Project Management under the CIO

By Judy Mottl

Creating a project management office (PMO) would appear to be a win-win situation for many organizations that have had trouble in the past delivering projects on time and within budget. The trick is in knowing how to establish such a department, clearly defining its role, and making sure the business unit has consistent support from top business leaders, both inside and outside of IT.

A recent Forrester Research report found that a growing number of forward-thinking companies are developing a PMO under the office of the CIO to help cut costs, boost IT efficiency, and foster faster project delivery. All those benefits can be realized if a PMO is built on a good organizational foundation and nutured by IT leadership support and attention, experts say.

The PMO is becoming the de facto business manager for the CIO by creating an environment for IT and business to work together and serving as a steward of process management to boost IT's ability to deliver, writes Forrester analyst Margo Visitacion.

PMOs are not new to business or the IT organization. A 2003 survey by CIO Magazine found that out of 450 CIOs surveyed, 67 percent said their companies had a PMO. Among those organizations with a PMO, half credited the PMO with helping to improve the rate of project success.

Forrester found that moving an existing PMO -- or creating a new PMO -- under the office of a CIO can do a great deal toward bringing together business and IT concerns "to improve how they work together -- leveraging the PMO but not replacing it or making it a dumping ground," according to the report.

Yet all those benefits can only be realized if a PMO is built on a good organizational foundation and nurtured by IT leadership support and attention, experts say.

"A lot of times, once they're up and running, [PMOs] don't get the attention they need long term to provide the benefits. It requires all around sponsorship from the CIO and other executive levels to work," says Tom Mochal, president of TenStep Inc., a Georgia-based project management consultancy that helps companies establish PMOs and handle project portfolio management.
 
In fact, executive level buy-in is not only crucial in getting a PMO established; it's crucial if IT wants to gain credence and credibility within the business organization.

"You can't just set a PMO up and walk away. That's just throwing your money away," says Mike Sisco, president of MDE Enterprises Inc., a Seattle-based IT manager training and consulting firm. Sisco, an IT manager for 20 years, notes that a majority of today's IT projects fail and that a PMO can go a long way toward changing that trend. "If the CIO or IT can't deliver project success, their credibility suffers. A PMO can help boost and restore that factor."
 
"If a PMO doesn't get an engaged sponsor, such as the CIO, or if the CIO at some point loses interest, the PMO will lose its direction and fail," adds Mochal.
 
IT project management experts offer the following recommendations to CIOs to help make a PMO achieve success:

• Plan and Define the PMO Role. Make sure all the other business unit executives are aware of the need for the PMO, the expected benefits, and the requirements for organizational support. Ensure that the PMO officer has legitimate powers as a business officer and establish good communication and rules of engagement between the PMO and other business organizations. "The biggest pitfalls are not understanding the role of the PMO and not giving the unit any organizational power. There has to be a hand-off in power and delegation of duties for it to work and work well," says Mochal.
• Conduct an IT Assessment. This will determine current project management processes in place and capabilities so that a PMO has a basis of operations to step off from.
• Define the PMO Focus. Define the responsibility. For example, how much of the work involves portfolio management, time reporting or inventory, or asset tracking is up to an individual organization, explains Mochal.
• Hire PMO Expertise. Consider consulting help in creating the office if there is no formal or true project management expertise within your IT organization. Trying to 'wing it' is a setup for failure, warns Sisco. In staffing the PMO office, you need to hire experienced managers, as the learning curve for non-PM experts will be too burdensome, he explains.

As one PMO expert explains, creating a PMO is a journey and not a destination.

"You have to be in this for the long haul, and you have to be firm but flexible," says Nancy Mulholland, a project management professional, CIO, and Deputy Executive Director of the NYS Workers' Compensation Board. "There will be legitimate adjustments that have to be made to accommodate the culture of the organization, but you have to know when to adapt and when to stay the course."

Mulholland speaks from experience. She previously served as the first Director of the New York State PMO. In that role she directed the development and publication of a statewide project management methodology (the NYS Project Management Guidebook) to provide a common framework for all state agencies to use in their projects.

"When a PMO is implemented, and takes on the role of IT project portfolio management, business users are forced into a more transparent decision-making process, which is not always entirely welcome," Mulholland adds.

But the benefits of applying project management expertise to IT projects -- namely, that projects are managed within budget and wrap up on time -- far outweigh the demands placed on others in the IT department.

Judy Mottl is a freelance technology writer based in New York who has contributed articles to such publications as InformationWeek, Bio-IT World and Information Security Magazine.