Advanced Project Management Office:

A Necessity for Todays Global, Complex Projects

Dr. Ginger Levin

Project Management Consultant
Adjunct Professor University of Wisconsin-Platteville
Lighthouse Point, Florida, USA
954-783-9819
954-783-9235 (fax)
ginlevin@aol.com
Rad and Levin, 2004

Presentation Overview
Motivations to
Establish a PMO
PMO Functions
Project and
Enterprise
Determining
Functions to Perform
PMO Implementation

Rad and Levin, 2004

Definition of a PMO
The Project Management Office is:
The organizational entity with full-time
personnel to provide a focal point for the
discipline of project management
It may be called a:
Project Office
Project Support Office
Program Management Office
Project Management Group
Project Management Center of Excellence
Directorate of Project Management
Rad and Levin, 2004

The Increased Importance of a PMO

The functions of the PMO have evolved:
It is not just an organization to provide support for
scheduling and monitoring activities on a single
project
It is becoming an essential component for the future
success of the organization
It provides services and organizational focus in core
and supporting areas of project management

Rad and Levin, 2004

Reasons to Establish a PMO

The PMO helps to manage the organizations
future through:
An emphasis on ensuring consistency and uniformity
in projects
An organizational desire to excel
An enterprise focus on improvement in project
management competency
A reduction in project overruns
An increase in the delivery speed of projects
An increase in customer satisfaction
Rad and Levin, 2004

PMO Goals
Set Industry Standards

Organizational Recognition

Funding and Commitment

Show Higher Corporate Profits

Integrate Project Management into the Organization
Improve Divisional Project Management Performance
Have Competent and Productive Project Teams
Implement Consistent, Formalized Project Management
Finish this Project on Time/Budget
Rad and Levin, 2004

Presentation Overview
Motivations to
Establish a PMO
PMO Functions
Project and
Enterprise
Determining
Functions to Perform
PMO Implementation

Rad and Levin, 2004

PMO Functions
Project-Focused
Consult
Mentor
Augment

Rad and Levin, 2004

Enterprise-Oriented

Promote
Archive
Practice
Train

Project-Focused Functions
Augment
Fill the gaps in team resources

Mentor
Work side by side with novice team members

Consult
Provide occasional validation and assistance

Rad and Levin, 2004

Project Areas of Assistance

Standards for managing
projects
Standardized report
forms
PM software
Proposal development
methodology
Project start-up
assistance
Charters and scope
statements
Kickoff meetings
Rad and Levin, 2004

Project risk assessment

Project visibility room
Project requirements
changes
Project workbook or
library
Timesheets
Administrative
assistance
Project reviews
Issue resolution
Project closeout support
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Enterprise-Oriented Functions
Enterprise objectives have more long-term
effects and include:
Promoting consistency and uniformity in
project management
Archiving project performance data
Providing a centralized point of reference for
the project management practice
Imparting specific skills and knowledge
through training to project professionals
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11

Enterprise-Oriented Functions
Promote
PM culture advocate

Archive
Clearinghouse for project performance information

Practice
Best practices and state-of-the-art procedures and
guidelines

Train
Ongoing training in PM

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12

Enterprise Areas of Performance

Estimating
Project selection
Data integration
Reward and
recognition

Rad and Levin, 2004

Project audits
Communication
facilitation
Customer satisfaction

13

Presentation Overview
Motivations to
Establish a PMO
PMO Functions
Project and
Enterprise
Determining
Functions to Perform
PMO Implementation

Rad and Levin, 2004

14

Organizational Goals and PMO Functions

The organizations goals affect the
functions that the PMO will perform:
The PMO can change the direction of the
organization to one of enterprise project
management
It also can primarily assist individual projects
It can serve as the interface between the
project managers and others in the
organization
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15

The PMO and Maturity Levels

Level 5 Supports Business Strategy
and Enterprise Resource Allocations
Level 4 Supports the Entire Organization
Level 3 Supports a Division/Department
Level 2 Supports Several Projects in a Program
Level 1 Supports One Project
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16

The PMO at Level 5

Functions of a PMO according to PMIs PMO
SIG:
The organizational structure, methodologies,
processes, procedures, controls, tools, people,
training, and other components serve to integrate
existing projects, manage the portfolio, control
functions, and successfully deliver the organizations
business objectives

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17

PMO Activities
Enterprise Functions

Crisis Management
Mode
Rad and Levin, 2004

Mature
Organization
18

Presentation Overview
Motivations to
Establish a PMO
PMO Functions
Project and
Enterprise
Determining
Functions to Perform
PMO Implementation

Rad and Levin, 2004

19

Phase 1 - Define the Goals for the PMO

Assign a lead for the initiative
This individual will require the skills and ability to
communicate and effectively negotiate with senior
management

Identify organizational constraints and

assumptions
Definitions and terms to establish a common
language
Business processes and procedures that all projects
must use
Organizational and project metrics
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20

Phase 1 - Define the Goals of a PMO

Continued

To define the goals:

Gather problem analysis information with a
focus on business needs
Determine the root causes of troubled
projects
Assess results from maturity assessments
Analyze the gaps

Then list the goals and the prioritized

business needs
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21

Phase 2 Obtain Organizational Support

Create a Communications Plan to determine:
Is the PMO of sufficient importance that a formal
announcement by the sponsoring executive is needed?
What type of communication media describing the PMO
should be used?
Are there any organizational entities that will not be
receptive to having a PMO, the functions it provides or the
authority it exercises? What special orientation is needed
for them?
Should there be a meeting with all organizational entities?
Individually or as a group?
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Phase 2 Obtain Organizational Support

Continued

Create a presentation for an orientation that

addresses:

Why is a PMO being created?

What are the objectives of the PMO?
What benefits will the PMO provide?
How will the PMO and organizational entities interact?
What is the frequency/schedule for the interactions?
What will organizations need to provide to the PMO?
What will the PMO provide to organizational units?

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23

Phase 2 Obtain Organizational Support

Continued
Prepare a PMO implementation plan and develop
organization-specific PM procedures:
In all areas of project management
For all divisions

Use the plan as a basis for:

Promoting
Training
Consulting
Mentoring
Augmenting
Disseminating
Archiving

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Phase 2 Obtain Organizational Support

Present a realistic schedule for PMO
results:
Project-level PMO
Three Months One Year

Division-level PMO
One Three Years

Enterprise-oriented PMO
Three Seven Years

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Phase 2 Obtain Organizational Support

Continued

Develop implementation milestones:

Metrics for success evaluation
Milestones and metrics
Short term, three months
Mid term, three six months
Long term, beyond six months

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Phase 2 Obtain Organizational Support

Write a Charter for the PMO including:

Goals and objectives

Responsibilities/authority
Assumptions
Constraints
Major risks
Major milestones
Approvals

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27

PMO Charter
Director, PMO

Phone

Fax

E-Mail

VP of Projects

Phone

Fax

E-Mail

Objectives
Scope
Assumptions
Constraints
Major Risks
Major Milestones
Approvals:

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Phase 2 Obtain Organizational Support

Continued

Reach agreement and gain commitment:

Provide an initial estimate of the PMOs budget
Estimate the number of beneficiaries and
organizational coverage
Outline the schedule and tasks needed to set up the
PMO
Recommend the actions the sponsoring executive
will need to take to support the effort
See whether a formal presentation and a special
announcement are required

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Phase 3 Define the Functions

Identify the basic functions of the Project
Management Office:
Project-focused functions
Enterprise-oriented functions
Functions may be phased in over time

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30

Phase 3 Define the Functions

Continued

Define the scope (limits) of the PMO with

options such as:
All organizational units or only certain units
All programs and projects or just a subset of
certain projects, e.g. just high risk, high
budget
The complete project life cycle or only support
of concept phase and business case but not
implementation
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Phase 3 - Define the Functions

Continued

Decompose the items identified

Begin with a set of initial functions that will
solve the highest priority problems and
contribute most to the business improvements
expected and that require the least
investment
Set reasonable expectations
After the PMO is operational and gains
support, then expand its scope
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Phase 4 Define
Roles, Responsibilities and Interfaces
Define the roles and responsibilities of the PMO:
Vice President of Projects
PMO Director
PMO Staff Members

Determine roles and responsibilities relative to:

Project Managers
Functional Managers

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Phase 4 Define
Roles, Responsibilities and Interfaces
Continued

Define the interfaces with other organizational

entities
List those entities with which the PMO will interact:
Internal organizations
External organizations

For each entity above identify:

Direction that will be received from the entity

Direction that will be given to the entity
Information that will be provided to the entity
Information that will be received from the entity

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Phase 4 Define
Roles, Responsibilities and Interfaces
Continued

Determine where in the organization the

PMO should report:
List advantages, disadvantages, challenges
and critical success factors associated with
each option
Discuss and negotiate options with the
sponsoring executive

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Phase 4 Define
Roles, Responsibilities, and Interfaces
Continued
The Enterprise
Division A

Unit A1

Division B

Unit D1

Division C

Division D

Unit D2

Unit D3

PMO?

Unit D4

PMO?

Unit A2
Sub-Unit D21

Unit A3

Sub-UNit D22
Sub-Unit D23
Sub-Unit D24
Project X

Project Y

PMO?

Rad and Levin, 2004

Project Z

PMO?

Determine the PMO placement

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Phase 5 - Identify the

PM Processes and Tools
Describe internal and external project
management processes and tools the PMO will
use:
Internal PMO Functions
Function

Processes

Tools

Risk Management
Quality Assurance
Change Management
Schedule Management
Financial Management
Supplier Management
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Phase 6 Estimate the Resources

Several techniques can be used:
A top-down or analogous estimate
appropriate when comparing to a PMO with
another unit of similar scope and function
A bottom-up estimate based on the functions
and interfaces to provide the most accurate
estimate
An affordability estimate, based on the overall
budget available, provides a limit as to what
can be provided with a limited budget
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Phase 6 Estimate the Resources

Continued
Cost of the infrastructure for:
Promote

Archive

Practice

T rain

Consult

Mentor

Augment

Scope

Cost

Quality

Schedule

Risk

Contract

Integration

Reporting

Communications -

Team Relations

Client Relations

Vendor Relations -

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Phase 6 Estimate the Resources

Continued

PMO Funding

Consider the Organizations Maturity Rating:

Maturity Rating
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Phase 6 Estimate the Resources

Continued

Total Cost

Determine Project Performance Costs:

Implicit
Explicit

Maturity Rating
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Phase 6 Estimate the Resources

Continued
PMO Cost Estimates
Labor

Estimated based upon functions to be performed,

interfaces and processes and tools.

Labor costs by month

Travel

Where there are geographically-dispersed projects, travel

may be required. Identify all locations where
travel is anticipated, the number of trips to make,
length of trips and the number of individuals
making the trips.

Travel costs by month

Facilities

Facilities include costs for use of office resources or costs

for set up of home offices. Furniture, telephone,
and computer connections make up the majority
of this budget item.

1. Startup facility
costs
2. Recurring monthly
costs

Tools/
Processes

This category includes hardware costs, software, site

license fees, etc.

1. Startup facility
costs
2. Recurring monthly
costs

Suppliers

For services of subcontractors or other outsourced

entities.

1. Startup facility
costs
2. Recurring monthly
costs

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Phase 7 - Get Budget and Approval to Start

Obtain executive approval:
Convince the decision-makers based on sound
research as outlined in the previous phases:
Be thoroughly prepared with a complete knowledge
of your planning data
Anticipate questions and be prepared to defend your
logic

Finalize operating procedures:

Include documentation of the outputs from the
previous phases that is approved by the stakeholders
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Phase 8 Staff the PMO

Acquire the
individuals
Start with a
understanding of the
functions to be
performed
Ensure staff have
expertise to gain early
confidence and
acceptance
Rad and Levin, 2004

Orient and train the

individuals to the:
Organization
Business processes
PMO objectives, plans
and success factors
Functions to perform
and tools to use

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Advanced Project Management Office:

A Necessity for Todays Global, Complex Projects

Rad and Levin, 2004

45

References
Advanced Project Management Office, by Parviz F. Rad &
Ginger Levin, CRC Press, 2002

Achieving Project Management Success Through

Virtual Teams, by Parviz F. Rad & Ginger Levin, J. Ross Publishing,
2003

Assuring Project Success With Metrics-Based

Management, by Parviz F. Rad & Ginger Levin, In Preparation
People Skills for Project Managers, by Steven W. Flannes &
Ginger Levin, Management Concepts Press, 2001

Project Estimating and Cost Management, by Parviz F.

Rad, Management Concepts Press, 2002

Rad and Levin, 2004

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