More organizations are employing project offices, and it's no coincidence that project success rates are improving.
The Standish Group's CHAOS 2001 research report shows that, compared to 1994 when its research began, there has been a threefold increase in project success! Better tools, more skilled project managers and better management processes are hailed as reasons for the increase in project achievement.
There is an interesting parallel to the improved project management performance and the genesis of the project office (PO), especially in high-tech industries. The military was the first to create the precursor to what we now know as a PO. Its systems program office developed the model for the “strategic project office.” At this level of a PO, Level 3, it is more than a place or set of people; it is a “shared competency” designed to integrate project management within an enterprise [The Strategic Project Office: A Guide to Improving Organizational Performance, J. Kent Crawford, Center for Business Practices/Marcel Dekker Inc., 2002].
Organizations that have been embracing project management over the past few years may have developed a Level 2 PO. A PO at this level is more like a business unit, providing support for individual projects with its primary challenge of integrating multiple projects of varying sizes within a division and effectively integrating resource control.
However, most organizations are not nearly mature enough to be at a Level 3 or even a Level 2 PO. Most are at Level 1—the simple single-project control office—and aspire to be at Level 3 within a few years.
Regardless of level, there is a distinct parallel between the increase of project success and the increase of POs within companies. Organizations are no longer trying to force projects to fit a bureaucratic structure but are embracing projects as an organizational principle and unit. The extensively practiced and researched discipline of project management practices has found a home in high-tech industries [The Strategic Project Office: Business Case and Implementation Strategy, J. Kent Crawford, Center for Business Practices, 2001].
There are six primary components to any PO that grow in capability and complexity as it takes on more strategic responsibilities. Those functions are:
- Processes, standards and methodologies
- Project managers
- Training/professional development
- Project support
- Software tools
- Mentoring and coaching.
Businesses focused on improved performance are heeding the recommendation of The Gartner Group, Stamford, Conn., USA. Its 2000 research projected that, through 2004, information systems organizations that establish enterprise standards for project management, including a PO with suitable governance, will experience half as many major project cost overruns, delays and cancellations as those that fail to do so.
Why is the PO so closely linked with the success of project management within organizations? Basically because POs develop and maintain standards and processes, garner executive support, and develop experienced project managers. My guess is that the 72 percent of failed or challenged projects mentioned in the Standish report did not have an effective PO to establish these key ingredients for success.
Why should we care if project performance improves? From a personal viewpoint, it is rewarding when a committed project manager brings a project in on time and within budget. From a business perspective, it saves money. The bottom line is that projects brought in late are not only over budget but have missed an opportunity that could have generated the organization millions—sometimes billions—of dollars. PM
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PM NETWORK | JANUARY 2002 | www.pmi.org