January 30th, 2020

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

Project management methodologies, certifications and tools have around for many years and have considerably increased the maturity of 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 Project Management Office

In project-centric project management offices, there is a bottom-up mindset. This means that executing projects on time and budget is the sole focus. Little attention is given to larger organizational business goals and objectives. There is not much alignment between strategy and execution. Visibility into performance trends across projects and portfolios is limited. 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 they don’t see when they will get payback of the investments. Project-centric PMOs are 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. They take a top-down approach and a business-oriented mindset. They are supported by strong business leadership at the C-level, business objectives and goals, and business value delivery metrics.

 

Business Driven Project Management Offices Support a Top-down Mindset

 

Technology to Support the Business-Driven Project Management Office

As project management offices become more business-driven, there is a growing mandate to manage both portfolios and projects very tightly.  The goal is to ensure delivery of business outcomes as well as efficiency in execution.

This is the foundation of Enterprise Project Performance (EPP). EPP is 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. This is similar to Enterprise Resource Planning (ERP) software. ERPs break down silos between business units and provide 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.

 

Enterprise Project Performance provides a single view of of all project data

 

 

 

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Six Things to Look for in a Solution

An integrated EPP system enables you to establish consistency in planning and execution. It also provides comprehensive visibility into performance, and also ensures 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.

 

Business driven project management offices need to view goals at the portfolio level.

 

2. Strategic balancing, including what-if scenarios, so you can shape the portfolio with projects of the best strategic fit.

 

Business driven project management offices need to make sure projects are a strategic fit

 

3. KPIs, so you can monitor which projects are tracking, at risk, and not tracking.

 

PMOs need KPIs to monitor projects

 

4. Resource capacity planning, so you can adapt the workforce to project needs.

 

Resource balancing is a key function of business driven project management offices

 

5. Portfolio risk and changes registers, so you can monitor and trace what could happen and what has happened.

 

Risk and change registers help track what has happened

 

6. Embedded interactive dashboards, so you can drill down instantaneously to investigate.

 

Embedded dashboards with drill down capabilities empower business driven project management offices

 

Conclusion

With the right ingredients to optimally support a business-driven project management office, 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

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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