Mar 8, 2012

State of the PMO 2012 Research Now Available

PMOs can drive upwards of $400,000 in savings per project

Project and program management offices (PMOs) are becoming fixtures in most organizations, growing in number, in capability and in value to the firm. According to PM Solutions’ benchmark study on the “State of the PMO 2012,” PMOs decreased failed projects by 30%, delivered 25% of projects under budget and 19% ahead of schedule, and saved companies an average of US$411,000 per project.

PM Solutions surveyed 554 high-level project management personnel from all size organizations in various industries, including manufacturing, healthcare, technical, finance and government. The primary purpose of the study was to gain a clearer understanding of current PMO operations such as size, functions, staffing, challenges, performance and capability. Of the organizations surveyed, 87% have a PMO in place, demonstrating a steady growth from 48% in 2000, 77% in 2006, and 84% in 2010.

What distinguishes PMOs in high-performing organizations: They address issues that matter most to executives, including alignment with business objectives and strategy execution. They’re nearly twice as likely to engage in performance measurement functions. And they’re more than twice as likely to practice resource forecasting and capacity management.

“With finances tight and the business outlook uncertain, companies are demanding more of their PMOs and they’re responding with an increased focus on performance,” said J. Kent Crawford, PMP, CEO of PM Solutions and author of An Inside Look at High-Performing PMOs. “Now is the time for the PMO to prove its value; and PMO leaders are stepping up to the plate: implementing project management training programs, evaluating competency, and increasing their use of contracted resources to deliver more value to their firm.” [see graphic]

The full report, now available at www.pmsolutions.com/research, identifies four key predictions on the future of the PMO based on current trends:

  • PMO leaders will continue to build better relationships with executive management
  • PM training will remain steady, with stepped-up basic training augmented by the use of contracted resources
  • Improvements in performance measurement will make it possible for PMOs to more accurately measure productivity and track benefits and
  • As PMO leaders strive to define their organization’s role, they’ll move from a linear set of “levels” of capability to a more descriptive model that functions as a menu of possible PMO features and capabilities.

Additional findings suggest exciting new growth opportunities for the PMO as it continues to expand its influence and move up the organizational ladder. PM Solutions’ “State of the PMO 2012” research shows that PMOs in high-performing organizations are training more in advanced skills and leadership practices, thus preparing their staff for the next phase of PMO development. These PMOs continue to be trusted with high-value responsibilities: 62% participate in strategic planning. Their budgets are more than twice those of low-performing PMOs (US$900K vs. US$400K). And they are active in performance measurement: 68% of them engage in PMO performance monitoring/controlling compared to only 36% of low-performing organizations.

“PMOs are rising in organizational influence,” notes Crawford. “The question PMO leaders should be asking themselves now is: What do we focus on next to continue delivering business value?”

About PM Solutions

PM Solutions is a project management firm helping organizations apply project and portfolio management processes and practices to drive operational efficiency for its clients. For more than 15 years, PM Solutions has been well-known as a leader in PMO design and practice, bringing its clients the expertise and tools needed to help create and sustain a value-driven PMO. Comprehensive offerings provided by PM Solutions address organizational improvement, project execution, and learning and development delivered through its training arm, the PM College® (www.pmcollege.com). PM Solutions serves a diverse client base that includes some of the world’s leading organizations in industries such as manufacturing, IT, energy, insurance and financial services. For more information, visit www.pmsolutions.com.