It is fascinating that the PMO acronym can stand for such different things within the Project Management discipline. What does it stand for? Well, at least three things!
PMO - Project Management Office
PMO - Program Management Office
PMO - Portfolio Management Office
So what's the difference??
Let's start with the PMO (sorry - couldn't resist!), the Project Management Office. There is a lot of variation in how Project Management Offices actually "look" within organizations, but they all represent a view of project governance regardless of the projects alignment.
Traditionally, there are three types of Project Management Offices:
Supportive - these provide a reference function. They have the templates, lessons learned, policies, process, etc. When the project is begun, the Project Manager is directed there to research how to run the project.
Controlling - all of the above plus they provide human support. They may have experts to assist you in navigating the organizations governance processes, serve as documentation reviewers, and even determine if the project has met the requirements to move forward within their milestones. They may also have to approve your plan, determine if you can deviate from templates within the plan and work with you to determine the overall schedule.
In neither of these cases is the Project Management Office responsible for the delivery of the project!
They provide assistance, and in some cases grade the project to determine if the project is ready to advance to the next milestone. If the project falls behind schedule, goes over budget or experiences significant problems with scope, they dutifully report it.
However, no one is holding the Project Management Office accountable! That’s what the Project Manager is for…
This leads us to the third type of PMO:
Directive - In a Directive PMO, they are responsible for project delivery and serve as a home for the project managers. This has profound implication for the organization as the responsibility for delivery has shifted from the sponsoring organization to the PMO. This also has implications for career paths for the project managers, project selection (do we have a project manager to deliver it?) and C Suite politics.
I will discuss this in the future as it is a fascinating topic!
The second PMO is the Program Management Office.
Program Management Offices are used when you have related activities. The implication is that there is a need for a level of coordination and integration among the Projects and related activities.
This impacts everything! The release dates of the projects need to be coordinated. The resources need to be coordinated. Ensuring that there is Configuration Management among the projects is one of the main responsibilities of the Program Management Office.
Think of the Apollo Program. Everything had to work together to get an astronaut to the moon and back safely! This high level of integration required, by definite, an Apollo Program.
The third PMO is the Portfolio Management Office.
Portfolio Management Offices are used when you have Projects and related activities that are strategically aligned, but not necessarily related. Since these are strategically aligned, they should all point to a common strategic priority.
Let’s say that your company has a strategic priority to “increase your media presence”. You could do this in a variety of ways. You may develop a web site, establish a Twitter account, start a blog, establish a Facebook presence, advertise in print, advertise on the radio, and begin connecting on LinkedIn. All of these can be done independently, but the activities and projects should be managed through the Portfolio Management Office to ensure that they are all being aligned to achieve the Strategic priority!
You can be hugely successful in establishing a Facebook and LinkedIn presence, and fail miserably in your advertising. That is why this is a classic Portfolio. While they are aligned activities, they aren’t connected in the sense failure in one are impacts success in another!
As with the Program Management Office, this has profound impact on project reporting, allocation of resources, risk assessment and overall project governance. Configuration and integration management are not issues, nor are harmonizing of releases and resources. This frees up the PMO to ensure strategic alignment while treating each subordinate project as a standalone activity.
This also free up the PMO to “kill” a project if it isn’t contributing to the strategic priority, or move resources among the projects if one proves to be higher value than another.
This is dramatically different than a Program Management Office where the work is all coordinated.
It is common to establish a Program Management Office when you really need a Portfolio Management Office. This is a mistake! It contributes to significant governance problems across all Project Management process groups.
The next time you identify multiple projects and activities that require a higher level of governance, take the time to determine if you have a Program or a Portfolio.