Stefan Rank, PMP

Project World November 2005

Orlando, Florida

Business-PMO & IT-PMO

What is the difference?

Does one model fit all ? Where do you want to be?

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Agenda

This is your agenda

You can ask all the questions you want

We have one hour

This is a workshop for you

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This is why you are here!

Project Management organizations (PMO, EPMO, COE for PM) are vital components of all types and sizes of corporations.

Organizationally they are aligned differently based on size of the company and the initial charter when they where established.

This session will focus on the organizational differences of Project Management Offices and the real world challenges that Project Management Offices face based on their organizational alignment in the overall structure of the organization.

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Project Management Office Definition

A shared organizational structure that serves as a repository of information

for project reporting and disseminating best project management practices

A Project Management Office (PMO) is a shared competency designed to

integrate project management practices within an organization.

Sometimes called project office. This is the office or department responsible

for establishing, maintaining and enforcing project management processes,

procedures, and standards. It provides services, support, and certification

for project managers.

Source: www.nitoc.nv.gov/PROJ/projdocs/ATC-SummerSession.pdf

Source: it.csumb.edu/departments/data/glossary.html

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Program Management Definition

Program management is the process of managing multiple on going projects. An example would be that of

designing, manufacturing and providing support infrastructure for an automobile make. This requires hundreds, or

even thousands, of separate projects. In an organization or Enterprise, Program Management also reflects the

emphasis on coordinating and prioritizing resources across projects, departments, and entities to insure that

resource contention is managed from a global focus.

The coordinated management of a portfolio of projects to achieve a set of business objectives is

called program management. Or, a program might refer to an ongoing set of activities internal to

the organization, for example, a Total Quality Management program, workplace safety program,

supplier development program, etc.

Source: http://en.wikipedia.org/wiki/Program_management

Program management is the process of managing a portfolio of multiple ongoing projects. An example would be

that of designing, manufacturing and providing support infrastructure for an automobile make. This requires

hundreds, or even thousands, of separate projects. In an organization or Enterprise, Program Management also

reflects the emphasis on coordinating and prioritizing resources across projects, departments, and entities to

insure that resource contention is managed from a global focus.

Source: http://www.mapnp.org/library/prog_mng/prog_mng.htm

A portfolio of projects selected and planned in a coordinated way so as to achieve a set of defined

objectives, giving effect to various (and often overlapping) initiatives and/or implementing a strategy.

Source: http://maxwideman.com/pmglossary/PMG_P07.htm

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Definitions of Project Management

Project management is a management approach concerned with getting the job done, on time, within budget, and according to specifications

Project Management is the art and culture of getting work done

People responsible for doing something that has never done before – for people who don’t know what they want – who must first predict the unknown, make a plan to complete with the unforeseen, and execute the plan with too-limited resources that they don’t control and who are held responsible for the results, even when miracles are required

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Type of Project Management Offices

Project Management Office

Program Management Office

Program Office

Enterprise Project Management Office

Center of Excellence for Project Management

Project Office

PMO’s for program execution – temporary in nature – dissolved after program completion

Product Management Office

“PMO out of the BOX” in six weeks

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Google & Yahoo result count

Term

Business PMO 426 88

IT-PMO 610 944

Enterprise PMO 924 1510

Project Office 2,050,000 1,490,000

Program Management

Office248,000 240,000

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Business Program Management

Company Strategy

Company Goals

Clearly defined

measurable goals?

Business Programs

Define & Establish

programs that link to

company goals

Projects

Projects are prioritized and

executed to achieve

completion of programs

Tasks

Execution of project tasks to

achieve project completion

Company strategy is defined on

executive management level

Strategy translates into business

programs (Products & Services)

Projects are the building blocks

in the execution of organizational

strategy

Project level experience feeds

back into programs and strategy

Feedback loop is key – Measure

at every level

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Business Program Management

Business drives technology

Business processes are automated by

technology

Technology is enabler for business

success

Technology needs to enable & improve

existing business processes

Technology not for the sake of technology

Time to market drives technology solutions

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Program Management & Project Management

Program Management –

Doing the Right Things

Project Management –

Doing Things Right

Develop and link operational and

strategic plans

Support & enable strategic

planning

Maintain and leverage business

and operational processes

(knowledge)

Define, refine and own project

delivery processes

Define and use metrics and

service level agreements

Operation external to project

delivery

Execute and deliver projects

Ensure triple constraint is met

Deliver business solutions

Execute governance and

control

Reporting and analysis

Operate internal to project

delivery

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Business & IT PMO Charter

CEO level alignment

Tied to CEO performance

Company & Enterprise level scope

Business & product oriented

Drives project pipeline across business functions Cost, Schedule, Quality, Scope

Business analysis function

Supports governance processes

Financial responsibility for capital project cost & benefits and ROI

Business portfolio management

Project Life Cycle

CIO level alignment

Tied to CIO performance

IT Project Pipeline

Technology projects enabling business

Architecture & development & system focus

IT-project managers

IT project management

Interface vs. business process thinking

IT processes improvement, SDLC, Architecture

Business - PMO Charter IT - PMO Charter

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What are the major differences?

Business focus

Organizational alignment

Focus of work

Customer orientation

Product orientation

Daily exposure to business concerns and problems

Integration of business areas

Control function

Business analysis function

PMO

Customer

IT Business

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Is this your day in the PMO?

Stakeholders: Business owners, Executive owners

New product releases & enhancements

Sales & Marketing timelines

Projects driven by product release schedules

Projects driven by vendors & outside parties

Newest product features & enhancements

Product vs. Project

Revenue and cost implications of projects

Project prioritization in a “fast to market” environment

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Organizational Alignment

CIO CEO CFO COO

Technology

• Architecture

• Solutions

• Systems

• Operations

• Databases

• Technology

Blueprint

Business

Product

• Sales

• Marketing

• Logistics

• Governance

Financial

• Accounting

• Financial

planning

• SOX

• Audit

• other controls

Operations

•Customer

• Service

• Call center

• Warehousing

• Engineering

• Facilities

CIO Research reports – Best practices for PMO’s:

At what level does your company employ a project office ? 2% not answered

39% Corporate – strategic

27% Division

27% functional group/business unit

6% local group or organization within function

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Roles and Responsibilities are split

Business requirements

Business process design

Facilitate

Manage project

Coordinate departments

Financial tracking

Overall schedule

Budget

UAT

Business projects

Architecture definition

Technology design

Build technology solution Hardware selection

Develop solution

Integrate systems

Test

IT schedule (Development / operations / Architecture)

Technology selection

Technology projects

Business PMO Information Technology

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Roles and Responsibilities

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The people side

Project management organizations consist of people

People are key to deliver projects

People deliver on tasks in a project (WIFM !)

Highest risk factor: People Don’t like the project

Don’t like the PM

...

Projects create people development opportunities

Projects can be seen as a major change to people Change management is often times forgotten

Business side: New processes – perception of automation is negative

IT: This technology is new – will it prevail? Can it be managed?

Projects can take the security of a departmental structure away

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The business savvy Project Manager

Communicator

Business process understanding

Business process improvement

Business requirements

Product orientation

Technology understanding Systems, Architecture, Development

Application, Testing (unit, integration)

Manages UAT

Adheres to processes and controls

PMI certified

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Factors for organizational alignment

Company size

Maturity and “age” of company

How close for comfort – what do I know about project management

Where does strategic planning happen? Doing the right things & Doing things right !

Independence

Control function

Visibility into work pipeline Project, BAU, Other

Financial Controls

Today – SOX ! Control function – Project management processes enable controls !

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Why Project Management Offices are created

Strategic objectives & goals are not being met

Major business endeavor

Historically driven based on need – in IT -Y2K example (it is all over now!)

Senior management need for control

Project failures – schedules out of control

Cost out of control

Insufficient information on project status

No decision framework

Resource bottlenecks

Need for better controls & visibility

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Motivation for having a PMO

Are we doing the right things?

Are we doing things right?

Where does the money go?

What are we working on?

Why can’t I have this earlier?

Are we on schedule with this?

How does this impact our customers?

What are the dependencies?

Which resources can work on this?

Why is this not done yet?

Why did we loose this account or customer?

Lost opportunities!

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PMO – the CIO perspective (I)

Independent & non-political department

Coordination and management of customers

“People People” – not technologists

Management of expectations & schedule cost, quality

Rational framework for delivery of projects

Balance and scale

Prioritization of efforts

Definition of business solution

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PMO – the CIO perspective (II)

How do I exploit & leverage all the data collected to make informed business decisions

Focus on services to the enterprise

Do not do any business project activities

Technology is my business

The CIO is the technology and information expert

IT focus – I need to succeed with the projects that I am responsible for

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PMO – the Governance Perspective

PMO organizational alignment depends on executive

level management setup (CEO-President-CIO-CFO)

Strategic service department for project execution

Enabler for cross-functional efforts

Driver of new enterprise wide products & projects

Independent check & balance function

Controls around Schedule, Cost, Quality on projects

Definition of processes & project controls

Oversight and tracking of budget and spending for

projects

Real-time objective status reporting

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Business PMO Real World Challenges

Prioritization of programs & projects

Focus projects on customer needs and impacts

Keep cost down

Balance governance and project delivery needs

Schedule Fast to market

Competition’s schedules

Resources & Resource constraints Business resource constraints

IT resource constraints

Quality When you run you stumble more easily

Build quality into the delivery process

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Integration of SDLC and PMLC

Business Process

SDLC

QA

PMLC

Architecture

Integrated

processes

Bringing all elements together !

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The tools that help us

Project

Life Cycle

MS Project

Standard

Office Tools

VisioDashboards

Oracle Financials

A F

OO

L W

ITH

A T

OO

L IS

ST

ILL A

FO

OL

Organizations have implemented tools in hopes of solving business problems, only to discover

that the root cause of the problem ends up being process related.

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Bottom Line

One size does not fit all!

Where will you place your PMO in your organization to be setup for success?

How can your PMO provide value to the organization?

What is it you want your PMO to be when it grows up?

Are you “Doing the right things”?

Are you “Doing things right”?

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Questions ?

Did you get value out of the presentation?

Suggestions ?

Questions ?

E-mail: srank1@gmail.com