PMO Strategy — Creating a Valued Presence

March 6, 2023


Do you feel like your PMO is not being recognized for the value it brings to the organization?  If so, you're not alone.  Many PMO leaders struggle with this challenge.

The importance of a Project Management Office (PMO) has grown substantially in recent years as organizations look to support their strategic initiatives. However, for a PMO to remain an integral part of a business, it must be able to effectively demonstrate its value and measure success to prove its worth.

Without the ability to quantify and communicate the value that they are providing, many PMOs have been dissolved due to a lack of evidence that they are providing real value for the company. This is why it is paramount for any PMO to have a strategy in place for tracking and reporting their performance and measuring success. By doing this, the PMO can provide tangible proof of its value and ensure its long-term survival within the organization.

Who Defines Real Value?

To be seen as valuable, it is essential to determine what kind of value is expected from you by your most important stakeholders. This can be a complex process, but it is necessary to ensure that the correct messages are being communicated to the correct people.

Without this understanding, it may appear as if you are providing no benefit at all. Taking the time to gain an understanding of the wants and needs of key stakeholders will enable you to provide them with a more valuable experience that reflects your expertise and shows an appreciation for their interests.

Furthermore, when communicating with people related to these stakeholders, having this knowledge will help you deliver more accurate and useful information that meets their specific goals.

Communicate Value to Stakeholders

The success or failure of a PMO is largely dependent on the stakeholders associated with it. Stakeholders can be individuals, groups, or entities and have varied levels of influence on the initiatives undertaken by the PMO. Therefore, it is important to have an understanding of all the stakeholders' interests, needs, and goals to ensure that the organization's objectives are met.

Define your stakeholders

A successful communication plan should include a comprehensive list of all PMO stakeholders. Stakeholders can be internal or external to the organization.  This list must contain key players from all departments involved in projects, including:

  • Executive Sponsors – These individuals are responsible for providing oversight and guidance to ensure the project achieves its goals and is completed on time and within budget. They may need to review progress reports or provide other resources to ensure success.
  • Project Managers – These individuals are responsible for the day-to-day management of the projects and serve as the primary contact between the PMO and all stakeholders. They will need to be kept up-to-date on progress to effectively lead their team.
  • Functional Leaders – These individuals guide the project teams and ensure that their respective departments are receiving the services they expect and are delivering on their commitments. They will need to be informed of any changes or updates to stay ahead of the curve and support the project’s success.

Build the communication plan

  1. Identify and interview each stakeholder to understand their specific information needs for success.
  2. Analyze stakeholder information demands to prioritize the importance of different types of information.
  3. Develop a plan of action to ensure that all stakeholders efficiently receive the necessary information, beginning with the most critical data demands first
  4. Validate that the information is effective and complete for each stakeholder

Report Key Performance Indicators (KPIs)

KPIs are agreed-upon standards that can be used to evaluate if goals are being met within a PMO. When designed correctly, they can provide a powerful gauge as to whether or not objectives are being reached and value is being generated. If executed poorly, however, KPIs will fail to provide the insights necessary to make meaningful progress.

Key performance indicators (KPIs) should be carefully crafted and tailored to the specific needs of each stakeholder. By providing accurate and up-to-date information in a format that is easily understood, KPIs can assist stakeholders in making informed decisions.

Properly utilized and reported, KPIs offer invaluable insight into the performance of an organization, enabling stakeholders to make more informed decisions.

When creating KPIs, it is imperative to take into account the company background and project portfolio. This ensures that the metrics created are tailored to the organization's specific goals, as opposed to generic and potentially ineffective measurements that have no relation to the core objectives of the business, or the interests of stakeholders.

Typical KPI Categories

  • Schedule
  • Scope
  • Budget
  • Human Resources
  • Risk
  • Issues

Example KPIs

  • Percentage of delivered projects
  • Percentage of projects delivered in line with the business case
  • Resources added compared to resources forecast
  • Benefits realized compared to benefits forecast
  • Percentage of projects terminated
  • Return on investment (ROI) across the PMO’s project portfolio
  • Percentage of projects that failed to deliver  
  • Percentage of projects at unchanged status over a defined number of reporting periods

Note that these KPIs are generic examples only.  KPIs should support the specific requirements and requests of your stakeholders.

In summary

This article outlines the importance of creating a comprehensive list of key players from all departments involved in projects. This list should include Executive Sponsors, Project Managers, and Functional Leaders who will be informed about any changes or updates, to ensure that projects are successful.

In addition, communication plans must be developed to effectively share information with each stakeholder, and KPIs should be tailored to the organization’s specific objectives and interests to provide stakeholders with meaningful insight into project performance.  When implemented correctly, this strategy can help ensure that projects are delivered on time and within budget, while delivering greater value for all involved.

Steven Souther
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