From Projects to the PMO
The Project Management discipline may be considered formally started as a result of Scientific Management theories, with Henry Gantt and his famous activities chart being a popular reference. In the 1950s and the following decades, the USA military and some large corporations developed new mathematical models such as PERT (Program Evaluation and Review Technique) and CPM (Critical Path Method), and thus a more formal approach with tools and techniques was adopted.
For the second half of the twentieth century, markets and organizations evolved from mass production to a globalised environment with shorter product life cycles and shifting demands. Projects and teams became a common approach for management and organizations to have the needed flexibility to deliver goods and services. New organizational structures appeared, such as the projectized organizations, where the Project Manager (PM) has most authority and control over resources; and the matrix structure, which is a mix between functional and projectized structures. Project Management presence in organizations gained a lot of momentum in the 1990s, with professional associations and project management methodologies becoming main-stream and recognized industry standards. Some like the USA based Project Management Institute (PMI), Swiss based International Project Management Association (IPMA), and the UK’s Office of Government Commerce Projects In Controlled Environment 2 (PRINCE2) grew exponentially in members or followers.
In this scenario of more organizations working on more projects than before, projects have been having a growing impact on the organization’s business results. Organizations tend to take on projects as they see them as the correct approach to deliver some of their goods or services. However, projects generally underperform, with a large proportion not meeting the target dates, or costing more than budgeted, or delivering less than required or not as specified. Running projects in an organization presents a new challenge as to how organizations can improve the general poor project performance. If projects by definition are bounded by their particular or unique objectives, scope, resources and timeframe, can they be run as isolated isles of effort, or should projects be coordinated amongst themselves within the same company? How does each project relate to the host organization? How do projects share the common and limited resources in the organization? How do projects and the organization manage conflicts or differences between the projects? The need for a project management order and understanding, a coordination or standardization of the project management approach within the organization, saw the emergence of the Project Management Office (PMO)
The growing awareness of the PMO is evident in professional literature and amongst Project Manager Professionals. Software vendors have also noticed this trend and are offering multiple projects’ portfolio management tools for PMOs. There may be a general understanding that the PMO is concerned with the improvement of project management within the organization, through the setting of standards and methodology, reporting to senior management on status, risks and deviations, with the coordination of portfolios, or even directly managing large projects or programs. However, there seems to be no clear consensus. Only a few years ago, in the late 1990s, as IT professionals experienced their particular gold –Y2K- rush, PMOs were created with a focus on the coordination of the software development and methods for those Y2K IT projects. It has only been about 10 years since, and we have seen or heard of Project Offices, Program Offices, Program Management Offices, Centers of Excellence, Project Support Offices, and other similar names. Is there an answer for what the PMO is and what we should expect from it?
The objective of these pages is to understand more about the PMO, what it is, its functions, how it may evolve and be developed, and how it may deliver value to the business.