Top 10 Reasons PMOs Fail

According to Project Management Institute’s (PMI), a Project Management Office (PMO) is a “management structure that standardizes the project-related governance processes and facilitates the sharing of resources, methodologies, tools, and techniques”. Alex Nelson, PMP shares with us how PMOs can look and act radically different from one organization to the next, but a well-run PMO of any flavor can deliver significant ROI for any organization. However, many PMOs do not deliver on that potential and produce less than optimal results. Below, we’ll explore the top 10 reasons PMOs fail and identify opportunities for overcoming those obstacles. ?

1. Lack of leadership support to promote organizational buy-in.

Without careful implementation and strong backing from leadership, even a well-structured and adequately resourced PMO will struggle to establish authority and foster buy-in within an organization. When this happens, any established biases or perceptions of the PMO are left to develop freely and the PMO may quickly be seen as a layer of bureaucracy or audit function instead of a value-added service within the organization. It is critically important for leadership to effectively articulate the PMO’s place and purpose within an organization, resource it effectively, and provide it the appropriate level of authority so that it can gain and maintain buy-in throughout the organization.

2. Selecting the wrong type of PMO for the organization.

Failure to select the PMO model that best aligns with the organization’s needs and project management maturity will cause foundational issues that derail a well-intended PMO. The PMI identifies three PMO types:

Supportive PMO: Supportive PMOs act as a repository to an organization’s projects. A Supportive PMO provides templates, best practices, training, and keeps track of lessons learned. Center of Excellence PMOs are a good example of a Supportive PMO. Supportive PMOs have a very low degree of control in projects and are best suited for organizations with a functional or weak matrix model .

????????? Controlling PMO: Controlling PMOs act as the auditor of the organization. A Controlling PMO checks whether organizational tools, processes, and standards are applied in projects. Controlling PMOs have a moderate degree of control in projects and are best suited for organizations with a balanced matrix model.

????????? Directive PMO: Directive PMOs manage and have a high degree of control in projects. Directive PMOs are best suited for organizations with a strong matrix model or in projectized organizations.

When establishing or realigning a PMO, it is important to select a model that aligns with the organizational model and matches the organization’s current project management maturity. As the organization’s project management maturity evolves, the type of PMO and its role within the organization may need to change too.

3. Poor placement of the PMO within the organization.

Failure to correctly position the PMO within the organization and with the appropriate reporting structure can undermine the value proposition of a PMO, and in some cases, can lead to multiple PMOs being chartered within the same organization. Below are several common placements within an organization:

????????? Business/Functional Unit: A PMO positioned within a specific business unit or functional department with oversight and influence mostly limited to that business unit or functional department.

IT PMO: A Business Unit PMO specifically positioned within an organization’s IT department with oversight and influence mostly limited to IT-based projects. An IT PMO typically operates with a set of standards, tools, templates, and processes that are more acutely aligned for delivering technical projects.

Enterprise PMO (EPMO): A PMO positioned to have the most oversight and influence within an organization and often reports directly to organizational leadership. An Enterprise PMO’s goal is strategic alignment by ensuring that the organization’s portfolio of projects and programs are synced to the organization’s strategic objectives. An Enterprise PMO is heavily involved in enterprise-wide governance as well as portfolio management, project prioritization, strategic planning, and alignment.

It is important to identify the goals and objectives of the PMO within the organization and then determine the organizational placement and reporting structure that puts the PMO in the best position to succeed. Often, the placement of the PMO within the organization should be influenced by the type of PMO selected for the organization.

4. Failure to identify and provide the right services and functions.

Failure to identify and provide the services and functions that would provide the most benefit to the organization is the root cause of many significant structural issues. Depending on the type and positioning of the PMO within the organization, there are several common services and functions that a PMO could provide to create its value proposition to the organization:

????????? Project Management: Most commonly, a PMO is well-suited to provide project management services and support to individual projects.

????????? Standards, Tools, & Templates: A PMO can provide standards, tools, and templates that help provide structured approaches to ways of working and consistent language for project stakeholders.

????????? Training & Support: A PMO can provide training and support to help grow project management competency around the organization to manage lower priority projects and initiatives that the PMO is unable to resource directly.

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?????????? Program Management: A PMO may have the skills and resources available to provide program management services to oversee a set of interrelated projects supporting a common objective.

????????? Portfolio Management: A PMO may have the skills and resources available to provide portfolio management services to manage the organization’s portfolio of projects and facilitate the related portfolio management processes to track and report out metrics, KPIs, and overall portfolio health.

????????? Project Prioritization: A PMO can establish and maintain a project prioritization methodology that iteratively evaluates new, pending, and queued projects against the criteria of the methodology to derive a priority score relative to other projects in the portfolio. It should be noted that project prioritization requires the implementation of portfolio management as a function.

????????? Resource Management: A PMO can support the organization’s ability to track and manage its allocation of resources to align resources with the right work at the right time. It should be noted that resource management functions best when coupled with portfolio management services.

????????? Strategic Planning: A PMO can support and facilitate strategic planning initiatives to help the organization articulate and track against strategic goals and objectives.

????????? Business Analysis: A PMO can provide business analysis services that can support the identification of business needs and determine the solutions to business problems in a variety of applications both within the parameters of a project and outside the confines of a project.

When selecting services to provide by a PMO, identify the current gaps within the organization that could be best served by standard functions the PMO could offer to ensure right-size fit. Based on those selections, ensure the PMO is effectively resourced to deliver those services and functions.? Selecting the appropriate portfolio of services based on organizational needs and available resources is critical to establishing the PMO as a value-add part of the organization.? Failure to meet the needs of the business can lead to a lack of trust in the PMO, decline in reputation, and could even put the future of the PMO at risk.

5. Inability to hire and develop a roster of talent that can deliver.

Failure to roster the resources necessary to effectively provide the PMO’s services and functions can erode the organization’s trust in the PMO and lead to a lack of utilization and adoption. While identifying the appropriate service offerings is a critical first step, a lack of resource competency or availability to deliver those services and functions can be crippling to a PMO. As methodologies and best practices continue to evolve, failure of the PMO to provide the necessary emphasis on training and development to align with those methodologies and best practices could have long-term ramifications on the PMO’s effectiveness in delivering its services. Ensure the right people are there to do the right job.

6. Inadequate tools and systems to support service delivery.

Failure to provide the tools and technology that give the PMO’s resources the ability to deliver the PMO’s services and functions efficiently and effectively could reduce its quality of services and, as a bi-product, lead to the build-out of labor-intensive workarounds. As best practices and approaches to project management evolve over time, iteratively assessing the fit of the tools and systems to ensure they support the delivery of the PMO’s services can provide significant ROI, increasing both the speed and quality of delivery of relevant content for the PMO and its customers.

7. Poor alignment of resources with the right projects and initiatives.

Failure to effectively manage PMO resources and align skills, competencies, and experience of those resources with the most valuable projects and initiatives of the organization can result in the delivery of the PMO’s services and functions on efforts that do not move the needle for the organization. When implemented and managed correctly, portfolio management and resource management should be synced with project prioritization to put the right people with the right skills on the right work at the right time.

8. Inability to establish and maintain high quality standardized templates.

Failure to establish and maintain templates that standardize and support the consistent delivery of quality services can lead to inconsistent outcomes on projects with PMO resources spending time and effort creating low quality one-offs or ad-hoc documents that miss the mark in delivering the information they are intended to provide. Additionally, the PMO’s customers experiencing the project lifecycle in largely different ways creates the unintended consequence of establishing perceptions of how project management, or other PMO services, look and feel. If the one-off or ad-hoc documents and deliverables create experiences that do not align with the PMO’s goals and expectations, it can become difficult to navigate the organization away from what has been done in the past. Take the time to identify the right templates to continuously deliver successful outcomes.

9. Inadequate focus on value delivery.

PMOs should be focused on delivering value to the organization through the successful delivery of the services and functions it provides. Rigidity to standards, processes, and procedures that do not create value-added benefit will quickly create distrust and potentially lead to avoidance. It is the PMOs role to build assessment of value into standard practices and to promote the value of the work the PMO engages in.? Ensure the PMO operates with this northern compass and has the flexibility to adapt and pivot as needed to drive value, not process.?

10. Failure to adapt and change.

All project managers serve as change leaders, so it is imperative that the PMO seeks to continuously improve and be willing to change and evolve. As the organization evolves, as project management methodologies evolve, failure for the PMO to adapt to the changing landscape will make the PMO less relevant within the organization and diminish the trust capital that has been established. PMOs must remain vigilant to stay on top of industry trends and be willing to adopt new methodologies, best practices, and approaches to continue playing a part in the success of the organization. ?

While there are many reasons PMOs fail, most can be traced back to these foundational and structural issues that minimize or negate the positive impact a PMO can have on the organization. Like any other successful team, a PMO needs to have the right support to be set up for sustainable success. When executed properly, a PMO can change the game for an organization and provide lasting impact to its people, culture, and bottom line.

Do these failure points sound familiar to you?? What pitfalls have you experienced that have destined an organization’s PMO for failure?