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Project Management Office ( PMO ) MITM743 – Advanced Project Management. Time for Dilbert. What is the PMO?. What is the PMO?. An organizational body … assigned various responsibilities related to the centralized and coordinated management of those projects under it’s domain.

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Project Management Office (PMO)MITM743 – Advanced Project Management

Time for Dilbert

What is the PMO?

What is the PMO?

An organizational body …

assigned various responsibilities related to the centralized and coordinated management of those projects under it’s domain.

There in no such thing as a „universal solution“.

To be effective, a PMO must be tailored to your organisation‘s project types, management/staff capabilities, and organisation culture

Why setup the PMO?

Time for Dilbert

What can the PMO be?

  • Supportive PMO

    • Generally provides support in the area of expertise, templates, best practices, access to information

  • Controlling PMO

    • It also requires that support to be used (pass the regular reviews, audits, …)

  • Directive PMO

    • Only professional project managers are assigned to the projects

    • High level of consistency across all projects because PMs are reporting back to the PMO

What would the PMO provide?

This leads to seizures, delays, insufficient resources,collisions, …

Preffered way, eliminates disadvantages of the previous method, leads to better TTM and timing in general, could prevent teams from overloading

Basic approaches

Companies use the time-to-market metric to evaluate how products are developed and how a specific project handles external competition.

Working on all projects at the time

Working on projects which have apropriate resources

MITM 743

Advanced Project Management

IT Project Management Office


  • Provide an overview and general understanding of PMO models, functions, success factors, and implementation

  • Introduce the CobiT PM CMM as a framework for establish and evolving the PMO Project Management functions

IT PMO Trends

  • 67% of IT organizations in 2003 have PMOs (Forrester Survey)

  • More than half established since 2000 (Forrester Survey)

  • Government is moving to standardize IT Project Management

    • Nov, 2003, Federal CIO Council recommends setting up Federal PMO to standardize PM practices

    • Jun, 2004, SC requires management of major and inter-agency IT projects to use standard practices and be managed by PMP

    • Jan, 2001, NY sets up PMO to standardize management of technology projects

    • Jun 2002, CA CIO established objectives for statewide project management standards

  • IT PMOs are becoming strategic

  • IT PMOs are gaining more influence

What’s Driving IT PMO creation?

  • Late and over budget IT projects

    • Lack of coordination of activities

    • Poor project management practices

    • Lack of standardization of PM methodology

  • Need for consolidated project reporting to drive prioritization/decisions

    • More focus on IT project ROI

    • More focus on alignment of IT projects with business strategy

    • Strategic value and dependency on IT applications/technologies

What’s Driving IT PMO creation?

  • Increase in IT Project workload

    • Proliferation of IT project proposals

    • Delays in getting projects approved

  • More complex IT environment and solutions

    • Enterprise solutions/cross-functional projects

    • Distributed development organizations

    • Outsourcing and contracting out of IT projects

PMO Benefits

  • Companies that implemented successful PMOs achieved:

    • 80% ROI

    • 20% reduction in project time

    • 30-35% successful project delivery

  • Companies without a PMO experience 74% project failure rate

Source: Forrester Research

PMO Models

  • One size does not fit all

    • PMO drivers/business needs

    • PM maturity

    • Vision and goals of sponsor

    • Business/organization mission

    • Organization size

    • Number of projects

    • Political and cultural environment

  • Tactical vs. strategic

  • Internal vs. external focus

  • Single vs. multiple

Key Considerations

  • PMO charter

  • Culture change

  • Implementation strategy

  • Staffing

  • Metrics/Performance

  • Success factors

  • Maturity of Project Management Practices

PMO Charter

  • Charter Scope

    • Business Needs

    • Sponsor

    • Public vs. Commercial

    • PM Maturity

  • Charter Document

    • Mission/Vision

    • Goals/Objectives

    • Sponsor

    • Service Offering

    • PMO Governance

    • Key Performance Metrics

    • Funding model

PMO - Culture Change

  • Natural resistance to change

  • Political landscape

    • Winners/Losers

    • Management Support

  • Degree of cultural change

    • PM maturity

    • PMO charter

    • Existing skill level

    • Key driver implementation strategy

  • Change Management

    • Assess impact of change

    • Inform

    • Educate

    • Involve

PMO Implementation Strategies

  • Strategy drivers

    • PMO charter

    • PM maturity

    • Sponsor and management support

    • PMO drivers

    • Perception of value

    • Political environment

    • Culture/Value System

PMO Implementation Strategies

  • Evolutionary/Incremental

    • Lower implementation risks

    • Lower start up costs

    • Will take longer to demonstrate ROI

    • More suitable if high resistance to change and low management support

  • Revolutionary/Wholesale

    • Higher implementation risks

    • Higher startup costs

    • May be able to demonstrate ROI quicker

    • More suitable if crisis or recognition at high level that change is imperative

PMO Staffing/Skills

  • Staffing Approaches

    • In-house resources

    • Hybrid (In-house/contractors)

    • Ad hoc contractors augmentation

  • Skills

    • PMO Director/Manager

    • Project Manager

    • Project Portfolio Manager

    • PM Process/Methodology Trainer

    • Relationship/Account Manager

    • Tools Support/Administration

    • Administrative Support

    • Librarian/Document Control

PMO Performance Metrics

  • PMO vs. Project metrics

  • Less that 15% of PMOs employ formal metrics program (Source: Forrester Research)

  • Metrics are essential for growth and support – demonstrate progress, value, and productivity

  • Performance metrics are driven by charter – no such thing as typical metrics

  • Business value metrics

    • Executive focus - Measure and demonstrate value to business

    • Help justify existence during downsizing

    • Expressed primarily in dollars savings/revenue or ROI

    • Tend to be few and harder to derive

PMO Performance Metrics

  • Functional performance metrics

    • Internal focus - Measure and demonstrate performance or quality of PMO functions

    • Help justify PMO budget

    • Help improve PMO performance

    • May require baseline or benchmark to demonstrate performance

    • Expressed primarily in percent or counts

    • Tend to be many depending on functions performed

    • Must be selectively chosen so as not to overwhelm

  • Service level metrics

    • Customer focus - Measure and demonstrate service level or quality of service to customer

    • Help improve and maintain customer satisfaction

    • SLA/SLO

    • Expressed in a variety of ways

    • Select on key and most important value to customer community

Success Factors

  • Clear Charter

    • Creates clear expectations

    • Defines boundaries for implementation

  • Top-Down Support

  • Bottoms up Buy-in

  • Sponsor - Reporting to senior executive

  • Strong line-of-balance (LOB) representation

  • Communication/PR

    • Promotion of services

    • Education of value

    • Performance metrics that demonstrate business and customer value

PM Capability Maturity Models

  • Valuable tool for establishing PMO and help define objectives, charter, and processes

  • Assess current status

  • Compare against best practices

  • Develop strategy and road map for PMO

  • Help communicate vision and get buy in

  • Different models (CobiT, OPM3, ISO 15504, CMM/CMMI)

CobiT ® Capability Maturity Model

  • CobiT® CMM is valuable and comprehensive framework for assessing maturity of IT organization

  • CobiT® CMM

    • International Open Standard for IT Governance

    • IT Governance Institute (ITGI®)

    • Information Systems Audit and Control Association (ISACA®)

  • ITIG ® not associated with Software Engineering Institute (SEI), Carnegie Mellon

  • CobiT® CMM uses same conceptual framework as SEI’s CMM

  • Defines maturity of IT organizations in four domains

    • Planning and Organization

    • Acquisition and Implementation

    • Delivery and Support

    • Monitoring

  • PM CMM part of CobiT® Planning and Organization domain


CobiT® Maturity Levels

  • 0 Non-Existent – Not applied

  • 1 Initial – Ad hoc and disorganized

  • 2 Repeatable – Follow regular pattern

  • 3 Defined – Documented/communicated

  • 4 Managed – Monitored and measured

  • 5 Optimized – Best practices followed/ automated

Source: CobiT 3rd Edition, Management Guidelines

CobiT® Model Components

  • Defines processes within each domain

  • Defines high-level control statement for each process

  • Defines maturity levels

  • Defines success factors for each process

  • Defines key goals for each process

  • Defines key performance indicators

Source: CobiT 3rd Edition, Management Guidelines

CobiT® Project Management Process Control Statement

  • Control of project management process with the business goal of setting priorities and delivering on time and within budget

  • Is enabled by the organization identifying and prioritizing projects in line with the operational plan and the adoption and application of sound project management techniques for each project undertaken

Source: CobiT 3rd Edition, Management Guidelines

Level 0 – Non Existence

  • PM techniques not used

  • Organization does not consider business impact of poor project performance

Source: CobiT 3rd Edition, Management Guidelines

Level 1 – Initial/Ad Hoc

  • Aware of need for project structure and risks of poorly managed projects

  • Use of PM techniques left to the individual

  • Projects are generally poorly defined and do not incorporate business or technical objectives of the organization or stakeholders

  • Lack of management commitment and project ownership

  • Critical project decisions are made without user management or customer input

  • Little or no customer and user involvement in defining IT projects

  • No clear organization within IT projects and roles/responsibilities are not defined

  • Project schedules and milestones are poorly defined

  • Project staff time and expenses are not tracked and compared to budgets

Source: CobiT 3rd Edition, Management Guidelines

Level 2 – Repeatable but Intuitive

  • Sr. Management has gained and communicated an awareness of the need for IT Project Management

  • Organization is in the process of learning and repeating certain techniques and methods from project-to-project

  • Projects have informally defined business and technical objectives

  • Limited stakeholders involvement in PM

  • Some PM guidelines developed, but left to discretion of project managers

Source: CobiT 3rd Edition, Management Guidelines

Level 3 – Defined Process

  • PM process and methodology formally established and communicated

  • IT projects defined with appropriate business and technical objectives

  • Stakeholders are involved in the management of IT projects

  • Defined project structure with roles and responsibilities

  • Defined and updated project milestones, schedules, budget and performance measurements

  • IT Projects have formal post systems implementation procedures

  • Informal project management training provided

  • No established policies for using combination of internal and external resources

  • Quality assurance procedures are defined

Source: CobiT 3rd Edition, Management Guidelines

Level 4 – Managed and Measurable

  • Formal and standardized project metrics

  • PM measure and evaluated throughout organization not just IT

  • PM process enhancement formalized and communicated, and project team members are trained on all enhancements

  • Risk management performed as part of PM

  • Stakeholders actively participate in projects or lead them

  • Project milestones and criteria for evaluating success at each milestones are established

  • Value and risk are measured and managed prior to, during, and after project completion

  • Management has established a program management function within IT

  • Projects are defined, staffed, and managed to address organizational goals, rather than only IT specific ones.

Source: CobiT 3rd Edition, Management Guidelines

Level 5 - Optimized

  • Proven full life-cycle project methodology is implemented and enforced, and integrated into organizational culture

  • On-going program to institutionalize best practices has been implemented

  • Strong and active project support from Sr. Management sponsors and stakeholders

  • Implemented project organization structure with documented roles, responsibilities, and staff performance criteria

  • Long term IT resources strategy is defined to support development and operational outsource decisions

  • Integrated Program Management Office is responsible for projects from inception to post implementation

  • Program Management Office is under the management of the business units and requisitions and directs IT resources to complete projects

  • Organization-wide planning of projects ensures that users and IT resources are best utilized to support strategic initiatives

Source: CobiT 3rd Edition, Management Guidelines

CobiT® PM Success Factors

  • Experienced and skilled project managers are available

  • Accepted and standard project management process in place

  • Sr. Manager sponsorship of projects, and stakeholders and IT staff share in the definition, implementation, and management of projects

  • There is an understanding of the abilities and limitations of the organization and the IT functions in managing large, complex projects

  • Organization-wide project risk assessment methodology is defined and enforced

  • All projects have a plan with clear traceable work breakdown structures, reasonably accurate estimates, skill requirements, issues to track, quality plan, and transparent change process (my note – effective PM methodology enforced)

  • Transition from implementation team to operational team is a well-managed process

  • System development life cycle methodology has been defined and is used by the organization

Source: CobiT 3rd Edition, Management Guidelines

CobiT® PM Key Goal Indicators

  • Increased number of projects completed on time and on budget

  • Availability of accurate project schedule and budget information

  • Decrease in systematic and common project problems

  • Improved timeliness of project risk identification

  • Increased organization satisfaction with project delivery services

  • Improved timeliness of project management decisions

CobiT® Project ManagementKey Performance Indicators

  • Increased number of projects delivered in accordance with defined methodology

  • Percent stakeholders participation in projects (involvement index)

  • Number of project management training days per project team member

  • Number of project milestones and budget reviews

  • Percent of projects with post-project reviews

  • Average number of years of experience of project managers


  • IT PMOs can improve IT project delivery performance

  • One size does not fit all

  • PMO Support/Control model most useful

  • Clear charter, top down support, & bottom ups buy is key to PMO success

  • PMO performance metrics should focus on value to key stakeholders

  • CMM valuable framework for establishing and evolving PMO

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