Driving IT Projects: The Value of the Project Management Officer

The establishment of a project management office can help organizations integrate IT with business strategies by facilitating standardization and encouraging collaboration between various stakeholders.  

A November 2023 Capterra study of 400 project managers at US-based businesses found a formal PMO significantly enhances project management quality, with 60% of project managers surveyed affirming its value. 

Among those project managers, more than two-thirds (67%) reported having a formal project management officer (PMO), while an additional 18% have an informal one. 

The traditional PMO typically sets the policies and procedures for project management along with performing issue escalation/resolution, resource management, and ensuring strategic alignment with the overall business goals and objectives. 

The report noted companies lacking a PMO are five times more likely to have minimally informed project sponsors and more than twice as likely to encounter project delays exceeding one month. 

“We’re seeing a shift away from a strict focus on rule setting and prescriptive processes and starting to see more PMOs acting as a strategic partner to the business, providing more leadership, guidance, and soft skills-based support to project leaders and teams,” says Olivia Montgomery, associate principal analyst at Capterra, in an email interview.  

Related:Time to Turn Project Management into Product Management?

As project management software continues to improve, PMOs can evolve to focus on being strategic partners to executive, IT, and operations leaders. 

PMOs: Keeping it all Together   

In a business with a formal PMO, project teams would know the processes and have the tools needed for each phase of the project and each project could be properly staffed. 

From standardized status updates to an issue escalation path, the PMs would have the guidance and support to provide clear, regular communication with all stakeholders. 

This increased level of predictable engagement supports timely decision-making, reduces the likelihood of misunderstandings, and fosters a collaborative environment. 

“People like to have clear and standardized information, and a PMO helps ensure this happens,” Montgomery says.  

A business without a formal PMO would likely struggle to provide standardized, clear information across stakeholders, leading to miscommunications, missed expectations, and increased instances of rework. 

As a result, stakeholders would be less engaged and more likely to skip meetings and/or miss important emails, delaying decision-making and ultimately impacting project timelines. 

Related:How to Set Realistic IT Project Deadlines

Tina Goulbourne, chief operating and customer officer at Vena, says a formal PMO demands the attention of key stakeholders. 

“They make key projects a priority for all involved by setting up an appropriate meeting cadence to keep everyone informed as to project status, to ensure roadblocks are addressed quickly,” she explains in an email interview. 

When this structure is missing, individual PMs may struggle to get the visibility needed because they cannot connect high enough in the organization, and the project may languish. 

Goulbourne says great PMO teams leverage consistent templates and tools to communicate timelines, dependencies, resources required, and roadblocks to the executive sponsor or leadership team and all those involved in the project. 

“They hold everyone accountable -- project participants and stakeholders alike -- to keeping the project on track,” she says. “They also help balance the critical dimensions of speed, quality, and cost both within a single project and across a portfolio of projects.” 

Establishing the PMO  

Montgomery points out a PMO can look very different depending on a company’s size, complexity, and resource availability. 

At the minimum, the core collaborators for a PMO require an executive leadership that champions the PMO and provides authority and strategic direction, a portfolio/PMO lead and project manager(s) and a functional manager who agrees to use the PMO for their projects. 

Related:Digital Transformation: What Should be Next on Your Agenda?

“Human resources, who play the role supporter and guides talent acquisition and training, as well as IT resources should also be included,” she says.  

Goulbourne advises the time to implement a PMO is when you start to realize that the cost of having one is less than the cost of not having one. 

This could be when projects are not getting over the finish line fast enough, when cost overruns are happening with greater frequency, or the quality of the final project deliverable is deteriorating. 

“You should resist the urge to bloat your PMO team and believe that you need a project manager for every project,” she says. 

Consider the size of the PMO relative to the number of large and/or complex cross-functional projects the organization has the capacity to implement in a year. 

“An organization can only absorb a certain amount of transformational change each year,” she adds. 

The key collaborators could include any team in your organization that leverages project managers to get work done, such as operations, product management, and professional services. 

“Bringing these individuals together to standardize on the best templates and tools, and understand the specific challenges faced by your organization's project managers will help you determine where to start,” Goulbourne says.  

Montgomery said to best work together to establish a PMO, workshops with these core collaborators can be used to establish the PMO’s design, implementation strategies, and guardrails. 

“By fostering a collaborative and inclusive approach, businesses can leverage the collective expertise, insights, and support of key collaborators to establish a custom PMO that meets their needs,” she explains.