The PMO Form and Function
The project management office (PMO) often emerges as a construct to manage the project portfolio as a company’s project management maturity increases. The PMO may sit at different levels in the organization and provide a variety of functions to a program, organization, or an enterprise. Before organizations implement a PMO, they should understand the different types of PMOs available and the functions they support.
PMOs can be found at different levels of an organization including enterprise-wide, organization-level or program-level PMOs. The enterprise level PMO has a strategic focus and its scope encompasses across all the projects in the corporate portfolio. Depending on the governance requirements, all projects may report into the enterprise PMO, or only select programs or projects may report directly to the enterprise PMO. Independent of portfolio reviews, the enterprise PMO is a top-down organization that defines the project management standards, tools, and techniques other organizations should follow.
An organization- or department-level PMO focuses on the specific projects executing within the organization and implements the standards, tools and techniques prescribed by the enterprise PMO. Depending on the project size, complexity and organizational impact, department-level projects may be reviewed by the enterprise PMO for improved communication and support.
A program-level PMO provides the administrative and project management support to projects within the program. Its scope and influence is limited to the program since its authority is an extension of the program manager’s authority. A program level PMO can be considered the “arms and legs” of the program management function that drives program delivery.
The scope and authority will vary depending on the hierarchy of an enterprise, organization-level or project PMO. However, each PMO can provide several key functions to support the portfolio. These functions range from the classic project management processes found in the PMBOK to the administrative tasks sometimes bestowed upon business planners or staff generalist positions.
Project Management Office Functions
Governance: The PMO’s governance function plays an important role by providing decision support for project sponsors, decision makers, and stakeholders involved in the program, organization and enterprise. Documenting governance decisions and tracking action items for future governance sessions provides the administrative support needed for effective decision making.
Performance Management: The performance management function integrates project level status reporting and generates the program level status for executive reviews. The PMO investigates specific performance issues and communicates early warning signs of troubled projects. The PMO also enforces consistent performance reporting guidelines so each project reports project performance consistently.
Schedule Management: The schedule management function assists the program by identifying project level milestones and integrating them into an overall program level plan. The program level plan is a summarized view of critical program milestones. If the program is leveraging tools such as Microsoft Project Server or CA Clarity, the PMO may integrate the detailed project schedules into a detailed program schedule. The PMO also monitors schedule variances and recommends corrective action.
Financial Management: Tracking actual spend and forecasting future costs while navigating a company’s internal billing and reconciliation procedures can often be a full time role within the PMO. Reporting cost variances and adjusting program forecasts based on change control is a critical function for fiscal success.
Risk, Issue and Scope Management: The processes of risk management, issue management and scope management apply to programs as well as individual projects. The PMO supports individual projects by identifying and evaluating risk, issues and change requests to a program. The PMO manages the specific reviews and documents key decisions. Projects are organized within a program due to synergies gained from working as an integrated set of activities. The key processes of risk, issue and scope management also need to be integrated for mutual benefit.
Resource Management: Resource allocation and resource capacity needs to be managed across the program for effective utilization. Depending on how well resources are allocated, different projects may have additional resource capacity and skills that can be shared across the program. By establishing a resource management model and tracking utilization, programs can make better decisions for project prioritization. The key to an effective resource management model is the quality and reliability of the underlying data. The PMO manages the data collection and reporting process.
Quality Management: The PMO provides quality management by providing expertise in quality control, quality assurance, coordinating quality inspections, and process coaching. This function is often perceived as administrative overhead and intrusive to individual projects, however, it is a critical function for consistent delivery. The PMO should inspect project level deliverables and more importantly provide coaching to project teams requiring additional project management support.
Communications Management: Every project and program requires a communications plan. Although the target audience and frequency may vary at the program and project levels, the PMO creates the overall program communication standards for projects to follow. The PMO will also assist the program manager in developing necessary communications to program stakeholders.
Supplier Management: The PMO supports supplier management by monitoring the various suppliers providing services to the program and notifying the program manager of supplier performance issues. Supplier performance scorecards are integrated through the PMO and individual suppliers work with the PMO to understand performance-reporting standards.
These functions are specific to project management delivery; however, additional administrative functions such as document management and facility management may be supported. The scope of functions provided depends on the form and needs within the program, organization or enterprise. Once a company determines the form of PMO needed, they can use these functions as a PMO checklist to develop the project office.
When organizations first establish a PMO, it should have a PMO development plan. Each of these processes can appear as high-level tasks in the development plan to ensure the PMO is delivering all its functions. Organizations may prioritize specific functions depending on need and project management maturity; however, fully functioning PMOs have established processes that integrate and roll up through the program, organization and enterprise.