Key Steps Every Company Should Know When Launching a PMO (Part 2)

In Part 1 of this series, I talked about Planning The Transition to establish a PMO by developing a Business Case and assessing the current project management processes within a company. Once company approval of a PMO is accepted, the next step will be to Create a PMO Governance.

Stage 2 – Create a PMO Governance

Establishing Roles/Responsibilities within the PMO. Depending on the overall size of the company and the amount of current and future projects will determine what roles will be required to effectively deliver those projects. How many resources will be sufficient to manage current and future projects and what will the organizational structure look like?

Defining PMO Key Performance Indicators (KPIs) to capture the right data to show the value of PMO methodologies once the PMO has been launched. Some possible metrics that can be used to define the success of a PMO launch are shown in the table below.




Strategic Contributions Strategic Project Delivery
  • Increase the success rate of % of strategic projects delivered / the total number of strategic projects
  • Improve Time to Market Delivery = Elapsed Time from Idea Conception to Project Start (How long does it take to start a project)
  • Improve Time to Market Delivery = Elapsed Time from Idea Conception to Project Delivery (How long it take to deliver a project)
  • Improvement of estimated time versus actual time of project delivery = comparison between the estimated and the actual time of projects delivered (How good the estimation of our project delivery)
Governance Process Methodology Compliance
  • Required deliverables vs. actual deliverables)
Portfolio/Project Management Dealing With Change
  • % of projects remain at same status for x reporting periods
Improved Project Management Process
  • Increase the success rates of the projects = (within a certain time period, the number of success projects/the total of projects)
  • Improve training rate of project staff members
  • The improvement of estimated cost versus actual cost for the projects = (comparison between the estimated and the actual cost of the projects)
Resource Management Increased Resource Utilization on Projects
  • Increased productive resource utilization on project time (ie: Business Analyst >31.5 hrs p/week = Exceeds)
  • Increased resource utilization on projects = Billable Hours/Total Hours
Stakeholder Management Improved Customer/User Satisfaction
  • Customer or user satisfaction survey averages (aim for a % above previous quarter or year average)
  • Over-delivered items within budget
Return on Investment Business Benefits Achieved
  • Post-project ROI review to determine if project ROI is being realized
  • Benefits realized against Benefit forecast for year
  • Simple Return on Investment (ROI) for all of the projects the PMO has oversight
Staff Members Improve Staff Retention
  • Improve project member satisfaction survey averages (aim for a % above previous quarter or year average)
  • Improve career path for project members

Developing/Defining the Project Lifecycle process in order to standardize all projects within the organization. This task requires the input of all resources/stakeholders involved in current project management processes in order to agree upon the number/name of phases, deliverables required in each phase, milestones within each phase, and the resources involved in each phase. An example of a project lifecycle is shown below.

Once these steps are developed, defined, established, and approved, the team can now focus on the third stage of Establishing a PMO process, identifying and devloping project managers already within the organization.

Next time, I will talk about  Identifying/Developing Project Managers by Defining Roles within the Project Team, Assessint the Current Pool of Resources, and Developing Project Management skills of Identified Resources.