What is a project management office?

Jun 16, 2024

 

This is a versatile segment of your organization that should be tailored to best fit your company structure, strengths, weaknesses, goals, and needs.

As engineers advance in their careers, many find their way into project management, often by default, without (formal) training or mentorship. But project management is easy compared to engineering, right? They will figure it out!

“Project management by default” does a disservice to your firm, clients, and project managers. One solution to this is a project management office, or PMO. The PMO can provide firm-specific tools, processes, oversight, training, and mentoring of your project managers. A PMO can be implemented at firms big and small and can grow with your organization.

First, what exactly is a PMO? According to the Project Management Institute, the PMO is, “An organizational unit to centralize and coordinate the management of projects.” It is a versatile segment of your organization that should be tailored to best fit your company structure, strengths, weaknesses, goals, and needs.

Prairie Engineers, an 80-person (and growing) small business, initiated a project management office on January 1, 2024. The PMO was initiated with the following goals:

  1. Provide support, oversight, mentoring, and training for current and future project managers.
  2. Improve overall project performance.
  3. Integrate reporting across markets and disciplines.
  4. Coordinate project alignment with corporate direction.

The principal theme of these goals is to provide support for project managers and senior leadership to help position Prairie for continued growth and success.

In preparation to launch the PMO, Prairie undertook a process to research typical duties of a PMO, including learning about how it has been implemented at other firms. The results from this investigation phase were considered alongside the specific needs of Prairie and the strengths and responsibilities of the leadership team, current project managers, and the planned project management officer. As a result of this process, Prairie developed six core tasks:

  1. Mentor and train project managers. The most important role that Prairie set for the PMO is mentoring project managers. Working closely with PMs on their specific projects is more beneficial than generic standards and training. The PMO meets with each project manager one-on-one on a regular basis. This allows for tailoring to each PM’s needs while allowing for detailed review of project-specific information. The PMO also provides training for PM’s and reinforces expectations.
  2. Maintain project management standards. One of the most common ways a PMO supports the company is by developing and maintaining project management standards such as manuals, references, templates, and tools. Prairie had many existing tools, but they weren’t used consistently or needed updates.
    The first standard issued by the PMO on day one was the project management manual. It was critical to Prairie that this was released immediately to detail what project management means at Prairie. The manual was developed around many existing processes, documenting best practices that many of the project managers were already performing. The PM manual outlines what is expected from PMs and strives to explain why each expectation is important and the impact it has on the business operations.
  3. Monitor project management KPIs. The PMO is responsible for setting and monitoring KPIs to track project management performance and improvement. These metrics will be regularly reviewed with project managers and summarized and shared with leadership. KPIs include the common financial performance metrics for projects, as well as qualitative metrics which are not as simple to measure. KPIs used should be in alignment with the goals of your individual company, and adjusted as the team grows and improves.
  4. Align projects with business objectives. The responsibilities of the PMO can extend to strategic business alignment and coordination across markets and disciplines. At Prairie the project management officer meets with Prairie’s market leads and discipline leads on a regular basis. These calls are focused on how to meet the goals of the markets and disciplines and are another avenue of cross communication. Having these discussions allows the PMO to have an idea of where the issues are in each area of the company and when opportunities arise, it is more likely that a connection between a need and a solution can be made during these discussions.
  5. Track and report financial performance and forecasts. The Prairie PMO is responsible for aggregating financial performance and forecast data. In previous years, market leads were responsible for their individual client sector performance and forecasts and each market lead handled these differently. The PMO is responsible for pulling that information together to develop a combined report and provide this report with greater frequency, so the leadership team has the best available information to make staffing and pursuit decisions.
  6. Planning and resource allocation. Prairie is better positioned to predict the demand for staffing as a result of compiling higher quality and holistic forecasts. This report provides information to leadership, market leads, discipline leads, and project managers. With a better estimate of the magnitude and timing of upcoming work, project managers can plan and adjust project staffing proactively rather than reacting to project workloads when projects are well underway and more difficult to pivot.

Prairie’s PMO is in its infancy, and it is developing the office over the course of the first year, but the company is already reaping the benefits. In the first three months, the PMO has provided virtual and in-person trainings, met regularly with PMs and senior leadership, provided updated templates, tools, and references, and worked one-on-one with project managers to improve understanding and listen to challenges to better identify additional improvements and tools.

A project management office can benefit any size firm. It must be tailored to the specific needs and strengths of the individual company and its personnel. The PMO needs to play a flexible role in your company while being leveraged to strengthen the skills of your company’s project managers. It should extend into governance, business alignment, or financial support, as needed to meet your company’s goals. 

Alicia Kamischke is the project management officer at Prairie Engineers P.C. Contact her at akamischke@prairieengineers.com.

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