Viewing Posts by Mario Trentim
Digging Deeper into a PMO Implementation Plan
Categories:
PMO
Categories: PMO
| In my last post, we discussed the five basics of a PMO implementation plan. Here, I'll delve deeper into those five: 1. Current State Assessment When assessing the current state, it might be helpful to hire an external consultancy, as internal initiatives may lose momentum along the way. The people internal to an organization might not be able to ask the right questions or they might even resist due to a fear of change. An external consultancy can assist in overcoming political issues by adopting a structured approach. Usually, consultants force or drive change because that's what they are hired to do. In the end, a good diagnosis will point out issues and opportunities for improvement. 2. Future State Vision Based on the assessment, it is possible to design a future state vision, describing how projects, programs and portfolios should be managed in order to fulfill organizational needs. That's because when the current state is clearly understood, it is easy to compare to benchmarks. Consequently, the organization can realize what is missing or what is done but could be improved. Ultimately, the future state vision details exactly what the organization wants to become. 3. Gap Analysis The next step is to carry out a gap analysis by comparing the current state to the future vision. This analysis has to focus on three factors:
A successful gap analysis clearly identifies what is missing or what could be improved, prioritizing which features, processes and structure the PMO should have, according to effectiveness (cost x benefit), desirability (sponsorship; what the company want to implement) and feasibility (what is realistic and what is possible to do). We have to select and prioritize based on cultural and organizational feasibility, not only based on resources available. For example, imagine an organization wants to implement enterprise project management (EPM) software. There are plenty of options in the market. Some have fancy features and are more expensive. It might be desirable to have top-notch software, so we won't have to substitute or upgrade it for years. However, it is effective to choose software that offers the simplest solution and satisfies future state needs. Finally, it might be feasible to start with familiar software to overcome people's resistance and rejection to the PMO implementation. In this particular case, project professionals might desire the best EPM in the world (desirability) -- but the company could do well with a free version or simpler software (effectiveness). Finally, considering that people unfamiliar with project management practices will have to use the software, it might make sense to get something familiar or similar to other software they already use (feasibility). 4. Implementation Strategy After the gap analysis, introduce stakeholder requirements to define the implementation strategy. I recommend thinking of the PMO like a new business unit or a small new company. The PMO should have its own mission, vision and goals. We have to identify who are its stakeholders and customers, so we can define its value proposition and its services. Personally, I use the Business Model Generation canvas to do that. The implementation strategy defines the approach to implement a PMO, major expected results and the overall framework, considering organizational strategy and corporate project management governance. Consequently, the PMO business model must support and enhance strategic alignment by selecting, prioritizing and managing portfolios of projects that sustain and boost organizational strategy. 5. Implementation Plan Finally, the implementation plan is the detailed project management plan for implementing the PMO. While the implementation strategy is the approach chosen to implement the PMO, the implementation plan puts that strategy into action. We start by defining its scope and work breakdown structure. Then we create a schedule of tasks to deliver the project scope. Resource needs are identified and a budget is set. Other subsidiary plans are created to manage integration, scope, time, cost, quality, communications, human resources, risks, procurement and stakeholders. The implementation plan should be as detailed as you need. I want to emphasize the importance of defining a business model for your PMO, allowing for performance measurement and improvement after the implementation. In my next post, I'll provide a framework for sustaining and improving your PMO, once it is set up and running. Do you have any tips or examples of PMO implementation plans? For more on PMOs, check out the PMI® Thought Leadership Series: Strategic Initiative Management - The PMO Imperative. |
Five Basics of a PMO Implementation Plan
Categories:
PMO
Categories: PMO
| I often say that establishing a project management office (PMO) is not for the faint of heart. It is a very difficult endeavor -- not just because it involves advanced knowledge, but also because it challenges status quo in the organization. In my previous post, we discussed The Must-Haves of Establishing a PMO. Now we are going one step further by laying out an implementation plan. Implementing a PMO involves five basic -- but essential -- sets of decisions: 1. Current State Assessment
2. Future State Vision
3. Gap Analysis
4. Implementation Strategy
5. Implementation Plan
Not following these steps can result in serious problems. For example, if we don't conduct a gap analysis, we will probably end up with an unfeasible plan, disconnected from reality. I once participated in a PMO implementation that was doomed to fail under the original plan. The future state vision was nearly impossible to reach, considering the current state of the organization. While conducting the gap analysis, it became clear that we should lower our expectations to implement that PMO. In that particular case, it was necessary to implement a rudimentary PMO to kick-start a cultural change to embrace project management. That was the chosen implementation strategy, which led to a feasible implementation plan supported by key stakeholders. In my next post, we'll dive deeper into these five steps with best practices and examples on how to carry them out. What other questions do you think are helpful to ask of your organization when building a PMO implementation plan? For more on PMOs, check out the PMI® Thought Leadership Series: Strategic Initiative Management - The PMO Imperative:
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The Must-Haves of Establishing a PMO
Categories:
PMO
Categories: PMO
| Seventy percent of organizations had a project management office (PMO) in 2013, according to PMI's Pulse of the Professionâ„¢ In-Depth Report: The Impact of PMOs on Strategy Implementation. That compares to 61 percent in 2006. Despite the increasing number of PMOs, many of them still fail. The first step in effectively establishing a PMO is figuring out if your organization even needs one. Only then can you ask, How can we establish one successfully? Part of determining if a PMO would be a good fit for your organization is knowing what a PMO's functions are. A PMO is an organizational structure, like a department or group, responsible for helping the enterprise achieve its strategic goals through effective project management results. Therefore, a PMO usually delivers three main objectives:
Obviously, implementing and sustaining a PMO is not cheap. Usually, there is some capital investment in setting up a PMO, particularly because it will add management overhead in addition to existing projects' costs. For a company whose core business involves only a few projects, if any, it might not make sense to implement a PMO. And while there's no formula to determine when organizations need a PMO, most do when they have:
So let's say it's been determined that your company needs a PMO. How do you lay the foundation to establish it effectively? First, it is important to know that there are different types of PMOs. These include but are not limited to:
Keep in mind that implementing a PMO involves a lot of change management, because it entails a new organizational structure, which affects the balance of power and culture in an organization. I recommend organizations invest more in change management tools or talent. Finally, to tailor the best PMO for your organization from the start, I recommend following these key steps:
In my next post, I'll outline a plan to implement a PMO. We will also talk about maintaining a PMO and continuous improvement to keep it sustainable. Do you have advice for determining if your organization needs a PMO or basic tips for establishing a strong, sustainable PMO? |
Embedding Portfolio Management Through Effective Communications
| Despite uncertainties in today's economic environment, organizations remain under pressure to successfully execute business strategies. These challenging conditions demand that organizations innovate and gain an advantage through projects. Yet launching a bunch of projects won't save the day. We need solid portfolio management to enable that competitive edge. It's not just about software, methodology and frameworks, after all. To perform well, portfolio management requires a cultural change and solid communications within an organization. And yet, we still suffer due to poor communications. Many companies, for instance, invest significant effort and capital on projects and programs that do not directly align with corporate objectives because those goals are poorly communicated. Meanwhile, others struggle to balance risk and fail to seize opportunities because of ineffective communications that do not support informed decision-making. For example, I worked on a project of high complexity that had huge technical challenges. These challenges could have been better addressed if there had been more communication among different research teams in our organization. The payoff to investing in project communications can be substantial, as many studies -- such as a recent one from PMI -- point out. Companies that excel at portfolio management are able to complete projects on time and under budget, increasing ROI and other benefits. But how do we consistently communicate the portfolio management strategy, policies, governance and benefits throughout the organization?
I'm a firm believer that the role of communications is to ensure that portfolio management is embedded in the corporate culture. What do you think is the role of communications in a portfolio? |
The Secrets to Managing an Innovation Portfolio
Categories:
Portfolio Management
Categories: Portfolio Management
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Managing a portfolio of innovation projects is very different from traditional portfolio management. Innovation projects hold more uncertainty. It is usually difficult, if not impossible, to provide good estimates and a detailed project plan. And while most organizations care about managing the development of marketable new ideas, few really know how to foster them for business results. The first step to managing a portfolio is determining the role and ROI of innovation in a business environment. Innovation, in essence, has to bring tangible results and a competitive advantage to the organization by generating new revenue, reducing costs, improving asset management and increasing reputation. To achieve these goals, innovation portfolios aim for steady innovation flux, or a constant pipeline of new ideas, for a sustainable competitive advantage. That requires balancing short- and long-term benefits and costs of the following:
For example, it would be shortsighted to generate only incremental innovation; in the long-term, there will be no breakthroughs. However, incremental innovation brings short-term revenue, which is important to keep the company going. Basis and radical innovation generate new products, but require significant time and effort. A good portfolio balance mixes incremental, basis and radical innovation projects in a way that best fits the organization. Another important aspect of managing an innovation portfolio is selecting the right ideas. Selection is particularly crucial to innovation projects because of the commitment to a long-term "technology roadmap" (i.e., if you choose to invest in Blu-ray products, that means you have a Blu-ray portfolio). Investing in the wrong technology can put an organization in financial jeopardy. Complexity is also greater because you're creating something new and without precedent. So the challenge is choosing projects that support the organization's long-term objectives while still considering these aspects. In summary, innovation portfolios need different selection and prioritization criteria. Here are suggested criteria, ranked from most to least important:
The criteria above are mainly qualitative, so you should also use an enterprise-wide scale for grading each project's potential to generate innovation:
After selecting your innovation projects by balancing the above criteria, tailor key performance indicators. Here again, KPIs will differ from a more traditional portfolio. Some I have used in the past include:
Does your organization have research, development and innovation projects? Do you use an innovation portfolio? How are they managed? Share your thoughts below along with your Twitter handle, and Voices on Project Management will publish the best response as a blog post. |
