Table of Contents
As Varajão (2008) states projects can be found in almost every organization and industry in the world and have developed in maturity over the past decades (p. 10 - 11). The 8th Global Project Management Survey (2016) ordered by the Project Management Institute (PMI) identified that “fewer projects are being completed within budget or meeting original goals and business intent. More projects are actually failing and creating significant monetary loss for their organizations.” (p. 2). Further it states that “US$122 million wasted for every US$1 billion invested due to poor project performance” (p. 5) which represents a 12 percent increase to the previous year. This indicates that projects are not successfully delivering despite decades of maturing the profession.
To help manage projects better, many organizations have implemented one or more Project Management Offices (PMOs) over the past decade, attributing a variety of both operational and strategic roles to their PMOs (Dai. 2004. p. 523–532). Jones (2016) defines the PMO as “an organizational structure, based within the IT function, that provides support for projects within IT and often across the organization. It is a management structure aimed at ensuring project success, but does not necessarily deliver or execute projects directly” (p. 33). Essentially the PMO defines the standards for project management within the organization and provides support on Project Management Tools. It is usually headed by a senior Project Management practitioner.
The Global State of the PMO – An Analysis for 2015, a survey ordered by ESI International, states that around 74 % of surveyed companies claimed to have a PMO (p. 1). Lopez (2016) states that the existence of a PMO may have an impact on organizational performance but there is a disinterest by management teams across multiple industries (p. 1. To organizations the PMO is perceived of not delivering value).
Looking at these trends it is obvious that there is a problem in the delivery of projects. The implementation of a PMO was ought to help with project management success and ¾ of surveyed companies have establish such function within the business.
My research topic is to look into how a PMO function can help with successful project delivery and what PMO model in particular is proven to manifest. This study is important when considering the monetary loss of “US$122 million for every US$1 billion invested” (PMI. 2016. p. 5)
In total nine literature artefacts were analysed as part of this literature review. The purpose of the investigation is to understand what previous researchers have done and if a solution to my problem has already been found. It will also enable me to understand better how the problem has been approached by others and aid me in designing my own solution.
I started my research by searching the QUT library, Google Scholar, Gartner database, publications and papers published on the PMI website. I used Boolean strings to improve my search hits. The search is focused on PMO, how the function is perceived as a value add to organizations and gaps identified for improvement. I narrowed down my research area by defining project management methodology improvements and capability development as out of scope items. This will help me to focus my research efforts on a more specific problem.
I started with an initial review of all selected documents and made notes in a separate document based on the below criteria:
- Who is the author within the PMO industry?
- What is the literature about?
- Key findings that agree disagree with my research problem
- What gaps are identified that would require further research?
Different literature sources were sighted during the process:
- Industry surveys published by PMI and ESI
- Research studies in from of academic dissertations from Lopez
- Industry articles published by Gartner
- Position paper from Santos to gain an overview of the topic and find additional sources
- Industry books published by Taylor
I used the three pass method and speed reading techniques for some of the larger reviews. I sorted the resources according to results achieved and findings.
After my initial analysis, I summarized my findings in the next section.
PMI’s annual Global Project Management survey (2016) agrees that “PMOs play a crucial role in delivering organizational value” (p. 2) It suggests that organizations with a PMO that have a broader business-wide responsibility, such as the Enterprise Project Management Office (EPMO), are more successful in delivering projects. The responsibility of EPMOs is to align projects to corporate strategy and is not only limited to specific function of the business as in Information Technology (IT). It states that half of the organizations surveyed already have an EPMO function and “only 44 percent of those EPMOs are highly aligned to the organization’s strategy” (p. 12).
ESI International’s bi-annual survey (2016) also confirms that EPMOs “have gained the spotlight in recent years due to the increasing interest in portfolio management and the desire to see increased alignment between the organisation strategy and the programmes and projects that deliver the changes required to meet the strategic goals” (p. 3).
ESI states that one of the top challenges which their PMOs are facing in 2015 is resource management. This was not only limited to the ability to allocate resources to projects, but also the PMO members own skill set. For the first time it identified the lack of training and of skilled resources in Agile projects (p. 3). ESI International sees this as an opportunity for PMOs to play an essential role in developing this skill set of their project staff and closing the gap. It suggests that PMO staff should upskill on Agile methodologies in order to drive its adoption.
It further highlights the gap that the PMO needs to consider its own metric and measurement areas “to highlight its own effectiveness and successes rather than relying on measures which in reality are the responsibility of the project or programme manager (i.e., projects delivered on time, etc.)” (p. 15).
A study done on a much smaller scale by Lopez (2016) overall indicates that PMOs have proven a positive return on investment and have a positive impact on the organization’s success. One of the suggested improvements also included to develop performance metrics to measure the value of the PMO (p. 1).
Mieritz (2015) from Gartner also identified that “a lack of effective project management office (PMO) metrics undermines the PMO leadership's ability to communicate progress and success, and secure stakeholder buy-in” (p. 1). It recommends to build PMO metrics based on three categories: operational excellence, effectiveness, and people and skills. Further it states that the Gartner PPM research team noted a 30% increase in client interactions regarding PMO metrics in the first three quarters of 2015 compared with the same period in the previous year. This highlights to me that there is further research in PMO metrics could contribute new knowledge of potential value, however it does not really help with the increasing the success of project delivery.