Project Management Institute

Reimagining the Project Management Office

Transcript

STEVE HENDERSHOT

There’s no question organizations can get solid value out of traditional project management offices—PMOs that take strategic direction and then figure out how to make things happen. But when you bring PMO leaders into the conversation and give them a voice in defining that strategy? That’s when you can really see the power of the PMO—as more companies are realizing.

TOM KUCZYNSKI

We’ve definitely engaged the business more directly in the planning process, whereas in the past they would have just handed us something and basically told us, “When it’s done, let us know.”

NARRATOR

The world is changing fast. And every day, project professionals are turning ideas into reality—delivering value to their organizations and society as a whole. On Projectified®, we’ll help you stay on top of the trends and see what’s ahead for The Project Economy—and your career.

STEVE HENDERSHOT

This is Projectified®. I’m Steve Hendershot.

The more fragmented we are, distributed teams, silos, the easier it gets to lose sight of what’s happening across a company. That includes ensuring that the portfolio is moving forward and staying aligned to the overall strategy.

Nearly 70 percent of surveyed companies say they have a PMO, according to PMI’s soon-to-be-released 2021 Pulse of the Profession® report. So now the question is: How can they help organizations deliver results in sync with strategy?

Today we’ll look at two cases where PMOs have really proven that value, both by keeping their organizations on track and also by using a strategic orientation to not just identify business opportunities—but help make the most of those opportunities.

Our sponsor for this episode is PMTraining.com. From live virtual classes to online courses available on demand, PMTraining equips students to earn PMI certifications including the Project Management Professional, or PMP®. And Projectified® listeners are eligible for discounts of up to $400 per class; just enter the link PMTraining.com/podcast.

At Coca-Cola’s offices in Johannesburg, South Africa, the strategy and innovation PMO works with project leaders to turn innovative ideas into real projects. Projectified®’s Hannah Schmidt spoke with Katitja Molele, strategy and innovation PMO manager at the operating unit for Coca-Cola, about how involving PMOs in creating strategy can help deliver more business value.

MUSICAL TRANSITION
HANNAH SCHMIDT

What role does the strategy and innovation PMO play at the operating unit?

KATITJA MOLELE

The good thing is—and I think [Coca-Cola] has done it very well in terms of fusing the strategy and the PMO—we map out the strategy, and without having an effective PMO, you are unable to translate the strategy into actionable items. There’s a best fit, like it fits like a glove, where the PMO is able to take some of the actions or the key pillars from the strategy and translate those into real life. In the [Coca-Cola] language, we say, “We take something from a PowerPoint and we put it in the fridge."

HANNAH SCHMIDT

So the PMO is really helping to craft the strategy—not just getting it from the C-suite and executing.

KATITJA MOLELE

I think senior management have realized that we can actually use PMOs to really push our strategy. In the past it used to be, as a PMO lead myself, I’ll do a lot of convincing and a lot of campaigning to say, “Oh, hey guys, this is really good.” So now we’re really seeing that top-down approach where we’re getting a lot of support where there’s a lot of resources that are plugged into the PMO to really get it up and running.

HANNAH SCHMIDT

What do you think is one of the biggest challenges for PMOs today?

KATITJA MOLELE

Because we live in this age of technology, I see the PMOs in the new age operating in silos. They build all these capabilities, and no one uses them. So stakeholder management, stakeholder engagement is quite key. It’s like designing the process with the end user in mind, and who’s the end user? It will be your senior stakeholders. So I see the challenge as there is not a lot of that. There’s not a lot of emphasis on stakeholder management, but there’s a lot of emphasis on technology. There’s a lot of tools that can do so many things, artificial intelligence, but no use if the end user is not consulted.

HANNAH SCHMIDT

What do you think are some ways PMOs can meet these challenges and really move into the future?

KATITJA MOLELE

For me, I think it’s just an understanding of what adds value and how do we define value. I think we need to be in sync. We need to look at our strategy, and one of the challenges that I forgot to mention is that in the PMOs that there was a disjoint between strategy and the PMO. If we can marry the two and ensure that the technologies address the issues, it’s not like both of these are standalone modules, if I can say that. So I think if PMOs can be involved within the strategy development of the organization, that will really solve a lot of things. And then we’ll know from that point of view, in terms of what are we designing, what is it for? I’ve seen that, for example, you’ll have PMOs that are in contact with IT to build a certain tool, and that tool really doesn’t amount to anything because no matter how beautiful it is, but if it doesn’t answer the questions or the problem that we have, then it’s really a waste of time.

So I think that’s really what the PMOs can start doing, just being involved in the strategy and understanding what does the organization want to do? Where are we going? Where does the organization see itself going? A lot of PMOs don’t really have that because it sits in a different space. Just because it sits in a different space, then there’s that disjoint. I see that being really something quite important going forward. And remember, historically PMOs used to be viewed as admin. It used to be very admin intensive—the guys to store things, the guys to communicate, what report template do we use. It’s also around changing those norms, making people understand that PMOs have really changed. Especially if you look at COVID, it has really sped that up.

For example, in my organization, I help project managers understand where to go. Where to go, where to find out how to do things, how to compile a business case, what’s important in the eyes of, for example, the gatekeepers? What is important in the eyes of the senior stakeholders? What do they look for for them to push your idea forward? Although your idea was identified and is the part of the strategy, but how do we move it forward? It’s really educating the system to understand why and how.

MUSICAL TRANSITION
STEVE HENDERSHOT

Speaking of PMOs that deliver value, let’s talk about the IT PMO at DC Water, the water utility in Washington, D.C.

Tom Kuczynski is the organization’s vice president of IT and also helped build its IT PMO—winner of the 2020 PMO of the Year Award. Not only has DC Water vastly improved its project completion rate with the PMO, but it has generated multiple products that have spun out into a separate company, benefiting other communities and bringing additional revenue back into the organization. I asked Tom about building the PMO from the ground up and extracting maximum value from DC Water’s IT projects.

MUSICAL TRANSITION
STEVE HENDERSHOT

When you joined DC Water, an early focus was to build this PMO. Why was that, and how did you approach that project?

TOM KUCZYNSKI

I joined DC Water in August of 2013, and as part of initial 100-day plan, they did an assessment of the IT department, its effectiveness and where there were opportunities for improvement. One of the first things I noticed was that there were tremendous number of projects that were underway, but not very many getting done, and the ones that were getting done typically weren’t meeting the requirements of the business. The primary reason I attributed that was lack of structure and discipline and governance around project management.

It was important at that point to begin to build a PMO capability within the organization, refocus the efforts of the IT group on a smaller number of projects that were active at any given time, not necessarily canceling anything we were working on but just putting them on hold and focusing on a smaller number of projects. We did an evaluation and really put together a business plan for the PMO that said to the business: We believe we can be more effective in delivering more things on time and on budget that were higher quality if we established a formal PMO process and a set of governance policies to manage actually the project portfolio that we were charged with delivering.

STEVE HENDERSHOT

You’ve been able to deliver more successful projects with the PMO, but your work has also led to the creation of the nonprofit Blue Drop that makes use of some of the intellectual property generated by the PMO. How do you prioritize those competing interests?

TOM KUCZYNSKI

One of the biggest challenges we have is we’ve got a number of different businesses as DC Water. So we’ve got our potable water delivery, which is fresh water delivery. We’ve got our wastewater treatment plant, which is actually a regional facility that does wastewater treatment for D.C., but [also] the surrounding counties. But then we got our customer service business, which is really managing the relationship with the 135,000 retail customers for the delivery of water and sewer services. And then we have just the whole support side of the business, so the administrative teams, the accounting and finance. So we’ve got a breadth of applications that span all those areas of the business, and the biggest difficulty is trying to come out with a prioritization scheme that actually allows us to evaluate all of these different projects across those diverse set of business lines.

And that was probably the most difficult challenge, is coming out with something that didn’t overweight one piece of the business at the expense of the other business and create a balance across the organization that allowed us to achieve a broad set of objectives, not just an operational need or a customer service need. So we worked on that model, and it’s a multifactor model that considers not only the economic benefits but those that actually contribute to the experience that our users have or our customers have with the systems that they use.

STEVE HENDERSHOT

So the PMO identifies and authorizes the project. What’s its role once the project is underway?

TOM KUCZYNSKI

So then the PMO itself coordinates with each of the individual PMs to ensure that the schedule’s filed, the schedule itself is sufficiently detailed for the project itself. So we have basically a tiered set of PM deliverables based on the type of project. So large projects have many more project artifacts, and project plans have to be much more detailed than smaller-level projects. As part of the resourcing of the project, one of the first things we do is we do a project assessment. Based on the results of that, which is basically how big is the project? How many people does it impact? Is it a new system? Is it just an upgrade to an existing system? There’s a series of questions that we go through. That dictates the level of detail that each project is required to provide as part of the PMO tracking and auditing process.

Those plans are put into our project management system, and then that feeds a project portal that is actually available to anybody in the company. Any employee can go on our webpage, see the list of projects we’re working on, see the status, see the PM, can click on the details and look at any of the artifacts on the project. But then we do monthly report outs to the executive team as well on the status of each of the initiatives that are currently in flight as to on time, on budget, any issues and things like that. And that’s all managed by the PMO lead.

STEVE HENDERSHOT

How has that evolved? You’ve clearly benefited from having a PMO. Between 2014 and 2019, it helped elevate DC Water’s on-time, on-budget delivery rate from 35 percent to 80 percent. How has the PMO gotten better over time?

TOM KUCZYNSKI

The evolution has been from just making sure that we were executing the projects we agreed to do to being more sophisticated about planning the future, better ability to estimate cost and schedule with more certainty around it. We certainly have more discipline around testing and validation. In the past, our metrics have largely been on time, on budget as what we track for the most part. I think the other thing is our on time, on budget is not necessarily just: Did you meet the schedule or exceed it? We actually track you within 5 percent plus or minus of both schedule and budget because we don’t want people padding the schedule or the budget just to meet an easy schedule.

Two other metrics we’re really looking at is the level of requirements that have been met with the deliverable and how well they were met. So we try and measure the effectiveness of us meeting those requirements, but we also try and look at adoption rate as well. In a lot of cases, some systems are mandatory to use, but in other cases they’re not. All the functionality that may have been delivered may not be necessarily used by all the users. We’re trying to measure adoption rates and ensure that our adoption rates are quicker than they would be if the system was more complicated or more difficult to use than it should be.

So those are two other metrics, and now we’re really getting into post- implementation audits as well. While all our business cases have a cost and a benefit, we haven’t always measured the achievement of the actual benefits because they’ve always been post-implementation. So now we’re in the process of developing a post-implementation audit mechanism so we can ensure that when you’re telling us you’re going to achieve these benefits, you actually achieve those benefits.

STEVE HENDERSHOT

Organizations have been contending with lots of change the last few years as work patterns shift, and now of course that’s been accelerated with COVID-19. How do you see PMOs responding?

TOM KUCZYNSKI

We had a strategy to migrate to the cloud that we’ve been executing against for almost three years now. We’re probably 98 percent in the cloud at this point in time, which, because of COVID, has actually allowed us to transition to a 100 percent work from home for our administrative staff within two weeks of the announcement. We couldn’t have done that, I don’t think, without a focused strategy to move to the cloud, but without also an ability to manage things in a more virtual sense.

MUSICAL TRANSITION
STEVE HENDERSHOT

PMOs are evolving, gaining a seat at the table where strategic priorities are set and plans are crafted. When project leaders are partners in the strategic process, not only are projects more likely to be set up for success, but you also get teams that understand where their organizations are trying to go. And that means that they’re better equipped to spot opportunities and add value along the way.

Thanks again to our sponsor, PMTraining.com. From live virtual classes to online courses available on demand, PMTraining equips students to earn PMI certifications including the Project Management Professional, or PMP. And Projectified® listeners are eligible for discounts of up to $400 per class; just enter the link PMTraining.com/podcast.

NARRATOR

Thanks for listening to Projectified®. If you like what you heard, please subscribe to the show. And leave a rating or review—we’d love your feedback. To hear more episodes of Projectified®, visit Apple Podcasts, Google Play Music, Stitcher, Spotify or SoundCloud. Or head to PMI.org/podcast.