Section 1: Devise

a Business Case
for the PMO

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 Roll Out Capabilities and Assess and Evolve the
Establish Buy-in and Objectives Lay the Foundations
Services PMO

Section 1: Devise a Section 1: Devise a Business Case for the PMO

Business Case for the • 1.1 Craft a Compelling Case Study for Your PMO
PMO
• 1.2 Understand Challenges in Project, Program and/or Portfolio Management
• 1.3 Provide Evidence to Substantiate the Challenges
• 1.4 Communicate the Potential Impact of the PMO
Section 2: Define the
PMO’s Scope and Services • 1.5 Assess the Costs and Benefits of Implementing the PMO
• 1.6 Tailor Your Message to Acquire Buy-in

Return to Roadmap

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1.1 Craft a Compelling Case for Your PMO
Five Steps to Craft a Compelling Case Study for Your PMO

Understand the Provide evidence Identify how the Assess the

organization’s to substantiate the PMO will address costs and
strategy-to- issues and the challenges benefits of
execution gap challenges that and support the implementing
and challenges your organization organization in the PMO for the
in realizing faces. achieving its organization.
Where to value from objectives.
Land Your work.
Analysis Sell your message
in the to acquire buy-in.
Business
Case

Problem Statement Evidence Impact Financials Buy-in

Your Deliverable Business Case

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1.2 Understand Challenges in Project, Program and/or Portfolio Management
Three Sources to Identify Organizational Challenges

Sample challenges in project, program and/or portfolio

management
Organization's
strategic 1. Inefficiencies in delivery and execution practices
objectives and across the organization
goals Current state
of project, 2. Increasing involvement of business teams in
product, technology
program and
portfolio 3. Increased interdependencies between projects,
management products and portfolios
Stakeholders’ 4. Strategy-to-execution gap across the organization
challenges,
priorities and 5. …
concerns

Analyze the information gathered from these

three sources to identify common
challenges. Prioritize these challenges
based on their importance for achieving
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strategic objectives and their urgency.
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1.2 Understand Challenges in Project, Program and/or Portfolio Management
Interview Framework to Capture Priorities, Pain Points and PMO Concerns of IT/Business Stakeholders

Stakeholder Interviews (60-90 minutes)

Surface
stakeholders’
challenges, Session Priorities Pain Points PMO Stance
Focus (25-35 minutes)
l minutes)
(10-20
priorities and (25-35 minutes)
concerns!
 What are the top  What are the three  How do you
strategic initiatives biggest anticipate the
• Priorities? your function or improvement introduction of a
• Pain points? team is focusing on? opportunities in your central/domain
• PMO stance? Sample  What's driving the current processes level
Discussion need to focus on to execute on project/program/po
Questions these areas? strategic priorities rtfolio
 What are the and coordinate work PMO Concernsoffice
management
business outcomes across (PMO)minutes)
(10-20 will impact
and metrics that will teams/functions? existing processes
be used to measure  What are the top or workflows?
success? three  What are your top
challenges/pain 3 expected
points you face benefits or
throughout the life potential concerns
PMO Leader IT/Business Stakeholder(s) cycle of about working with
an initiatives? such a group?

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1.3 Provide Evidence to Substantiate the Challenges
Example Evidence Derived From Project Delivery Challenges
Sample challenges in project, program and/or
portfolio management
1. Inefficiencies in delivery and execution
practices across the organization
2. Increasing involvement of business teams in
technology
3. Increased interdependencies between projects,
products and portfolios
4. Strategy-to-execution gap across the
organization
5. …
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Evidence
• 38% of initiatives exceeded budgets.
• 42% of teams lacked sufficient resources to complete tasks
efficiently.
• Lack of clear communication between departments or
initiative stakeholders.
• …
Evidence
• Vague or conflicting definitions of success criteria, lack of
key performance indicators (KPIs).
• 45% of initiatives focused on short-term gains or
departmental needs, with limited connection to the
organization's long-term vision.
• 32% of initiatives experienced a gap between planned
and achieved outcomes.
• …
1.4 Communicate the Potential Impact of the PMO
Example PMO Impact Statements

How can the PMO address Inefficiencies

How can the PMO address strategy-to-
in delivery and execution practices
execution gap across the organization?
across the organization?

Achieve consistent, high-quality execution by implementing Maximize the return on investment for resources and time by
process improvements. Reduce operational costs and optimize enabling teams across the organization to focus on initiatives with
resource allocation to maximize capacity. the biggest impact.

• Develop and constantly update processes, frameworks and tools to
maintain excellence.
• Select, implement and promote tools to streamline workflows and
enhance collaboration across teams.
• Eliminate duplicative, low-value work from delivery pipelines.
• Anticipate resource bottlenecks or surpluses and adapt deliverable
timetables accordingly.
• Create central dashboards and reports that provide visibility into
initiative health, resource allocation and potential risks across the
organization.
• .…
Source: Gartner
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• Define clear and measurable success criteria for each initiative to
ensure alignment with strategic objectives.
• Break down objectives into measurable deliverables and help link
each initiative work directly to the strategic vision.
• Review initiatives at the idea stage to determine whether they are
aligned with the strategic priorities.
• Facilitate regular discussions between stakeholders and teams to
ensure strategic alignment.
• …
1.5 Assess the Costs and Benefits of Implementing the PMO
Example Cost Analysis

Cost Explanation Estimated Amount

Personnel Costs PMO director, project managers, ($ [Personnel Costs] )

business analyst, support staff

Technology Costs PPM tools, collaboration tools and ($ [Technology Costs] )

necessary IT infrastructure

Training Costs Providing training for PMO staff and ($ [Training Costs] )
other stakeholders
Miscellaneous Costs Incidental expenses that arise in ($ [Misc. Cost] )
various areas of operation (e.g.,
supplies, maintenance)

……… ……………… ($ …..,….)

Total Estimated Annual Cost: ($ [Total Cost])

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1.5 Assess the Costs and Benefits of Implementing the PMO
Example Cost Savings and Financial Benefits Analysis
Benefits Explanation Calculation Est. Saving and Benefit Amount
Improved Project [Example] Saved Overrun Cost = Average Overrun Cost × (Projects Estimated total of
Success Rate Current: 67% successful projects Before PMO × Overrun Reduction) ($ [Saved Overrun Cost] ) + ($
After PMO: 87% successful [Increased Revenue] )
projects Increased Revenue = (Successful Projects After PMO −
Successful Projects Before PMO) × Average Revenue per
This corresponds 20 percentage Project
point reduction in fever failed
projects and overruns.
Minimized [Example] Estimated Cost Savings = Estimated Total FTEs Saved × ($ [Estimated Cost Savings])
Rework or Expecting a 20% decrease in Cost per FTE*
Redundant work rework and redundant work costs.
(*include all costs associated with employing a person in this
role e.g., salary, benefits etc.)

Increased Cost [Example] Estimated Cost Savings = Vendor Costs Before Negotiation ($ [Estimated Cost Savings])
Savings from Expecting cost savings of 10% − (0.10 X Vendor Costs)
Vendor from vendor negotiations.
Negotiations:

……… ……………… ……………… ($ …..,….)

Total Annual Cost Savings and Benefits: ($ [Total Savings and

Benefits])

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1.5 Assess the Costs and Benefits of Implementing the PMO
Example Return on Investment (ROI)

ROI

($ [Total
ROI FORMULA
Savings &
Benefits])
ROI X 100 ($ [Total Cost])

($ [Total Cost])

Source: Gartner
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1.6 Tailor Your Message to Acquire Buy-in
Story Arc to Convince Stakeholders

Directly connect with your

stakeholders’ pain points
Emotional Solution and priorities
Intensity What PMO can do to help
Be authentic
Connect
What’s stopping us?
Next Steps Finish the story on a
What we need? positive note.
Hook
Start with the vision Road-test before
Financials presenting
Cost and benefits
(if asked)

Story's progression

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 1.6 Tailor Your Message to Acquire Buy-in
Strategies to Acquire Stakeholder Buy-in Considering Their Influence and Posture

High Medium Low

Engage with your advocates regularly,
seek their input and demonstrate how the Evangelist
PMO will align with their goals. Use their
support to build momentum and credibility
Advocates
Supporter
for your ideas.
Uninfluential

Posture
Positive
Stakeholders
Critic
Meet with challengers individually to listen
to understand their objections. Address their Challengers
pain points directly, and if necessary refute Blocker
their assumptions about why PMO is not
needed with information you gathered in
Section 1.2. Level of Influence

Deprioritize time with uninfluential stakeholders.

They are unlikely to act on insights, effectively
offer support or prevent success.
Source: Adapted from Fiserv
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1.6 Tailor Your Message to Acquire Buy-in
Potential Stakeholder Concerns and Key Messaging

Stakeholder Group Potential Stakeholder Concerns Key Benefits Messaging

• Processes may not mature fast enough and stunt the • Better insight on investments and returns
company’s growth. • Ensures highest-priority initiatives get the most attention
Senior Management • IT may not adequately support the business. • Improved balance between products and projects, allowing a
better overall alignment of initiatives to business strategy
• The PMO may create more red tape and reduce • Increased alignment of investments to functional strategies
Business Executives responsiveness. • Business units can approve higher thresholds of investments
at the cross-functional council level
• General resistance to adoption. • Serve as an enabling organization rather than policing
• Investments are better grouped and easier to manage
IT Executives • Ability to effectively coordinate among delivery teams using
a wide variety of methodologies (Agile, waterfall and hybrid)
• PMO may create additional bureaucracy that slows • Fewer fire drills regarding portfolio or annual planning
Account Managers down work.

• More process steps to comply with. • Easier to communicate with business partners about
• Additional governance may slow down the pace of projects due to streamlined processes
Project/Product Managers delivery. • Clearer guidelines and documentation
• Adaptative governance can streamline delivery without
increasing the governance burden felt
• Less autonomy. • Tailored processes to suit the specific needs of the initiatives
Delivery Teams • Teams are empowered through support, tools and resources

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