YOUR COMPANY

LOGO

PROJECT MANAGEMENT OFFICE

(PMO) CHARTER
for

<Company Name>

Version x.x

<Version Date>

Prepared by: <PMO Lead or PMO Sponsor>

Authorized by: <Executive Body>
<Y OUR ORGANIZATION NAME> PUT YOUR LOGO HERE

Document Version History

Version Date Description of Changes Author / Editor Approved By
0.01 Initial draft

Document Executive Sponsor/Owner

Name Title Organization E-mail Contact #

Document Distribution
Name Type of No. of Title Organization E-mail Tel.
Copy Copies
TBD TBD TBD TBD TBD TBD TBD

II PMO CHARTER
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GENERAL TEMPLATE INSTRUCTIONS:

[This “PMO Charter” template is for a company that will be establishing a Project Management
Office (PMO), focused on Information Technology projects. However, this template is generic and
you can easily apply specific sections to non-IT project focused PMO organizations. For
example, if your are establishing a PMO for construction or real estate projects, you should use
the structure of the document and the existing sections, such as the “Executive Summary”,
“Objectives”, “Metrics”, “Critical Success Factors”, etc. Simply adapt the content of the section to
best fit your industry.]

As you begin to use this template, initially do the following:

ƒ Search and Replace “<Company>” or “<Organization>” with the name of your organization
ƒ Search and Replace “<Executive Body>” with the name of the group who authorized (or will
authorize) creation of your PMO
ƒ Search and Replace “<PMO Sponsor>” with the name of the person who is sponsoring the
PMO
ƒ Search and Replace “<PMO Lead>” with the name of the person who will supervise and lead
the PMO operations
ƒ Watch for other items in <angle brackets> where you will need to substitute text appropriate to
your organization
ƒ As you complete each section, delete the instructional text (the text in italics and surrounded
by [brackets])

PMO CHARTER III

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TABLE OF CONTENTS

EXECUTIVE SUMMARY.........................................................................................................................................1

INTRODUCTION.......................................................................................................................................................3

PMO JUSTIFICATION .............................................................................................................................................3

PMO VISION ..............................................................................................................................................................4

PROJECT SUCCESS......................................................................................................................................................4
PMO MISSION ...........................................................................................................................................................5

PMO OBJECTIVES ...................................................................................................................................................5

1. ESTABLISH & FACILITATE PROJECT SELECTION................................................................................................6
2. ENCOURAGE A PERFORMANCE F OCUSED PROJECT ENVIRONMENT...................................................................6
3. DELIVER SUCCESSFUL IT PROJECTS..................................................................................................................6
4. BUILD PROJECT MANAGEMENT DISCIPLINE & PROFESSIONALISM ....................................................................8
5. KEEP <ORGANIZATION>’S MANAGEMENT TEAM AND PROJECT MANAGEMENT COMMUNITY INFORMED .........8
6. SERVE AS <ORGANIZATION>’S AUTHORITY ON PROJECT MANAGEMENT METHODS AND PRACTICES ...............9
CRITICAL SUCCESS FACTORS............................................................................................................................9

PMO METRICS........................................................................................................................................................10

PMO STAFFING.......................................................................................................................................................11

PMO SPONSOR........................................................................................................................................................12

PMO ORGANIZATIONAL STRUCTURE............................................................................................................12

PMO STAKEHOLDERS..........................................................................................................................................12

PMO AS A LEARNING ORGANIZATION ..........................................................................................................13

PROPOSED STRATEGY TO ESTABLISH THE PMO ......................................................................................14

PMO DRAFT BUDGET ...........................................................................................................................................15

FUTURE OF THE PMO ..........................................................................................................................................15

APPENDICES............................................................................................................................................................16
APPENDIX A : FREQUENTLY ASKED QUESTIONS (FAQ)...........................................................................................17
APPENDIX B : VALUE OF A SUCCESSFUL PMO TO THE ORGANIZATION ...................................................................20
APPENDIX C : EXPECTED BENEFITS FROM THE PMO FOR SPECIFIC CUSTOMERS .....................................................21
APPENDIX D: PMO SUCCESS FACTORS....................................................................................................................23
APPENDIX E : STEPS THE <ORGANIZATION> CAN TAKE TO ENHANCE PROJECT SUCCESS .......................................24
APPENDIX F : GLOSSARY OF TERMS, ACRONYMS, AND ABBREVIATIONS.................................................................26

IV PMO CHARTER
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EXECUTIVE SUMMARY
[This Executive Summary should provide an overview of the purpose, objectives, staffing,
leadership, and critical success factors of your PMO organization. Make sure you specify who
designated the creation of the PMO and the name and title of the Executive Sponsor. Some
“generic” content for this section is provided below.]

The <Organization> Project Management Office (PMO) is a service organization created for the
specific purpose of supporting <Organization>’s Information Technology (IT) [or state as
appropriate in your industry] Program.

The mission of the PMO is two-fold:

ƒ Guide key (IT) projects to a successful conclusion
ƒ Create a foundation for consistent project success throughout the organization. Do this through
development of a strong and pervasive Project Management (PM) discipline within the
organization’s project teams.

In support of that mission, the PMO has four primary objectives:

Deliver successful IT projects … → Provide Project Management services and oversight for
select IT projects.

Build Project Management → Mentor, train, and guide the organization’s project
professionalism among teams as they learn and then adopt PM best practices
<Organization>’s staff … in their projects.

Keep <Organization>’s Management → Provide a variety of regular updates ranging from

Team and Project Management monthly status of enterprise projects to an annual
community informed … report on the organization’s progress at
institutionalizing Project Management.

Serve as <Organization>’s authority → Set the standard, provide the tools (e.g. Risk
on IT Project Management practice Evaluation tool, templates) and then be the resident
… advocate and model for good Project Management
practice.

Through sponsorship by <PMO Sponsor> and supervision by <PMO Lead>, the PMO gains:
ƒ Authority it needs to promote <Organization>-wide organizational change effectively

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ƒ Independence that can sustain objectivity

ƒ Oversight that can keep its work aligned with the organization’s business strategy
ƒ Legitimacy as it fosters an effective, enterprise approach.

The PMO has three sources of staff:

ƒ Direct appointment of existing or new <Organization> staff into the PMO
ƒ Temporary assignments from other departments (report to PMO via dotted line)
ƒ Contracted staff (as needed to provide expertise or staffing not available within <Organization>).

The PMO operates under this guiding principle:

The success of the PMO is derived exclusively from the

success of its customers.

Note: See Frequently Asked Questions in Appendix A and Glossary in Appendix H for
definition of terms and concepts used in this document.

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INTRODUCTION
[This section introduces the reason or reasons for this document. Some “generic” content for
this section is provided below.]

<Organization>, through its <Executive Body>, has authorized the creation of an Enterprise
Project Management Office. The purpose of this charter is to establish agreement on key aspects
of the PMO in advance of its implementation.
This charter is, in effect, the organizational mandate for the PMO to exist. This document defines
the purpose, vision, mission and functions of the PMO. It states who the PMO's sponsors and
primary stakeholders are, the services that it offers and the staffing and support structures
required to deliver those services.
This charter is not the project plan for implementing the PMO, but instead a statement of what the
PMO will do once it is fully implemented.

PMO JUSTIFICATION
[This section provides the details regarding the reason or reasons for establishing the PMO.
Make sure these are the reasons as agreed to by your organization’s senior management before
authorizing the creation of the PMO and authorizing the budget. Some “generic” content for
this section is provided below.]

Establishment of the PMO arose out of the perception that the organization’s (technology)
projects were not adequately meeting the needs of those for whom they were undertaken. The
observable problems with these projects include: [note: make sure to quantify the following
“problem” areas]
• missed delivery dates,
• cost overruns,
• incomplete deliveries, and
• dissatisfied customers.

<Organization>’s Senior Management Team is aware of a wide variety of possible causes for
these difficulties.
<Organization>’s purpose in establishing the PMO is to provide a means for eliminating those
problems that have arisen due to inadequate or poorly applied Project Management practice.
Note, however, that establishment of a PMO also carries the possibility of additional benefits as
listed in Appendices B and C.

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PMO VISION
[Keep this succinct. The Vision should capture the spirit of what you are trying to accomplish in
just a few words. An example and some “generic” content for this section is provided
below.]

Successful IT Projects. Every Time.

Project teams and Project Managers are encouraged to be creative, adopt new approaches,
expand their skill set and take appropriate levels of risk in their pursuit of this Vision. (See section
below on “PMO as a Learning Organization”.)

PROJECT SUCCESS
[It is very helpful to establish a definition of success here that can be applied to all that the PMO
does. Discuss “success” with the executives in your organization and then distill their comments
into a definition that fits your culture. Some “generic” content for this section continues
below.]

Based on input from <Organization>’s executive management, the PMO considers a project to be
a complete success when the following are true [note: make sure to quantify these “success
metrics”, as best as possible, with the agreement of your senior management]:

ƒ Pre-defined Business Objectives and Project Goals were achieved or exceeded (i.e., the project
satisfied the need that created it)
ƒ A high-quality product is fully implemented and utilized
ƒ Project delivery met or beat schedule and budget targets
ƒ There are multiple winners:
ƒ Project participants have pride of ownership and feel good about their work
ƒ The customer is happy
ƒ Management has met its goals.
ƒ Project results helped build a good reputation
ƒ Methods are in place for continual monitoring and evaluation.

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PMO MISSION
[The Mission of the PMO should be fully in support of the Vision. The Mission expands upon
the Vision and provides guidance on how the Vision will be made manifest. An example and
some “generic” content for this section continues below.]

Provide a solid foundation for <Organization>’s Information Technology

Program by creating an environment of measurable, disciplined Project
Management professionalism where:

ƒ Project success is the norm

ƒ Project teams are proud of their work
ƒ Project teams are rewarded for high levels of performance
ƒ Internal customers reap the benefit of a carefully planned investment
ƒ The citizenry wins through improved service or lower cost.

The PMO operates under the following primary guiding principle:

The success of the PMO is derived exclusively from the

success of its customers.

PMO OBJECTIVES
[The PMO Objectives, as agreed to by the senior management of the PMO should be fully in
support of the Vision. The Mission expands upon the Vision and provides guidance on how the
Vision will be made manifest. Some “generic” content for this section continues below.]

For each objective, the PMO will develop one or more SMART1 targets against which to evaluate
performance. PMO performance will be reviewed quarterly. SMART targets will be evaluated
and renewed annually. PMO governance and leadership will agree upon the validity and
usefulness of all targets.

1
SMART = Specific, Measurable, Attainable, Results-oriented, Time-delimited

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Primary PMO Objectives are:

ƒ Establish and facilitate project selection criteria aligned with <Organization>’s business
objectives and direction.
ƒ Encourage a project environment focused on performance and execution
ƒ Deliver successful projects
ƒ Build Project Management discipline and professionalism among <Organization>’s staff
ƒ Keep <Organization>’s Management Team and Project Management community informed
ƒ Serve as the <Organization>’s authority on Project Management methods and practices

Listed below is the specific work that the PMO will perform in order to meet its objectives.

Note: This list is not exhaustive. PMO implementation may involve introduction of this work in a
phased manner.

1. ESTABLISH & FACILITATE PROJECT SELECTION

The PMO will work with the Finance Team, and with the approval of <Organization>’s
Executive Management Team, establish quantified criteria for the selection of projects.
These criteria will be ROI-based and conform with <Organization>’s overall business
objectives regarding Return on Investment.

2. ENCOURAGE A PERFORMANCE F OCUSED PROJECT ENVIRONMENT

All projects for which the PMO is accountable for successful delivery, will be regularly
monitored and measured for performance using Earned Value (EV) or some other
performance calculation. All projects will be encouraged to regularly self-monitor
performance and share these performance measurements with Project Sponsors and
Stakeholders.

3. DELIVER SUCCESSFUL IT PROJECTS

The PMO collaborates with IT and <list other key players> to manage the IT Projects portfolio:
ƒ As part of a management team that includes <list members>, assist in development and
articulation of <Organization>’s technology strategy
ƒ Work with <list players> to make the IT project-selection process successful
ƒ Maintain and publish a master IT projects schedule, including critical milestones

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ƒ Assist IT and <list players> with project resource management

ƒ Warn <Executive Body> of IT projects at risk and provide recommendations
ƒ Perform capacity planning with IT and <list players> so that <Organization> makes
optimal use of its resources.
ƒ Regularly, as agreed, monitor and measure project performance
ƒ Work with the Project Manager and Project Sponsor to make adjustments to under-
performing projects

The PMO manages all Enterprise IT projects either directly or indirectly (per definitions
that follow) and is accountable for successful project delivery.
ƒ The PMO directly manages other projects on request:
o Sponsors make their requests to the PMO. PMO, IT, and <list other groups>
collaborate to decide where PMO resources should be allocated
o PMO provides Project Management services for the project
o PMO is accountable for successful project delivery
o PMO deals directly with the Sponsor
o PMO enforces its Project Management methodology and standards on these
projects.
ƒ The PMO indirectly manages other projects on request:
o Sponsors make their requests to the PMO. PMO, IT, and <list other groups>
collaborate to decide where PMO resources should be allocated
o Department provides the Project Manager for the project
o Project Manager reports on dotted line to PMO for duration of project.
o PMO provides guidance to the Project Manager but under normal
circumstances would not provide direct Project Management services.
o PMO is accountable for successful project delivery
o PMO deals directly with the Sponsor and Project Manager
o PMO enforces its Project Management methodology and standards on these
projects.

In addition, the PMO <list additional services here>:

ƒ Performs quality audits on request
ƒ Performs risk audits on request
ƒ Provides Business Analysis services (e.g., Requirements Analysis, Joint Application -
Development sessions) on request.

Note: The PMO encourages the use of its published Project Management methodology and

PMO CHARTER 7
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standards and best practices in all IT projects. However, the PMO only enforces its published
Project Management methodology and standards on those projects for which it is accountable
for successful project delivery.

4. BUILD PROJECT MANAGEMENT DISCIPLINE & PROFESSIONALISM

ƒ Mentor2 PMO project teams (and other project teams by request)

ƒ Assist project teams in all phases of their projects from project definition to rollout
ƒ Train3 <Organization> Project Managers in a full range of Project Management topics
ƒ Create and maintain a Project Management Core Team composed of <Organization>
staff who work as Project Managers on IT projects. Work with this team as a means of
building and sharing Project Management expertise.
ƒ Work with <Organization> in development of a Project Management Career Track
ƒ Recognize excellence in Project Management in accordance with a focused Reward and
Recognition Program.
ƒ Serve as honest broker on all issues brought forward to the PMO by Project Managers.
ƒ Participate in the performance reviews of Project Managers who report to PMO on
dotted line
ƒ Provide training to all levels of <Organization> management so that supervisors, middle
managers and executives each understand their role in making projects a success

5. KEEP <ORGANIZATION>’S MANAGEMENT TEAM AND PROJECT

MANAGEMENT COMMUNITY INFORMED

2
Mentor in such areas as:
ƒ " RFP Development
ƒ " Vendor Management
ƒ " Risk Assessment
ƒ " Issue Management
ƒ " Team Development
ƒ " Organizational Change Management
3
Training venues can include:
ƒ " Formal Project Management classes
ƒ " In-service training electives (sponsored through Personnel and designed for each department)
ƒ " Special seminars and workshops
ƒ " Supervise fundamental Project Management training provided by a third party

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ƒ Report to <Executive Sponsor> on:

o Enterprise projects – monthly
o Other projects – quarterly
o Special projects – only upon request
o Metrics that measure PMO effectiveness – annually
o Issues and opportunities – as they arise.
ƒ Under the direction of <Executive Sponsor>, provide regular reporting to the
Executive Management Team.
ƒ Maintain and publish a “Lessons Learned” database
ƒ Maintain the PMO Web site
ƒ Serve as the “technology-to-English translator” for the <Executive Body>.

6. SERVE AS <ORGANIZATION>’S AUTHORITY ON PROJECT

MANAGEMENT METHODS AND PRACTICES

ƒ Set <Organization>’s Project Management methodology and standards

o PMO works with an advisory group of <Organization> Project Managers to update
and maintain the methods, practices, and standards
o Methods and Standards are posted on the PMO Web site
ƒ Be the resident advocate for good Project Management practices in the organization.
ƒ Select Project Management tools for organization-wide use
ƒ Serve as the official source of project templates and other project aids.

CRITICAL SUCCESS FACTORS

[The PMO’s “Critical Success Factors”, as agreed to by the PMO governance team and PMO
Leadership, should be fully in support of the PMO Objectives and aligned with your company’s
business objectives. Some “generic” content for this section continues below.]

The following may be considered necessary steps <Organization> can take that help ensure PMO
success:

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ƒ Implement a Rewards and Recognition Program that specifically supports the Project
Management process and achievement of project objectives.
ƒ <Organization>’s Senior Management Team provides the PMO with unanimous, visible, and
vocal support
ƒ Introduce PMO functions in a phased manner. Do not try to do it all at once.
ƒ <Organization>’s Senior Management Team supports the process of Organizational Change.
Managers recognize that some groups and individuals will embrace the change in Project
Management practice better than others

A list of additional Success Factors is provided in Appendix D. The PMO will be more successful
in the long-term if these factors can be achieved.
In addition, Appendix C presents numerous steps <Organization> can take in conjunction with
establishment of an PMO in order to hasten and enhance benefits from the PMO.

PMO METRICS
[The PMO Metrics, as agreed to by the PMO governance team and PMO Leadership, should be
fully in support of the PMO Objectives and aligned with your company’s business objectives.
Some “generic” content for this section continues below.]

Metrics should measure those aspects of PMO performance that are directly related to its
Mission. On that basis, the following areas of focus can be used to judge PMO value:

ƒ Are the organization’s projects more successful over time?

ƒ Is there evidence that <Organization> staff is taking a more professional approach toward
project management discipline and practices?
ƒ Are the attitudes of <Organization> staff regarding project activities and results improving?
ƒ Are the products of the organization’s projects meeting their business objectives?
ƒ Is <Organization> meeting those business objectives directly aligned with project performance
and project success?
The PMO staff will develop or acquire appropriate instrument(s) with which to obtain objective
measurements. The PMO Sponsor will approve the instrument(s) before they are used.
Examples:
ƒ Improvement in project success over time can be measured through decreases in schedule and
budget variances or the tone of customer comments

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ƒ Project Management approach can be measured by quality and timeliness of project planning
documents, accuracy of time and cost estimates, and effectiveness at managing risk
ƒ Staff attitudes can be measured through use of a short survey.
A team composed of staff from the PMO, <list other sources> can perform the assessment.

PMO STAFFING
[The PMO’s “Staffing”, as agreed to by the PMO governance team and PMO Leadership, should
be fully in support of the PMO Objectives and aligned with your company’s resource objectives.
Some “generic” content for this section continues below.]

Once fully implemented, the PMO has the following permanent staff:

ƒ Director (PMP)
ƒ 1 Project Manager (PMP)
ƒ 1 Project Coordinator
ƒ <list other staff>

During its first year, the PMO has one planned contracted staff member. Other contract staff may
be added as required.

ƒ 1 Business Analyst (1 year; second year optional)

ƒ Performs requirements analysis, joint application design
ƒ Assist business departments with project documentation and in preparing and editing RFPs and
contracts
ƒ Mentors <Organization> staff in analysis techniques and requirements management
ƒ Provides training in ROI analysis; assists with Rational Unified Process implementation
ƒ <list other contracted staff>

The PMO also can have temporary staff in the form of departmental Project Managers who report
via matrix on a dotted line to the PMO Director or to a PMO Project Manager. This can occur
when a department:

ƒ Supplies the Project Manager but requests that the PMO indirectly manage the project
ƒ Requests this arrangement as a means of mentoring their Project Manager.

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The PMO maintains an office:

ƒ For its own staff

ƒ For temporary staff (e.g., department project managers on temporary assignment)
ƒ Where Project Management library materials are kept
ƒ Where <Organization> Project Managers and project teams can meet to strategize or work out
project issues.

PMO SPONSOR
The project to establish the PMO is sponsored by <PMO Sponsor>. The sponsorship of the PMO
has the direct approval of <Organizations>’s Senior Management Team.

PMO ORGANIZATIONAL STRUCTURE

PMO reports to the PMO Governance Board consisting of the PMO Sponsor <PMO Sponsor>;
the PMO Leader <PMO Lead>; and member of the Senior Management Team <Name of
Position>. Through alignment with the <PMO Sponsor>’s office and the Senior Management
Team the PMO gains:

ƒ Authority it needs to promote <Organization>-wide organizational change effectively

ƒ Independence that can sustain objectivity
ƒ Oversight that can keep its work aligned with the <Organization>’s business strategy
ƒ Legitimacy as it fosters an effective, enterprise approach.

Initially, all PMO staff report to the Director, PMO.

PMO STAKEHOLDERS
The PMO regards the following as primary stakeholders:

Stakeholder Relationship with PMO Expectations of PMO

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ƒ <Executive Team Executive Team Oversight <Executive Team Member> is a member

Member> of the PMO Governance Board and
provides Senior Management Team
oversight.
ƒ <PMO Sponsor> PMO reports to the PMO <PMO Sponsor> supervises the PMO
Sponsor director and provides the PMO guidance
on PMO business objectives and
supports the PMO’s efforts to achieve
them
ƒ Director of IT Collaborative partner The Director of IT looks to the PMO as a
source of expertise and support in all
matters related to management and
successful delivery of IT projects.
ƒ IT Department staff Customer The PMO supports the IT Department in
its mission to deliver successful IT
projects
ƒ Department Heads Customer As <EXECUTIVE BODY> members,
department heads expect the PMO to
ƒ <List other
provide guidance, drive projects to
executives>
success and deliver updates
ƒ <Organization> Customer Expect the PMO to set the PM standard;
Project Managers provide training and mentoring; work with
the <NAME OF EXECUTIVE BODY> to
ƒ Other <Organization>
create an environment conducive to
Management staff
project success
ƒ All <Organization>
staff engaged in
projects

PMO as a Learning Organization

[The “PMO as a Learning Organization” is a statement of the PMO’s relationship to its
Stakeholders. These statements are in full support of the PMO Objectives and aligned with
your company’s business objectives. Some “generic” content for this section continues
below.]

The PMO models itself as a Learning Organization in its relationship to the <Organization>’s
Executive Management, Project Managers, Project Teams and Customers. A learning
organization may be defined as “an organization that facilitates the learning of all its members
and continuously transforms itself to achieve superior competitive performance.”

Learning organizations have the following characteristics:

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ƒ Are adaptive to their external environment and continually enhance their capability to
change/adapt

ƒ Develop collective as well as individual learning, and use the results of learning to
achieve better results

ƒ Learn from both failure and success, understanding that finger-pointing and blame are
detrimental

ƒ Link individual performance with organizational performance

ƒ Foster inquiry and dialogue, making it safe for people to share openly and take risks

ƒ Embrace creative tension as a source of energy and renewal

The PMO will express its Learning Organization orientation through many means, including:
ƒ Positive use of Lessons Learned exercises to encourage continual improvement in
projects
ƒ Maintenance of a Lessons Learned database to promote organizational learning
ƒ Encouragement of cross-training and “stretch” assignments
ƒ Promotion of continual learning and professional growth in Project Management
ƒ Working with staff to develop the ability to consistently select and execute projects with
significant positive ROI

PROPOSED STRATEGY TO ESTABLISH THE PMO

[The PMO’s “Proposed Strategy”, as outlined in this section, provides the steps to establishing
the PMO. This outline should be agreed to by the PMO governance team and PMO
Leadership, and be in support of the PMO Objectives and aligned with your company’s business
objectives. Some “generic” content for this section continues below.]

ƒ Gain agreement on PMO Charter from the Senior Management Team at the <Date> Meeting.
ƒ Gain <EXECUTIVE BODY> approval of PMO Business Case consisting of:
ƒ PMO Requirements (high level)
ƒ Implementation Strategies and Schedule
ƒ Project Plan
ƒ Cost Estimates
ƒ Refine and agree upon PMO performance targets (SMART)
ƒ Establish PMO review process and performance metrics

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ƒ Establish a budget
ƒ Acquire PMO space and equipment
ƒ Acquire PMO staff.

PMO DRAFT BUDGET

[The PMO’s “Draft Budget”, as outlined in this section, provides the 2-year cost estimates for
establishing and running the PMO. This initial budget is agreed to by the PMO governance
team and PMO Leadership, and be in support of the PMO Objectives and aligned with your
company’s business objectives. Some “generic” content for this section continues below.]

PMO cost during the first two years of operation will depend on how it is implemented. A draft
budget is presented in Appendix I. It also may be viewed through the following document link:

Draft PMO Budget – create link here

FUTURE OF THE PMO

[Since the majority of this document is to describe the establishment of the PMO, this section
describes the continuing operation of the PMO. Some “generic” content for this section
continues below.]

The PMO as described in this document is only a starting point. <Organization>’s Senior
Management may choose in the future to expand or diminish the scope of services that the PMO
provides, depending upon whether or not the PMO continues to provide value. The
<Organization> can obtain a regular measure of that value through use of objective measures
(see section entitled “PMO Metrics”).

As Project Management becomes institutionalized within the fabric of the <Organization> work
environment and <Organization> culture transforms to embrace it, the need for having the PMO
report to the highest level of executive management may diminish. In this case, the PMO could
be transferred to a department, e.g. Information Technology or Administrative Services. On the
other hand, should <Organization> management choose to expand the scope of PMO services to
include projects outside of IT, it would be advisable to maintain the connection with the <Position
of Sponsor>’s office until the next round of culture change runs its course.

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APPENDICES

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APPENDIX A : FREQUENTLY ASKED QUESTIONS (FAQ)

What is a Project Management Office (PMO)?

[A PMO is an] organizational entity established to assist project managers throughout the
organization in implementing Project Management principles, practices, methodologies,
tools, and techniques. [Project Management Terms – A Working Glossary, J. LeRoy Ward
(ESI 2000)]

What is a Project Portfolio?

A Project Portfolio is any group of projects that are being managed together for any of a
number of reasons, including:

ƒ All projects are related to the same goal or set of Business Objectives
ƒ Projects are interrelated via shared inputs and outputs
ƒ Projects share resources.

Is the PMO a permanent <Organization> feature?

This depends on the value the PMO brings to the <Organization>. If the PMO outlives
its usefulness it should be retired. If it consistently provides good value, it should be
retained.
What does it mean that “The PMO manages select IT projects either directly or indirectly”?

If the PMO provides the person who is the Project Manager, then the PMO is managing
the project directly.
If the Project Manager is a contractor or a staff member from another department who
reports to the PMO via matrix assignment, then the PMO is managing the project
indirectly.
“Manages” means that the PMO is directly responsible for all aspects of project planning,
execution and close. It also means that the PMO Project Management Methodology
applies.
The problem with Reward & Recognition Programs is that the truly deserving people all too
often get left out. How can you make it practical?

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It is possible to design a Rewards and Recognition Program so that there is a full

spectrum of awards (e.g. certificates of appreciation, a free lunch, attendance at a
conference, an accelerated performance review). For example, the <Organization>
could allow team members and Project Managers to provide many small rewards that
would recognize exemplary performance at all levels. It is also possible with a modest
budget to provide significant awards that are meaningful to the project teams, e.g.
Project Team of the Year, PM of the Year, Project that Pulled Itself out of the Dumpster
Award, etc

Will the Director of the PMO have a disproportionate amount of control?

No. Business Sponsors own their projects. The business community is responsible for
defining the business objectives in their projects. IT is the source of technical expertise.
The PMO exists solely for the purpose of making the projects succeed, using the criteria
for success that came from their customers.
In addition, the PMO can only impose its Project Management Standard when the PMO
is directly responsible for success or failure of the project. For all other projects, the
PMO PM Standard is highly recommended, but optional.
How will the PMO properly evaluate department PMs who work through the PMO on a project?

The PMO will only evaluate Project Managers on their work as Project Managers. This
can be done, for example, by comparing a Project Manager’s actual performance
against a checklist of standard Project Management tasks and skills, so that the Project
Manager and their department can properly evaluate the Project Managers’ strengths as
well as areas in need of improvement.
The PMO would not evaluate a Project Manager on non-project work.

What is the role of the PMO in project selection?

The PMO will have one seat (and one vote) on the <name of representative body in your
organization>.
As the < name of representative body in your organization> considers projects for
funding, the PMO can provide insight from the project management perspective (e.g.
likely risks, specific staffing requirements)

Training in Project Management is one of the activities proposed for the PMO. Will the PMO
staff do that training or can that actually be done by a third party?

There would be no problem with having fundamental Project Management training done
by a third party. However, advanced topics (especially as they relate specifically to
<Organization>) might best come from PMO staff and other organization Project
Managers.

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Are there any specific pitfalls that the <Organization> should watch out for while implementing
the PMO?
An underfunded PMO will have difficulty fulfilling expectations.

The PMO work plan should not require PMO staff to spend so much time compiling
reports for senior management that there is not enough time to ensure that projects are
delivered on time and within scope

If the PMO staff become “Process Police” or “Document Nazis” they are headed down
the wrong road. Project documentation exists for the benefit of the project and the
organization, not for the fulfillment of some document standard.

Where the PMO is responsible for projects, it is essential that the PMO staff keep in
close contact with the respective project teams. Assigning too many projects to the
PMO can be counterproductive.

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APPENDIX B : VALUE OF A SUCCESSFUL PMO TO THE ORGANIZATION

In general, the value of a common IT Project Management process includes:

ƒ Reduced cycle time

ƒ Reduced delivery costs
ƒ Improved quality of project deliverables
ƒ Early identification of project issues, budget, scope, and risks
ƒ Knowledge leverage and reuse
ƒ Improved accuracy of estimates
ƒ Improved perceptions of IT organization by clients
ƒ Improved people and resource management
ƒ Reduced time to get up to speed on new projects
ƒ Elimination of the thrash (e.g. false starts, self-defeating conflict, indecision) that is so common
in failing projects

In addition to the above, a successful PMO:

ƒ Eliminates duplication of data and processes among Project Managers

ƒ Collaborates with <Organization> staff to implement effective processes for managing all IT
projects
ƒ Cultivates “unusual” levels of cooperation
ƒ Institutes new operating mode with detailed definition of process, roles, and measures
ƒ Promotes change from status quo, upstream and downstream of IT mission
ƒ Nurtures organizational neutrality
ƒ Instills a passion for the profession of Project Management’s processes, practices, and tools

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APPENDIX C : EXPECTED BENEFITS FROM THE PMO FOR SPECIFIC

CUSTOMERS

ƒ Executives
ƒ PMO provides timely feedback about project goals, status, accomplishments, and issues
ƒ Organization has an increased probability of meeting corporate business goals
ƒ Organization receives timely warning about critical issues and possible steps toward resolution

ƒ Functional Managers
ƒ PMO provides metrics to ensure staff is performing adequately and projects are on schedule and
on budget
ƒ PMO maximizes chances of project success, resulting in less rework and reduced cost of product
delivery
ƒ Project guidance helps departments maximize use of resources
ƒ Departments can obtain Project Management resources when needed
ƒ PMO helps the departments to integrate Project Management Methodology into their Product
Methodology

ƒ IT Department
ƒ Promotes change from status quo, upstream and downstream of IT mission
ƒ Assists IT management in establishment of effective processes for managing all IT projects
ƒ Clients develop improved perceptions of the IT organization

ƒ Project Managers
ƒ PMO improves Project Managers’ execution through the establishment of a consistent framework
for the management of projects and defining methodologies, best practices, and guidelines
ƒ PMO enhances the capabilities of the Project Managers by providing mentoring, training, and
career development
ƒ Training, coaching and mentoring move Project Managers more quickly through the learning
curve
ƒ Suggests to Executive Management solutions to organizational issues that may hinder project
success

ƒ External Customers
ƒ Increases probability of meeting customer requirements and expectations
ƒ Aims at increasing customer satisfaction
ƒ Provides single point of contact for multiple projects within same customer

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ƒ Finance
ƒ Project teams are able to provide periodic data of project actuals
ƒ Project teams are able to provide supporting documentation to expedite invoices collection

ƒ Human Resources
ƒ PMO establishes and provides quantifiable metrics for the evaluation of personnel
ƒ A Project Management Career Track facilitates the Project Manager’s career path and training.

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APPENDIX D: PMO SUCCESS FACTORS

The PMO will be more successful in the long-term if the following can be achieved:

ƒ The PMO functions and services/deliverables are prioritized and implemented in a time-phased
manner
ƒ The organization selects an PMO leader who has the right set of skills and experience
ƒ A consistent approach to planning and managing projects is implemented across the
organization
ƒ Internal Project Management training is provided at all levels (from staff to Senior Executive)
ƒ Project Management is recognized as a core competency (i.e. as part of the organization's
culture)
ƒ The PMO’s balance between project support and control functions is defined and
communicated to ensure that departments understand what is expected of them and what they
should expect from the PMO
ƒ The PMO staff understands the culture; the organization intentionally modifies its culture to
support its goals
ƒ The PMO leverages industry standards and best practices
ƒ The organization defines its strategy; the PMO focuses on those projects central to realization
of the strategy
ƒ The PMO adjusts its operation based on continuous customer feedback
ƒ The PMO designs a scalable Project Management system (process and tools)
ƒ The organization recognizes that some groups and individuals will embrace Project
Management change better than others.

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APPENDIX E : STEPS THE <ORGANIZATION> CAN TAKE TO ENHANCE

PROJECT SUCCESS

ƒ Focus on Teams

ƒ Define the Core <Organization> Values for Project Management (e.g., “Be a team player”). Give
special recognition to those who abide by these values.
ƒ Ensure that <Organization> staff assigned to projects are given sufficient time to carry out project
tasks
ƒ Create incentives to help staff overcome their aversion to risk
ƒ Provide management with training in matrix management
ƒ Give IT an opportunity to gain experience with new (and needed) technologies by funding an
ongoing R&D effort
ƒ Train existing IT staff in and/or hire new staff with Business Analysis skills
ƒ Provide workshops on Effective Communication

ƒ Focus on Organization

ƒ Articulate a vision for the Technology Program (in progress)

ƒ Prioritize needs and then define immediate, mid-term, and long-term goals for the Technology
Program
ƒ Map proposed projects to Technology Program goals. Set realistic expectations: Support only
those projects with a reasonable chance of successful completion within the defined time.
ƒ Make “Incorporation of an enterprise view in daily work” a Core <Organization> Value
ƒ Make “Be a leader” a Core <Organization> Value
ƒ Acquire sufficient IT staff to successfully complete and maintain its projects

ƒ Focus on Project Management

ƒ Identify <Organization> staff who have interest in a career in Project Management. Provide them
with both formal training and on-the-job experience (e.g., have them work under PMO guidance
or as deputy Project Manager to PMO staff).
ƒ Ensure that novice project team participants receive appropriate training and coaching in the
Project Management Methodology
ƒ Require thorough project pre-planning before project funds are released
ƒ Encourage a culture of continual improvement in Project Management skills. Use a Project
Management Maturity Model as an indicator of organizational growth.
ƒ Make “Managing Projects For Success” a Core <Organization> Value
ƒ Develop in-house expertise in Testing / Quality Control, Quality Assurance, Business Analysis

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ƒ Apply the Project Management Methodology to all IT projects

ƒ Manage risk proactively
ƒ Use a formal Change Management process whenever scope is ill-defined or likely to change.

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APPENDIX F : GLOSSARY OF TERMS, ACRONYMS, AND ABBREVIATIONS

Term Definition
best practice According to the North Carolina IRMC’s Approved Principles, Policies, and
Standards: Superior method or innovative practice that contributes to improved
process performance, product quality, or business effectiveness.
[http://irmc.state.nc.us}
Another definition is: … a technique or methodology that, through experience
and research, has proven to lead reliably to a desired result. A commitment to
using the best practices in any field is a commitment to using all the
knowledge and technology at one's disposal to ensure success. The term is
used frequently in the fields of health care, government administration, the
education system, project management, hardware and software product
development, and elsewhere.
In software development, a best practice is a well-defined method that
contributes to a successful step in product development. Throughout the
software industry, several best practices are widely followed. Some of the
more commonly used are: an iterative development process, requirement
management, quality control, and change control.
An iterative (meaning repetitive) development process, which progresses in
incremental stages, helps to maintain a focus on manageable tasks and
ensures that earlier stages are successful before the later stages are
attempted. Requirement management addresses the problem of creeping
requirements, which is a situation in which the client requests additional
changes to the product that are beyond the scope of what was originally
planned. To guard against this common phenomenon, requirement
management employs strategies such as documentation of requirements,
sign-offs, and methodologies such as the use case. Quality control is a
strategy that defines objective measures for assessing quality throughout the
development process in terms of the product's functionality, reliability, and
performance. Change control is a strategy that seeks to closely monitor
changes throughout the iterative process to ensure that records are intact for
changes that have been made and that unacceptable changes are not
undertaken.
A best practice tends to spread throughout a field or industry after a success
has been demonstrated. However, it is often noted that demonstrated best
practices can be slow to spread, even within an organization. According to the
American Productivity & Quality Center, the three main barriers to adoption of
a best practice are a lack of knowledge about current best practices, a lack of
motivation to make changes involved in their adoption, and a lack of
knowledge and skills required to do so. [Reference B]
CEO Chief Executive Officer
CIO Chief Information Officer
e.g. for example
PMO Project Management Office

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Term Definition
FAQ Frequently Asked Questions
i.e. that is; in other words
IT ƒ Information Technology Department (<Organization>)
ƒ Information technology
Generic term that includes equipment, hardware, computers, software,
firmware, and related procedures, systems, ancillary technologies,
technologies that cause content to be active in any way, documentation,
services (including support services) and related resources. It includes
subsystems, interconnections, and interconnected systems. [Reference B]
See also: IT
IT project Any project that involves computer-based technology, requires IT Department
resources and involves more than $50k in expenditures.
PM Project Management
PMO Project Management Office
PMP Project Management Professional
R&D Research and Development
SMART Specific, Measurable, Attainable, Results-oriented, Time-delimited
TBD to be determined

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