Why Executives “Hate” PMOs
Why is there friction between executives and the PMO, even though both are working toward the same goals? We delve into this too common issue in this episode of What’s the Plan? and how the key to solving this friction is value. Our guest is Stuart Easton, CEO and Co-Founder of TransparentChoice, who speaks around the world about portfolio management and successful projects. The questions Stuart is most often asked at conferences and speaking engagements are:
- “Why do my executives hate me?”
- “Why don’t my executives pay attention to the PMO?”
- “Why don’t they get it?”
It’s this mutual frustration between executives and the PMO that provides an opportunity for PMOs to build support for the vital work they provide to the organization. Executives want value, and in their minds, PMOs are too focused on processes and tools.
Stuart cited research from Oxford University, where they examined more than 22,000 projects and found that only 37% of projects actually achieve their stated benefit, and less than 1% of projects deliver on time, within the budget and with the benefit delivered.
The Duck Versus the Egg
In our conversation with Stuart, he compares what PMOs focus on and what executives want to a duck and an egg. PMOs are typically focused on their projects, which are like ducks. The executives don’t care about the gender of the ducks (like they don’t care about a Gantt chart or project status report). They just want the egg – the value from the project. The lesson? If you are not delivering value that is driving the KPIs of your organization, you are not adding value, regardless of the new project methodology you have implemented, new process or software you’re using, or updates you are able to provide on projects’ status.
How did we get to this mismatch between executives and the PMO? Many PMOs grew out of successful careers in project management. Across the profession, there has been a reckoning about how project managers have to transition to be project leaders (for more insight, we recommend you listen to our interview with Noel Ransom for great insight on transitioning from a manager to a leader). For the past 40-50 years, the most common professional certification for project managers, from the Project Management Institute, has focused on the “duck”, and only in the last year as PMI added the “egg”, or focusing on value, into the definition of a successful project.
The Job of a PMO is Not to “Put in Place the Processes and Tools”
Stuart explains how the job of a PMO is not “putting in place the processes and tools”, which is a recipe for executives wanting to eliminate your position. It’s about providing value. If you’re doing your job as a PMO, you are understanding what the business needs:
- KPIs: grow revenue, control costs, etc.
- Taking care of the leadership team and giving executives good insight and visibility into what’s going on
Most organizations assume that if you do more project management, you’ll be more successful and will deliver more benefits. This assumption is false. If you put in place a more sophisticated tool to manage your projects, have a new checklist, or require more in your process, that can have a negative impact on your project delivery, as people are spending too much time filling out forms and checking lists, rather than delivering value. Addtionally, there is significant data to support that more projects do not help deliver more, but slow down the pace of all current work.
Three Steps to Deliver Value
Stuart boils down the steps that PMOs can take to help solve this mismatch with executives and deliver value to three steps.
Step 1: Project Prioritization
Are your new projects actually moving your goals forward? If there is a new project that is not supporting your goals, even if it helps with other items around your organization, then it is taking away valuable resources from your projects that you should be delivering, and it means you’re delivering fewer of those projects that are aligned with your goals. PMI data shows that 20% of the projects in your portfolio are so badly aligned with your organization’s goals, that they should be stopped. Stuart suggests using the Analytic Hierarchy Process for analyzing your projects and turning them into quantitative data to make decisions.
Step 2: Resources
When your resources are overloaded, and they have complex tasks, they don’t multitask, they task-switch. And with every switch from one task to the other, you’re losing up to 40% of the capacity to manage that task. Productivity falls off a cliff when you overload people. The solution is better capacity planning, and ensuring your people are able to focus on the right projects you prioritized in Step 1.
Step 3: Benefit-Centric Portfolio Management
The final step is focusing on the benefit that you expect out of each project, and ensuring that the portfolio is focused on the benefit, using that core idea to drive the project deliverables and governance. If you have first focused on delivering the right projects in step 1, and then focus on delivering more of them in step 2, this step is about increasing the percentage of projects that will deliver benefits to the organization.
To learn more about the executive viewpoint of PMOs, delivering value as a PMO for your organization, and how to determine what the business needs and what your executives want, listen to our latest episode of What’s the Plan?.
Check out the full episode here: https://www.prosymmetry.com/podcasts/e8-executives-dont-care-about-your-projects-why-pmos-must-focus-on-value.
For more insightful conversations about real-world conversations about all things project management, resource forecasting, capacity planning and more, subscribe to What’s the Plan? Episodes are available on:
Episode Frequently Asked Questions
Why is there friction between company executives and the PMO?
There is a fundamental mismatch between the value that executives want delivered toward achieving goals and the focus on processes and methodology that drives the PMOs. It’s important for PMOs to focus on delivering value and understand that executives want the insight and deliverables out of projects, not data and deadlines.
What should the role of the PMO be in a typical organization?
The PMO should be focused on maximizing ROI for the portfolio. While the methodologies and the processes are important to making sure projects are being completed, the takeaway for company leadership and conversations between the PMO and executives needs to focus on the value being delivered.
What are the steps that a PMO can take to deliver value?
The steps involve focusing on project prioritization, capacity planning for resources, and benefit-centric portfolio management.
