January 30th, 2020

In our very fast changing world driven of capital projects, many organizations are looking to digitally transform their Project Management Office (PMO) for better control of their project portfolio.

Project management methodologies, certifications and tools have around for many years and have considerably increased the maturity of the PMOs. However, even as projects are managed better and better, outcomes are still not predictable, overruns still happen, and projects fail to deliver intended business results far too often. Why is this?

Project-Centric vs. Business-Driven PMO

In project-centric PMOs, there is a bottom-up mindset, where executing projects on time and budget is the sole focus. There is little attention given to larger organizational business goals and objectives, not much alignment between strategy and execution, and little visibility into performance trends across projects and portfolios. Project managers are focused on meeting key deadlines regardless the project status. Resource managers focus on staffing only high priority projects. Portfolio managers complain against budget cuts when all projects are in good health, executive sponsors approve projects without clear business cases, and executives don’t see when they will get the payback of the investments. Project-centric PMOs are perceived as good practitioners and guard rails for cost and schedule, but also theory-driven gatekeepers and reporting agents.

This is the reason why business-driven PMOs have gained prominence in the last decade or so, with a top-down approach and a business-oriented mindset. This is supported by a strong business leadership at the C-level, business objectives and goals, and business value delivery metrics.

Technology to Support the Business-Driven PMO

As PMOs become more business-driven, there is a growing mandate to manage both portfolios and projects very tightly, ensuring the delivery of business outcomes as well as efficiency in execution.

This is the foundation of Enterprise Project Performance (EPP), a mindset that expands from improving outcomes of individual projects to one that also heavily considers achievement of business objectives for ALL projects within an organization.

The missing link for many PMOs today is technology to support EPP. Luckily, it exists…

EPP software provides a single, integrated platform to manage all project data that has been disseminated in Excel files or in-house systems. Similar to Enterprise Resource Planning (ERP) software, which breaks down silos between business units and provides a single view of an enterprise’s financial and operational performance.

An EPP system works much the same way by providing a single, unified view of all projects in an enterprise.

 

 

Six Things to Look for in a Solution for Your PMO

An integrated EPP system is a key enabler for establishing consistency in planning and execution, providing a comprehensive visibility and ensuring alignment with goals and objectives.

To be successful, it is important that such a solution contains the following key elements:

  1. Goals and objectives at the portfolio level, financial as well as non-financial, with progress measurement.
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  3. Strategic balancing, including what-if scenarios to shape the portfolio with projects of the best strategic fit.
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  5. KPIs to monitor which projects are tracking, at risk, and not tracking.
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  7. Resource capacity planning, to adapt the workforce to project needs.
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  9. Portfolio risk and changes registers, to monitor and trace what could happens and what has happened.
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  11. Embedded interactive dashboards to be able to drill down instantaneously where investigation is required.

 

Conclusion

With the right ingredients to optimally support a business-driven PMO, organizations can identify the right strategies, select the right projects to execute those strategies, and ensure project execution delivers expected outcomes. Embedded business intelligence provides reports to see what has happened, dashboards to understand what is happening, and analytics to predict what could happen.

Business-driven PMOs and the tools that empower them, such as Enterprise Project Performance software, are necessary for companies to survive and create competitive advantages in the current industry landscape.

For more information, you can watch this webinar.

 


 

Jean-Luc Ozoux is currently in charge of EcoSys Business Development at Hexagon PPM, a company that supports its customers in their digital transformation by offering innovative solutions to adopt new technologies applied to the management of large industrial projects.

MBA graduate of Paris University in Information Systems and Management, he has been helping organizations implement their Capital Project Management solutions for 30 years. His experience with major project management software, as well as the advice he provides to major companies in France and Europe, allows him to take a critical look at the very rapid evolution of tools and technologies that are transforming the working methods, culture and tools that need to be mastered today.


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