Your PMO is up and running, and you have a team of Project Managers providing oversight on several projects. Progress and visibility of deliverables are provided to leadership and key decision makers. The organization sees the PMO as adding value and executives are utilizing the PMO to make better decisions. It may be time to consider the next role of the PMO.
Think about the ability of your PMO to manage related projects together as a program. Or consider how your PMO can aggregate data and information from several projects and programs to help executives manage project portfolios. While the role of most PMOs is to provide oversight at the project level, a growing trend of PMOs is to manage programs and enable portfolio management. When a PMO expands into program and portfolio management, the roles and responsibilities of its team members must change as well.
Project Management Office: The Fundamentals
The term PMO most common refers to a Project Management Office. The Project Management Institute (PMI) defines a Project Management Office as “an organization body or entity assigned various responsibilities related to the centralized and coordinated management of those projects under its domain.” Project Management Offices typically have a flat organizational structure which includes Project Managers reporting to a PMO Manager. As covered in the first blog of this series for establishing a PMO, a Project Management Office creates a single point for all projects and their current status, issues, and cost/savings.
Fundamental roles, responsibilities, and processes must be defined at the project level before a PMO expands into program and portfolio management. A PMO will have distinct processes for managing projects or programs, but they often interrelate.
Program Management Office: Benefits Realization
A Program Management Office is responsible for managing projects and programs. Whereas projects can be grouped together into a master project, a collection of projects is not always a program. Programs are a group of related projects; however they are managed in a coordinated way that yields benefits and control not available from managing them individually. Therefore, it should not be assumed that any Project Manager in a Project Management Office can manage a program. There are additional characteristics for a Program Management Office:
- Programs often have to react to changes in strategy and changes in the environment.
- Whereas Project Managers provide visibility into project deliverables, Program Managers provide visibility into program benefits.
- Program status is a compilation of all projects, and the PMO must have clear definitions and processes for reporting program status.
- Program stakeholder management will often include more senior level executives and sponsors.
These characteristics require a Project Manager with a more strategic mindset. Program Management Offices are typically staffed with more experienced Project Managers and Program Managers. The PMO Manager may even choose to organize the PMO with Project Managers reporting up through a Program Manager.
Project Portfolio Office: Putting it all Together
A Project Portfolio Office (PPO) is involved in strategic decision making of all projects and programs in a business portfolio. PMI defines Portfolio Management as “the centralized management of one or more portfolios, which includes identifying, prioritizing, authorizing, managing, and controlling projects and programs.”
PPOs consist of a combination of Project Managers and Program Managers, and commonly refer to their organization as an Enterprise PMO or EPMO. Whereas Project and Program Managers in a PMO provide analysis of schedule, effort, budget, and benefits, the role of the Project and Program Mangers in a PPO/EPMO is to ensure that all this information comes together so that the appropriate resources are allocated to their assigned, authorized projects and programs. This means Project and Program Managers in PPOs and EPMOs have additional roles over a PMO:
- Determine whether (and how) a set of projects in the portfolio can be executed with finite resources in a specified time.
- Efficient and effective deployment of resources where and when they are needed.
- Provide a central repository for change requests and the ability to match available resources to evolving demand within the financial and operational constraints of individual projects.
- Determine the value of projects in relation to the strategic objectives and priorities of the organization.
- Analyze the risk sensitivities within each project, as the basis for determining confidence levels across the portfolio.
PMO roles and responsibilities are always evolving. Get your PMO running smooth before tackling program and portfolio management. Build the fundamentals of managing projects into your PMO. The next blog in the PMO series will cover another growing trend in PMOs: Agile Project Management and how various methodologies can be blended into a PMO.