Your PMO Must Be a Value Center!

Project management offices (PMOs) are awesome. No, really, they are. There may be a perception out there that they do nothing but governance and reporting. That they slow things down, or that they get in the way of effective project delivery. But the truth couldn’t be more different. Ot at least, it couldn’t be more different if you implement a PMO in the right way: with value delivery as its foremost function.

A 2023 report by Project Management Institute (PMI) revealed that organizations with high PMO maturity performed better in revenue, customer loyalty, and ESG (environmental, social and governance) factors. Those metrics matter to leaders, in fact they matter a lot. But what makes a PMO high performing? What allows it to succeed? And how do you create that type of PMO?
 

The PMO as a Function for Value Delivery

PMOs must be viewed and managed as business functions, not project functions. They must exist to improve the ability of the project environment to deliver initiatives that achieve business goals. That means shifting away from a focus on process compliance, reporting, and project planning. And it means enabling improvements in:

• Resource capacity and utilization. Ensuring that there are the right number of people with the right skills to deliver the planned work. Also, scheduling and distributing work to avoid “hotspots” of over- and under-utilization.
• Business planning. Contributing as an expert in project delivery to strategic planning and replanning activities. This guidance can improve project selection and funding, as well as work distribution. It also helps ensure that the approved work approved can achieve the required outcomes.
• Communication and collaboration. Acting as a conduit for communication between business leaders, decision makers, and delivery teams ensures a common understanding of what needs doing, and how individual work items contribute to business success.

That doesn’t happen overnight, and it can’t happen without the right mandate, support, and guidance for the PMO. But here’s the thing. There’s no reason why every PMO shouldn’t have the ability to contribute in this way. Organizations don’t create PMOs just because they think it’s a good idea. They create them to deliver more value to the business than they cost to operate. That’s no different to any other function – sales, marketing, etc. If that value delivery isn’t clear, then either the PMO has the wrong focus, or it has a leader who can’t deliver on that focus.
 

PMO Leaders Drive Functions

Historically, PMOs have been asked to define their own mandate more than most functions in an organization. That’s because many business leaders don’t understand project environments well enough to know the factors that are driving performance. Which makes setting appropriate goals and objectives for a PMO difficult.

There’s no problem with the PMO leader providing input to the process of establishing a mandate and priorities. But they can’t own it – any more than sales can own the setting of the sales target. But for business leaders to set meaningful PMO goals and objectives, they need visibility into what is happening in project environments. That’s where effective project portfolio management (PPM) software comes in.

With Sciforma, leaders have visibility into where work is being delivered effectively and efficiently, and where it isn’t. In turn, that visibility allows leaders to work with PMOs to set appropriate goals, and then monitor the progress made by viewing how key delivery and business metrics are improving. That way they can validate that the PMO is delivering value – just as it should be. To learn more about how Sciforma can help your business, book a demo.