What are typical pitfalls when setting up a PMO? Why is standardization not the single most important thing? And what is the role of training and communication? In 2020, TPG The Project Group conducted the PMO Survey 2020. For more than 20 years, the company has engaged in all topics around enterprise-wide project management and the PMO. The survey had 330 participants from companies with a PMO and 120 from companies without a PMO (number of participants after data cleansing).
The PMO Survey is meant to help you to assess your own position and next ventures in comparison with other companies. Another goal is to identify opportunities and priorities for improving your company’s own PMO.
In this article, we present you with the PMO Study 2020 in more detail:
- PMO Definition
- The PMO Survey 2020
- Benefits for companies with a PMO
- Benefits for companies wishing for a PMO
- Demographics of participants of the PMO Survey 2020
- Division into top, high and low performers
- Biggest differences in resource management
- More strategic support in the future
- Conclusion: PMO Survey 2020
The Project Management Office is a permanent organization unit that plays a key role in coordinating and managing the projects in the company or a department. Its responsibilities can include strategic support, multi-project management and resource management, project execution, training and support, methods and processes and the provision of the necessary tools.
The PMO Survey 2020
Many organizations have seen a stark increase in the number of projects over the last few years. In many cases, the reason for this is digitization, which has led to many internal cross-departmental projects. Such projects often require a lot of internal coordination by employees, which is easier to implement with a PMO. However, companies often realize that they neither can nor want to afford implementing a certain type of project any longer. These are projects exceeding their timeframe, going beyond their budget or failing to achieve the required goals.
A PMO makes it possible to keep an overview of the project landscape and to increase efficiency in project management. Therefore, whether you want to set up a PMO or already have one, you might like know how you are positioned in comparison with other companies. To this end, you can consult the survey we conducted and compare the results to your own situation.
We have divided the survey regarding general information on the company in two groups. On the one hand, we wanted to provide information from participants who have already gained experience with a PMO. On the other, we were also interested in the wishes of those companies that are only planning to begin establishing a PMO.
The study is intended to help you as readers assess your own position, and determine what the next steps should be, by comparing your organization to other companies. Another goal is to identify opportunities and priorities for improving your company’s own PMO. This PMO Survey provides you, or rather your PMO, with guidance in strengthening your efforts and enhancing performance in the area of project management.
Benefits for Companies with a PMO
From the answers of the companies with a PMO, we have defined performance levels for low, high and top performers. From the evaluations differentiating between these three levels, we derive explanations for the differences in their effectiveness in implementing projects. This will help readers identify what PMOs of the high and top performers do better than those of the low performers.
Benefits for Companies Wishing for a PMO
Companies that want to set up a PMO will get the following benefits from the PMO Survey: The wishes of the participants without a PMO and the responses from companies with a PMO vary immensely in parts. This makes it possible to derive realistic focus areas supported by tips concerning where best to begin when establishing a PMO. Thus, the start with your own PMO should work out perfectly.
Demographics of Participants of the PMO Survey 2020
450 participants from Germany, Austria and Switzerland took part in the survey, of which 330 were already operating a PMO and 120 were planning to set one up. Regarding the sector distribution, companies in the field of Information and communications are ahead of companies categorized as Other manufacturing industry and Other services.
The size of the companies with a PMO is over 1,000 employees in 60% of cases. The size of the companies without a PMO is 100-500 employees in one third of cases.
Apart from company size and industry, we also asked about:
- The PMO’s internal sphere of action
- Type of project implementation (traditional, agile, hybrid)
- Number of PMO members
- Length of the PMO’s existence
- Other classifications
Division into Top, High and Low Performers
We divided the companies having a PMO into three levels: top, high and low performers. This happened depending on their effectiveness in implementing projects based on their responses to the questions regarding compliance with deadlines, budgets and quality requirements.
Companies with a PMO that complied with deadlines and budgets and quality requirements in more than 80% of their completed projects.
Companies with a PMO that complied with deadlines and budgets and quality requirements in at least 50% of their completed projects but do not belong to the level of top performers.
Companies with a PMO that complied with deadlines or budgets or quality requirements in a maximum of 50% of their completed projects. Basically, all others.
If the PMO is to do more than define standards and deliver reports, it is invaluable to see what top performers do better than low performers.
Many companies already have a PMO, but very few have reached a sustainable level of satisfaction. Simply setting up a PMO and letting it do its thing is not enough. This is especially true if the PMO is expected to not only generate reports but also ensure that projects are managed more successfully.
Top performers and high performers are much better than low performers at providing the necessary framework for the projects. The top performers significantly outrank the high performers in terms of satisfaction with the PMO and are even further ahead of the low performers. In no part of the PMO Survey did the low performers ever excel over high performers or top performers.
Biggest Differences in Resource Management
There are marked differences in the performance levels with regard to multi-project management and resource management responsibilities as well as in individual areas of training and strategic support. The biggest difference is in strategic capacity planning and the management of employee skills, followed by the availability of career paths for project managers and the ability to demonstrate the projects’ strategic value. PMO acceptance is highest among the top performers, significantly less among the high performers and least among the low performers.
The difference is particularly evident in top management, with top performers having a three times higher percentage of the “very satisfied” rating compared to the low performers. Among the factors hindering an increased acceptance, top performers cited “No clear advantages to having a PMO” and a “Lack of transparency in resource planning” only half as often as low performers.
More Strategic Support in the Future
Irrespective of the performance levels, PMOs intend to shift their efforts from promoting standardization and managing projects to providing strategic support , training project managers and handling multi-project and resource management. The key priorities for the next 12 months mentioned by at least 20% of the survey participants were:
- Implementing a knowledge database for project managers
- Strategic capacity planning
- Ensuring the strategic alignment of projects and ideas
- Sharing knowledge and information with finance and accounting departments
- Managing cross-project dependencies.
When asked for the best way to increase PMO acceptance, the most frequent response was that the PMO should strive to add real value. To do this, stakeholders must be surveyed to determine their expectations, and then the PMO must adjust its services accordingly. The survey should start by surveying top management so that the PMO’s mission can be clearly articulated and it will not be viewed as merely a cost center. The best way to create transparency depends on the company’s corporate culture, which means that it requires trust and time. The PMO can hereby set the course with the backing of top management.
Conclusion: PMO Study 2020
The survey of companies with and without a PMO in the context of the PMO Study 2020 enables a 360-degree analysis of priorities:
- Support in setting priorities: The PMO Survey provides an excellent overview of the companies’ PMO priorities from which you will benefit greatly.
- Orientation thanks to an excellent PMO benchmark: The differentiation between top, high and low performers means you will know directly where you are at present and where you should be heading.
- Realistic assessment due to empirical values: The illustration of the expectations of PMO newcomers and the comparison with reality gives you a feeling for your own expectations.
- You learn from the top performers: You will prevent frequent mistakes and learn directly how to do it properly because we have condensed the top performers’ experience for you!
What are your dos & don’ts for a successful PMO? Please share your experiences in the comments section below!
About the author: Johann Strasser, a certified engineer, has been a managing partner at TPG The Project Group since 2001. After many years as a development engineer in the automotive and energy sectors, Johann Strasser spent a decade as an independent trainer and consultant in the field of project management. During his tenure, he also served as project manager for software projects in the construction industry and provided scheduling and cost management support for large-scale construction projects. At TPG, he applies his expertise in product development and consulting services for international clients. His special focus is on PMO, project portfolios, hybrid project management, and resource management. For many years now, he has shared his knowledge through presentations, seminars, articles, and webinars.