Enterprise Navigator

PMO Survey Still Open Plus Gartner: What's in a Name?

A sincere Thank You! to everyone that has participated in the PMO 2.0 Survey thus far (see entry from last week below). We have hundreds of responses already, but for those of you that have not yet had a chance, there is still time to take the survey if you hurry; it will remain open through tomorrow (Tuesday), and every ounce of feedback is important to this research. I am really looking forward to digging into the results.

Given that we are only a few weeks away from our annual Horizons North America Users Group, I will share some raw preliminary results as part of a PMO 2.0 Update session I am doing on the morning of Wednesday the 8th — if you are attending, please come sit in on that track, as we will also open the floor to discuss future PMO events and gather your input.

Speaking of PMO surveys, Gartner has released a new report dated 15 September, "Naming the PMO: A Rose by Any Other Name", by Lars Mieritz (#G00161234 for Gartner customers who want to grab a copy).

Certainly the title caught my attention, as one of the questions on our survey is, "How is your "PMO" Titled?" Particularly for organizations that have expanded their scope of operations beyond just project management, PMO is a bit of a misnomer, regardless of what the "P" stands for. Then there's the case of the three-letter acronym becoming a four-letter word. I can't count how many organizations have told me they had to name their organization something else because of the sins of a past PMO, so the very concept became "grupo non grata."

Even my own PMO was never named as such; we were the Engineering Work Control Group (but then, the whole site was really funny about what they allowed to be called a project, PMI definition be damned). Regardless, the term PMO definitely carries a lot of checked baggage that both airlines and corporations charge extra for, so we desperately need a new handle that better describes the new world order.

I tried to get the concept of "Management Integration Center (MIC)" to catch, but it didn't. Yet. I stubbornly continue to use it because, well, I'm stubborn. I have a hunch we will see a lot of "Center of Excellence" variants in the survey, but that is already somewhat cliché and let's face it, a bit presumptuous. Do you start out first calling yourself a "Center of Inexperience", and then proceed through "Center of Mediocrity" to "Center of OK", then "Good" before finally having a Most Excellent PMO Adventure?

I had a person tell me at the Jersey City forum that they informally called themselves the "DFG", since they were universally referred to as "Doz Freakin' Guys" by the rest of their organization. The comment link is open for you to toss in your favorite ideas for an alternative moniker for the modern PMO. Keep it civil and remember, no bloviating — that's my job.

Oh yeah — the Gartner paper. I have apparently digressed.

The research paper actually touches on a couple of different survey topics (from third quarter 07 of 130 different organizations) in addition to PMO naming convention. It spends most of its ten pages discussing positions found in the PMO and their functions and roles. Lots of related pie charts (5) and bar graphs (3) breaking down their survey results and demographics.

With respect to how the PMO is named, nine variants are specifically listed, with all but two including some version of "PMO" with a preceding qualifier, such as Enterprise PMO, IT PMO, Strategic PMO or Virtual PMO. Lars also offers a Scandinavian proverb to title that section, "A much-Loved Child Has Many Names." I don't know about you growing up, but if someone called me anything other than "Terry", it probably signaled I wasn't being 'much loved' at that particular moment — if both the middle name and last names were included, I knew I was in for a world of hurt.

I leave you with this quote from William Makepeace Thackeray that I think most appropriate for any PMO, regardless of how you term it:

"I would rather make my name than inherit it."

2008 PMO 2.0 Survey Is Open

This is a very exciting week — by the time you read this, our first PMO 2.0 Survey will be open to participants. I feel like a kid at Christmas, waiting to see what kind of results Santa is going to drop down my chimney.

But first, a word about Hurricane Ike, as many readers are Planview customers and know we are a Texas-based company. As I'm sure you've heard it was a rough weekend here for those on the upper coast, as well as western Louisiana. Steve Alexander, Our VP of US consulting, lives near Galveston Bay and several of his staff and one of our account executives are in the Houston area. While everyone from Planview seems to have made it through relatively unscathed, most are without power — for who knows how long. Here in Austin impacts were limited to receiving several thousand evacuees and a good stiff breeze on Saturday, so by and large we are counting our good fortune (although we desperately needed some rain and got none). The impact on the coastal area was significant and many thousands will be displaced for weeks to come — please visit www.redcross.org if you want to help support the recovery effort.

Back to the survey. As I've alluded to in some other posts, we've had a marvelous opportunity to touch so many different PMO managers with the forum series, through speaking engagements, web casts, this blog and other events. While all of this has provided wonderful anecdotal insights, the reliability engineer in me is clamoring for data, graphs and pie charts, thus the survey.

We are doing something really fun to encourage your participation. In addition to giving away $15 Amazon.com eGift certificates to the first 50 respondents, we are holding a drawing for 1 of 3 Flip Mino Video Cameras we'll be sending to some lucky winners. I couldn't stand it any more, so I ran out Saturday morning and got one for myself. This thing is so cool, mainly because it's so small. It's about the same height and thickness as my Blackberry but a little narrower and much lighter; in other words, pocket-size. What I really like is that it's totally self-contained. A USB connector flips out to plug into your computer to access the 2GB of flash memory (about 60 minutes of video), and also doubles as the charging mechanism for its internal Lithium Ion battery. Even the software is native to the camera itself, so there is no executable to install. And it's so user-stupid friendly, you hardly need instructions. The Flip will join the Ikea KVARNO chaise lounge in my "Intelligent Product Hall of Fame".

OK, enough about the bait we are fishing with and more on what we are trying to catch. What I plan to achieve with this survey is obtain a quantified picture of a representative cross-section of modern PMOs, and where they are in their evolution. In particular, I am intensely interested in understanding the scope of services you are providing, how your PMO fits within your organization, the challenges you are facing, and finally, what kind of events you would like to see us sponsor in the future.

It is going to take me some time to digest the results and be able to offer a thorough report on it, but I will most certainly share conclusions with those who respond, and summarize them on this page as well. The benefit to you is a great reference point to benchmark your PMO against those of other respondents. And, fear not — I promise we are not going to assault you with sales calls; we have retained OpenSky Research as a neutral 3rd party to provide the survey, so your response will be anonymous.

About 30 questions are arranged in 5 sections: An Overview of your PMO and its functions, PMO Challenges you are facing and key 2009 initiatives you have planned, some questions about the Standards and Methodologies you are using, what your scope of PMO 2.0 Involvement has been, and basic demographic information to put all the info in context. Responses should take no more than about 10-15 minutes. If you haven't received an email inviting you to the survey and you are involved with a PMO, click here to be part of this study.

Thanks in advance to those who are participating, and good luck on the drawing for the Flip!

PMO 2.0 Bites into the Big Apple

We held a PMO 2.0 Leadership Forum in Jersey City at the Hyatt Regency on Thursday last week. What a lovely venue, with expansive views of the NYC skyline across the river. The hotel is next to both rail and ferry service, and very near the Holland Tunnel and Jersey financial center, so it is a good place to attract folks from the city as well as the NJ business area.

The evening view from the Hyatt Regency boardwalk

Featured Speaker Terry McArdle

Terry McArdle, the Vice President of the PMO at Sumitomo Mitsui Banking Corporation (JRI-America), was our featured presenter, delivering a terrific review of both their PMO and the challenging business environment it supports. I can't say enough about the experts that joined him on the discussion panel, including Fumiko Kondo of Intellilink, Jim Bradbury of Fujitsu Consulting and Michael Leser of ESPN. Together, they offered a diverse and formidable body of expertise.

Of course, all that is of little use without the participants, and as have proven to be the case at all of these forums, those attending were engaged and thoughtful in their questions and comments.

Fantastic Four, L to R: Jim Bradbury, Terry McArdle, Fumiko Kondo, Michael Leser

Scheduling these things can sometimes be a frustrating exercise. Despite all the planning that goes into such events and the stunning amount of information available at your fingertips on the web, there is always potential for local conflicts that can't be taken into consideration. I believe in risk management parlance, this is summed up by, "You don't know what you don't know." You may recall that when we went to Philadelphia we realized just a few days before the event that it coincided with the Pennsylvania primary election. In Jersey City, we had an unusual number of no-shows despite the good registration numbers, as well as a lot of attendees coming in at the last minute or after the event began. Well, that would be because it was the first day of school. Ya gotta love it.

Some of the NJ Attendees

Nonetheless, we had a respectable turnout, with several different industries, types of PMOs and levels of service represented. We spent a lot of time talking about adoption-related subjects; always a tricky topic, but the panel offered some great insights and advice.

What's Next — The PMO 2.0 Survey

So, this was our 10th PMO Leadership Forum event, and the last one we have scheduled (so far) for this year. Over the past two years that we have been doing these, we have had such great support and learned so much from all of you that have taken the time to come out and share your own thoughts and issues with us. We have discussed internally where to go from here, but we really need your input on what it is that YOU want. I have some ideas to offer but need your feedback.

The other thing that I am desperate for is to quantify some of the qualitative insights I have gotten from you all. With all that having been said, we will be sending out a PMO 2.0 Survey soon to all of the contacts we have gathered in this process. The goal is to get some basic demographics and data on how today's PMO is functioning within corporations and other organizations, as well as get your feedback on some options for future events. Of course, I will share results with you as we get results, so just a heads up this will be coming to you soon, and your participation is most appreciated (more about the survey when we actually send it out).

The ROI of PPM

I rue the day that someone (more likely a committee, no doubt) decided our airspace should be called Project Portfolio Management. I want to make a case for calling it WRPM — Work and Resource Portfolio Management. I think by now that most everyone has figured out that all of the work in the world is not comprised wholly and exclusively of projects. There are, in fact, other different kinds of work. Often times the costs of this other work far overshadows the money and effort required for the project portfolio.

Furthermore, you don't get very far doing work management without understanding and managing the motive force needed to get it done. Otherwise, you are basically daydreaming; "Gee, what I could do if only I won the Power Mega Million Lottery" sounds suspiciously like, "Gosh, I could meet that aggressive schedule if only I had some staff to actually do the work."

(As an aside, I would also suggest that WRPM also a much more fun acronym, as it conjures up the mental picture of "Wind up the RPMs"; an irresponsible act that brings great joy into my daily life.)

I am starting out with this basic premise as an important level set for talking about the true value of having an integrated view of all the work and resources in your organization. Specifically, what that is worth to you in hard dollars (or Euros, Drachma, or whatever).

Often times, we find ourselves helping prospective customers calculate the return on investment for acquiring a PPM product (that they will use for WRPM). The basis for this number often centers around hardware, software and process improvements directly associated with installing or using the application, such as consolidating the existing hodge-podge of disparate tools, reducing the amount of effort to produce reports, or time it takes execute certain processes. While there are several such direct elements that can be included when calculating the value of implementing a PPM solution, improving the ability of the organization to work more productively has such significant bottom-line contribution that it overshadows all other considerations combined.

This is important not only for purposes of estimating true return on investment, but also for the implications it has on the overall approach and potential success of the initiative. Fundamentally, a PPM implementation should be approached as a business improvement initiative that applies technology as part of the solution, rather than characterized as a "technology project". Placing productivity improvement in the forefront cultivates a more balanced and successful approach that addresses people, processes and technology in equal measure.

For organizations that currently do not have a comprehensive approach and toolset for enabling visibility into overall workload and workforce information, the potential for increasing organizational efficiency is worth millions of dollars a year. Here is why.

Resource effort is the critical raw material of knowledge worker environments. Because technology service providers are almost always in a position of having relatively fixed resource capacity to meet an excess of demand, the ability of an organization to increase the throughput of deliverables results in direct savings in the form of reduced need for external or supplementary staff, avoiding or deferring future staff increases, reducing the per capita cost per deliverable, and/or realizing the benefit of more deliverables sooner.

It is not unreasonable to expect increases of 15-35% in the ability of the organization to accomplish work, depending on the as-found state of the environment, tools and processes. Realizing this level of improvement usually requires that executives and managers also employ process and cultural changes, but the resulting payback is a compelling source of motivation. To put this in monetary terms, assume a nominal productivity increase of 20% and an average fully burdened FTE annual cost of $100,000. This means that the typical annual recurring savings per 100 staff is $2,000,000.00.

With the average customer looking for a solution to manage organizations ranging from a few hundred to several thousand workers, the annual cost/benefit ratio of this calculation ends any lingering doubts over whether the initial investment is worthwhile. If you are the pessimistic type and dubious that you can get much beyond a mediocre implementation, halve the efficiency increase to only 10% (that's only 4 hours per week per staff redirected to high value work); it is still a no-brainer.

But trust me, for most organizations, 20% is like falling off a log; I did it easily 13 years ago, when I was comparatively clueless about that I was doing.

The Innovation Multiplier

However, this calculation by itself does not fully reflect potential bottom line benefit. Innovation defines the ability of an organization to move forward by accomplishing work of high value to improve its overall business posture. Even small gains in the amount of effort spent on operational work can be reinvested into initiatives that transform and expand the business to further multiply savings.

Using a nominal IT spend ratio of 25% to innovation and 75% on current state operations as an example, a mere 5% reduction in operational costs re-applied to innovation nets a 20% increase in the ability of the organization to innovate. Time and effort spent on maintaining the status quo is inherently limited in its net value to the business. Redirecting capacity to engage in more business innovation has almost unlimited ability to contribute to the success of the enterprise.

The Source of Productivity Improvements

Where do these significant increases in productivity come from? There are several specific improvements enabled by integrated work and resource portfolio management, in combination with improved governance and a strong integrated business management process framework, which allows the implementing organization to become more focused, proactive and efficient. These include:

1. Improving alignment between strategic intent and the work being performed, which increases organizational focus to "do the most important work first"
2. Making consistent, informed and transparent decisions for resource utilization and financial spending improves business governance
3. Centralizing inbound requests to analyze total demand creates opportunities to consolidate compatible work, eliminate redundant or low-value requests and better manage the backlog
4. Establishing common priorities fosters a unified sense of purpose and improves collaboration between various matrix environment skill centers
5. Visibility into individual capacity versus assignments allows resources to be better directed using achievable weekly goals. This allows managers to hold staff accountable to target objectives and better control how time is utilized.
6. Use of a common real time data source and business application to manage work and resources ensures that everyone is working with a complete perspective of all the information needed to make decisions, as well as the necessary functions to revise and immediately communicate changes in plans
7. Reduction in the amount of work done in a reactive manner, along with the resulting number of efficiency-robbing stops and starts caused by excessive multi-tasking. Proactive work planning allows staff to focus on fewer assignments for longer time periods, enabling them to get into "the zone" of productive work more often.
8. Better visibility and understanding of how the organization really operates, allowing specific bottlenecks, roadblocks or inefficiencies to be identified and corrected
9. Improved ability to identify and adjust to business dynamics that impact work plans, allowing the organization to be more responsive to change influences

All of these improvements result in a more focused organization that is better able to manage and employ its resources. By being able to accurately measure how effort is currently being applied, immediate improvements can be instituted in staff utilization. Often times, significant increases in utilization can be achieved through a number of minor tactical changes rather than major sweeping modifications. For example, analyzing the amount of time spent in unproductive meetings or on unnecessary travel, finding repetitive functions that consume too much effort and need process improvements, locating pockets of under-utilized staff that can be redirected to more productive activities, or identifying tasks that represent a duplication of effort, are all examples of low hanging fruit that provide quick wins in how effort is used.

In addition to the direct benefits inherent in these improvements, they work in concert to improve the overall effectiveness of the workplace in other significant ways. For example, a common secondary benefit is lower staff turnover, especially in critical skill sets. By working more productively rather than longer hours, and by making better use of individual talents and skills directed to high value activities, workers feel more engaged and successful, and the organization gains self-confidence that stems from operating in a methodical manner at visibly higher levels of performance.

This is the ROI of PPM. You take the initiative, and we'll provide the expertise and tools.