Business Driven PMO Success Stories: Across Industries and Around the World
368
Business Driven PMO Success Stories: Across Industries and Around the World
368Hardcover
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Product Details
| ISBN-13: | 9781604270761 |
|---|---|
| Publisher: | Ross, J. Publishing, Incorporated |
| Publication date: | 01/01/2013 |
| Pages: | 368 |
| Product dimensions: | 6.00(w) x 9.00(h) x 1.00(d) |
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CHAPTER 1
Why PMOs Fail
It's a simple question. Why do PMOs fail? Over the years, there has been no shortage of analysis and commentary on this subject. We have all been treated to the research reports that show 25% of PMOs fail within their first year, 50% of PMOs fail by their second year, and 75% of PMOs fail and are closed by their fourth year. And these are permanent PMOs, not temporary program offices that by design will be closed after the program has concluded.
So, given this more than ample amount of analysis of the marked and measured rate of PMO failures, the documented reasons why PMOs fail, and the proposed recommendations for what a PMO should be and do to avoid failure, why has there been such little movement and improvement in the rate of PMO failures over the years? And with respect to PMOs in general, why is the project management community making such a mess of it all? We have tools, we have standards, we have certifications, and we have a lot of really smart people. So what is the problem?
I have my own thoughts and perspectives on why PMOs fail that are based upon more than a decade of asking this specific question to executives to whom the PMO reports, to management and constituents served by the PMO, to IT professionals, to agile software development enthusiasts or agilest as (a term many use to describe the passion and perspectives of this vibrant and growing community) and I have asked this question to the members of the PMO itself such as PMO managers, PMO officers, project managers, business analysts, and a wide variety of others who work in the PMO. But before sharing my thoughts and perspectives on why PMOs fail, let me first suggest that as a community of project management professionals most of us are stuck inside the box in terms of our thinking about PMOs.
As depicted in Figure 1.1, being stuck inside the box is not a lot of fun or where you want to be and it is hard to get out. It is akin to being stuck in a rut where the direction and outcome are all but predetermined. In the context of why PMOs fail, the only way we can become unstuck and get out of the box is to think outside the box. After all, it has been the same inside the box thinking about PMOs that has led to the high failure rate and in many cases negative sentiment about PMOs and the project management community as a whole.
For example, did you know that in the agile development community, the term PMO means Pissed Me Off? Other non flattering terms that I have heard over the years include Pretty Myopic Organization, Pouring Money Overboard, Project Management Overload, Poorly Managed Office, Project Management Orangutans, and on and on
Thinking outside the box, especially when trying to break a pattern or poor track record or losing streak, is tremendously beneficial. Actually, it is a requirement. Thinking outside the box can reveal new approaches and techniques that are often right before our very eyes and within our grasp. However, for most people, thinking outside the box is not natural, it is very hard to consciously do, and it is very difficult to see even the easiest and most obvious solutions to problems even though they are right in front of us all the time. Don't believe me? Let me prove it to you.
Over the years, I have given PMO presentations and conducted PMO workshops in over 50 countries spanning six continents. When presenting new, outside the box ideas and concepts, I always like to start the presentation with a little exercise to demonstrate how hard it is for us to think outside the box, as well as to demonstrate how natural and prevalent our tendencies are to remain inside our own little box of thinking even when we are specifically asked to step out of it. As no challenge is complete without a reward, I always take a $100 bill out of my wallet and offer it as a reward to the first person who can successfully find the answers to the exercise. Are you ready?
The exercise goes like this. In less than five minutes, using the four numbers (1, 2, 3, and 4) and the two arithmetic operators for plus and equals (+ and =) as shown in Figure 1.2, rearrange all these numbers and operators into three different and correct equations. Each equation must use all four numbers and both operators and use them only once.
This seems simple enough. Did you already think of the answer 1 +4 = 2 + 3? That is the most common wrong answer that is quickly cited. The equation is correct of course, but the plus sign is used twice. Again, all numbers and operators must be used and used only once. As depicted in Figure 1.3, the three solutions to the exercise are (1) one to the power of two plus three equals four, (2) one to the power of four plus two equals three, and (3) three times four equals twelve. In this last solution, the plus sign is rearranged by rotating it 45 degrees, making it a multiplication sign. Arguably, this last solution is more outside the box than the first two solutions, which merely employed the use of exponential notation.
The broader point, however, is that all these solutions to the exercise are quite simple, one might even say trivial. But did you arrive at any of these solutions, not to mention all three of them? If you did, then give your self a pat on the back as you are in very select company. In all the times over the years that I have conducted this little test at various PMO work shops and seminars as an example of how hard it is to think outside the box, only once have I lost my $100 bill to someone who was able to come up with all three answers.
Now, with that exercise behind us, think about all the reasons and rationale for why PMOs fail that have been posited within the project management community over the years as well as the suggestions and advice that are given to avoid PMO failure. The top five reasons for PMO failure that I often read about or hear in presentations are as follows:
1. Lack of executive support
2. Ineffective and overburden some project management methodologies
3. PMO viewed as template police rather than helpful to the business
4. PMO does not have enough decision-making authority to ensure success
5. Value of the PMO not understood
But are the above reasons really the reasons why PMOs fail or are they merely symptoms of a deeper root cause for PMO failure?
For example, few PMOs magically appear out of thin air. There was obviously executive support for the PMO or it would not have come into existence. Likewise, such things as methodologies and templates are a means to an end, not the end to be achieved, so it is illogical that thesethings would be a root cause of PMO failure. In a similar vein, what can possibly be meant by not enough decision-making authority? Most people will inherently do what helps them succeed and avoid what doesn't. If the PMO is helping others succeed, then wouldn't people take the appropriate actions without the PMO needing more decision-making authority over them? And more decision-making authority for what aim — to make the business successful or to comply with a PMO strategy and project management methodology that may or may not be effective and appropriate for the organization? When people suggest that the value of the PMO is not understood, do they mean the value of preparing documents and reports or do they mean the value of best addressing specific project-related issues and opportunities that the organization has?
There is a very simple reason why PMOs fail, but it will not be found from inside the box of the traditional thinking about PMOs. Before we get to that very simple reason, let's reflect upon some of the advice that has been given over the years and that has dominated the project management community. Have you heard the term people, process, and tools ?Have you read the often suggested road map for setting up a PMO that includes (1) pick a PMO model, (2) list your PMO roles and responsibilities,(3) establish quick wins, and (4) sell the value of the PMO? Have you heard the advice to crawl, walk, run?
All these perspectives and many more are the result of an inside the box way of thinking about the PMO, a perspective that is more focused on the means to the ends of the PMO and what a PMO ought to be in a perfect world, rather than a perspective that is focused on the ends to be achieved by the PMO as driven by needs of the business for which the PMO exists to serve. This causes execution difficulties for the PMO right from its start; PMOs are far too often set up and managed based upon someone's idea of what a PMO ought to be, rather than specific business end results to be achieved.
Take the advice of a well-known and well-intentioned PMO authority who shall go nameless so as not to embarrass this individual. The advice that this individual, like so many others, has given on the role of the PMO includes the following:
* Strategically align the project portfolio to the goals of the organization.
* Develop project, program, and portfolio processes aligned to industry standards.
* Implement a project management information system.
* Develop a training program to certify project managers.
* Develop a list of PMO services.
* Conduct project audits.
* Provide project reporting to management.
* Conduct regular project management maturity assessments.
That the above list, and other lists like it, is a collection of well-intention edideas for a PMO is of no debate. That the above list solves the specific business problems of a given organization would be a gross assumption and an error in business judgment. In layman's terms, it is putting the horse before the cart.
It is put best by one of my dear friends and longtime project management and PMO expert Doc Dochtermann, formerly of the Microsoft Project Portfolio Management (PPM) Solutions team, who rhetorically asks:
If the PMO is the answer, then what was the question?
This pithy and pointed question illustrates a tremendous problem and issue within the formal project management community. There is far too little focus, virtually nonexistent, on what business problem, as determined by the constituents of the PMO, the PMO is actually going to solve for the organization, right now, and what the value of solving that problem is in terms of, and as measured by, PMO end results achieved. It is hard to argue the point that without knowing the problem to be solved, one can't advance a sensible solution. Yet, this is exactly what is advised and happens ,time and time again, within the formal project management community. And this is the reason why PMOs fail with such speed and regularity and, I might add, lose the support of executives and annoy others along the way.
CHAPTER 2PMO Survey Findings
When I entered the formal project management and PMO community over a decade ago and after 20 years of experience, all of which was in the field lines of business of the company, I was quite surprised to see, hear, and learn how different the formal project management community's view of a PMO was as compared and contrasted to the view that I and my line of business colleagues had about our PMOs and PMOs in general. For the first few years of my entrance into the formal project management and PMO community, I just assumed that the differences in our PMO views were simply because of the interactions that I was having with specific individuals at various project management conferences, seminars, and events and that these individuals, though they presented a common view as a subset group, could not possibly represent the collective view of the formal project management community as a full and broader group of PMO professionals. After discussions with my colleagues at BOT International, we decided to conduct a survey for the purposes of determining if there are any inferences that can be made, based upon research data, from the different views of what a PMO is and what a PMO should do.
The year was 2007. Using Student's t-distribution analysis techniques, we structured our initial survey to ask a set of questions to a very homogeneous group of 25 IT PMOs at companies with similar fundamentals such as revenue, income, number of employees, etc. Obviously, there are many other kinds of PMOs, and IT PMOs should not be viewed as the only or best or most important type. In fact, one could argue that too much of what is presented within the project management community about PMOs comes from a slanted, IT PMO perspective. Nonetheless, IT PMOs are perhaps the most homogeneous of the lot and it was necessary to have a homogeneous sample size; otherwise differences in the data might beat tributable merely to differences in the PMO types contained within the sample.
One section of the survey concerned itself with the focus and perceived value of the PMO as shown in Figure 2.1. We asked the following questions:
* Does your PMO have measurable objectives? By measurable objectives, we mean measurable performance objectives for a given report period from which the PMO is held accountable. This is not to becon fused with key performance indicators.
* What is the top area of focus of the PMO? This question was intentionally open-ended so that the answers provided would best reflect the top focus of the PMO and not the closest fit of the multiple choice answers provided. Also, using an open-ended question prevented the potential bias of selecting from a predetermined list of answers.
* What is the PMO manager self-assessment of the performance of the PMO? The answer to this question was in the form of a grade, much like a school grade, where A is outstanding (honorable distinction),B is above average (honor roll), C is average (not bad), D is below average (needs improvement), and F is failing (not passing and not acceptable).
* What is the CIO assessment of the performance of the PMO? By design, these were all IT PMOs that reported to the CIO, so the grade would be coming from that titled position. The grading scale was the same as described above.
* How important is it to sell the value of the PMO? The answers to this question included very important, important, unimportant, and very unimportant.
The answers to these questions are shown in Figure 2.2.
What can be inferred from the answers to these survey questions? At first glance, one might conclude that PMOs are organizations that are not held accountable, their top area of focus is concerned with project management methodology, they are performing quite well as self-assessed and assessed by the executive to whom they report, and it is not just important but very important for the PMO to engage in Selling the PMO activities to ensure that others throughout the organization understand the value of the PMO. Overall, one might tend to think that this would seem to be a good reflection of the state of the PMO in terms of focus and value; not a bad picture.
After peeling the onion back and taking a second, more detailed look at the data, a quite different picture came into view. As shown in Figure 2.3, a further analysis of the answers to the survey questions revealed two distinct statistical modes. One of these groups we classified as business driven PMOs and the other we classified as theory driven PMOs.
The analysis of this simple survey was quite revealing and suggested that there were, in essence, two very distinct types of PMOs in terms of perceived focus and value; in subsequent telephone interviews with all the participants, this distinction further crystallized and manifested itself.
Of the business driven PMOs, these organizations were all driven by very clear mandates and these mandates were ensured by specific goals and objectives for which the PMO was held accountable. This was clear not to just the PMO but to those served by the PMO, as in most cases the mandate and objectives were set not by the PMO but by those served by the PMO. The top area of focus of the business driven PMOs was speed. When asked what speed was being referred to, such as the speed of selecting new projects, speed of project management activities, speed of delivering projects, speed of making decisions, and speed of identifying and resolving issues, the answer was yes to all the above. It was interesting that the PMO managers of the business driven PMOs gave themselves very modest grades (C+) while at the same time their immediate bosses, the CIOs, were extremely satisfied with the PMO and gave it high marks (A–). And neither the PMO managers nor the CIOs of the business driven PMOs felt that ever so recommended tactic and advice of Selling the PMO was needed and rated that as very unimportant.
(Continues…)
Excerpted from "Business Driven PMO Success Stories"
by .
Copyright © 2013 Mark Price Perry.
Excerpted by permission of J. Ross Publishing, Inc..
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.
Table of Contents
Dedication iii
Foreword ix
Acknowledgments xi
About the Author xiii
Contributors xv
Preface xvii
Introduction xxi
Web Added Value™ xxv
Part 1 Business Driven PMO Insights and Techniques 1
Section 1 PMO Mandate 3
Chapter 1 Why PMOs Fail 5
Chapter 2 PMO Survey Findings 11
Chapter 3 Project Management Community Mind-set All Wrong 21
Chapter 4 Case Study Example of PMO Failure 29
Chapter 5 Techniques for Establishing a PMO Mandate 41
Section 2 PMO Business Acumen 49
Chapter 6 Project Acumen 51
Chapter 7 Portfolio Acumen 63
Chapter 8 Dashboard Acumen 71
Chapter 9 Methodology Acumen 81
Chapter 10 Maturity Acumen 97
Section 3 PMO Future 113
Chapter 11 Perspectives on the PMO Domain 115
Chapter 12 Perspectives on PMO Manager Career Paths 123
Part 2 Business Driven PMO Success Stories 129
PMO Success Story #1 Strategic PMO at Greek Prime Minister's Office Panagiotis Agrapidis, Greece 131
PMO Success Story #2 e-Government Program Suhail AlAlmaee Mounes Rashid Shadid, Saudi Arabia 139
PMO Success Story #3 Thomson Reuters Aranzadi Juan Arraiza, Spain 147
PMO Success Story #4 British American Tobacco Marion Blake, United Kingdom 153
PMO Success Story #5 An American Benefits Administration Organization Harlan Bridges, United States 159
PMO Success Story #6 SIVECO Romania SA Jimmy Char, Romania 165
PMO Success Story #7 An American Insurance Company Luis Crespo, United States 175
PMO Success Story #8 International Facility Management Association Jennifer Drai, United States 183
PMO Success Story #9 A Global 10 Company and the Consolidated PMO Richard Eichen, United States 189
PMO Success Story #10 Dubai Roads & Transport Authority Laila Faridoon, United Arab Emirates 197
PMO Success Story #11 Baker Hughes Incorporated Ricardo Ferrero, Spain Kathie Mitchell, Australia 205
PMO Success Story #12 Tryg Ole F. Holleufer, Denmark 217
PMO Success Story #13 A Nigerian Telecoms Company Henry Kazalma-Mantey, Nigeria 221
PMO Success Story #14 Tyco Flow Control Wai Mun Koo, Singapore 225
PMO Success Story #15 Ericsson Korea Project Office Yechie Labay, Korea 233
PMO Success Story #16 RACE Consulting LP Vanessa Matsas, Greece 239
PMO Success Story #17 A South African Financial Services Company Colin Anthony McCall-Peat, South Africa 251
PMO Success Story #18 ABS Nautical Systems Christopher McCourt, United States 257
PMO Success Story #19 ON Semiconductor Frank R. Myers, United States 263
PMO Success Story #20 Fujitsu Sweden John O'Neill, Sweden 271
PMO Success Story #21 National Insurance Company Frank Parth, United States 277
PMO Success Story #22 IBM Branch Office 120 Mark Price Perry, United States 283
PMO Success Story #23 ING Central and the Rest of Europe Henny Portman, Netherlands 289
PMO Success Story #24 Consulting for the Pharmaceutical Industry Patrick Richard, Canada 295
PMO Success Story #25 NAVMISSA Andrew Wilson Karen Krause, United States 299
PMO Success Story #26 A Global Software and Internet Protocol Networking Product and Service Provider Troy Youngnickel, Malaysia 305
PMO Success Story #27 PartnerRe Erhard Zingg Martin Kuepfer, Switzerland 313
Epilogue 321
Index 325