So far in this series of posts where the project is establishing a PMO, we have defined the Business Objectives (business outcomes we expect by having a PMO) and the Project Objectives (the things we need to accomplish to state we have now established a PMO). Now we will take a look at the Stakeholders.

Stakeholders fall into two broad categories:

1. Those affected by the process of executing the project
2. Those affected by the business and project outcomes of the project

Stakeholders in the first category are typically those who will work on the activities needed to accomplish the Project Objectives. They will do things such as document the organization structure, create the job descriptions, do the hiring, write processes and policy, etc.

Stakeholders in the second category, in this case, will mean everyone in the organization! Why? Because the PMO can manage or oversee projects in any area. If the PMO is around long enough they will interact with every department and many of the personnel. With so many people to inform, a careful Organization Change Management Plan will need to be documented and agreed upon. Having a PMO will be a huge change for most organizations. Some areas may even object to having one. Formal Change Management will be critical to the success of your PMO. I can’t stress this enough. If your PMO gets off to a bad start due to lack of Change Management, it may not survive for long.

If you search this blog for “Organizational Change Management”, that series of posts will provide you with guidance for this discipline.

In the prior post, I talked about defining the Business Objectives (outcomes) for the PMO. Once these are known and agreed upon by the PMO Sponsor, you can move on do defining the Project Objectives, with the project being the establishment of the PMO.

I list here some considerations for setting Project Objectives for the PMO. It is not meant to be a complete list, but it will give you a good idea of what to consider.

• Budget – What will be the budget for the PMO? Consider salaries, benefits, ongoing education, funding for professional organizations such as PMI, paying for certifications such as PMP, and travel.
• Organizational Structure – What will be the level of the top of the organization (Officer, Sr. VP, VP, Sr. Director, Director, etc)? Will there be multiple levels below this? Will you have different levels of PM’s? How many full time employees? Will you use consultants?
• Offices and Locations reserved
• Job Descriptions – Once you have an Organizational Structure defined, you will need Job Descriptions and pay ranges for each defined job. These will be used as guides in the interview and hiring process.
• Hiring – Starting with the top of the PMO organization. Once hired, this person will be largely responsible for hiring the rest of the team.
• PMO Charter – This will contain the “rules of engagement” for the PMO. Things like how projects will be assigned, the roles the team will play, the project life cycle for this organization, the definition of when the PMO engagement on a project ends, etc.
• PMO Processes and Templates – These will be the standards and practices for all steps of the project life cycle.

Your Project Objectives for establishing the PMO should be approved by the PMO Sponsor before moving on to the next step.

If you have been following this blog you will recognize a common theme in almost everything you want to do: know your outcomes (aka “Business Objectives”). Before establishing a PMO, you need to understand the PMO Sponsor’s vision of what problems they are trying to solve and/or what opportunities they wish to exploit.

Here are some possible problems your business may face that can be mitigated by having a PMO. You may have one or more of these to solve:

• We aren’t maximizing our Return On Investment (ROI) from our portfolio of projects.
• Our project mix is not aligned with our long and short term business goals
• We don’t have control on our project request process
• We have key resources frequently overloaded causing project bottlenecks and delays
• Our projects are usually late
• Our projects are usually over budget
• We under-deliver on the agreed upon scope
• Our projects often have the scope expanded without knowledge or approval
• Our project quality is frequently lacking
• We take on too much risk
• We don’t take on enough risk

Depending on the problems you wish to solve, here is just a sample of the measurable business outcomes you can obtain my investing in a PMO:

• Regular financial analysis reviews showing the ROI on the current active project portfolio and the ROI on alternative combinations of projects
• No resource bottlenecks; Resources obtained and deployed in the most effective manner
• Deliver projects on or under the approved schedule and budget
• Deliver on the approved scope
• Control how much risk we are taking on (possibly by regular review of the risk/reward matrix of the current portfolio of projects)

In the next post I will present some possible Project Objectives for the establishment of a PMO.