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Corporate PMO = EPMO

Corporate PMOs are also generally known as Enterprise PMOs or EPMOs. The term has been strengthened over time because it is understood that there are features common to all corporations, regardless of the nature of their products and services, which directly affect the challenges and attributions that the project office should assume.

An EPMO reports directly to one of the highest executives in the organization. Very often, there are other PMOs of lower rank, for example for the coordination of programs or a business unit; but none has the global reach of EPMO.

It has often been said that EPMOs are the most important instrument to ensure that the corporate strategy is truly executed in all areas of the organization. The EPMO would be, then, a catalyst, an engine oriented to promote the constant transformation in an environment whose natural inertia would lead, otherwise, to immobility.

Responsibilities: start by deciding just initiatives

Every action has associated an opportunity cost. Even when it is clear what is being done, it is clear that many other possible actions are being discarded.

When, in addition, you work in a huge organization, the lack of alignment of the departments to the corporate strategy results in a very voluminous waste of energy.

For that reason, the EPMO approach is twofold:

make sure that the right initiatives are started (doing the right things)

make sure that they are managed properly (doing things right)

It is, therefore, a constant monitoring of the strategic alignment for all the work planned and underway.

Other responsibilities include, of course, traditional areas of the PMOs, such as training and counseling (of the other PMOs); value management, which is easy to lose sight of in highly complex environments; resource planning; Demand management or coordination among PMOs.

Benefits of an EPMO

The benefits of an EPMO are similar to that of a smaller PMO, but with strategic orientation. The big difference is that the EPMO has the necessary governance structures to navigate and master the bureaucratic complexity and processes that can often become the biggest enemy of change in a corporate organization (from 5,000 employees).

In any case, it is worth reviewing those benefits:

Increase in the number of projects delivered on time and in time

Better strategic alignment between projects and business objectives

Greater support for departmental projects, and with this, greater chances of success for the project, which can gather the required support at critical moments

Less overlap of work between department

Greater interdepartmental collaboration

Greater visibility of corporate initiatives

Higher ROI for the projects implemented, especially in non-financial terms

More efficient delivery of projects –and faster to put new products and services on the market

A better structured approach to the treatment of risks, including risk mitigation

Success factors of an EPMO

Organic location, immediately below the General Management

Change management according to good practices, so that the new EPMO is not perceived as a rival of the existing PMOs and projects managers

Complementation of the managerial function: support in the decision-making, without robbing autonomy or generating political problems

Autonomy with respect to functional areas, so that it does not depend on IT, Financial, Human Resources, etc.

All subordinated PMOs must report, either directly or indirectly, to the EPMO. Otherwise, pockets of information are created that do not flow

The competence profile should combine project management with the business vision: those who are part of the EPMO will advise managers in making critical decisions and train project managers to continue advancing as professionals

No EPMO can work reasonably well if a high degree of standardization is not achieved.

References:

Although working by objectives is the best way for managing staff, organizations’ management requires an organizational level which is only provided by projects.

Management by objectives has set us free from a working culture in which it was more important to be present at our workstation rather than doing a valuable and quality job. But, nowadays, we can say that it is about going to a better place.

OK: I admit that saying that management by objectives is a cadaver could be an exaggeration, but also is saying that we all have been set free of perfect attendance

In fact, just as we all have friends in whose jobs it is more important to be than to work, objectives are a key element to motivate employees and escape from the routine. Let’s not dismiss them yet.

Nevertheless, let’s analyze why they are no longer enough for those who run an organization.

Discover how to manage your organization by projects with ITM’s White Paper

Management by objectives, for what?

Let’s put the example of Alice Smith, the web designer of an e-commerce company

When Alice improves a 25% the views of the star product section on the web, she is meeting one of the goals defined along with her boss. This means beneficial and foreseeable consequences.

When meeting objectives, Alice gets her coordinator and firm's recognition: she has accomplished a beneficial objective for star product sales and thus, benefited the whole business. She has become a recognized professional who has been rewarded for her job.

Consequently, Alice has the well-done job satisfaction and the incentive to keep working by objectives meaning that, when managing her time in the future, she will take decisions oriented to maximize results that will maintain or improve her status and will keep on contributing to general good results.

For their part, the Company’s managers are satisfied as they can delegate hard work and focus on managing which are the goals the company must achieve.

Why management by objectives is not enough

After some years, it is easy to see that management by objectives, despite its advantages of motivation and personal time management, it does not always help taking the right decisions at the right moment. Sometimes, it is not even enough to deliver the expected work.

When each worker works by their own objectives, which is the risk of no one taking care of the efforts coordination between the different initiatives that are being carried out?

Too high

On the following year, Alice did not manage to get her objectives because the TI department was too busy creating a new purchasing management system to support her on the web changes.

What is missing? Employees’ efforts must be coordinated between each other so that no one see himself blocked due to the need of cooperating with colleague who is too busy with another issue.

How can that coordinated cooperation be achieved? Managing internal work by projects, especially the most fragile one.

What is project-based management?

At project-based management, each project is connected to the objectives and business benefits willing to be achieved. Employees work on a coordinated way to obtain the project’s output: cooperation is programmed.

At the same time, the project’s output is an objective of the company or a necessary factor to achieve it. Without that project, the same factor wouldn’t be carried out and would block the work.

When there is a complex objective and it needs many different factors to happen, many projects grouped on the same program can be created. Program’s director will have to coordinate the projects to support each other, favouring synergies and avoiding a project pending work to block another project.

Let’s give an example

Let’s imagine that the company Alice is working for wants to create a new line of domestic products thought for single women between ages 35 and 50.

The goal is to put on the market 10 products of this new range and obtaining 1 million revenues in two years

The new range requires the work of all departments: product design, web, TI, marketing and commercial. Furthermore, all managers are very interested because their final year bonus are linked to initiatives. Particularly, the finance, sales and operational directors know it is about something important.

Instead of assigning objectives by department and by every employee, different projects grouped on the same program are created. The operational director is placed on the top of these projects as they have experience on projects management.

Many of these projects have transverse teams: people from marketing and systems and product design departments are working together. On the other hand, there is a single sales, web and systems project in order to have everything ready to start selling as soon as the products are ready.

With this kind of structure, program director:

Counts on the information about the ongoing process of the project
Can cancel projects that are not essential for the development of the new line
Allocates more human and financial resources to urgent or central projects
Is able to report the advancements on the project to the company’s senior management, anticipating possible problems and foreseeing results.

Why project-based management and management by objectives are compatible

No company in which a management by objectives style has been adopted has to leave the management structure to start running projects.

Management by objectives and project-based management are compatible and interdependent.

Let’s have a look to what ITM Platform’s white paper recommends

“The combination is straightforward: it is enough to link both project and tam to the objectives. This mechanism informs team members about the importance of the project, which is not only in the delivery, but in the external goal.

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