Can PMOs and Centers of Excellence Coexist?

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Categories: Best Practices, PMOs


Project Management Centers of Excellence (PMCOE) are becoming increasingly popular as a solution for organizations to streamline their processes while increasing efficiency, profit and competitiveness.

Generally, a Center Of Excellence (COE) is a business unit that has organization-wide authority. It coordinates continuous improvement initiatives, ensures that value is achieved in all areas, and fulfils the role of organizational thought-leader or consultant.

COEs are also created to capture an organization's best practices, standards and industry benchmarks. The COE facilitates the approval, transfer and integration of these best practices across the organization. For example, in a global manufacturing company, the COE may identify a best practice used in its European plant, tweak it, and implement the practice in its Saudi plant, too.  

There seems to be confusion between the roles of a Project Management Office (PMO) and a PMCOE. Some argue that the PMO sufficiently leads the organization to project management excellence. So, why would an organization with a well-structured PMO need a PMCOE?

In his book, Advanced Project Management: Best Practices on Implementation, Second Edition, project management expert Dr. Harold Kerzner states:

"The definition of project management excellence must extend well beyond experience and success ... Success is measured by having achieved performance that is in the best interest of the whole company, as well as having completed a specific project."

PMOs and COEs are only successful when they achieve the objectives for which they are created. Leaders in the profession note that the number of projects or years an organization has been delivering projects can't define project management excellence. Neither can the methodology it follows.

Larger, complex organizations may need a PMO and a PMCOE -- but their roles should be clearly defined.

A PMO is an important central hub with a mandate to coordinate and deliver all project activities as determined by the organization's needs.

PMCOE executives would operate as part of the business decision-making process. These individuals would report on the organization's project portfolio as a whole and provide the organization with project consultancy.

The PMCOE also supports the PMO through research, innovation and leadership initiatives and bridges the gap between PMO teams and business units within the organization.

What do you think? Are PMO's and COE's the same? Is a PMCOE just a glorified PMO? Have you come across a PMO and PMCOE in the same organization? Is there clear role differentiation?
Posted by Saira Karim on: September 20, 2011 01:27 PM | Permalink

Comments

Mohamed Badie
They are different in core functionality. A PMO can exist with a COE. Majority of enterprises lack the proper vision concerning how they would manage their Program (could be related or unrelated projects), departing from which a misleading concept overlaps PMOs with PMCOE functionality.

There is a huge difference between Program and Portfolio Management, i.e. a proper methodology to prioritize future and current projects against strategic business objectives, and being an administrative supporting body for ongoing projects hence, PMO.



Mounir Ajam
Hi Saira,

Is not what you call a PMCOE is another name for Enterprise PMO or Corporate PMO? I do not see the difference between the two except reading between the lines it seems that you put the PMCOE in charge of organizational performance and if this is the case then what is the role of the PMO, reporting?

The following is a link to a post I wrote about PMOs. I discuss that there different type of PMOs, so in my view, a PMCOE is just another name for a PMO. Link to my article: http://wp.me/p1DbYP-3l

Ralf Finchett
Yes and No... in that order.
Can PMO's and CoE co-exist, Yes they can. Have I ever seen it work, No!

I think the reason behind the co-exist is they must be merged into one, otherwise you would have to be very precise with the objectives and more importantly, the KPI's (Key Performance Indicators) of each unit.

I have worked with a CoE in a consulting role, and because they had no KPI's, all they did was wait to be asked about project management best practices (probably the easiest role in the organisation).

If the CoE had been targeted on say improving the organisation maturity, and this was independently measured each year, I'm sure the work ethic in the unit would have been very different.

Ron Goris
I believe there is not only value in organizations having some form of PMO but also a PMCOE. However, do they need to be two distinct units or groups within an organization? I think this really depends on the organization itself and how it wishes to address the the value propositions presented by each.

As mentioned in your post ("Can PMOs and Centers of Excellence Coexist?") a key element will be how each is defined, and what the scope of their services, roles and responsibilities are.

If, due to company size and/or complexity, the decision to create a single, all encompassing function/service or to separate into discrete, focused, and specialized units, one of the key considerations needs to be how they will work together, in conjunction with the business units, to deliver value-added, complimentary services.

This is not a decision that can be made lightly or without due consideration. Whatever decision is made all parties must also understand and agree that this will be a journey and not a destination.

The development and maturation of the respective units and/or disciplines will need to grow and change over time while constantly assessing and demonstrating value to not only management but the practisioners as well. This includes Project Managers, project team members, stakeholders and business leaders. Be prepared to make risk-appropriate decisions and be ready to benefit from both successes as well as failures along the road.

Finding the right mix of value-added improvements covering all areas (people, process, and technology) that can be implemented within a reasonable and defined timeline, accompanied with the appropriate level of metrics and measurements to demonstrate value-add to concerned/affected parties will be a challenge but worthwhile for those organizations with the foresight and commitment to see it through.

What you need to ask yourselves is "Are you up to the challenge?".

Cheers,

Ron Goris.


Randy Tangco
When a PMO is being formed, I believe one of the objectives should be to become the center of excellence of the organization for PM practices.

This way you add more value to the PMO. Many PMOs simply implement process and tools and forget that part of its duty is really to be the advocate of project management best practices.

Saira Karim
Thank you for your comments. This is an interesting ongoing debate I am having. I am tending to agree that there is a difference between the two.

Most definitely considerations such as clear roles, KPI's and value added improvements separate from the PMO may be challenging. I feel in our region PMO's do not always have maturity and authority and tend to be administrative and reporting bodies.

So Mounir, I agree it doesn't need to be a PMCOE but there is a need for a separate executive level, leading type of body for project management in these instances. What do you think?

Saira

Byron Shafer
A COE as you define it, "a business unit that has organization-wide authority" would essentially operate as a Six Sigma style oversight group in the company, while a PMO group, and by extension a PMOCOE would be a business unit specific group or Line operation.

Where the two might meet for common cause is when the COE identifies a process that needs to be addressed, and perhaps is not being addressed by a business unit, or perhaps it is a process that spans many different lines of business and line managers from the PMO are drafted as Green Belts to participate in a project initiated by the COE.

Ron Goris
Saira,
I agree that a PMO and a PMCoE can be two completely different functions within a given organization. I believe it depends, as you said, on how these functions are defined within the context of the organization. In smaller companies you could have a single entity that satisfies some of the functions of each while delivering/demonstrating value to the organization.

In my opinion it all comes back to the needs of the organization, their level of maturity, their commitment to ongoing improvement, and the long-term vision of leadership. Do you have a good understanding of not only your current capabilities but what the business feels is important? Is this reflected in the ongoing delivery, assessment and improvement of these services based on hard data from not only those utilizing these services but also the business leaders? If not, whether these are separate or combined functions is immaterial.

So how (and when) do you assess the ongoing viability of these capabilities? How do you keep senior management convinced of the ongoing need for these functions within the organization even when project execution and delivery maturity has attained the level required? Or is this really somewhat of a moot point since many organizations are still trying to attain that level of mastery (as well as demonstrating that they can maintain it for a period of time)?

What do you think? What have your experiences been?

- Ron Goris.

Peter Taylor
An interesting article and discussion.

I would say that, based on my own experience, that both can coexist with perfect synergy.

In my own PMO at a previous company the PMO encompassed all of the project management community and activity within Europe. But within that PMO there was effectively a centre of excellence in a core team of highly experienced project managers who focused very much on capturing our best practices, standards and industry benchmarks - along with other work as well.

It all depends on the type and model of PMO you are building.

Peter
'The Lazy Project Manager'

Faisal Rathoor
PM COE is a maturity level. The CoE is the peak of the maturity its not by any means different from PMO.

Mounir Ajam
Saira
I still do not see the difference except in naming.

Some of what i read below is that a PMCOE is a PMO at the strategic level.

I agree with Faisal that PM COE is a level of maturity - possibly achieved by few organizations. So a PM function in any organization (whether we call PMO, PM Department) should seek excellence in their work --- assuming the organizational culture seek excellence.

Otherwise, I am afraid that the concept of PM COE is another gimmick to sell to executives since a COE is more "sexy" than a PMO; especially with PMO failures being common.


Chris Field
I fear that to create two organisations within an enterprise with very similar goals and to call one a 'centre of excellence' will harm the brand of the other. Human beings are very simple creatures and in most cases I am sure that if the two organisations were to exist in the same ecosystem one would have an immediate advantage over the other. Surely the purpose of a PMO is also to encourage excellence - albeit within a given scope. To that end the term 'centre of excellence' is misleading should it coexist with the PMO. In fact I would encourage PMOs to consider rebranding themselves accordingly.

Janyce Kamahele
I think of Centers of Excellence as subject matter experts who may manage projects or pull in PMO assistance as needed (ex: digital marketing expertise). They may have the pulse of the market and best practices within it, providing consulting services to the business. It is easiest to see in non-technical COEs. Think of a department that sets best practices, develops training programs, and selects/evaluates print, storage and fulfillment suppliers, perhaps managing print production activities of the company. The same type of responsibilities could be applied to digital marketing or an IT department. PMO staff can be pulled in as needed, but we live in the project space rather than the ongoing management. Granted, the lines are not always clear but this is the general practice I see practiced in larger companies.

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