PMO Lifecycle


Project prioritisation is a critical element of ensuring that limited resources are applied to the most appropriate initiatives, and result in the biggest bang for the buck. In a constrained financial environment this is even more critical, and will reveal inappropriate models, failures in governance, and decision making and the potential for missed opportunities or wasted resources. Identifying an accepted model is only one step and understanding the challenges in applying a prioritisation approach effectively will result in a far more productive outcome.


There is still significant emphasis on increasing the effective delivery of projects. According to a joint survey by KPMG and Australian Institute of Project Management (AIPM)1 only 25 per cent of projects in 2020 were delivered successfully, at least most of the time. This figure is up from 19 per cent the previous year. In 2021, this figure should be much higher given the focus on Agile and PRojects IN Controlled Environments (PRINCE2) over the past few years to improve project execution. Delivering a project on time, on budget and to requirements is the how and is the bare minimum. Delivering successfully means having a hard focus on the why and what. Why does a problem need fixing and what value will be created as a result. With organisational change and benefits realisation still at a very low maturity across many organisations, there is a lot to gain from putting a hard focus on the softer stuff.

Conclusion: Organisations understand that implementing projects is part of the natural workflow. Delivering projects that meet organisational expectations is expected and demanded. Project management offices (PMOs) have been established to support project management activities and provide some key elements such as project management methodologies, documentation, project manager recruitment and organisational reporting.

While many organisations have implemented a PMO, there are nearly as many organisations that continue to struggle with some key elements such as resourcing, benefits and prioritisation, and the PMO has an opportunity to provide real value to the organisation in addressing these areas.

Conclusion: Project management in organisations is commonplace. Organisations then seek to establish a Project Management Office (PMO) as a more permanent centre for project coordination. PMOs may start in the technology division and expand or may be established outside the ICT area. Knowing what the various models and structures are is important. Knowing how to assess the maturity and environment within the organisation and selecting the appropriate approach with empathy and common sense is critical to success.

Conclusion: Most organisations today understand that business change requires the effective management of stakeholders. Whether they be internal or external, the inclusion of their opinions, needs and concerns is critical to the success of the initiative. However, too many projects and change programs still struggle to be completed successfully or to achieve desired outcomes. Change management and stakeholder engagement is too often handled as a linear process and many are under the assumption that working through the activities in sequence will be sufficient. Stakeholders are complex to identify and to assess as their relative power and influence often go beyond the obvious. Effective stakeholder engagement absolutely requires a full and frank appreciation of the power and influence of each stakeholder.

Conclusion: The PMO role has many manifestations. It is also rarely static. When the organisation is in transformation mode the PMO must ensure project managers work as a team and deliver results. It is analogous to the role of an orchestra conductor who must get the musicians to rehearse so they know their roles and work together to make their opening concert a success.

Post transformation, one of the PMO’s roles is to get business operatives to assimilate the system’s functions so the benefits expected are realised. Similarly, the conductor’s role is to get the orchestra to perform so well there is a full house at every performance and the producer gets a satisfactory payback from the production.

Conclusion: The high-risk and high-reward Agile approach for systems development enabled many organisations to respond quickly to changing management strategies and yielded significant productivity benefits, according to a 2015 survey1.

However the same survey found not everyone has been so successful, as lack of experience in using the Agile approach, and organisation resistance to change, have frustrated almost the same number of organisations.

Once IT and business management have decided that Agile is the right approach they must:

  • Champion and defend its use
  • Actively track progress and allocate extra resources to the project if justified
  • Provide a safe environment in which a retrospective review can be conducted
  • Widely disseminate the lessons learned from the review, including strategies that succeeded and failed, without attributing blame

Conclusion: Poor planning is frequently cited in surveys as a major reason an ICT project has failed. A major element in the planning process is the preparation of the business case setting out why the project is needed and must be approved.

Management is remiss when it approves a poorly developed business case as it sends the wrong message to developers and sponsors – that if the project fails to deliver they are not to blame.

Conclusion: With the increasing focus on governance of ICT investments and successful project delivery there will be an ongoing demand for high quality Project Managers to deliver outcomes for organisations. According to an article in The Australian earlier this year the most in-demand ICT roles are “Project Managers, Business Analysts and .NET professionals1”. CIOs have a number of challenges in recruiting or developing project management capabilities to ensure projects are successfully delivered to the organisation.

Conclusion: Most organisations have more ICT enabled projects and initiatives than they can possibly deliver. A significant number of CIOs report that gaining business consensus to prioritisation of projects can be an extremely difficult and often emotional process.

While availability of budget is a common qualifying criterion for ICT project progression, it is often not the biggest constraint. By applying a relatively simple project prioritisation framework to the list of projects waiting to be undertaken, CIOs can develop a program of work that is achievable and can be agreed across the organisation.

Conclusion: IT steering committees and project managers must ‘keep their eye on the ball’ and remain alert for indicators that a project under their remit might fail. Avoiding corrective action will impact on morale and increase costs and potentially delay the project’s implementation. By taking immediate corrective action the project might be saved, or if it is to be stopped, minimise losses.

Conclusion: Establishing, or re-launching, a Program Management Office (PMO) using a text-book driven, ‘cookie cutter’ approach is not likely to bring about improvements in the performance of individual projects, IT programs or even a portfolio of projects. While some initial improvements may be observed as a consequence of closer management scrutiny, it is rare for formula-based approaches to work effectively on a sustained basis.

Conclusion: The terms “IT” and “governance” are frequently coupled, sometimes glibly and often inappropriately. Indeed, IT governance seems to have a multiplicity of meanings but is generally seen by IT people as a “white knight” in which business user engagement, properly executed, will overcome a troubled IT situation.

Conclusion: Australian taxpayers should applaud the Rudd government for adopting in full, all the recommendations of the Gershon Report.1 As a consequence, IT savings of an estimated $1 billion are planned for realisation over the next 10 years. However, will the government be able to bank all these savings? The answer is probably no. Intentionally or otherwise, what Gershon proposes is nothing more or less than a wide-scale, transformational change program. These unfortunately, rarely meet with complete success2.

Conclusion: The ability of organisations to implement major strategic business initiatives is to a large degree dependent on their ability to successfully execute the program of projects on which these strategies are reliant. Despite the importance of such programs most organisations, while accustomed to the demands of managing individual projects, often lack the skills and experience required to manage the complexity of such programs. The recruitment of an experienced program manager to lead the program and an integrated approach to program governance and planning can go a long way to ensuring a successful outcome.

Conclusion: In March 2001 the Organisation for Economic Cooperation and Development (OECD) published a management brief1 addressing problems in implementing large IT projects in the public and private sectors. Observations in this report included “...budgets are exceeded, deadlines are over-run and often the quality of the new system is far below the standard agreed when the project was undertaken”.

Conclusion: Through the 1990s many organisations established Project Management Offices (PMOs). Also known as Project Offices and sometimes as Strategic Project Offices, these were generally set up within the IT organisation and were driven by the desire to take a more focused, financially responsible and standardised (read template-driven) approach to project delivery.

Conclusion: Portfolio Management is a process that allows management to prioritise and manage its portfolio of projects. The more progressive organisations within IT are finding that this approach needs to be modified in order to manage the different project types that are associated with competitive edge and strategic advantage business initiatives.

Conclusion: An ongoing process of Project Portfolio Management, managed by a Project Management Office (PMO), can lead to significant improvements in the returns achieved on funds being invested in your IT projects.

Conclusion: Over the last five years agile software development approaches have become more popular, and are increasingly replacing heavy-handed methodologies. At the same time there is a growing interest in benchmarking the productivity of software projects, and in achieving process maturity that can be measured against certification standards such as CMMI. At first sight it would seem that these two trends represent two mutually exclusive philosophies. When taking a closer look it becomes clear that both trends can indeed complement each other.

Conclusion: Providing it has strong management support and is resourced with the right mix of personnel, a project management office can produce major benefits around:

  1. management of your organisations IT project portfolio; and

  2. the outcomes from these projects.

Once again some recent high profile failures of IT projects have raised the issue of good project management and its impact on project outcomes. Those organisations that have yet to establish an effective Project Management Office (PMO) should consider the benefits that can accrue in IT projects through the correct application of a PMO.

Conclusion: In an ideal world the business case report recommending the organisation invest in a business solution (systems, business processes and workplace change) should act as the cornerstone on which the ensuing project(s) proceeds. If the report is coherent, well researched and presents a credible picture of the future, all stakeholders can use it to guide their actions.

While many organisations have templates of the typical business case report, compliance is no guarantee of quality.

Conclusion: Inability to manage the plethora of projects cutting across most organisations can lead to failed initiatives, an inability to align ICT and business investments, a lack of confidence in the organisation's ability to innovate and even substandard operational performance - quite simply operational performance can fall because renewal projects become late or are ineffective.

The main reason that these problems occur is that business initiatives are spawned within functional hierarchies and these hierarchies tend to act like silos. Organisations that are looking to effectively balance goal based and role based work need another structure to support the governance process so that resources and initiatives can become visible to the entire organisation. This paper recommends that a project office correctly implemented can play a key role in supporting the governance of goal based activities.

Conclusion: When faced with proposals requesting investment in Business Solutions in an environment in which demand exceed available resources, firms need to develop and apply an IAC (Investment Allocation Criteria) to help them prioritise and rank the competing proposals.