To build a strategic PMO, an organization needs to focus on cultural change through several key areas over time, including gaining speed in achieving objectives while also having patience as full deployment may take years. The PMO should start small with individual departmental projects before expanding enterprise-wide. All levels from project teams to executives must be engaged. Continuous learning and improving processes are also important. Ultimately, a strategic PMO helps manage projects and link them to corporate strategy through portfolio management.

1. How to build a Strategic PMO
Terri Kenitzer, PMP
9/19/06

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So you want to build a strategic PMO?

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So you want to build a strategic PMO?
Take a class.

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So you want to build a strategic PMO?
Hire some strong clerical support that
is organized to track projects.

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So you want to build a strategic PMO?
Hire some data guys to really put some controls in
place to manage status, cost, time and resources.
(A fancy database would be nice.)

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So you want to build a strategic PMO?
Skeptical?

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So you want to build a strategic PMO?
A project management office is designed to
manage projects and improve the
management of the enterprise through
portfolio management linking projects to
corporate strategy.
Projects Portfolio Corporate Strategy

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So you want to build a strategic PMO?
More than establishing an office and creating
reports, it’s infusing a cultural change
throughout the organization.

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So you want to build a strategic PMO?
J. Kent Crawford who authored “The Strategic
Project Office” identified seven key areas of
cultural change that deciding to implement a
PMO will require.1
As with any good textbook or course
you take….let’s see what we can sift
out and apply to our worlds.

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So you want to build a strategic PMO?
Speed AND Patience
Building a PMO culture takes time, however,
achieving clear objectives during PMO
development is key or you risk the possibility
of a failed PMO where leaders lose sight of the
value project management practices can bring.

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So you want to build a strategic PMO?
Speed AND Patience
Move forward quickly
Show results within 6 months
Begin changing corporate culture within 1 year
Begin showing corporate results within 2 years
Be prepared that it will most likely take
2-5 years to fully deploy a PMO.

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So you want to build a strategic PMO?
Leadership from the Bottom Up
Start small, with individual projects that focus
at the departmental level.

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So you want to build a strategic PMO?
Leadership from the Bottom Up
Two things will happen:
This is grass roots cultural change.
1. Business partners that participate as
stakeholders of the departmental projects
experience the project methodology AND
delivery of results.
2. These leaders will ask… how can we
leverage this approach for our own
performance….can we adapt this
approach?

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So you want to build a strategic PMO?
A Systems Thinking Perspective
All players must be on board, from the project team
member to the executive sponsors of initiatives.
As a result, successful PMOs are located at the
corporate level providing data on funding, resources
and status for projects.

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So you want to build a strategic PMO?
A Systems Thinking Perspective
When executives can prioritize initiatives based on
facts about initiatives, funding and resources…they
are applying a Systems Thinking Perspective as
opposed to tinkering with pieces and parts or political
favors.
At a corporate level, the playing field is leveled as this
information gains visibility, in terms of what the
organization is working on.

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So you want to build a strategic PMO?
Enterprise-wide Systems
Kent Crawford recommends that all data to support
enterprise-wide project management be in a single
system.1
The reality for many of us is we’ll use
spreadsheets and databases to manage this
work.
Guard against creating a project to develop a
tracking system that takes more resources
and funding than the initiatives your PMO is
managing for your clients.

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So you want to build a strategic PMO?
Knowledge Management
Establishing a set of basic procedures and
standards with a common mechanism or
practice for storing and sharing information.

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So you want to build a strategic PMO?
Learning and Learned Project
Organizations
Ensure project management staff have the
baseline education to be successful in your line
of business.
Seek out individuals with college degrees in
project management OR the Master’s
certificate in project management.
Seek out individuals with PMI’s certifications;
PMP or CAPM

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So you want to build a strategic PMO?
Learning and Learned Project
Organizations
Sure….education isn’t all that and a bag of chips, there are plenty
good project managers who have degrees from the school of hard
knocks. However, education provides any organization a baseline
understanding of project management methodology.
This approach simply removes a set of barriers with all PMO
associates talking AND walking the PM talk.
As a result, you are better positioned to focus on learning
knowledge associated with your industry versus focusing on
basic PM knowledge.

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So you want to build a strategic PMO?
Learning and Learned Project
Organizations
One of Stephen Covey’s habits of highly
effective people is to ‘Sharpen the Saw’.
On going learning opportunities, whether
they be internal lessons learned sharing or
more formal educational opportunities are
required to help your associates keep their
PM skills sharp and ensure you
continuously improve.

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So you want to build a strategic PMO?
Seems straight forward.
Open Communications
Open communications is the point between
which project management crosses between
function and art.
We spend lots of hours training, learning and
executing WBS’s, Gantt Charts, documenting
meetings, requirements, critical path
calculations, cost estimates, resource
allocation, etc.
This is the function

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So you want to build a strategic PMO?
Open Communications
Facilitating divergent groups of
people to a common goal or
objective with trust, integrity and
commitment.
The art is when through the PM’s skill,
a team, who thought the goal could not
be achieved and have divergent
objectives, achieves a goal as a team
through the art of applying project
management.

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So you want to build a strategic PMO?
Open Communications
When this happens in your organization, not only
does the project team win, but deliver enough of
these initiatives and the culture from the CEO
to the project teams, start to use common
terminology to describe their work, how projects
inter-relate to each other and ultimately how the
company is managing their portfolio.

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So you want to build a strategic PMO?
Let’s Review those 7 components of
cultural change….
Speed AND Patience
Leadership from the Bottom Up
A systems thinking perspective
Enterprise-wide systems
Knowledge management
Learning and Learned project organizations
Open Communications

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So you want to build a strategic PMO?
A Maturing Profession……
As a child, who knew they wanted to be a nurse or fireman?
As a child, who knew they wanted to be a project manager?
As a young adult, who selected their college due to is
reputation on education for project management?
Who majored in project management in college?

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So you want to build a strategic PMO?
What this validates for us is project management is an
evolving profession.
The majority of us likely were assigned to some task
or initiative and through frustration or the result of
being a control freak…..you found yourself
providing project management.
Now, you may have accomplished a goal once, been
assigned another objective and re-used some of
the things you previously did, but primarily made it
up as you went.

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So you want to build a strategic PMO?
Over the years we have learned that the free spirit of
project management increases the failure rate on
projects.
Stated differently, if projects are not initiated,
repeated, defined, managed and optimized using a
consistent methodology…..failure is more likely to
occur.
Also known as the Capability Maturity Model

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So you want to build a strategic PMO?
Success
Initial
Repeatable
Defined
Managed
Optimizing
Process is ad hoc.
Necessary process are
established to repeat earlier
success.
Processes are documented,
standardized and integrated for
the organization. All projects use
an approved, tailored process to
deploy.
Quality measures are
collected and process is
quantitatively understood.
Continuous improvement
on qualitative data and
feedback from piloting
innovative ideas.
Components of the Maturity Model

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So you want to build a strategic PMO?
So how do you know what your PMO’s maturity is?
Reference the triple constraints……
Scope
A less mature
organization will
consistently miss
milestones and
completion dates
A less mature
organization will
experience cost
variances, require
additional funds and
shrink profit margins.
Two of the most frequent measures associated
with lack of maturity are runaway scope and low
customer satisfaction.

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So you want to build a strategic PMO?
Maturity is good….Excellence is better.
Part 1 of Excellence Defined:
Excellence in project management requires a
continuous stream of successfully managed
projects. Keeping in mind that projects may not
be successful, but the projects were successfully
managed. If you find yourself with 100% project
success, then you are likely not taking enough
business risk. 2 Excellent companies take risks.
It’s what separates good from great.

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So you want to build a strategic PMO?
Maturity is good….Excellence is better.
Part 2 of Excellence Defined:
Requires that decisions made on individual
projects must take into considerate the best
interest of the project and the company.
Companies that have achieved excellence in
project management also realize that excellence
is ongoing. Complacency opens the door for
competition.2

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So you want to build a strategic PMO?
Maturity is good….Excellence is better.
Projects
Time
Maturity Excellence
2 Years 5 Years
Failures
Successes
2

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So you want to build a strategic PMO?
Cut to the chase….
The reality is whether you want to start a PMO or
improve project management processes, it begins
with one of those honest conversations and base-
lining what exists…..against your organization’s
business goals or strategic intents and know that
performance, over a period of time, is the only
measurement.

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So you want to build a strategic PMO?
At Humana, we evaluate each request for professional
resources against their contribution to the:
Let’s look at an example of the tools…..
Cost Benefit
Financial
Benefit
Strategic Alignment
Competitive Position
External Customer Impact
Consultancy Resource
Impact

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So you want to build a strategic PMO?
Once a resource is assigned….our PM Professionals
follow our Playbook which is summarized with a quick tip
sheet.3
Historically, we’ve done semi-annual audits of projects for
compliance to the Playbook methodology

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So you want to build a strategic PMO?
Project executives have warned….a company must
use maturity modeling as a way to meet business
goals, not as a goal itself.1
While other professionals have suggested, …when it
comes to an art/science like project management, we
must be cautious not to standardize the life out of the
organization.1
In Summary……

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So you want to build a strategic PMO?
Bibliography
1 The Strategic Project Office – J. Kent Crawford and
accompanying course
2 Advanced Project Management – Harold Kerzner, PhD. And
accompanying course
3 Humana’s Playbook
4 Humana’s Initiative Intake Workbook

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How will you strategically align your PMO?