Building a PMO from the Ground Up

Karl Knapp, MBA

AmerUs Group / Indianapolis Life
 Agenda

 Steps to Building & Maintaining a PMO:

 Step 1: Assessment
 Step 2: Approach
 Step 3: Application
 Step 4: Repeat
 Case Study
 Step 1: Assessment
 Step 2: Approach
 Step 3: Application
 Results
 Revised Approach
 Questions & Answers
The Greatest Tool For a PMO

Common Sense
Step 1: Assessment

 History
 Culture
 Perceptions of PM
 PM Maturity
 PM Talent Review
 Mission & Vision
 Gap Analysis
 Historical Assessment

 A historical assessment of the company allows you

to understand where the company came from, what
path it has traveled and how it has gotten to where it
is currently at.
 Cultural Assessment

 The culture of the company has a major impact on

the approach to take implementing a PMO.
 Perceptual Assessment

 The perception of project management in the

company will GREATLY affect the right approach
to implementing a PMO.
 Find out about project failures. Drill down into why
the happened, who got hurt, and who might be
harboring ill thoughts about project management.
 Find out about process successes, and drill down
into these.
 Maturity Assessment

 At the outset of establishing a PMO, assess the

project management maturity of the organization.
 This early assessment will:
 Guide the areas of focus for the PMO
 Establish the baseline to track improvement in the project
management maturity level of the organization.
 Talent Assessment

 The level of available project management talent in

the organization is another key indicator of the
approach to take.
 Identify experienced and influential individuals.
 Involvement of project managers throughout the
organization is a key to success.
 Mission Assessment

 The mission answers the question, “why do we

exist?”. The mission should:
 Provide a sense of timelessness

 Involve both “ends” and “means”

 Appeal to all stakeholders

 Address all four basic needs (physical/economic,

social/emotional, mental/ intellectual, &
spiritual/holistic)
 Be developed and owned at all levels
 Vision Assessment

 Vision communicates the future desired state and

answers the questions, "Where are we going?
Where do we want to be one year from now? Five
years from now? Twenty years from now?“
 Qualities of Vision:
 Is challenging, inspiring, and energizing
 Creates purpose, direction and commitment
 Goes beyond individual self-interest
 Becomes an integral part of the culture
 In uncomplicated, concise, easy to understand, and
simple to communicate
GAP Assessment

 Given where you are &,

 Where you want to be
 Identify the gaps as
potential areas for
development
Step 2: Approach

 Given the results of the

Assessment, determine
the Approach that fits
organizational:
 History
 Culture
 PM Maturity
 Available PM Talent
 PM Mission & Vision
 Gaps & Opportunities
 Current Situation
 Steps in Developing an Approach

1. Given your organizational history, culture, and

available talent, choose the proper spot on a
Continuum of Approaches
2. Given your mission, vision, and available talent,
choose the initial, and eventual Menu of Services
3. Target specific opportunities for success. Build
Visible Wins.
 PMO Continuum
Continuum
Control
• PMO At Highest Level
• Prioritization Leadership
• Information Ownership
• Project Managers Report
• Project Staff May Report
• Projects Run By PMO
• Strict Standards
• PMO System Reporting
• Education Standardized
• Certification Standardized
of
Oversight
• PMO At High Level
• Prioritization Participation
• Information Coordination
• Project Managers Dotted
• Project Staff Affiliated
• Projects Coordinated
• Standards Co-Developed
• System Co-Selected
• Education Offered
• Certification Supported
Approaches
Influence
• PMO At Any Level
• Prioritization Input
• Limited Information
• Project Manager Members
• Project Staff Separate
• Projects Not Coordinated
• Standards Recommended
• Systems Recommended
• Education Is Key
• Certification Encouraged
 Develop a Menu of Services

 Portfolio Management  Standards &

 Project Selection
 Project Prioritization
 Project Scheduling
 Project Closure
Information
 Project Dashboard
 Project Status
 Project Records
Management & Archive
 Benchmarking
 Forecasting
 Lessons Learned
 Develop a Menu of Services

 Consulting Services  Tools

 Project Scope
 Project Estimation
 Project Planning
 Professional
 Full Lifecycle Project
Management
 Mentoring
 PM Information
Systems
Organizations
 PMI Membership
Encouragement
 PMI Membership Fee
Reimbursement
 Host Chapter Meetings
 Develop a Menu of Services

 Education & Training  Certification

 Curriculum Design  Internally Developed
 Course Design  PMP Encouragement
 Course Delivery  PMP Reimbursement
 Tuition Reimbursement
 Opportunities for Success

 Actions speak louder than words

 Demonstrate the positive effect of good project
management practice
 Find a runaway project to rein in
 Better yet, find a visible project, choose your best project
manager and let them execute
Step 3: Application

 Implementing a PMO
is implementing
change.
 Use the eight steps to
successfully leading
change proposed by
John Kotter in his 1996
book, Leading
Change.
 8 Steps to Leading Change (Kotter)

 Step 1: Establish a sense of urgency

 Step 2: Create the guiding coalition
 Step 3: Develop a vision & a strategy
 Step 4: Communicate the change vision
 Step 5: Empower employees
 Step 6: Generate short-term wins
 Step 7: Consolidate wins & produce more change
 Step 8: Anchor new approaches in the culture
 1: Establish a Sense of Urgency

 Build awareness of project management with the

corporate management team
 Highlight the results of good examples of project
management
 Highlight the need for project management in
runaway projects
 Compare the speed and effectiveness of your firm
in others in your industry. Can you execute as well
and as fast as your competition?
 2: Create the Guiding Coalition

 Identify the key influential stakeholders

 For senior managers, pick one of their key projects
as a pilot project (choose low-hanging fruit)
 Create a project management counsel, steering
committee or board of directors
 Involve key project managers in the development of
the PMO and in the determination of standards
 3: Develop a Vision & Strategy

 After creating the initial vision and strategy, refine

it along with the guiding coalition
 Have the key project managers involved in refining
the mission, vision and strategy
 Get the feedback of the project management
counsel (senior management) on the mission, vision
and strategy
 4: Communicate the Vision

 COMMUNICATE, COMMUNICATE,
COMMUNICATE!
 Communicate the mission, vision and strategy to
the organization
 Package your message well
 If possible, ask for help in designing professional
looking logos to spruce up the presentation
 Use town hall meetings, newsletters and the
company Intranet to communicate
 5: Empower Employees

 Support or supply project management training

 Support PMI membership
 Support project management certification (PMP)
 Supply project management tools
 Create an environment for success - set realistic
goals
 Supply information
 6: Generate Short-Term Wins

 Pick low-hanging fruit (VERY IMPORTANT)

 High visibility, FUNDED project as a pilot
 Runaway projects (more negative but quick)
 7: Consolidate Wins

 Win Friends and Influence People

 Build on project successes
 Highlight project successes outside of the PMO for
good examples of project management
 DEMONSTRATE SUCCESS TO SENIOR
MANAGEMENT AND BUILD
 Once the ball is rolling, GO GO GO!
 8: Anchor New Approaches

 Involve more and more people in project

management
 Train project participants in the basics of project
management
 Embed project planning into organizational
planning
 Prioritize, schedule and fund projects
 Project management should be embedded in every
organizational change
Reevaluate and Repeat

 Evaluate lessons
learned
 Reevaluate mission and
vision
 Reevaluate the menu of
services
 Summary

 Assessment
 Approach
 Application
Case Study
 Grass-Roots PMO

 Larry Halbach – Sr. VP of Planning & eBusiness 25%

 Business Planning
 eBusiness Strategy
 Project Management Organization
 Karl Knapp – Executive Consultant 50%
 Balanced Scorecard
 Executive Consulting
 Project Management Organization
 Colleen O’Brien – Project Manager (Part-Time) 100%
 Program Manager – Demutualization
 Project Management Organization
 PMO Members

 Part-Time Focus
 Other ‘jobs’ were primary
 Well respected
 Well qualified
 Belief in importance of project management
Assessment

 History
 Culture
 PM Perceptions
 PM Maturity
 PM Talent Review
 Mission & Vision
 GAP Analysis
 Assessment - Culture
 Management
 Low morale
 Heavy politics
 Uncertainty
 Management versus Project
Management
 Unrealized potential for
synergy
 Ownership concerns
 Lack of accountability
 Organizational
 Multiple Project
Organizations
 High maintenance
 Distribution complexity
 IT disconnected from the
business
 Multiple uncoordinated IT
organizations
 Assessment –
Perceptions/Maturity
 Perceptions
 Have not completed projects
within specifications, time or
budget
 Don’t know performance
 Don’t track performance
 Expenses high
 Runaway projects
 PM Maturity
 Inconsistent analysis of
alternative approaches
 Varying methodologies
 Varying tools – no effective
utilization
 No standards
 No tracking of performance
vs. budget
 No communication across
business units
 Lack of prioritization
 Don’t track internal costs
 Assessment – Mission

 Promoting consistent use of basic project management

standards, reporting procedures, and tools
 Providing a clearinghouse for critical project information
across the enterprise
 Enabling senior officers to prioritize strategic projects by
analyzing project commitments and results
 Educating employees on leading project management
methodologies
 Providing the organization with a nucleus of project
managers who can run projects
 Assessment – GAP Analysis

Area Current State Desired State

Methods Varying methods, no Standards, reports, tools,
standards guidelines & prioritization
Training Minimal training, seat of Standard classes (tools, soft
the pants skills, methods), PMI
Consulting None available internally Project reviews, mentoring,
manage projects
Support Multiple tools, no political Standard tools, templates &
support documentation
Managers Only a few trained, no All PMP certified, career
PMPs, no focused PMs paths, sponsorship
Approach

 Continuum of
Approaches
 Menu of Services
 Visible Wins
 Approach - Continuum

 Key Determinates:
 Lacked a ‘mandate’
 Uncertain support from senior management
 Needed to show rationale for project management and
demonstrate success
 Approach Selected:
 Influencing the Organization
 Approach – Menu of Services

 Prioritization Assistance
 Summary major project status report
 Prioritization process consulting
 Standard PM Templates & Forms
 Training Classes (Initiation & Planning class)
 Project Management (pilot project)
 PMP Reimbursement (anyone passing exam)
The Project Center Is Born
 Approach – Visible Wins

 Manage Large, Visible Project

 Demutualization
 Put best project manager in charge of the project
 Involved from the planning process forward

 Assist Prioritization Committee

 Information – bi-weekly summary status report
 Process – facilitated design of prioritization process
Application

 Sense of urgency
 Guiding coalition
 Vision & strategy
 Communicate vision
 Empower employees
 Generate short-term wins
 Consolidate wins
 Anchor new approaches
Reevaluation & Repeat

 Accomplishments
 Lessons Learned
 Mission & Vision
 Menu of Services
 Reevaluation - Accomplishments

 Expanded the consistent use of project management

standards, reporting procedures & tools
 Adopted the Project Management Institute (PMI) body of knowledge
as our basis
 Extended the Project Center to include key project managers
throughout the organization in a Project Management Counsel
 Created a Project Management Handbook including new project
management forms & processes
 Reported critical project information
 Provided bi-weekly status and resource projection reports to the
prioritization committee on key projects
 Deployed a web-based project dashboard for executives
 Reevaluation - Accomplishments

 Grew the base of Project Management knowledge

and experience throughout the company
 Conducted two ‘town hall’ meetings on project management,
 Designed, developed and implemented two classes covering the five
PMI processes - 20% of entire employee base trained
 Developed job descriptions for two levels of Project Manager
 Five PMP certified project managers
 Provided the organization with a nucleus of project
managers, focused on the key corporate projects
 Demutualization project ($15M) completed meeting strenuous
regulatory & quality goals, on schedule, exceeding cost by 15%
 Variable project ($5M) completed one month late, 7% under budget
 Approach – “Virtual” Project
Center
Dept.
Dept.
Dept.
PO Dept.
Dept.
PM PM
PM PM PM PM PM
PM

LH
Project
The “Virtual” Management
CO KK Council
Project Center
CHANGE

 Merger with AmerUs

Group
 Senior management
combined
 Loss of guiding coalition
and sponsorship
 The Project Center moved
to the IT Department
 What to do?
 Of Course!

 Assessment
 Approach
 Application
 Reevaluation & Repeat
Open Discussion