Three PMO models

There are several different PMO models (Project Management Office) in the organizations; the roles and processes vary widely. The projects usually have multifold architectural, resource, schedule, budget, and other cross-dependencies. Therefore, a dedicated team or role is necessary to harmonize the planning and execution. In many cases, this is the PMO. While the title of the department is the same, the roles and responsibilities vary widely. In this article, we review three of them and describe the advantages and disadvantages of the different models.

1. Portfolio management

The PMO is responsible for the project portfolio management but not for the project execution. The main activities of this type of PMO model are

  • create the prioritization and portfolio management methods and processes
  • collect the project demands
  • lead the project prioritization and portfolio creation activities
  • prepare the portfolio for approval
  • trigger, monitor and support the project launches
  • monitor the status of the projects
  • prepare portfolio level reports and initiates preventive and corrective actions in case of need

The PMO leads the process to define and select the projects to implement. Besides, PMO monitors if the project follows the described methods and procedures, including team set-up, project structure, and daily operation, documentation, budget utilization, resource allocation, reporting, and others.

However, the PMO is not responsible for the proper project execution and project delivery. Also, they don’t provide active support for the projects. The PMO is mainly a controlling and supervising unit. From a project point of view, they are an authority, that sets directions and rules, also checks if the project runs appropriately.

The primary advantage of this type of PMO is that they assure the preparation and maintenance of the project portfolio. As they set the rules and procedures, the project execution is unified to some extent. Besides, as they don’t lead or participate in any projects, they are neutral in project supervision role.

The disadvantage is that the PMO members don’t gain practical project experience. It hinders to create pragmatic processes and procedures, as they don’t have the everyday touch and feel. Also, for this reason, trust and cooperation may be low between the PMO and the project teams.

In this and also in the other PMO models, the demand management and the project portfolio management should be closely aligned.

2. Portfolio management and project support

In this PMO model, the PMO is responsible for all portfolio-related activities as described above, and also provides active support within the projects. Examples are training and consultancy on methodologies, processes, and tools. The PMO team members may also participate in the project work as part of the project team. They perform operative tasks, reporting to the Project Manager (PM) in this role.

The common area is the project office, including activities like:

  • ensure adherence to the processes and procedures
  • maintain the project, resource and other plans based on project team input
  • collect status info and create a project report
  • validate if the required project documents exist
  • organize meetings and creating meeting minutes
  • maintain the project level task lists

This approach has several advantages. The projects will have project office support that fits the PMO requirements and the organizational best practices. The cooperation is improved between the projects and the PMO since the PMO members act as a bridge. Last but not least, the PMO team will continuously gain experience and can refine the processes and methods based on practice.

On the other hand, if the PMO performs project tasks, it may be more challenging to formulate critics on project work, as PMO itself is part of the potential problem. Also, when some projects can get PMO resources and others not, some may feel a lack of equal and fair treatment.

3. Portfolio and project management

The PMO may be responsible not only for the project portfolio management and project support but for the project management as well. The PMs, or at least some of them, are members of the PMO.

Whenever the organization initiates a new project, the PMO assigns a PM to lead it. If there is not enough capacity, or there is a need for specialized knowledge, other departments also can assign the PM, but the default is that the PM is from the PMO.

The PM will report to the Project Steering Committee, and not to the PMO, so from a project governance point of view, there is no difference to the situation when the PM is from any other department.

The main advantage is that the PMs are well aware of the methods and procedures of the organization. They also share knowledge and learn from each other. It assures that the PM pool is well prepared, has a robust knowledge base, and understands how to run a successful project in the organization.

The other great advantage of this PMO model is that the PMO can optimize the PM resource allocation. Some projects require a full-time PM, others not. Some PMs are good at managing one large project; others excel when they run several smaller projects in parallel. The projects start and finish at different times. Some of them are time critical (e.g., there is a regulatory deadline); others can start with a delay. As the PMs are in the same resource pool, the PMO can prepare the optimum allocation.

However, there are disadvantages, as well. If the PM is not from the IT or business department that owns the project, she may lack important department-specific information and experience. Besides, the departments may trust less a PM, who came from outside.

A closing remark

The PMO works well, if the business and the IT departments are well aligned. The status of the project should be one agenda item of the business and IT alignment meetings.

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