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Strategy and the PMO

Peter Sexton
August 3, 2011

Putting the ‘S’ in your PMO can play a key role in both increasing the value of the PMO and your organisation—it’s just a matter of taking ownership.

I often get asked for a list of functions that a PMO should ‘typically’ provide. How I wish there was such a thing! Nonetheless, I do believe there are a couple of key functions that an enterprise level office should look to deliver if it is to remain relevant and of value to the business.

First and foremost of these is to facilitate effective delivery of the key business strategic initiatives. There is a lot of talk and research about the importance of both efficient operational management and effective strategy management. Yet, as many have experienced, there is often a natural tension between these two important business management functions with operations focused on the now, resisting use of important resources on the strategic initiatives.

It is also widely recognised that a failure to place sufficient efforts and resources on the development and delivery of strategic initiatives can jeopardise the longer-term health and sustainability of an organisation.

Part of the common cause of the misalignment between strategy and operations is that they require coordination of separate parts of an organisation, each of which have their own agendas, priorities and challenges.

Clearly, if business strategies are to be effectively developed and delivered with minimal impact to the ongoing business operational processes, there is a need for a business entity to be responsible for focusing on the delivery of the prioritised business strategic initiatives.

The enterprise PMO is ideally positioned to provide this balancing function within an organisation to ensure effective alignment of the important operational and strategic management processes.

To provide this vital business function, the enterprise PMO must overtly take ownership of the strategic management process and provide the following strategic functions:

  • Facilitate the strategic process to ensure the business strategy is developed effectively and translated into clear, sponsored and funded portfolios of initiatives;
  • Coordinate the execution of the strategic initiatives based on the assigned business priorities and ensure resources are appropriately allocated to achieve the goals; and
  • Govern the delivery of the strategic initiatives to ensure the senior executive is provided with a clear ongoing picture of the strategy realisation status, and that the individual initiatives ultimately deliver the desired outcomes.

Not surprisingly, many of these functions are often already being done by enterprise PMOs, albeit usually in a partial or incomplete manner: PMO directors are probably familiar with being asked to arrange parts of the strategic management process; PMOs are almost always the key player in the establishment of portfolio priorities and the subsequent coordination of resources; and PMOs invariably play a key role in the governance of projects delivery to ensure they remain on track and the business executive is fully informed regarding process.

Hence, taking a more overt leadership role of facilitator of the business strategy—and, in doing so, becoming more than just a ‘centre for project management excellence’ or a project reporting post office—is not a huge step. It does, however, establish the real credentials and purpose of the enterprise PMO as the office that integrates the resources and requirements from across the whole organisation to deliver results.

Peter Sexton
Peter Sexton is the director of Performance & Technology Advisory at KPMG, specialising in program management—including the establishment of PMOs and program governance controls—and business process improvement programs.
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