Should the Delivery PMO remain independent of the Program Director or is it essential that they are deeply involved? The answer: It depends on what is fit for purpose.
The decision about where a Delivery PMO sits within an organisation, how it reports, and the capabilities it provides are critical decisions that are best made early in the establishment of the PMO. The trick is ensuring that a considered and informed judgment is made to ensure that optimal arrangements are in place to ensure it is fit-for-purpose and that its Program Director is involved at an appropriate level.
The answer to where the PMO should sit in a governance structure ultimately depends on the nature of the program.
Program-led Decisions: What Type of PMO and The Governance Required
There are many types of PMOs, however, the most common and well-known are the Enterprise PMO, the ITPMO and the Delivery PMO. Enterprise PMOs govern the enterprise’s change agenda, ITPMOs normally govern the delivery of the IT Program of Work whilst the Delivery PMO is set up to govern and deliver a discreet piece of work. Another type of PMO we often see is the Transformation PMO, however these are typically similar in nature to a Delivery PMO.
Delivery PMOs are temporary and formed for the duration of a project or program then are typically disbanded when it is complete.
One of the questions often posed is one of governance around the PMO: Who should the Delivery PMO report into and why? More importantly, where does the authority of the Project Director start and finish in relation to the PMO?
Authority depends on capabilities required from the PMO
To answer the question about the Program Director’s authority, we first need to understand the capabilities that might be required from the Delivery PMO.
IMAGE 1: Quay Consulting PMO Capability Framework
In the PMO Capability Framework above, we have illustrated the typical levels and capability tiers that can exist in a PMO. In our experience, a Delivery PMO provides a large portion of the middle-tier capabilities, (read “Portfolio” as “Program”). On top of this, it also shares with the Program Director (or Manager) the provision of the capabilities required in the bottom tier of the capability model.
At a high level, the middle tier capabilities are for the most part investment-focused, ensuring that the right projects, people, governance, and reporting is in place. This suggests that independence from the Program Director is important to ensure a level of check and balance between those who are physically delivering the program (i.e. the work) and those ensuring that it is actually delivering (i.e. the assurance). We’d call this being outside the tent.
Where this becomes problematic, however, is when the Delivery PMO also provides the Project Shaping and Supply Management capabilities, which directly influence the delivery. Shaping impacts the how and the what, whilst supply impacts the who.
Careful attention needs to be paid to how these capabilities are provided to ensure that the PMO and the Delivery team are not unintentionally set up to lob grenades across the independence border when things are not working as planned.
Looking at the bottom tier of the Capability Framework, there are capabilities that are split between delivery-focused (Planning, Implementation, Change, and Resource Management) vs those that are assurance-focused (Benefits, Governance, and Reporting).
In this instance, a Program Director would be heavily involved in each of these capabilities, making it very difficult – if not, impossible – to have a Delivery PMO that is independent of the Program Director. This would suggest that the Delivery PMO should report to the Program Director. This we call being inside the tent.
So should the Delivery PMO be outside or inside the tent?
There isn’t a right or a wrong answer; rather, there is a process to work through to determine what is fit-for-purpose for the program. Let’s look at two different scenarios to illustrate how this can be determined:
The fully outsourced program: In our first example, the program has been completely outsourced to a systems integrator (SI) who has full accountability for the entire delivery, including change management. In this instance, the SI would no doubt create their own SI PMO, which would report to their Program Director.
The organisation engaging the SI may also establish their own Delivery PMO for the program, which focuses on the investment and assurance capabilities across the middle row, as outlined above. These capabilities may also be provided by an organisation’s IT PMO. In this case, the Delivery PMO could report directly to the Program Sponsor and sit independently of the Program Director.
The multi-project program: In our second example, the program is comprised of a number of projects being run by a combination of internal staff, various vendors, and rolled up under an overall Program Director and Program Board. In this instance, the Delivery PMO would sit comfortably with the Project Director, providing they are independent of the vendors that are delivering the projects. Each vendor would normally engage their own ‘supply’ and bottom tier capabilities, thereby reducing the likelihood of the grenades coming over the fence.
Understand the structure and nature of your PMO to decide
Having led and recovered programs of work over many years, we recommend that the decision of where a Delivery PMO sits, where it reports into, and the capabilities it provides, is best worked through at the program’s inception. Referencing a proven capability model enables the organisation to make a considered and informed judgment that the optimal arrangements are in place.
There isn’t a right or wrong answer about whether the Delivery PMO should be inside or outside the tent, but there will be a determination about what is the ‘best fit’. The trick is taking time early in the establishment of the program and undertaking the right analysis – with the right tools – to arrive at an optimal model.
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