>> Control center PMO

From project manager to project architect

HAMBURG, 03.08.2022 – Project management offices (PMO) benefit from project architects.
And project architects also free project managers from having to "reinvent the wheel" on every project.
How project architects help companies achieve sustainable success ...

Current situation:
Projects are making an ever greater contribution to the success of companies. Many companies have therefore invested in expanding their project management expertise, for example by providing employees with appropriate training and certification, standardizing PM processes to a large extent, or developing IT systems that simplify the interlinked planning and control of projects. The existing organization is often expanded to include permanent functions such as Project Management Offices (PMO), which are integrated into both line and project work and provide targeted support for projects. The IT industry in particular should thus benefit from greater reliability and a higher degree of predictability in project implementation.

Yet despite all these structural and process measures, projects have often not become significantly more successful from the point of view of their clients. On the contrary: in an increasingly complex economic environment, the performance level of projects seems to stagnate.

What is the background?
In the past, the projects existing in the company were implemented at the discretion of the project manager based on his own methodology. Each project manager decides what is good and right and, above all, appropriate. With the unified approach after the establishment of a PMO, which is mainly concerned with the introduction of formalisms and methods, projects are treated equally. In addition, further formalisms are introduced to check interdependencies. In order to maintain the up-to-dateness of the documents, extensive documentation efforts are required. The additional workload leads to employee dissatisfaction. They complain about more work, more formalism, slower decisions, unproductive overtime. The result is a slowdown in development processes. In order to achieve the set goals, higher investments must now be made or a longer time-to-market must be planned. Project delays lead to delivery bottlenecks, additional payments, customer dissatisfaction and ultimately to high costs.

What are the causes?
This does not have to be the case. House of PM's experience from a variety of assignments both as a PM consultant and as an active project manager points to two structural causes:
- PMOs are often strongly implementation-oriented or
- are limited to the maintenance and management of the PM methodology and the PM toolbox.

They see themselves optionally as masters of standards and instruments, as quality controllers, as coaches, as the extended arm of controlling - but very rarely as a powerful element of an entrepreneurial decision-making and development process. Proportionality of means is often not taken into account. As a result, they are constantly forced to make their added value visible to management and to justify their role anew time and again.

There is another way:
Today, a modern PMO ensures that projects are done "right". At a time when human and intellectual resources are becoming increasingly scarce, while innovation cycles are accelerating and globalization is increasing, the company is challenged to select the "right projects" and thus make an important contribution to the return-oriented implementation of the corporate strategy. In addition to its previous tasks, the modern PMO is therefore increasingly becoming a "project architect".

This means:
- It allows you to decide which projects to set up from a variety of ideas.
• Es gibt zu einem frühen Zeitpunkt belastbare Abschätzungen über die voraussichtliche Projektdauer
und den benötigten Ressourcenaufwand ab.
• Es erhöht die Transparenz und Messbarkeit der Projektarbeit und ermöglicht so zeitnahes Eingreifen
in den Projektverlauf ebenso wie die fortlaufende Verbesserung des PM-Prozesses.

A more modern approach is the strategic and complexity-dependent prioritization and control of projects. Not all projects are carried out equally, but rather depending on their priority and complexity. In addition to prioritizing a project, the PMO does this by analyzing the organization's ability to manage complex projects.

It creates a PM benchmarking database:
Now, project managers are supported and relieved from the outset with the available, concentrated collective knowledge in planning, risk assessment and resource estimation. Less complex projects can be simplified, and projects with excessive complexity can even be cancelled altogether if necessary. In this way, projects are managed from the outset with the effort they deserve.

The right three service modules
The appropriate three service modulesIf a PMO is to contribute to the implementation of the strategy beyond its operational and methodological work, three service modules are particularly important:

Initial assessment of strategic "fit" of project ideas:
On the basis of 10 - 15 strategically relevant and weighted criteria, which can include classic aspects such as customers, costs and competition, but also company-specific factors such as regulatory framework conditions, securing ongoing business capability or the development of executives, the PMO provides an initial assessment of how strongly individual projects will support strategic goals such as "market position" or "profitability". This assessment is carried out by project managers, experts and key stakeholders; the management-oriented presentation takes the form of a portfolio, for example.

Fig. 1: Strategic evaluation of a portfolio of project ideas > Influence on profibility | Influence on market position

Organizational ability to implement the project:
As one of its core tasks, the PMO records and analyzes ongoing or completed projects with regard to the organization's ability to handle complex tasks. The analysis over 15 - 20 criteria results in a so-called "complexity score" for the company or for individual departments, which indicates up to which level of difficulty projects could be successfully carried out and from which point they overtaxed the organization's ability to successfully implement them.

By then having business specialists, PM experts, internal suppliers, executives, and possibly even external partners and customers make an assessment of the likely complexity of the project ideas selected as "in line with strategy," the PMO can make a significant contribution to prioritizing the projects from the outset and sharpening their focus or target formulation. In this way, the organization obtains an overview and a selection option at an early stage as to which projects make sense and are feasible at the given time.

Provide project planning parameters:
The data basis with which the PMO quantifies a company's accumulated project experience also serves to provide project managers with important planning information about the expected duration and budget to be allocated to their project right from the start. The project manager is relieved at this point; successful but also failed projects of the past are actively used to increase the company's collective knowledge of feasibility and risks; the project owners can consciously reduce the supposed complexity of their project at an early stage, for example by reducing the number of interfaces with external developers, installing a well-rehearsed project team or interpreting their own role in the steering committee more actively.

A PMO which, in addition to its traditional role, assumes the task of a "project architect" and is expected to make a visible contribution to the implementation of the corporate strategy on the basis of a sound knowledge of project success and failure factors, must be directly linked to the corporate management. The decision to give a PMO with previously limited and operationally focused tasks the mandate to fundamentally shape the decision-making process for future projects from the outset will inevitably lead to organizational tensions. But companies that weather the conflicts arising from such an expansion of the PMO's mandate and consistently focus on the measurability of project success have the prospect of a number of advantages:

- There will be fewer projects and less "reactive power" for vague ideas. Instead, the projects are better thought out and set up with a sense of proportion right from the start.

- There will be faster and clearer decisions about which projects to implement or stop, but most importantly: Which ideas, which sometimes sound good, are not even pursued and thus tie up energy, time and resources.

- There will be quickly accessible information on where to optimize one's own processes and projects - especially when the fastest improvement is to reduce complexity and increase clarity.

- Project managers - and this is an important aspect in terms of attracting and developing managers - are freed from having to "reinvent the wheel" on every project. The PMO provides them with an assessment from the outset of how long their project will take as currently defined, what risks they will face, and what strategic contribution is expected from the project.

The modern PMO leads to a more realistic assessment of the project potential right from the start. The individual project components can thus be coordinated more effectively. These analyses are very valuable for the company and provide invaluable added value.