GUEST SPEAKER - CORINNE FORREST - PRESENTATION

Thank you all so much for coming.  I am grateful for the opportunity to share my experience, and at times my adventures, in EPM and to talk with you about your experiences with PMOs.

When WIT board member, Jenny Barbour, invited me to speak, I couldn’t help but say yes. I had some suggestions for what the topic might be:

My first suggestion was “Everything I know about EPM I learned from Jimmy Choos shoes”, she said “Yeah, yeah………..um, no”

So then I thought how about “Everything I know about managing difficult project managers I learned from hunting wild rhino”.  Jenny said “Have you recently had a stroke?”

I then figured that the topic “Everything I Know about IT I Learned from ''Elvira, Mistress of the Dark'' was probably off the table also.

Jenny had already used the clinching argument:  You get to speak to a group of women in IT whom have a keen interest in EPM & PMOs. 

So we settled on “Why you need a PMO & why you Need it now”.  A pretty good topic I thought although I was pretty disappointed not to talk about shoes and I’m sure you are too but we’re all women so we forbear.

Okay, before I start, I’d like to use today’s time as a way of exchanging information so I’m happy to take questions as we go along so please feel free to jump in at anytime.

I’m also taking questions on shoes.

All of us in business operate in an environment of increasing complexity and ambiguity.  Companies today face many conflicting priorities in remaining competitive and many challenges.

The pressure to deliver more with less, operate in direct relationship to customers and shareholders' needs, whilst staying flexible and adaptable to internal changes and market demands has created a need to find innovative approaches.

• Boards & the executive make commitments to deliver benefits through projects
• These commitments involve the translation of strategic objectives into outcomes
• Project investment or projects are the vehicle by which to achieve those outcomes
• These outcomes are typically articulated as project deliverables or benefits

How does, say, an IT manager stay connected to the business strategy, manage more projects with less staff and still provide responsive service to the business whilst the business environment, that IT supports, is changing rapidly?

In a recent survey conducted by KPMG across 600 organisations and 22 countries, it found that project commitments are up, with:

• 81% increase in projects
• 88% increase in project complexity
• 79% increase in project investment

They also observed increased interdependencies between projects and an increase in volume of cross-divisional initiatives.

These are substantial increases, and increases that might be argued are in addition to some of our day jobs, so effective & efficient management of projects becomes a key organisational capability and an imperative.

So, why do we need PMOs and why do we need them now?

Mark Jeffrey, Associate Professor of Technology at Kellogg Business School, a person who has done some really smashing work in EPM has been quoted as saying:

“Enterprise programme management is the act of connecting project delivery to strategic planning.  Few companies achieve this without a Programme Management Office.”

There’s much literature about & regrettably some consultants that make some quite lofty claims about what a PMO will deliver.

Sometimes, they’re unfortunately touted as the cure-all for many organisational ills but typically, they seek to answer the challenges presented by an ever increasing project load & greater expectations from project investment.

My experience in EPM is that, correctly configured and correctly run, PMOs are the true north for managing all project investment and all project activity.

There’s a caveat I’ll add here.  Implementation of PMOs is not to be underestimated.  They involve time, investment & commitment at the very highest levels and across the organisation, but given those factors what you can expect in broad terms is:

• An explicit link between project investment and strategy;
• To manage the project portfolio to ensure highest investment return;
• Precisely control the project environment - detailed project definition, planning and scheduling - so that you get compliance, precision & focus on project deliverables;
• Manage demand & resources across all project activity – pre-assesment: what are we getting ourselves in for before we undertake any investment in this project & do we have the capability & capacity to undertake this project;
• Assist in the choice of right projects, at the right time, for the right reasons – prioritisation model: we look specifically at whether this investment delivers on strategy and then how it rates against business imperatives and also how it rates against the project investments we’ve already made

In short, the key processes PMOs deliver are:

• enterprise-wide project definition, prioritisation and authorisation;
• resource capacity planning and allocation;
• enterprise-wide and project-specific communication, visibility and reporting;

So, how do you do that?  First, a look at what makes up the programme environment.

There are three levels in EPM:

Firstly, programme management:  provides the framework, models & processes that delivers total alignment.

Models are:

• Pre-Assessment & Demand Management
• Strategic Alignment
• Prioritisation
• Risk Management
• Benefits Realisation

All these models roll into a form of integrated governance that provides tight control of project investment, the benefits derived from the investment & drivers of equity, stakeholder, corporate & the business.

With these models, executives and senior managers are able to set strategy which is clearly translated into an actionable plan for their resources. As an aside, programme management models shouldn’t be confused with managing a programme of projects.

The second level is Portfolio Management. Portfolio Management provides an holistic view of your entire project investment.  It’s essentially a laundry list of all projects.

A strong portfolio management programme can:

• Cluster projects by characteristic and manage those clusters as programmes;
• Maximise value of project investments whilst minimising the risk;
• Improve communication and alignment between the project environments and the business;
• Encourage business leaders to think in terms of deliverables and be responsible for the return on projects;
• Allow planners to schedule resources more efficiently, even optimally;
• Reduce the number of redundant projects and make it easier to kill projects, especially for the right reasons.

The third level is project management.  Project management is concerned with project progression - how a project goes from start up & initiation through various phases & phase gate reviews into execution and onto closure. 

I’d like to put a semi-colon here and have a talk about where project management is heading. 

Project management in the business environment has evolved considerably in the past five or so years.  It is becoming more and more a profession, rapidly moving towards an institutionalised form of control with the inevitable measurement and accreditation of expert labour. 

This “professionalisation” of project management vouches for a project manager’s capabilities, experience and grasp of the project management knowledge base & helps to ensure they use the latest tasks, knowledge and skills in what is a rapidly evolving field.

Accreditation serves two purposes:

• Baseline for skills sets and experience in initiating, planning, executing, monitoring and controlling and closing processes
• Hiring against a particular project management methodology such a Prince 2. 

It also guards against what I heard once referred to as the “ITRF”: IT managers who for a variety of reasons have been disgorged from IT positions and have reinvented themselves as project managers.  As project management becomes more of a profession these PMs will be required to gain appropriate certification.

Often complex and sometimes chaotic, the project environment is no place for the timid. Rather, it is home to project managers who somehow routinely navigate changing schedules, budgets and scopes.

I’m sure we’ve all managed a variety of project managers, some excellent, some good and some not so good.

I look for these characteristics, amongst others, that define the proficient PM:

Implementing A PMO

So on to implementing a PMO. As I said before, PMOs are not to be undertaken lightly.  Whether you are building a PMO to support and enhance project management capabilities or to focus on strategic aspects of programme & portfolio Management, you will encounter implementation challenges and mixed results.

While the PMO can offer tremendous benefits and have strategic impact, the challenge is in the focus of the PMO and the way it’s implemented and sustained.

As a first step, ponder on these matters:

• How can you find innovative ways to build and sustain a PMO that can address the challenges and critical success factors to overcome the barriers?
• What organizational structures, functions, processes and practices will ensure success?
• How can you sell and demonstrate PMO value and Return on Investment (ROI) quickly to the executive and the business? How does the PMO tie into the efficient running of the business and what true value does it offer?

Some of the answer lies in taking a structured and controlled approach to the implementation.

Very quickly, because time is short:

Step 1: Assess your organisation's capabilities and challenges

• Define organisational challenges
• Organisation-specific vision for PMO, what type of PMO, bear in mind your building the PMO of the future so start where you mean to end
• “Projectise” the business plan, be clear on what’s BAU & what’s project, make assessments on current project investment, determine capability and capacity, use evidence-based approach to see how the project environment is functioning.

Step 2: Launch the PMO project

• Get executive commitment.  This is vital;
• Set staff expectations, be very clear about roles;
• Signal types of change to be expected, communicate the change in the form of value statements, let them know there will be challenges but balance this with the pay-off;
• Expect some resistance from project managers.  Project managers like order and discipline but they at times also resist change.  Bring them along on the development process.

Another voice of doom caveat here:

Overall, the view of PMOs is positive but the perceived value of the PMO has not improved.

• Lack of accountability for PMOs is an issue
• According to KPMG only 22% of companies measure their PMOs
• Only 17% align assessment with the project criteria.

Step 3: Analyse the detailed PMO requirements

• Prioritise requirementsprojects, capability void, capacity mismatch), be clear about greatest need (problematic projects, too many
• Which models are currently being used, how is the PMO currently structured. Make analyse current process – decide which to keep and which to discard or re-engineer.
• How the project environment is operating – most important to getting control quickly.

Step 4: Design the PMO model

• Stakeholder collaboration
• Defining programme organisation
• Realigning existing processes

This is the time when the pivotal role of the programme organisation and the mechanics of the PMO solution are penned.

There are two areas of focus in the design phase: improving or realigning existing processes and developing new processes based on PMO requirements.

Point-to-point processes may already exist that simply need to be redefined.

The goal is to define an organisation-wide solution that achieves total alignment, while taking advantage of an organisation's most successful capabilities and features.

The designed processes become the basis for PPM configuration.

The sophistication of planning and scheduling software has increased in conjunction with the increased complexity faced by organisations in meeting their objectives. One can make some educated decisions about which processes to allow the PPM tool to define, which need encoding into the software and which should be pre-defined.

Caution:  To make the most of the features of the more sophisticated software, the configuration of the software must be defined prior to any installation.

Key areas:

• define user access & roles
• define data structures and
• define business rules within the software.

Step 5: Build the PMO tools

This is the point at which the PMO software and systems are installed and tested. The configurations defined in the design step are built into the system. The build step concludes when the PMO processes and tools are fully designed, built and integrated.

Step 6: Validate the PMO solution

Selecting pilot projects

The best way to prove the concepts is to test drive them using a select set of projects. Working with a select set of projects provides an opportunity for the newly formed programme organisation staff to become familiar with their roles and responsibilities, while refining the PMO model

In determining which projects are suitable to pilot, consider two types:

• Project in chaos and requires recovery
• Simple quick win project

The drawback is that people may observe the inevitable success of the project and in turn question the role of the PMO model in the success.

Step 7: Implement PMO organisation-wide

The key to PMO implementation is compelling people to follow a structured process. This requires an executive commitment to communication and leadership. It also requires the right consultant.  They must know their stuff and be able to influence on all levels.

I make a lot of my income from fixing previous PMO implementation attempts.

Good PMOs are run as professional services practices.  This practice offers services to its valuable clients. Typically, these clients are:

• The executive – the models that assist the leadership team to make the best project investment decisions
• The business – delivering on deliverables and benefits
• Governance structure – providing facilitation and compliance within the programme and project framework
• Project environment – assisting project managers and teams to deliver both project deliverables and investment deliverables.

Overall, maturity and methodology provide plenty of opportunity for improvement and success.

What return can you expect from all this effort?

Before        

• Resource contention. Project-by-project view of resource requirements.
• Limited integration across projectsactivity or result..  Lack of enterprise-wide view of project investment,
• Unjustified, poorly scoped projects. Limited rigor in project assessment, waste of seed capital, lack of specificity in benefit description.
• Deliverable/technology focus.  Lack of equal emphasis on managing project progression.
• Poorly prescribed project management methodology.  Confusion between project management methodology and other development & implementation methodology.
• Improving project manager capability. Focus on capability fit, qualified or certified project staff.
• Poor compliance to project management methodology. …it’s more what you'd call "guidelines" than actual rules. Welcome aboard the Black Pearl… Captain Barbossa, Pirates of the Caribbean

Projects fail, run off the rails, implode with little advance warning.  

After

• Control of project investment.  Project return planned, optimised & tracked.
• Effective return on project resources.
• Project investment is explicitly tied to strategy. Framework & systematic approach to deliver on project investment decisions.
• Right projects, right reasons, right time.  Management of models that continually review new project investment and funding decisions against investment maps.
• Precise control of the project environment. Top-to-bottom alignment of all project activity. Good balance between project investment results & process focus. Central management function for all project activity.
• Skilled, qualified project staff.  Greater environment efficiencies from resources skilled in technical delivery & project progression.  Methodology “champions”.

Projects deliver on time, on budget, within scope with emphasis on quality & control.

Golden Rules

Some golden rules I’d like to finish with:

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