The AtekPC Project Management Office

1.       What is the purpose and mission of a PMO?  The mission statement defines achievable and measurable objectives and identifies the responsibilities, and hence services, of the PMO.

The general purpose of a PMO was to realize the benefits that came from consistent project practices such as IT improvements in project performance, efficiency, and resource utilization to enterprise improvements in cost management and corporate capability to launch products.

At AtekPC, the current responsibilities of a PMO were limited to IT projects even though there were ongoing discussions about expanding its scope to an enterprise level PMO that would include business projects in the future. The specific duties of the PMO were typically divided into two categories: project-focused and enterprise-oriented. Project-focused responsibilities such as consulting, mentoring, and training were services that enabled the success of individual projects. On the other hand, enterprise responsibilities addressed services that might improve all projects such as portfolio management, PM standards, methods, and tools, and project performance archives. To that end, the PMO continued to build support from the functional areas and IT personnel involved in these projects.

2.       What are the main challenges and obstacles in implementing a PMO?  The governance model establishes the domain of control, its organizational level of accountability, and its authority.

In 2007, information systems projects were typically operational or maintenance efforts undertaken at the request of a particular functional area. They were generally small to medium-sized projects in terms of both size and duration, and they were managed informally without standardized practices.  The Director of Application Development stated “we had a lot of operational projects going on and a lot of enhancements going on, but we had very few enterprise applications going on. As we began to take a look at what we needed to do in the future, we realized that we had to really hone our skills to be able to move more aggressively and sure-footedly through projects and to be able to handle multiple projects at one time."

The changing environment that AtekPC faced created a number of challenges which they were planning to address with projects on a large and complex scale. The PMO was being introduced in order to provide standardization in managing these projects and to gain improvements in the planning and performance of the initiatives. Although AtekPC had undertaken a few large projections in the past that had employed some formal practices, these projects had not resulting in lasting formalization of practices.

One of the key challenges AtekPC faced is their distribution of IT projects to staff. IT projects were typically managed by adding PM responsibilities to one of the development staff who were assigned to specific functional areas. Lead Analysts assumed the role of project manager and supervised workgroups of analysts and programmers of varying skill levels, and they were responsible for satisfying the requests of the functional areas as well as the performance of their workgroups. The manager resolved any issues and conflicts, the request processed, executed, and delivered through the Lead Analyst. Project methods, documentation, practices, and tools were individualized by the Lead Analyst with little or no consistency across IT groups or business areas.

Although AtekPC thought this informal approach was benefit to their organization, not having consistency and standardization across IT groups and business areas could cause several internal conflicts within the organization. IT was viewed as a peripheral job function to the core business activities. As a result, IT had been seen as an order-taker, expected to provide service on demand. During the past decade, projects had become increasingly focused on operations and maintenance in an over-riding effort to improve efficiencies within the business functions. The development of cross-functional integration systems and the use of internet technologies were only two of many emerging needs as AtekPC struggled with radical changes in its industry and marketplace.

The new required projects were large and complex and they involved multiple functional areas and multiple technological areas unlike the narrow focused projects that were performed in the past. The demands of these new initiatives and projects were expected to overtax the current informal project management methods. However, implementing a PMO at AtekPC was itself a challenge which required skillful management to be successful. A difficult balance had to be maintained both between maintenance and new development as well as between resources that went into development activities versus resources that went into project management activities under the new PMO.

Another area of concern was where the responsibilities fell for the PMO. The specific duties of a PMO were typically divided into two categories: project-focused and enterprise-oriented. Project-focused responsibilities such as consulting, mentoring, and training were services that enabled the success of individual projects. Clarification of these project responsibilities of the PMO was continuously evolving at AtekPC. One of the major limitations of the PMO was the shortage of expert resources available to support these projects.

In the other category, enterprise responsibilities addressed services that might improve all projects such as portfolio management, PM standards, methods, and tools, and project performance archives. Enterprise-oriented responsibilities for the new PMO were slow to develop at AtekPC. The enterprise-focused services developed by Nelson’s PMO team were being well received. While progress in this area was constrained by the limited PMO resources, there was a clear agreement even at the CIO level that the PMO was responsible for establishing, publishing, and disseminating project practices, standards, and tools. On the other hand, portfolio management (the change from managing one-off projects to the establishment of techniques for managing continuous streams of projects) and archiving responsibilities (the establishment of archival records of projects for knowledge sharing) were not being addressed.

Another concern was the issue of authority. Strider decided that enforcement of these new project practices required formal authority, and he was prepared to provide that only when the PMO had proven itself to the business and IT. Due to the culture of AtekPC, support had to start from the top and not all of the senior staff was equally enthused about the PMO concept. In this case, authority was primarily being developed bottom-up through the value of the PMO services. Even this was limited to those functional areas and IT areas actively engaging the PMO. There was no current plan to enforce usage at the enterprise level.

 

3.       What structural and governance mechanisms are critical to effective PMO implementation?  The structural model determines its degree of centralization, staff allocations, and level of direct project management. 

At the one extreme, PMO-heavy was characterized by a full staff of project managers who assumed responsibility for the management of all IT projects. This model focused on the acquisition of project management experts, either from internal or external sources, and used these resources to manage projects under the direction of the PMO. In the extreme version of PMO-heavy, no project would operate outside the management and direct control of the PMO. At the other end of the spectrum, PMO-light was characterized by a minimal staff of experts who worked through internal project managers to perform the responsibilities of the PMO. This model focused on the development of the skills of internal project managers who were not formally connected with the PMO. In the extreme version of PMO-light, all projects operated outside of the PMO under existing organizational controls, and the ownership of projects resided within the functional area and IT group charged with execution of the project.

While Nelson was agreeable to working with a small team at the start, he felt that the delays from this approach might compromise their ability to provide PMO services and to demonstrate its worth to the functional areas of the business. However, he and the other managers recognized that resources were not free, and they had to come from someplace which meant reducing the capabilities of someone else’s work to advance his own. If he didn’t have constraints, he would prefer a team that consisted of project analyst and managers that could be new and as you go on, you could pull from the organization. In this approach the team would be getting a various range of experience and ability. Nelson felt there was not enough education about project management to know the difference between PMO light and PMO heavy. With these processes and procedures that we’re developing we’ll establish project planning, tracking, initiation, and closure. All the project managers will help get the IT house in order.

Gardner had the expectation that the PMO model would be more heavy than light. In his understanding the PMO would provide a project manager resource pool and use the “idea form” to capture new project requests. Gardner viewed the organization model as one where “they were moving from just helping us with methodology types of things to managing projects, they are thinking of a pool of project managers”.  Resources would be assigned in a matrix structure for the duration of the project where you would have one key manager working on your project.

On the other hand, Field recognized that the problem of a PMO-heavy structure was not only about IT staffing in bringing on project managers and analysts, it’s also the business resources. Today, we have line managers who are working on multiple projects in addition to their regular jobs, and they can’t take on any more. What really drives a lot of the projects in any company is the availability of the business resources to work on those projects. Having the business resources available is already becoming a problem for us. With a PMO-light we are lined up better with the business side in terms of the number of resources, and it’s a better balance.

With some functional areas in support, the PMO team continued their implementation efforts. As Nelson remarked, their advancement to date had been in “baby steps.” The frustration of such tedious progress tempted them to consider an alternative approach –- force the change with top-down mandates and hired experts. Several managers, including those directly involved with the PMO, recognized the need for a larger staff of experts to build standards and methods quickly, and they advocated a rapid, more resource intensive implementation strategy. Such an approach would allow the PMO to prove its value by actively managing more projects and helping AtekPC to achieve more consistent and better project performance. IT management was concerned that such an approach would fail because they couldn’t force radical change on AtekPC. Thus, the senior IT managers encouraged a slow, incremental strategy that would allow the PMO concept to prove it.

While not widely discussed, PMO governance has some importance. At present, there were no roadmaps or timelines for its maturation so there was no way to measure PMO performance other than through the subjective opinions of those involved. There was a sense that AtekPC would know whether the PMO was working if the projects were getting done and the company was getting what it needed. One worry of the companies is whether project management would slow down the company and they needed to prove the value. Given the approach of measuring PMO performance through subjective consensus and anecdotal data, the next governance issue was figuring out to whom was the PMO accountable. Currently reports are given Director Steinberg, but in theory he should not get the reports. Strider recognizes that the current governance model was only temporary, but explains that in order to get the PMO established, he needed to secure support from the planning office and the SVP to take to IT. AtekPC has not determined which department the PMO will be part of or be more of a hybrid.

4.       How much PM is enough PM?  How much PMO support is enough PMO support?  The cultural impact of the PMO on the organization is assessed by the receptivity to PM and the amount of organizational flux.

IT management realized that in the future they would depend on standards and consistent processes to manage their projects and drive them forward. Nonetheless, implementing a PMO in a non-PM environment was challenging because it went against the grain of the organizational culture. Many people within AtekPC viewed project management as just administrative overhead—something that would inevitably get in the way of doing “real work.” Field described the cultural challenge facing the new PMO:

“We are moving from a company that had really no formal project management to a company that would like to be very formal. We are going to be somewhere in the middle. We can’t be so rigid about project management. This culture is not going to let us do that. You have to mix the culture in with the methods and the processes, and now I even hear where the processes can’t be that rigid. If we go too rigid, it will fail. We have to be a little fluid and dynamic at times, and that upsets some PMO folks, but we have to do it that way here. To succeed we have to develop an organization that will be flexible and will be accurate in its reporting. So that’s my struggle -– having project management fit into a culture that is changing but is not quite over here yet.”

The forces opposing the PMO seemed overwhelming at times to those involved. Strider wondered how willing the IT organization itself was toward changing their processes and adapting to new project management practices as this was a key cultural issue. Many of the staff had little or no experience with formal project management practices. Very few knew how to use any of the software tools available such as Microsoft Project. In addition to these knowledge barriers, the informality of the current practices was seen as highly attractive by many. The IT staff also found the informality appealing since there was no cost tracking nor were any performance records kept on the projects. The functional areas were not accountable for measuring the benefits resulting from their projects, and the IT project staff was not working within an assigned project budget. Another source of resistance was the lack of understanding at all levels of the value of formal project management. Altogether these sources of resistance to a PMO created formidable cultural barriers to its success that management and the PMO team had to address.

The PMO implementation strategy at AtekPC was to work within the culture and to develop forces that would promote the PMO and overcome cultural resistance. Promotional forces included the mentoring, coaching, and training that were being provided by the PMO team. The company was clearly under pressure to change the way it did business, but there was no consensus among senior management concerning the degree to which the PMO was integral to the change process. The PMO had to become a part of the AtekPC culture and that requires small changes over a long period of time. If the PMO found itself fighting against the culture, it would definitely fit, so it was important to have the support needed for the PMO to succeed.

In Strider’s opinion it was too soon to apply formal authority without evidence of value and without more widespread support for the PMO concept. He believed that more buy-in was needed from the functional areas first. One of the chief cultural issues in his mind was how quickly the functional areas are willing to adapt to a more formal process. They would have to be willing to prioritize projects and make the tough choices and tradeoffs.

To compete in a changing industry in which consolidation was occurring, AtekPC had implemented a corporate Planning Office. Recognizing the role that IT would likely play in enabling AtekPC to respond to the industry pressures, the senior vice-president had supported the creation of a PMO within IT. The role of the PMO might be expanded to include non-IT projects if it proved to be successful. At the same time, there was a possibility that the PMO might fail due to the challenge of implementing such a measured and disciplined approach to projects in an environment where that was viewed as foreign to the culture.

Reflection

In class it was recommended to go with a PMO light for the short term and shift to a PMO heavy in the long term. In alignment with the recommendation, it’s also important to set milestones and hard deadlines for the organization to adhere to so that time, utilization, and efficiencies are being achieved. If you allow the company to slowly migrate with no end date, there is no confirmation that the migration will ever be successfully completed. There is also no way to accurately budget such a migration without having timelines of steps in place. 

Implementing a PMO structure would allow for improvements in cost management and the capability to launch additional products and services. One of the key benefits will be the standardization of many of the processes that can showcase to their vendors that there is structure and reliance in the AtekPC organization and that if you worked with one team, you would get the same quality as another team. 

Much of the conversation was around the culture of AtekPC. In many companies especially in large organizations, a culture switch can be initiated and carried out by the head of the company. There is something to valuing entrepreneurial spirit and having less structure, however this is a technology company. Although this could cause a shock to the company, a shock may be just what the company needs instead of employees relying on what they know and being comfortable. Where many job functions and processes would benefit from standardization and proper methodology. If senior management team begin to act in accordance to a culture shift than the rest of the organization should follow suit. AtekPC could benefit by giving employees incentives (i.e. bonuses) for implementing these changes by specific deadlines which can spur friendly competition or even new and improved ways of working that could tie in the current culture mixed with the new PMO structure in a hybrid capacity.