A Project Management Office (also called PMO), is an office or department within an organization that defines and maintains standards for project management. The Project Management Office provides guidance and standards in the execution of projects.
If you are a small operation, you may be able to manage without a Project Management Office (PMO). But if your organization runs multiple cross-functional projects at the same time, then it likely needs one! A PMO plays many roles within an organization, but this of course varies greatly from company to company depending on its size and the scope of projects being managed. A successful PMO is a combination of good people, processes and tools. Apart from just managing project portfolios, here are the other benefits it delivers:
Strategic planning and governance
This is the most important function of a PMO. By scoring projects using predefined criteria, the strategic selection of potential projects can be done according to the business goals of the organization. PMOs then advise senior management or C-level leaders to select candidate projects that best align with the strategic goals of the company, by providing a sound business case and a clear cost/benefit ratio.
With regards to project governance, PMOs set policies, regulations, functions, processes, and procedures that define the establishment, management and control of projects, programs or portfolios.
Best practices and process
PMOs implement and consolidate best practices and processes within the organization. Where possible, they standardize the process across all departments and services. A PMO can implement a repeatable project delivery process so that organizations can readily manage and deliver projects. The department also provides consistent project management guidance, methods, systems, tools and metrics for consistent project outcomes throughout the organization. This maintains consistency between project managers working on different projects, across different departments.
Common language, culture and mindset
A PMO helps disseminate a common project culture and mindset by informing, communicating and training employees about different techniques, methodologies and best practices in the industry. It also helps to develop a common project language by defining milestones, metrics and KPIs so that everyone is on the same wavelength. This way, the management of projects is harmonized and efficient across the whole organization, and in short, they act as champions of project management for the company.
PMOs also manage and allocate resources effectively across all projects, by managing priorities based on timelines, budgets, resource loads and what-if analysis information and accordingly providing the right resources, at the right time. They also define roles and responsibilities needed on any given project.
PMOs train, mentor and coach employees in general - and in particular project managers. They organize regular workshops and training programs regarding project management to keep staff up to date.
Creating and maintaining project artifacts, archives and tool sets
PMOs provide templates, tools and software to manage project efforts. They invest in tools for managing projects - which pays off in ensuring reliable data, which enables early visibility into project performance for better decision-making.
PMOs also play an important role in institutional memory. Once the project completes, or cancels, they archive all the project documents created during the project into a document repository. This is very useful for future reference, especially for lessons learnt.
As we can see - the role of the PMO is far-reaching and impacts many departments within large businesses that have large amounts of cross-functional projects to manage. Ultimately, they are there to keep everybody working in the same direction towards the overarching goals of the business.