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Activist PMOs and the Struggle for Lean PPM

30June2015

G00274838

Analyst(s):MattLight

Summary
Passivity,wasteandunfocusedvisionthreatenthePMOwithirrelevance.ActivistscanreorganizePMOsfromalowvalueoverhead
functiontoperformingakeyroleindrivingprojectqualityandefficiencyandstrategicsuccess.

Overview
Key Challenges
Projectmanagementoffices(PMOs)thatpassivelyperformadministrativetasksareatriskofbeingeliminatedoroutsourcedasbeingof
lowvalue.
Wasteinprojects,projectmanagementprocessesandtheprojectportfolioraisesprojectdeliverycostsanddissatisfactionwithproject
managementandthePMO,butitgenerallygoesunexamined.
Unfocusedvisionattheportfoliolevelintheformofprojectsonlylooselyassociated,ifthat,withtheenterprisestrategicvision
resultsinonlyafalteringadvancetowardmajorenterprisegoals.

Recommendations
Programandportfoliomanagement(PPM)leaders:
PromotereorganizationtogrowthePMO'svaluePPMleadersshouldinquireandassesswhetherseniormanagementinITandother
businessunitsseesthePMOasperformingthemostimportantPPMjobsorjusttheeasiestandpromoteaPMOreorganizationbased
ononlythemorevaluablefunctions.
Cutwastewhereveritexistsfromprojects,projectmanagementprocesses,thePMOitselfandfromtheportfolio.Leveraginglean
managementtechniques,runaninternalprogramtoreducewasteonprojects,inprojectmanagementprocessesandintheITproject
portfolio.
Createandmaintaina"sharedvision"fromstrategytoprojects,sothatenterprises'effortsarefocusedonhighvaluegoalsandthe
PMO'scontributionisclear.

Strategic Planning Assumption

By2019,mostglobalenterpriseswillrelyonactivistPMOleaderstocutacrosssilosandconnectstrategytoprogramexecution.

Introduction
Thisdocumentwasrevisedon24August2015.Thedocumentyouareviewingisthecorrectedversion.Formoreinformation,seethe
Correctionspage(http://www.gartner.com/technology/about/policies/current_corrections.jsp)ongartner.com.
Amongenterprisesadvancinginprogramandportfoliomanagement(PPM)capability,wehaveobservedanincreaseinmoreprovocative
orimpoliticprojectmanagementoffices(PMOs),whichwecharacterizeas"activistPMOs"becauseoftheirleaders.Likeconsumeractivists
leadingaboycott,politicalactivistsorganizingaprotestoractivistinvestorsforcingashareholders'vote,thesePMOleadersinspire
stakeholdersandreorganizeprocessestoimplementchange.WhetherinITorenterprisePMOs,theyseeaneedforchangeinorderto
respondtomajorthreatsorpromisingopportunitiesandtheyconsidertheriskofnotchanginggreaterthanthatofdisruptingthe
statusquoignitingakindofactivistzealtoconfrontriskandseizeopportunityviaPPM.1(#dv_1_based_on)

Thekindsofthreatstheyconfrontoccuratdifferentlevels,includingtheprogramlevel,whereoneclientwenttoextraordinarylengths
(involvingconfrontationwithanuninvolvedsponsor)torescueakeysocialmarketingcampaignthathadstalledaroundusability,
performanceanddefectissues.Butthreatsmayalsooccurattheorganizationallevel,aswithanotherclient,whoseCIOfearsitsIT
organizationfacesfutureirrelevanceduetopastpoorperformanceoncriticalprojects.
Inothercases,wehaveseenPMOsfaceeliminationwhenperceivedasnonvalueaddinggroupsof"paperpushersandprocesscops."In
additiontothreats,opportunitiestoocanenergizeactivistsinthePMO,suchasopportunitiestostrategicallysupportbalanceintheIT
portfolio,avoidwastefulprojectsandturnaroundpromisingbuttroubledprojects.2(#dv_2_best_and)
Occasionally,newexecutiveleadershipreorganizesaPMOtoboostitsvalueandprofile.Usually,though,tomakeagreatercontribution,
theactivistPMOmustfightforchangeifitistoadaptitsrolesandresponsibilitiestoavaluepropositionbeyondthepaperpushingand
processcomplianceemphasisofmorepassivePMOs(seeTable1).

Table1.ChooseanActivistVersusPassivePMOApproach

Passive PMO

Activist PMO

Collectstimeorstatusreports

Datadrivenrecommendationsfordecisions

Offersscheduledtrainingsessionsandawaitssignup

OnthejobmentoringforjuniorPMs,especiallywithprojectstartupassistance

Lacksandavoidsmeasurableobjectives

Metricsforselfimprovement,sharedgoals

Requestsandawaitsprojectupdates

Probesforriskaskstoughquestions

WaitsforapprovedprojectstriestofindaPM

PromotesPMOasthesourceofthebestPMs

Libraryoftemplatesfromstandards,textbooks

Customizesmosteffectiveprojectartifactsandshares

Shiesawayfromconflicts,politics

Worksorganizationpoliticsup,downandacrosschallengesPPMstatusquo

Mantraof"standardsandconsistency"

Mantraofadaptability"Afoolishconsistencyisthehobgoblinoflittleminds"(R.W.Emerson)

PM=projectmanager

Source:Gartner(June2015)

Analysis
To Lead the Value Revolution, Promote PMO Reorganization
ManypassivePMOs(forexample,atLevel2ofGartner's"ITScoreforProgramandPortfolioManagement"
(http://www.gartner.com/document/code/269295?ref=grbody&refval=3084926))arelightlystaffedandfocusedonadministrativetasks,
likethoseinTable1,includingtrackingtimereportingcomplianceandcoordinatingprojectmanager(PM)training(seeFigure1).The
surveyresultslistedinFigure1confirmthatthesefunctionsareamongthemostcommoneventhoughonlyaminorityofrespondents
desirethesefunctions.Respondentscouldchoosemultiple(notjustoneortwo)functionsthataPMOshoulddo,yetonly47%to48%
chosetimetrackingandtraining.However,thatminorityismostlikelytohaveitsPMOexpectationsmet.
TheprospectofachangeinthePMO'sroleneednotseemthreateningtothosepersonnelinlightlystaffed,administrativeand
coordinatingPMOs.Often,thesepersonnelarethestaffwhomostacutelyfeelthediscontentwiththePMOandthedangerofits
elimination.PMOleadersshouldemphasizethat,insteadoffeelingthreatened,currentPMOstaffshouldhelpleadthechangebyallying
withtheorganization'smosteffectiveandexperiencedPMs.Thesesenioror"master"PMsarebestsuitedtogrowthePMO'scontribution,
iftheycanberetainedwithinaleanstylemasterapprenticemodel.3(#dv_3_d_mann)
SuccessfulPMsgenerallyseek,andfind,advancement,buildingontheirsuccess.However,intheabsenceofareal,multilevelcareerpath
forPMs,highturnovercanleadnotonlytoashortageofPMsbutalsotoalackofinstitutionalknowledgeandabilityinproject
management.TheresultisaprimitivecultureofprojectmanagementthatdoesnotadvancebecausetheseniorPMsdepartforotherroles.
WhenpromotedintoareorganizedPMO,suchmasterlevelPMscontinuetomanagetheriskiestprojectsboostingthePMO'svaluewith
positive,notnegative,consequencesforthePMO'soriginalstaff.SomeofthatoriginalPMOstaffmayfeelthataddingmoreexperienced
projectandprogrammanagerscouldmakethemlessrelevant.Onthecontrary,PMOleaderswhopromotealeanmanagementmodelfor
thePMOleveragingleanstylequalitypracticesforboostingefficiencyandfocusingonvalueaddingwork.
ThisisonlyonesteptowardreorganizingthePMOforgreatervalue,butitmaybethemosteffectivefirststep:StaffthePMOwith"master"
PMs,andoftenfurtherimprovementswillfollowundertheirleadership.MoreadvancedPMOsmayseekotherwaystoevolvefollowing
leanmanagementandotherprinciplesforexample,viaspecializedrolesforgatheringmetricstoimprovenotjustprojectandprogram
performance,butalsothePMOitself(seeFigure1).

Figure1.GapBetweenActualVersusDesiredPMOFunctions

(A)WhichofthefollowingdoyoupersonallybelievetheprimaryPMOwithwhichyouinteractisactuallydoing?(ingreen)
(B)WhichofthefollowingdoyoupersonallybelievetheprimaryPMOwithwhichyouinteractshouldbedoing?(inblue)
Source:Gartner(June2015)

Cut Waste From Projects, Project Management, the PMO and the Portfolio
AcommoncriticismofPMOsisthattheyintroduce"unnecessaryoverhead."1(#dv_1_based_on)Althoughacasecanbemadetojustify
thevalueofsomemanagementoversight(forexample,reducingrisk,assuringalignmentandmore),attentionshouldbefocusedon
keepingthePMOlean.
ThecritiquealsocanbecounteredbyfocusingthePMO'sactivitiesonreducingwasteinPPM,withthegreatestopportunitytodosoin
fourmainareas:

1. Theprojectsthemselves,mainlymajorprojects(notthestreamofmanagedworkandenhancements)
2. Theplanning,controlandgeneralmanagementactivitiessurroundingprojects
3. TheactivitiesofthePMOitself
4. Theoverallportfolioofprojectinvestments
Thefollowinglistprovidesexamplesofwasteineacharea,withsuggestedcorrectiveactionsthatanactivistPMOcanperformand
promote:

1. Wasteinprojects:TwocommonformsofwasteinITprojectsarescopecreepand"waittime."ForMode1projects(forexample,
phasedwaterfallstyleprojects),thecompletedefinitionofallrequirementsisunrealistic.However,PMsshouldbeinstructedtoemploy
achangeapprovalprocessthatdetermineswhetherchangesaretruly"musthave,"orshouldbeaddressedasfutureenhancements.
The"waittime"onprojectsparticularlythosewithteamsdistributedacrossseveraldistanttimezonesintroduceswasteasteam
membersbecomeunproductiveuntilapprovalsorclarificationsarereceived.Often,thiscanberemediedbyrealtimecollaboration,
whetherinadailyscrumonanagileproject,ateamvideoconferenceatascheduledtime(evenifit'sinconvenientforteammembersin
anotherhemisphere)orbyasimple,interactivephonecallinsteadofasynchronousemail.

2. Wasteinprojectmanagement:Someinefficientprojectmanagementactivitiescanbereadilyimprovedoreliminated.Postproject
reviewsoftenprovideagoodexample.Muchtimeiswastedinsomecompaniesattemptingtopinpointanexactreturnoninvestment
indollars(orothercurrency)thisisalmostalwaysawildgoosechase,giventheenormousnumberofvariablesintheenvironment,the
inabilitytoobserveacontrolforcomparison,andthefactthatusuallymanyinitiativesusuallyareactivelydrivingreturnsandcreating
benefitsinthesamedomainastheproject.
Faster,simplerapproachestobenefitsreview(forexample,surveysreferencingthebusinesscaseusingratingslikethoseinaLikert
scale)canreplacethiswastewithvaluablefeedbackandaccountability.Similarly,mostprojectend"lessonslearned"celebrationsarea
wasteunlesstheinformationiscapturedinastructuredandusableform.Aleanorganizationestablishesarealmetricsprogramto
supporttargetedimprovement(forexample,oftheprioritizationprocess).

3. WasteinthePMO:ItisnotuncommonforPMOleaderstostresstheneedfor"standardsandconsistency"(seeTable1),and
certainlymanyenterprisesneedsomebasicterminologyandproceduresincommonforcommunicationandcontrol.Pastapointof
diminishingreturns,however,attemptstorunallprojectsaccordingtoatheoreticallystandardprocessbecomeunwieldyand,indeed,
unworkable.Whentheoryandpracticediverge,aformofcognitivedissonancemaytakeholdinwhichthePMOthinksitisenforcing
consistencyandstandards,evenasitobservesprojectsproceedingalongalternateroutes.MucheffortmaybewastedinthePMOin
attemptingtoenforceunrealisticandcounterproductivelevelsofconsistencyandstandardization,andadditionaleffortmaybewasted
inattemptingtoglossoverthedifferencesamongnonstandard,inconsistentprojectbehaviors.
Bytheirnature,projectswithdifferentkindsofdeliverableswilldifferintheirapproaches.Ratherthanwastingeffortwhittling"round
pegsforsquareholes,"PMOsperhapsworkingwithotherprocessgroups(forexample,architectureorqualityassurance)should
developaflexibleprocessframeworkoptimizedforbimodalplanningandexecution,andgenerallyincludeswaterfall,agileand
iterativeapproaches.

4. Wasteinportfolio:Aparticularlyegregiousformofwasteiswhenawholeprojectorprogramislargelyanunwarrantedeffort.
Sometimesreferredtoas"petprojects,"theirsponsorsoftenarefaultedasforcingthesesuperfluousorspeculativeeffortsintothe
portfolio.Usually,however,theyareonlypartlytoblamerather,itisseniormanagement'sfailuretoputaneffectivegovernance
processinplacethatallowsprojectstoproceedbasedonsometheoreticalcostbenefit,ratherthanonprojectssupportfora"shared
vision"ofenterprisestrategicgoals,asdiscussedinthenextsection.

Create a "Shared Vision" (Hoshin Kanri) From Strategy to Projects

HighcapabilityPMOsactivelyleveragetheirprojectportfolioviewtoaddextravalueviabetterlinkageofprogramsandprojectsto
enterprisegoals.Managementinsuchenterprisesrecognizesthatbenefitsreviewhighlycorrelatestovaluegenerationbyshiftingthefocus
fromprojectdeliverablestostrategicgoalsandstakeholders.4(#dv_4_p_tillmann)
ConnectingprogramsandITprojectstoenterprisegoalssometimesrequiresakindofpoliticalagitationtoinsistthatprojectsaddressa
balanceofenterprisegoalssometimespersistinginclarifyinggoalswithmanagement.Bothactivitiesaimtohelpdrivea"sharedvision"
(hoshinkanri)throughouttheenterprise.
Agitation:Activistsdefineandillustratetheproblem.Apoliticalactivistmightpointtocorruptionanactivistinvestormightcriticizea
nonperformingbusinessunitandaconsumeractivistmightillustratethedangersofanunsafeproduct.
Similarly,activistsinthePMOmightpointto"petprojects"andtheopportunitycostofdoingthemversusmorevaluableinitiatives.They
mightcriticizethelackofastrongbenefitsreviewtoprovideaccountability,ortheymightillustratethatexcessriskaversionhasprevented
approvalofexperimentalinnovationprojects,despiteastrategyincludinganinnovation.
Doingsocarriesacertainpoliticalriskthatactivistsshouldweigh.Tohelpremainsafe,intheseorothercases,politebutfirmactivists
shouldcarefullypreparetheirappeals,andtheirrebuttalsofpredictablecounterarguments.
Persistence:Changewillcomeslowly.Evenwhenstakeholdersaccepttheproblems,criticismsandexamplesthatanactivistPMO
identifies,inertiaisstrong.Persistence,however,willlikelyberewarded,becauseenterprisesdohaveanappetiteforchangeinthePMO's
contribution.

Figure1showsasurprisinggap,inthat80%ofthe217businessandITexecutivessurveyedbelievethatthePMOshouldprovideregular
programandprojectstatusreports,butonly33%ofPMOsdoso.Theexpectationsgapofalmost50%isstriking.AsPMOsactivelyaddress
theseexpectationsnotjustonce,butrepeatedlyandpersistentlytheircontributionwillbeincreasinglyconsideredandaccepted.
HoshinKanri:Inleanmanagement,classichoshinkanricallsforamonthlyreview(alongwithalongtermvision,mediumtermgoals,
annualobjectives,aresponsibilitymatrixandmore).5(#dv_5_s_bell)Inprioritizingitsownactivities,ifaPMOdoesnotalreadyproduce
amonthlyportfolioupdateofprojectsinorder,accordingtoriskthenitshouldbegindoingso,priortootheractivities.Including
columnfieldsfor"primarystrategyalignment"canpromptanongoingdiscussionofportfolioalignmentandpotentialimbalance,thereby
beggingthequestion,"What'sthestrategy?"Intime,afullhoshinkanrimatrixmaybeintroduced.
Oneclient,whenhavingdifficultyobtainingarticulatedstrategicgoalsforalignment,complained,"Idon'twanttobeapest."However,
thatistheessenceofactivismtoappealandbuildmomentumforchangeforwhichmanyPMOstakeholdershunger.Thesurveyin
Figure1illustratesthat,inafewdifferentareasofstrategysupport,respondentsfeelpoorlyserved.

Case Study
InadvancingtoahighlevelofPPMcapabilitymaturity,theITorganizationofaninternationalautomotivefirm'sEuropeansubsidiary
leveraged"sharedvision"(hoshinkanri)styletechniquestoboostitscontributionandrelevanceintheenterprise.Acompanyneedfor
bettervehicleusagedatawasidentified,and,withPPMprocesssupportviaa"volunteer"PMO,ITwasabletoestablishacrossEuropean
useofwirelesstodelivermoretimely,completeandaccuratedataregardingvehicleuseandmaintenanceneeds.Forthefirsttime,theIT
organizationwasempoweredtodeliverfunctionsforvehiclesthatweremassproducedbythecompany.

Gartner Recommended Reading

SomedocumentsmaynotbeavailableaspartofyourcurrentGartnersubscription.
"HowtoAchieveEnterpriseAgilityWithaBimodalCapability"(http://www.gartner.com/document/code/276981?
ref=ggrec&refval=3084926)
"HowanActivistPMOHelpsShareStrategicVisiontoOptimizethePortfolio"(http://www.gartner.com/document/code/264720?
ref=ggrec&refval=3084926)
"TheLeanPMO:PromotingLeanPracticesFromProjectInitiationThroughClosure"(http://www.gartner.com/document/code/224691?
ref=ggrec&refval=3084926)

Evidence
1

Basedonseveralhundreddatapointsderivedfromourclientinteractionsthroughinquiryandeventclientmeetings,weestimatethat
morethan75%ofPMOorganizationshaveopportunitiestobemoreactivist.
2

Best(andworst)practiceworkshops,GartnerPPMSummitsandSymposium/ITxpoevents,2013through2015.

D.Mann,"CreatingaLeanCulture:ToolstoSustainLeanConversions,"ProductivityPress,ThirdEdition,October2014.

P.Tillmann,P.TzortzopoulosandC.Formoso,"AnalysingBenefitsRealisationFromaTheoreticalPerspectiveandItsContributionto
ValueCreation,"ProceedingsIGLC18,July2010.
5

S.BellandM.Orzen,"LeanIT:EnablingandSustainingYourLeanTransformation,"ProductivityPress,2011.

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