PMO Models

This week I responded to a question on a LinkedIn group, Certified Project, Program, and Portfolio Managers, “What are the main components of a good PMO?”  Obviously, there are several different models for a PMO, so I listed what I felt are the most common.  Now that I’ve had a couple of days to contemplate, I’d like to amplify a bit on these three models.

Center of Excellence:  All project managers are assigned to one organization, called the PMO. They use the same tools and practices, and are assigned to projects based on experience, availability, and problem domain knowledge.  In this approach, the PMO is a vehicle for delivering standard services to “subscribers,” who may be department managers or portfolio managers.  This is an excellent model for organizations that have mature project management processes, but won’t benefit from centralized governance of the project portfolio.  It has the side benefit of being a great way to establish a career path for project managers.

Center of Governance:  The project managers are assigned to different departments, and the PMO budgets, selects, and prioritizes projects and resources, conducts in-process “gate” reviews, assigns auditors, and otherwise oversees the projects as investments.  In this approach, the PMO is a vehicle for strategic decision making, and managing the project portfolio.  This is an excellent model for organizations that want centralized governance of the project portfolio and capital budget, but don’t feel the need to develop a great deal of internal capacity for project management.  It is also a great model for organizations that prefer to contract out for project labor.

Center of Administration:  The project managers are assigned to different departments, but the PMO provides administrative support, record keeping, and other services.  In this approach, the PMO is a vehicle for administrative compliance.  This is an excellent model for organizations that want to use very structured methodologies, or are required to maintain very specific, detailed records due to contractual or regulatory requirements.  This is a great model for organizations with a lot of “accidental project managers,” meaning those for whom project management is not a core competency or a career goal; it’s just something they ended up doing as part of their “regular” job.  It’s also great for highly regulated industries that are subject to a lot of audits.

The role of the PMO may change over time, as the needs of the organization or their relative maturity changes over time.  My company used the Center of Excellence model, and then changed to a Center of Governance model five years ago.  More recently, we’ve settled in somewhere between Center of Governance and Center of Administration.  The PMO should not be a rigid institution – it should be like a project, “A temporary endeavor undertaken to create a unique product, service, or result.”

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About Dave Gordon

Dave Gordon is a project manager with over twenty five years of experience in implementing human capital management and payroll systems, including SaaS solutions like Workday and premises-based ERP solutions like PeopleSoft and ADP Enterprise. He has an MS in IT with a concentration in project management, and a BS in Business. In addition to his articles and blog posts, he curates a weekly roundup of articles on project management, and he has authored or contributed to several books on project management.

4 thoughts on “PMO Models

  1. Dave, great summary of PMO models. I have a theory about PMOs that I’ve been trying to develop, but it hasn’t really congealed yet.

    Projects are, by definition, temporary activities. An organization is (an attempt at) a permanent organization. What is the nexus between these two? What allows a permanent enterprise to have successful temporary ventures? What allows these temporary activities to have continuity?

    My theory — my model — is that the PMO is the answer. If this is true, we can further project your models out to the future where the mature PMO is the owner of organizational change. That is, there is operations, which runs the assembly line, and the PMO, which, like for auto manufacturers, periodically retools the assembly line. Maybe then corporations can add a Chief Change Officer (CCO) to the executive suite to join all the Chief Keep-Things-the-Same Officer positions they currently have.

  2. Or you could call her the “Chief Evolution Officer,” but I think that acronym is taken.

    Over the years, I’ve seen organizations introduce change in all sorts of ways, and I’ve seen the people in those organizations resist or embrace change in all sorts of ways. The one common factor in all successful change is making people feel more comfortable with the proposed future state than they expect they will be with the current state, sometime in the future. Ultimately, the people proposing the change have to answer the perfectly legitimate question, “What’s in it for me?”

    I used to manage HR business process outsourcing “transformation” projects, coming in after the initial shock has nearly worn off, to wean people off their old systems and entice them to adopt nice, shiny new ones. It was always a challenge to convince people who felt uprooted by recent change to actively participate in bringing in more changes. That’s why i always read Bas de Baar’s posts on The Project Shrink, looking for insights into the human factors.

  3. Dave,

    I decided to cross post my answer to the comment you made on my blog. I did read your post and it talks to variations of the original incarnation of PMOs as internal standard and auditing bodies. Many have questioned the ROI of such bodies and to many PMs this could be seen as Big Brother. There is also the potential for the staff of the PMO to never execute projects and be seen as “those who can’t teach”.

    To me, a PMO must be populated with an overwhelming majority of practicing PMs or it runs the risk of becoming disconnected from the organization’s day-to-day reality. It is fine and probable necessary to have staff members that do not execute projects but this staff should be kept to a minimum. I believe this is what your Center of Administration model depicts.

    What I’d like to hear from you is what prompted the move from Center of Excellence to Center of Governance to (eventually) Center of Administration in your company? Was the original structure embattled and had to change or was the whole company re-organized in a way that mandated the PMO changes? Also, this migration would appear to indicated a change from a mature, to an outsourced, and finally to an occasional or accidental PM environment. This is kind of scary, no?

  4. Hi Pat,

    I can make a good case for the Center of Excellence as a PM-centric model, in that it provides a clear career path for project managers to advance through their own ranks, under the guidance of senior practitioners. I can also make a good case for the Center of Governance model as a portfolio manager-centric model, in that it provides a means to select the right projects for funding, and provides a venue to review those in-flight so the ones that need to be canceled can be identified. And I can make a case for the Center of Administration as a program-centric model that facilitates data collection and distribution across projects. But it’s silly to have a PMO just because everyone else has one – you need a vision for how the organization should operate over time, and create a PMO that supports that vision.

    Now, in our case, the transition from CoE to CoG to Coa was driven by transitions at the CIO level. Most recently (two weeks ago), our newest CIO has re-organized the department and eliminated both the PMO and the portfolio management positions, including mine. So these changes were less about the relative maturity of our processes than it was about the organizational vision of the person at the top.

    The good news is, I start my new job on June 6.

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