Are you leaving $26M on the table? That’s the difference in project risk between high performers and low performers according to PMI’s Pulse of the Profession 2013. We looked at project statistics in detail last week with “Do your projects stink?” and saw that there are big-time financial benefits to improving your project capability. PMI identified three steps to get there:
These improve your project capability and improve maturity. The best way to take these steps is with a Project Management Office (PMO).
Done right, the PMO gives you measurable, repeatable long-term benefits. It provides that talent development, best-practice standardization, and alignment with strategy called out above. It can have various structures and roles. The biggest consideration is how much direct control it takes over individual projects. Typically this is defined as supportive, controlling, or directive.
All three of these structure should provide support, standardization, and alignment the only difference is how much control they exercise over each project.
There is no “best answer.” There is a chance that the supportive only PMO can be ignored putting some of the benefits at risk. The controlling PMO can be seen as a bureaucratic policeman if its’ focus becomes compliance over performance.
A Center for Business Practices study found that Level 4 PMOs performed 34.5% than Level 1 PMOs. Gartner found that world class organizations with PMOs had a 90% project success rate. So how do you measure the maturity of your own PMO?
We like to use a combination of the Capability Management Model made popular by the Department of Defense and PMI’s OPM3 model. The figure above gives a brief description of each level from 1 to 5. Many organizations don’t have any capability in place and we would characterize those as Level 0. In an upcoming post I’ll give more detail on how to assess what level you are at.
1. How mature is your company’s project management capability? Does it matter?
2. Do you have a PMO? What kind?
3. Are you seeing value from your PMO?