By Adrian Stalham
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
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 hour 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. And 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, crapping 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. But again the PMO reports on the overruns, ensures the stage gates are adhered to and due process is followed. The problem continues.
I have seen bad things …..
The traditional PMO is often too passive, providing governance, reporting and process that canslow the organisation down and simply monitor the chaos, rather than enabling solutions.
I have a view that the PMO of the future should, and can, be the powerhouse of change and effectiveness.
I believe this starts with the department’s purpose. Often teams don’t actually know their purpose, their Why as Simon Sinek would call it – or 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 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 PMOs do today.
A recent client divulged that they had >150 projects in flight. Funnily enough they also had portfolio gridlock, with all projects going slowly and a new cottage industry trying to balance capacity with demand, and maximise resource utilisation. The PMO was hurriedly creating new processes and the company recruiting more (and better) project managers because – well, because surely that would help?
More thinking mistakes.
PMOs are not great at understanding the value of work. There are many good concepts around now (such as Cost of Delay) that can help here. I have never seen a PMO use Cost of Delay, or even know what it is. When we can understand the value of the work we can make economic decisions. That helps us prioritise. And prioritise we must. 150 priority 1’s is a joke.
- The PMO of the future would understand Queueing Theory.
- They would understand Flow and the Theory of Constraints.
- They would have discovered that measuring resource utilization simply gives you busy people, not productive people.
- They would understand that high utilization (of any resource) increases cycle time significantly.
- They would understand that the earlier you start does not mean the earlier you finish.
- They would understand the evils of multitasking and how it hampers productivity.
- They would understand Kanban and the concept of limiting work in progress (WIP)
- They would use different metrics (cycle time, lead time, failure demand, throughput) to measure work getting done, rather than how busy people are (watch the baton, not the runner).
- They would understand that slack in the system makes things go faster.
THEN, and only then, would they be able to maximise the flow of the valuable work. And this is what I believe the PMO of the future should be doing. Flow first, then increase utilisation until you start to hamper flow. None of this is new – but we seem blind to it when we deliver portfolios of work.
Would they still be doing 150 projects at once ? No, they would be doing a lot less. But they would be able to show that those projects could be delivered much faster this way, and that only the most valuable ones are being worked on at any time. And in fact, all 150 projects could be delivered faster using a smaller pipeline of 40 projects, than using a pipeline of 150 concurrent projects.
The PMO of the future has the opportunity to fix this mess, but they 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.