. – you need to look at implementing a PMO to repopulate customer loyalty and better your project success rate through improved delivery processes.
5. Magnitude of the project – If your organisation’s existence is dependent on the outcome of a project, then every measure should be put in place to ensure that you achieve project success.
6. Project Backlog – Again, this ties in directly with project resource allocation and analysis of your current processes. If your company is running a multi-faceted business model with a high-rate of project turnover, you may find that backlogs are rife within many of your projects – more commonly IT and finance related endeavours. Measure your existing backlog of projects for indicators of the need for a project management office.
7. Priority of Projects – Do you answer the call to whichever client screams the loudest? Then your company is lacking discipline and may be bereft of simple protocol. If you are finding it too hard to prioritize all of your projects look towards establishing a PMO.

Did you find yourself relating to any of the above criteria? If you answered ‘yes’ to any of the above questions then you should be considering implementing a project management office to disperse resources where required, meet deadline and hence heighten your project delivery success rates.

While you sit back and cogitate the necessitation of a project management office, one thing that is important to keep in mind that PMO’s are simply a means to enhance predictable project success. Critical to PMO success is thus its ability to leverage the project manager’s ability to complete the project promptly, within budget and within designated time frames. Also be aware that there are different type of project management offices - for a detailed explanation on each type of PMO please refer to the best practices section on our website.

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