7 Critical Success Factors to Design Your PMO

Project Management Offices (PMOs) are highly beneficial tools for organizations managing a series of projects or programs that span over multiple years. With several initiatives on the go, a PMO can help owners manage their resources and successfully deliver various project types or goals. If you’re new to PMOs, our article Next Level Management: Why You Should Consider a PMO, offers an introduction to the approach and the management framework benefits it offers.

However, if you’ve already decided that a PMO is the right fit for your long-term project goals, your next step is to start designing your PMO framework. Designing a PMO is a lengthy process that can range from two to six months for the average organization, while more complex engagements can take up to a year. There’s a lot to consider when setting up a PMO, from internal capacity, investment budget, level of control and more.

Over the course of my career, I’ve come to specialize in helping public and private sector organizations across the United Arab Emirates and North America develop effective PMO frameworks that steer stakeholders towards successful project outcomes. Based on this experience, I’ve pulled together a list of seven essential steps to help you design a healthy, flexible, and sustainable project management framework.

Seven key steps to designing your PMO

No matter the type of projects you plan to take on, the following steps will help your organization establish a strong, functional PMO.

1. Establish a clear vision of your organizational structure
   It’s important to assess your existing organizational structure and clearly define the vertical and horizontal lines of communication. Organizations can accomplish this by reviewing their official documents, outlining how internal teams communicate with each other, identifying who is responsible for different types of decision-making, and establishing a clear chain of command. Updating your organizational structure and having a clear picture of how different departments and teams communicate helps lay the foundation for a strong and supportive PMO framework.
   
   
2. Identify a PMO sponsor
   It’s not uncommon to find some resistance to change within internal departments and teams. Changing company processes and protocols affects the way people work and employees often need time to adjust. The Project Management Institute defines a PMO sponsor as “an individual (often a manager or executive) with overall accountability for the project. [They are] primarily concerned with ensuring that the project delivered the agreed upon business benefits and act as the representative of the organization, playing a vital leadership role through a series of areas.” By identifying a single sponsor, employees have a resource they can contact to express their concerns and look to for guidance over the course of the PMO.
   
   
3. Align your PMO’s objectives with corporate policies
   Corporate policies are overarching existing procedures, processes or functions that should be followed. One of the most impactful to the PMO’s design is procurement policies. Many organizations, including governments, have strict procurement policies to ensure that there is a level of transparency and fairness when obtaining products or services from project managers, consultants, contractors, trades and other parties. When designing a PMO, corporate procurement policies will heavily influence your project management processes including how you plan, execute, and select proponents for a project. You’ll want to review any and all corporate procurement policies to ensure that your PMO’s processes align and compliment these policies without any contradictions.
   
   
4. Identify a level of control for your PMO
   Designing a PMO is an opportunity to develop a series of project controls that serve to maximize the efficiency of your program of work. Organizations can customize the level of control or influence they have over projects or programs of work. PMOs typically range across three levels of control: supportive, controlling and directive. A supportive PMO provides consultative advice to the organization on an as-required basis and exercises a low level of control over projects. A controlling PMO offers a moderate level of control and provides hands-on support in managing projects. This level of control enforces compliance across organizational practices and aims to promote the use of specific tools, templates and frameworks to govern projects. Lastly, a directive PMO holds a high degree of control, if not full control, over projects. Under a directive PMO, the PMO team directly manages all projects and assigned project managers. This level of control helps organizations achieve a very high level of consistency across projects due to its rigid structure.
   
   It’s important to define the level of control your organization requires during the design of your PMO framework. However, owners can adjust the level of control throughout the duration of the PMO to best meet capacity and/or the scope demands of individual projects.
   
   
5. Develop a robust PMO governance structure
   Identifying who is responsible for making decisions and how they’ll make them is critical to designing a successful PMO. Projects go through different stage gates that require organizations to make decisions regarding costs, design, schedules and more. Identifying a PMO governance structure or chain of command enables you to mitigate project risks and streamline decision-making and approvals processes to help keep your projects on time and on budget. Learn more about project governance and strategies to implement a governance structure in our Project Governance: A Roadmap to Mitigating Risk article.
   
   
6. Leave room for growth
   A PMO is a multi-year commitment. As projects progress and processes evolve, it’s important to ensure that your original PMO framework is adaptable to changing needs. PMOs find ways to improve project efficiency, and over time the processes and procedures will need to change to accommodate changes in governance or organizational objectives. Ensuring your PMO framework has room to grow is essential to its success. Start by incorporating processes and procedures that are brief, flexible and adaptable across a variety of projects. Avoid lengthy and overly prescriptive processes and procedures. As your PMO evolves, so can its functional tools. This allows project teams to draw on the framework and adapt its foundational elements to suit the task at hand. Additionally, a flexible PMO enables you and your project team to continuously build upon the framework and seek new or innovative ways to improve existing processes and procedures.
   
   
7. Check in and hold workshops regularly
   Once you’ve started your PMO design process, you’ll want to continue to meet with your PMO sponsor and stakeholders, as well as your PMO consultant on a regular basis and/or at critical decision-making points. Routinely scheduled check-ins and workshops ensure that your program of work is on track and allows you, as the owner, to engage in the design and continuous development of the PMO. Holding workshops enables organizations to define what success means and identify Key Performance Indicators (KPIs) that the PMO team can use to build, assess, and adjust the PMO framework to achieve success. Since PMOs change as organizations mature, these check-ins and workshops facilitate communication across all parties and project teams, and better accommodate the implementation of new or altered processes and procedures.

As I mentioned above, a PMO is a commitment. When designed and managed with care, it can be a wonderful tool for organizations to leverage throughout the delivery of a program of work. A PMO offers organizations the support they need to establish a high level of consistency, quality and performance in capital projects. Take the time to evaluate your capacity and don’t hesitate to draw on the support of an external PMO consultant to support your next endeavor.