Let’s start with a definition:
A traditional PMO is a group or department within a business that defines and maintains standards for project management within the organisation. The PMO strives to standardise and introduce economies of repetition in the execution of projects.
The Project Management Institute describes the PMO as a strategic driver for organisational excellence, which seeks to enhance the practices of execution management, organisational governance, and strategic change leadership.
We also have the concept of a P3O (project, programme and portfolio) – an uberPMO that handles an organisation’s whole change agenda.
Sounds great, doesn’t it?
But here is the problem I have;
- Projects continue to take much longer than we expect
- Costs are often out of control and overspend
- Benefits often aren’t delivered (or even tracked)
- Everyone is busy – and not much is getting done
- PMOs seem to report on the problems, rather than fix them
I once worked for a large company that employed a PMO the size of a small army. Every week they created an amazingly thorough 25-page report with slick graphics and a mountain of text. There was a particular project on there that always caught my eye – it had been going for a few years and was deep RED in problems.
The PMO dutifully reported every week:
Business Case cost £400m
Business Case benefits £650m
Cost to date £850m
Cost to finish £250m
Type of project Cost reduction
The PMO gleefully announced the “path to Green” with an extra 250 people to be brought onto the project (taking the total to 1000) and 24 hours working across time zones. No-one dared shout stop. There was simply too much pride at stake.
When I mentioned this bizarre situation at lunchtime one day, I was quickly hushed by my colleagues (with furtive glances left and right to check who was listening). Apparently, no-one was allowed to talk about it. I had called out that the Emperor wasn’t wearing any clothes, whilst the rest of the organisation was in a collective delusion that these were, in fact, the finest new clothes they had ever seen.
To me, the PMO appeared to be the chief spectator and photojournalist of a slow-motion car crash. They didn’t intervene, they simply reported the ever-increasing wreckage as it happened. Probably asking for more regular progress updates as the carnage escalated.
I have also seen PMOs doing “colour management”. The team report RED, the Project Manager reports AMBER (they are eternal optimists) and mysteriously, by the time it’s been rinsed through the PMO ready for the Exec, it’s a nice reassuring shade of GREEN. The Exec smile, the team despair.
I have been in places where projects never go RED, because “bad things happen” when they do. A hit squad of senior managers descend like seagulls, making a lot of noise, messing everywhere, nicking your chips and flying off leaving you battered and bruised. So nothing ever goes RED.
I have seen portfolios that are gridlocked, way too much work in-flight and everything at a snail’s pace. But again the PMO reports on the overruns, ensures the stage gates are adhered to and due process is followed. The problem continues.
In my mind, the traditional PMO is often too passive, providing governance, reporting and process that can actually slow the organisation down, and then simply monitoring the chaos, rather than enabling solutions.
The PMO of the future
I have a view that the PMO of the future should, and can, be the powerhouse of change and effectiveness in an organisation. They are ideally placed to be the centre for continual improvement and effectiveness in the portfolio.
I believe this starts with the department’s purpose. Often teams don’t actually know their purpose, or their ‘Why’ as Simon Sinek would call it. Alternatively, they are misaligned in their thinking and often the perceived purpose is not aligned to the optimising goal of the organisation. They locally optimise based on their local targets and objectives and slowly lose sight of what the goal is and how they can contribute to the wider organisation.
I would like to propose a new purpose for the PMO. The purpose of the PMO of the future is …
“To maximise the flow of valuable work”
A lot sits behind that simple statement and it’s fundamentally different to what Traditional PMOs do today.
Here is my vision for the future of the PMO
- They understand Cost of Delay and use this to ruthlessly prioritise the portfolio using economic decision making.
- They understand Queueing Theory and how the over-utilization of resources significantly increases cycle time. They, therefore, reduce and optimise the number of in-flight projects.
- They understand and measure Flow in the portfolio – and use the Theory of Constraints to tackle bottlenecks.
- They know that timesheets and resource utilization measures simply creates busy people, not productive people. Instead, they use different metrics (cycle time, lead time, failure demand, throughput) to measure work getting done, rather than how busy people are (i.e. they watch the baton, not the runner)
- They understand that the earlier you start does not necessarily mean the earlier you finish. They simulate this effect using simple exercises to enlighten non-believing Execs.
- They understand the evils of multi-tasking and how it hampers productivity. They minimise multi-tasking at individual, team and portfolio levels.
- They use Kanban and the concept of limiting work in progress (WIP) to visualise the work and improve flow.
- They understand that slack in the system makes things go faster, rather than trying to max out on utilisation.
THEN they would be able to maximise the flow of the valuable work. And this is what I believe the PMO of the future should be doing. Optimise flow first, then increase utilisation until you start to hamper flow. Then dial it back a little. None of this is new – all of these are established concepts – but we seem blind to them when we deliver portfolios of work.
The sclerosis of the project portfolio is a modern issue, and few organisations appear to know how to resolve it. Often they do exactly the wrong things (i.e. add more people, add more governance/process, report more regularly etc.).
The PMO of the future has a unique opportunity to fix the problem, but to do so they will need to re-skill, re-purpose and re-energise. Less spectating of the car crash – more grabbing the wheel and diverting us off down a clear slip road to continue the journey. I believe the traditional PMO is underplaying its role at the moment. The world is changing and we need to move with it. The PMO of the future sounds exciting and purposeful.
Let’s create it – get in touch to begin the journey to maximising the flow of valuable work and improving your change capability.