The multi-million pound PMO: 10 things you need to know

By following the top 10 dos and don'ts explored in this article, you will be able to navigate challenges and avoid some of the most common pitfalls in managing a large portfolio.

Most of us are familiar with the proverb ‘good things come in small packages’. As project management offices (PMOs) expand to span divisions or even whole enterprises, many of us find ourselves managing larger and growing portfolios. At the same time, we are proving good things can also come in big packages. By following the top 10 dos and don’ts explored below, you will be able to navigate challenges and avoid some of the most common pitfalls in managing a large portfolio.

1. Get organised by defining a portfolio hierarchy
Although each project is important, all things are no longer created equal. Agree a portfolio hierarchy with senior management and confirm which initiatives are most critical for the portfolio. Not only does this set priorities for your PMO, it will also illustrate the escalation path for risks and issues that arise in the portfolio.

2. Set standard reporting periods
Establish and agree with senior management the fixed intervals (eg monthly, fortnightly, weekly) to gather status information from the portfolio. Use the most recent version to feed all reporting needed until the next time the data is refreshed. Not much will change between periods, and this will prevent a vicious circle of continual updates and discrepancies when two reports issued around the same time reflect different statuses. However, in the event that something major has changed between reporting periods, a verbal comment or text footnote may be added to highlight this update. If you find this happening often, you should consider a more frequent period for refreshing the information.

3. Invest in proper tools and reporting
With a large portfolio, it is critical to be able to slice, dice and drill into the data that is captured. Sophisticated data-warehousing and reporting tools are nice, but it is always helpful to have a Microsoft Access or Excel guru in the PMO who can design and create tools and reporting quickly to massage the data into the different views you need. Adding the right ‘tags’ to existing data will often give you the additional information requested without having to design an entirely new process to capture it. For example, by tagging existing milestones reported as ‘regulatory’ where applicable, a regulatory milestone roadmap can be created using existing data.

4. Drive standardisation
Encourage stakeholders to source from the data and reports provided by the PMO, instead of building their own separate tracking and reporting. This not only helps avoid unnecessary reconciliations between their data and yours, it also improves quality. Push to have this standard reporting used for all governance bodies. Be assertive – there is only one version of the truth, and that is what the PMO creates. When project managers know that their submission will be seen by senior management, they will pay much more attention to the quality. Standardisation also saves resource time, with effort spent on one report, rather than several.

5. Keep it simple
Both those providing and those consuming PMO information have many other roles and responsibilities beyond their interaction with you. Do not over-engineer your processes for the sake of designing a top-of-the-line process. Communication should be in the language and frame of reference of the target audience. It is the responsibility of the PMO to take the time to communicate in a clear manner, rather than putting this burden on your stakeholders.

6. Communicate a consistent and unified message
The larger the PMO team, the greater the risk of ineffective communication, with the left hand not knowing what the right hand is doing. Formalise a communications plan that allows you to leverage existing meetings and communications, along with consolidating requests from various PMO sub-teams to the same stakeholders for information. The PMO team should avoid scenarios such as sending an email on Monday requesting a response on financials due on Wednesday; sending an email on Tuesday requesting a response on resource plans due on Thursday; or sending an email on Wednesday requesting a response on status due on Friday. One email should go out requesting a response on financials, resource plans and status due on the same day, or as close together as possible.

7. Be clear on accountability
You will no longer be able to know it all. In smaller portfolios, it is easy to correct careless mistakes and improve the quality of information reported, as you are familiar with the subject matter. As the size of the portfolio increases, you will not be able to keep up with the content, and need to rely on the project to provide the highest quality of information from the start. Define clear roles and responsibilities, and reinforce that the PMO is responsible for the reporting and transparency of the portfolio, while the actual content is the accountability of the project.

8. Keep track of ‘fire drills’
One of the biggest time killers is responding to unplanned and often urgent requests from management. Before beginning to gather the information, make sure you truly understand the question. At times, the requestor does not know exactly how to ask for what they need. By digging just a little deeper, you may find that you already have the information to hand. Most ad hoc requests turn into routine requests in the future, so determine a way to incorporate the task into the PMO book of work to avoid it becoming another ‘fire drill’.

9. Embrace being an enabler
Always remember that the PMO does not actually deliver the end product of the organisation. Although you are a valuable ally for the projects and the first line of defence of the portfolio to senior management, delivery should, and will always, come first. Use this to your advantage when working with your stakeholders by positioning your PMO as one that solves rather than creates problems.

10. Strive for efficiency and savings
Regardless of how essential and helpful the PMO is, it is a cost centre, as opposed to a revenue generator. PMO expenses take away funds that could be applied to delivery, so you should continually strive to keep your PMO lean and efficient. Do not assume that your costs should grow at the pace of the portfolio. With the right portfolio hierarchy, tooling and reporting, the PMO should be able to scale to the size of the portfolio. Often, the solution is not adding staff or costs, but instead improving the processes. When costs come under pressure, do not be afraid to renegotiate the PMO’s level of service with senior management.

The PMO discipline has become more advanced, with an increasing number of organisations really understanding its value. Each PMO encounters its own unique situations, but, with the 10 tips listed above, you will have an idea of how to start tackling your issues. Hopefully, you will discover that good things come not only in small packages, but also from your PMO.

Michele Echols is a director at a financial services firm, leading the global project portfolio services team in the risk and finance IT division.