The True Role of the PMO

 

Identifying and articulating the most appropriate role of the Project Management Office has proven to be difficult in the extreme, and the pursuit of this goal has become epistemologically messy, also in the extreme. The practitioners and teachers of project management feel strongly, passionately about their profession, and, in my experience, experience much frustration from the fact that the loudest voices in the management sciences often give short shrift to PM’s advantages and, by extension, the practitioners’ professional worth. This has led to many project management theories being marketed far beyond their capacity for returning relevant information or economic behaviors which, in turn, provide fuel for those opposed to doing project management right, when they correctly point out the overreach. The risk management types represent a classic example of this taking of an invalid theory and advancing it to its absurd lengths, and thereby making the rest of us look like doofuses.

Of course, should the most appropriate role of the PMO actually be captured and articulated, it follows that it could be quantified, and that would represent the brass ring of PM. No more eat-your-peas-style hectoring to get your PMO funded, no siree! The erstwhile PMO directors could present irrefutable analysis that demonstrated to even the most suspender-clad asset manager (read: accountant) that a stubborn refusal to pursue excellence in project management has directly traceable and cataclysmic consequences, to the tune of X dollars per year. As long as the PMO’s budget is less than X, the massive conflict that has afflicted project management types from the beginning of the PM struggle would simply evaporate, having been settled in our favor. Within management science, and by extension the macro-organization, peace would reign at last, and we could get up off of our knees and cease our begging for monthly status. Project management nirvana!

Unfortunately, the Project Management Institute® attempted such a quantification with a slew of books that tried to provide the framework for an organization to compute its PMO’s – wait for it! – Return on Investment. I kid you not. In trying to justify what is, in essence, their raison de etre’, they actually reached back to the accountants’ bag of tricks in order to produce a hard number that would validate the PMO’s creation and support.  Sadly, even when used on an asset (rather than a capability), the formula for computing an ROI is so fraught with either poorly quantified or even unknowable parameters that its returned value is next to meaningless. And yet, the accountants love it, and even PMI® was led to resorting to its use. Amazing.

No, the only way – and I do mean only way – to capture the PMO’s role in the macro organization, as well as in management science in general, is to realize that project and asset management are not variations within the same management science meme. They are different utterly: they pursue different goals, with different tools. As I have often taken them to task in this space previously, the asset managers seek to maximize shareholder wealth. So taken are they with this little axiom that they have convinced themselves that any disagreement with it represents profound backwardness in the management sciences. Nevermind that the Tom Peters of this world mock them to their faces over the over-acceptance of their goal – they will never abandon it. Then along comes the project managers, who dare to say that the pursuit of the customers’ goals with respect to scope, cost, and schedule ought to at least have a place at the decision-makers table, and the asset managers have a collective conniption fit. But it is undeniably true that PM should have a role in providing the decision-makers’ information stream, even as the asset managers see their influence wane.

As I discuss in my must-have second book, Game Theory in Management, there is a third element that must come into play: strategic management. Asset, project, and strategic management represent the triad of management science groupings that provide the only known structure for assessing the benefit of establishing the information streams that can even allow an evaluation of the PMO’s value and role. The organization that is informed of its position relative to its assets, customers, and competition performance is in a place to provide its decision-makers with the information they need to make the correct choices. And the organization that makes the better choices will overcome its competitors every time.

Without a feed from each of the three management science types, the decision-makers are just shooting in the dark. And probably missing.