In an agile world, what’s the role of the PMO?

The agile trend is here to stay. According to EU Consultancy, around half of all organisations have now been applying agile practices for at least three years as a methodology for change and transformation.

While agile has its roots in the software industry, its benefits – endowing companies with a more flexible, efficient and results-led way of delivering products and services – have been shown to boost bottom-line results in other sectors. EU Consultancy highlights international studies that demonstrate leaders in agile working rank in the top quartile for revenue growth and profitability.

So, in this brave new agile world, where does the project management office (PMO) fit in?

The traditional take on a PMO is a group or department within an organisation that defines and maintains standards for project management within that organisation, with the aim of standardising and introducing economies of repetition in the execution of projects.

The PMO trend has grown over the past four decades, with these types of groups or departments now embedded in some 60 per cent of worldwide organisations. A more up-to-date definition describes a group or department within an organisation tasked with the centralised, and coordinated, management of all projects.

PMOs need to be reinvented

As organisations increasingly adopt more agile approaches, this entails fewer management layers, and thus project-based work and self-managed teams come to the fore. Consequently, PMOs need to adapt urgently, according to Antonio Nieto-Rodriguez, former chair of the Project Management Institute and co-founder of the Strategy Implementation Institute.

“The current view of the PMO as part of a hierarchy is dead,” he says. “They need to be reinvented.”

There are two parts to the successful reinvention of the PMO. The first is a move towards strategy implementation, focused on strategic project selection and implementation, reporting directly to the CEO and executives. “That means developing new competencies in strategy, business acumen, value generation and strategy implementation,” he says.

Second, PMOs must become more “fluid and agile”. Traditionally, the PMO functioned to provide support. To survive, PMOs will need to “drive the implementation of large transformation programmes, together with the project managers”. Nieto-Rodriguez believes agile PMOs will be temporary. “They will be able to recommend which parts of the programme will be carried out with traditional project management techniques, which will be better for using agile methods, or a mix.”

PMOs will also support implementation with “change methods and technology”, he adds. “That means developing new competencies in innovation, technology, value creation, change management and strategy implementation.” And, in certain circumstances, fluid PMOs might take over the ownership and running of the outcome of the project once completed.

No one-size-fits-all

These all sound like competencies more associated with entrepreneurship than the more traditional PMO role, which can be thought of as rigidly pursuing process. PMOs need to be constantly re-evaluating and interrogating themselves about how they can help the organisation excel.

Emma-Ruth Arnaz-Pemberton, director of consulting services at Wellingtone and chair of APM’s PMO SIG, says: “The key with PMOs is that there is no one-size-fits-all, so they need to continually adapt to support the organisational objectives. Successful PMOs today are less process-driven and more people-driven. They act as a service provider, adapting their service offering to the reality of the organisation.”

Since the APM Body of Knowledge, 7^th edition added the concept of the PMO in 2019, Arnaz-Pemberton has observed a steeper rise of PMOs in smaller organisations, which are acknowledging that the project discipline is more important than previously thought.

Articulating value

Arnaz-Pemberton acknowledges that the value of the PMO is one of the hardest things for teams to articulate. The approach of using process and governance to “get stuff done” can feel safe and provide a sense that milestones have been accomplished. Today’s success-oriented PMOs need to deliver value, not just process for process’s sake, which can be challenging to quantify in terms of the bottom line.

“I always recommend attaching metrics to services and demonstrating value in that way. That is not to say that this makes a nice linear approach either. It’s important for PMO leaders to think outside the box, tell a story with their metrics and be able to articulate in non-project speak what their PMO does,” Arnaz-Pemberton says.

In the last year, she says, Wellingtone has seen a rise of maturity assessments of organisational PMOs. “I personally spent lots of the 2020–2021 year assessing organisational project portfolio management and PMO maturity as PMOs strive to see how they could have handled things better. This is leading to the development of efficiencies across organisations – a trend that I believe will continue.”

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