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The Next Steps
Once the PMO establishes itself as a true IT control tower, managing flight plans throughout their many stages, it offers the opportunity to put a positive spotlight on IT. Luna and an associate have teamed up on a program they call Partnership Project: The PMO collects best practices for project management and disseminates them to other business units for projects outside of IT. "We're using the Partnership Project to show the PMO's effectiveness and payoff," Luna says.
For GMAC's PMO, Fetsick has a three-year growth plan. She recently hired a PMO coordinator and plans to hire a project manager soon. The plan may also call for hiring more project managers with PMP certificates. Eventually, GMAC's PMO will become a center of project management excellence, farming out project managers on various projects throughout the company.
But Rockwell Automation's Jackson advises against taking this approach. He contends that if an organization has project managers already dispersed throughout the company, their relationships should keep projects and business goals aligned and thus shouldn't be pooled into a central group. Of course, this assumes that a midmarket company has multiple business units with a widely dispersed army of project managers. Jackson's IT group handles 400 projects a year, such as process redesign using Hewlett-Packard's OpenView, so it doesn't make sense to centralize all these project managers.
Nevertheless, Jackson offers sound advice: PMO success should not always lead to more of a good thing. Once a PMO shows signs of success, a CIO may be tempted to expand its scope, but that may not be the right call. For instance, the leader of a PMO that tracks projects might decide he wants to be responsible for conducting the performance reviews of project managers, "but that might not fit," Jackson says. Other managers may be more appropriate for such tasks.
All of this underscores the fact that there isn't a one-size-fits-all approach for a PMO. Practicality and results should govern a PMO's development. "There is no one right way to approach a PMO," says GMAC's Chestang. (See "A COO's Take on PMOs") "You have to consider your business drivers. What's your purpose behind formalizing project management in your organization? Is it to cut costs, build efficiencies, improve customer satisfaction?"
Such was the case for Robert Golden at Insurance House. Once he jettisoned the failing project, he won acclaim from the CEO and COO for saving more than $1 million and earned credibility for his PMO. Today, IT needs 40% fewer staff to complete the same number of projects, thanks to efficiencies gained from the PMO's ability to streamline processes; manage projects (using Clarity software); and reuse template project plans, charter documents and best practices. The PMO also revisited the killed project and decided to relaunch it. This time, Insurance House will outsource some of the application development work, accelerating deployment.
Most recently, Golden's PMO expanded its purview outside of IT, earning him the new title of director of strategic business services. It's currently overseeing two projects that should boost revenues. And in a nod to the importance of its role, the company is assuming that projects will be on time, on budget and within scope. "We're counting on those dollars in our 2006 projection and budget," says Golden. That's a long way from failure.
Tom Kaneshige and Ellen O'Brien were senior editors at CIO Decisions. To comment on this story, email editor@ciodecisions.com.
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