How to Start a Project Management Office (PMO)

Introduction to Creating a PMO Framework

A Project Management Office (PMO) is an entity that allows for the centralized oversight of project management. Often a PMO is involved with or responsible for program and portfolio management as well.

The Project Management Institute defines a PMO as “an organizational structure that may be used to standardize the portfolio, program, or project-related governance processes and facilitate the sharing of resources, methodologies, tools, and techniques.”

Why start a project management office?

There are many benefits to starting a project management office, including:

• Establishing standardized processes for project management and delivery.
• Creating a centralized knowledge database for capturing and sharing lessons learned.
• Improving transparency, communication and reporting with one primary point of contact.
• Aligning business strategy with project planning and execution.
• Implementing standard practices and procedures.
• Efficient management of shared resources.

How to start a project management office

Starting a project management office can be approached like any other project.

Step 1: Create the business case

A business case should be completed to justify the implementation of a proposed project management office. It’s important for organizational buy-in and planning to make sure the project is worth doing before moving forward.

The business case will outline the following:

1. The objectives of the PMO
2. The benefits and limitations of the PMO
3. Any risks involved in starting a PMO
4. An estimated cost of implementation
5. A rough timeline or length of the project
6. The potential impact on the business
7. Any other relevant information

The business case should include choosing the PMO model to be implemented. The three most common types of PMOs are:

1. Supportive: A Supportive PMO operates as a consultant or advisor. It is generally a knowledge center and a source of best practices, training, and lessons learned.
2. Controlling: A Controlling PMO acts as an auditor as well as an advisor. It goes a step further to ensure the best practices and standards are being followed. It often creates controls and governance standards.
3. Directive: A Directive PMO is directly responsible for the execution of projects. Project Managers report directly to the PMO rather than a separate function or organizational group.

Step 2: Assign strong leadership

If the project is approved to move forward, the next step is to assign the key team members to manage and execute the plan. This includes the project sponsor, the project manager, and others who will be directly involved in the project's success.

Step 3: Create the charter

The project manager will now draft the project charter for the creation of the Project Management Office.

This will include:

• The project scope
• High-level requirements
• Relevant assumptions
• Constraints
• Major milestones

Step 4: Follow the project management lifecycle

Once the charter is approved, the project should follow the same life cycle as any other project. The phases of the project management life cycle are:

1. Initiation
2. Planning
3. Execution
4. Monitoring & Controlling
5. Closure

Standard processes, procedures, and documentation should be created just like any other project. For example, you will need a baseline scope, schedule, and budget, as well as assigned resources, materials, and requirements or outcomes to measure success against.

Tips for a successful implementation

To increase the chances of your new PMO being successful, consider the following tips:

1. Obtain long-term buy-in: The establishment of a PMO will mean a significant, long-lasting change for the organization. It’s important to focus on change management and stakeholder engagement to ensure people are committed to its success.
2. Focus on early wins: It’s worthwhile to identify, achieve, and celebrate some quick wins. This will help build commitment and encourage morale while implementing these changes. For example, whenever a milestone is met, it should be acknowledged and celebrated. This could be as simple as sending out a newsletter when the standard operating policies of the PMO are established.
3. Maintain motivation through the down periods: Implementation of any significant change can be rocky. There will likely be periods where things seem to be happening slowly or not at all. It’s essential to remain positive and focus on keeping stakeholders engaged and committed to the end goal.
4. Ensure you have defined measures of success: As mentioned earlier, part of the business case should outline the benefits of a PMO. It’s important to have measurable benefits that can be tracked and reported against. For example, will the PMO standardize project management reports? If so, there should be a date that this will be achieved, and a way to ensure it was completed. 
5. Incorporate enough flexibility for the PMO to adapt and mature: As the business grows and changes, the PMO needs to adapt. For example, the PMO may start as a Supportive PMO, but over type morph into a Directive PMO.

Further reading:

• The Costs of Having the Wrong Work Management Technology
• What is a PMO? (Infographic)
• From Surviving to Thriving: 3 Challenges PMOs Need to Conquer Now
• Why Change Management Sucks (And How to Fix It)
• The Importance of Project Management: Q&A with PMO Leader Robert Kelly