Project Management 101: The Project Management Office (PMO)

The work landscape is changing. Significant percentages of work within organizations are shifting from operational work to project based efforts. To effectively manage the changing work scope, many organizations have established project management offices or are considering establishing project management offices. Sounds great, but what exactly is a project management office?

As defined by the Project Management Institute (PMI), a project management office is a management structure that standardizes the project-related governance processes andfacilitates the sharing of resources, methodologies, tools, and techniques. PMOs can perform a range of functions for an organization from directly managing projects to providing support in the form of best practices and templates. PMOs can be categorized in three broad categories based on the amount of control and influence held by the PMO within the organization.

• Directive: High level of control and influence held by the PMO. The PMO has direct oversight over projects and manages projects directly

• Controlling: Moderate level of control and influence held by the PMO. The PMO provides general support to the organization’s projects and requires compliance with standard methodologies or governance dictated by the PMO i.e. specific templates, reporting requirements, identified tools

• Supportive: Low level of control and influence held by the PMO. The PMO offers consultative services in the form of best practices, training, templates, lessons learned, and project management information

The control and influence of the PMO varies across a broad spectrum based on the needs of the organization from the authority to make key decisions i.e. terminate or fund projects and management of project resource allocation to simply providing a group to provide information on project management and templates. An organization may even have multiple PMOs serving the needs of various departments or different functions i.e. one office’s role may be to provide training while another office’s may be to formally manage projects.

PMOs can provide support to project managers in various ways i.e. mentoring, training, monitoring compliance, managing policies, developing templates, coordinating communication across projects, managing shared resources across projects, identifying best practices, or maintaining project records. PMOs and project managers serve different roles related to projects. PMOs optimize resource allocation across all projects while project managers optimize assigned resources to meet the needs of their projects. PMOs manage enterprise level project structure including methodology, templates, standards, metrics, interdependencies, while project managers manage individual project constraints. PMOs are concerned with program or portfolio scope changes focusing on the achievement of organizational objectives, while project managers focus on achieving the objectives of their projects.

If an organization desires increased standardization, central oversight, or project management knowledge, then the organization may benefit from establishing a PMO. Organizations should be clear in communicating the purpose and function of any PMO established to ensure that the scope of work performed by the PMO is understood. A PMO’s customers are the organization and its constituents. Customers are much more likely to seek or follow a PMO if the role of that PMO is clearly established.

Disclaimer: The views and opinions expressed are those of the blogger and are not necessarily those of the Federal Reserve Bank of Dallas or the Federal Reserve System.