power of pmo leadership

8/12/2019 Power of PMO Leadership

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The Power of PMO Leadership

October 2008

Copyright 2008 by Point B Solutions Group, LLP. All rights reserved.


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October 2008PMO Leadership Slide 2

PMO Leadership

Current Business Issues

PMO Challenges

Project Portfolio Management (PPM)

PMO, PPM, and Project Leadership

Conclusions


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Business Problem

90% of Corporate Strategies Are Never

Implemented Balanced Sco recard

Col labo rative, 2007

Companies struggle with formu lat ing real ist ic

strategic goals and tu rning s trategy into

outcomes

Strategic

PlanningExecution Results


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Industry Project Success Measures

Standish Group Results

0%

10%

20%

30%

40%

50%

60%

1994 1996 1998 2000 2004 2006

Year

P

ercent Challenged

Success

Impaired

Standish Group

Success: on-time, on-budget, with required features

Challenged: late, over-budget, with fewer features

Impaired: canceled or delivered but never used


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The State of PMOs

0%

10%

20%

30%

40%

50%

Perc

entof

Com

panies

Level 1 - Initial Level 3 -

Institutionalized

Level 5 -

Optimized

PMO Maturity

PMOs have been around for several years, but few are mature


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PMO Underachievement

PMOs could have much more of a business impact

Most PMOs fail for these reasons:

Created for the wrong reason

Lack of visionLack of executive sponsorship

Poor execution - inconsistent methods, skills, governance

Too tactically oriented

Poor alignment with the business

Lack of leadership

Most PMOs end up as order-takers


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Positioning For Success

Value to CustomerCanUniquelySupply Unique supplier

of something

nobody wants

Commodity

Provide something

that nobody wants

and cant even do it

uniquely

Strategic

Goal

Guy Kawasaki


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Converting Business Goals into Action

Project Portfolio Management connects strategy to execution

Why?

Because it encourages a discipline of strategic investing

It provides transparency It addresses a commonly neglected issueis the strategic plan feasible?

It helps the organization focus on value delivery and execution

ResultsStrategic

PlanningExecution

Project

Portfolio

Management


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What is Project Portfolio Management?

PPM - applying the tools and discipline of financial

management to project management

Portfolios are investments capable of generating value

Portfolio considerations

Investment strategy ROI

Growth

Profitability

Balance Diversification

Risk

Alignment to goals, mission


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PMO Focus for Strategic Value

Lifecycle

Templates

Standards

Training

Change Control

Status reports

Projects

Programs

Initiatives

Strategy

PPM


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Project Portfolio Management Goals

Align projects to strategy

Facilitate the transformation of strategy into results

Eliminate marginal and poor project investments

Provide a way to evaluate, prioritize, and sequence

projects

Optimize resource utilization


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Breaking PPM Down

Construct

Portfolio

ExecuteEvaluate Assess

Results

Prioritize

Match Investments

to Opportunities,

Align with Business

Program/Project

Management

Financial

Retrospectives,

Project PostMortems

Account For

All Projects

Review

Investment /

ResourceAllocations

The Process of PPM


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Constructing a Portfolio

Business Info Financial

Project

Line of

Bus. Business Initiative Type

Financial

Contribution Motive Funded

Segment

Gross

Margin

Segment

Growth

Investment

(budget)

Investment

as Percent of

Total

P14 Internal Fulfillment Throughput Maintenance Operational Discretionary Y 63% 15% 11,233,456$ 27%P18 LOB-A Customer Support Maintenance Operational Discretionary N 71% 5% 8,607,643$ 21%

P4 LOB-A Fulfillment Throughput Enhancement Operational Discretionary Y 71% 5% 7,000,000$ 17%P3 Internal Customer Support Enhancement Revenue Discretionary Y 71% 5% 3,569,540$ 9%

P7 LOB-B Grow US Sales New Operational Strategic Y 43% 7% 2,000,000$ 5%P16 LOB-D Grow US Sales Enhancement Revenue Discretionary Y 60% 13% 965,432$ 2%P19 LOB-C SOX Maintenance Operational Compliance Y 63% 15% 890,755$ 2%

Project Name Metadata Cost


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The Portfolio is Your Strategy

$0.00

$200,000.00

$400,000.00

$600,000.00

$800,000.00

$1,000,000.00

$1,200,000.00

$1,400,000.00

$1,600,000.00

LOB 1 LOB 2 LOB 3 LOB 4 Internal

Investment By Line of Business

Proposed

Funded

$-

$200,000.00

$400,000.00

$600,000.00

$800,000.00$1,000,000.00

$1,200,000.00

$1,400,000.00

$1,600,000.00

$1,800,000.00

Investment By Initiative

Proposed

Funded

$0.00

$500,000.00

$1,000,000.00

$1,500,000.00

$2,000,000.00

$2,500,000.00

$3,000,000.00

$3,500,000.00

Revenue Operations

Investment By Contribution

Proposed

Funded


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Using PPM To Increase Strategic Results

Strategic

PlanningExecution Results

Two Key Pitfalls PPM Can address:

Inadequate Resource Management

Inadequate Risk Management


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PPM Ensures Feasibility Risk Management

Key Factors Contributing to Risk

Risk Profile Impact on CoreBusiness

Ability to Deliver

Political Exposure


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Risk DNA Contributing Factors

Risk Profile Ability to Deliver

Organizational

Acumen and

Experience

Requirements

Resource Capacity

Schedule Flexibility

Quality Control

Do we control the plan?

Do we know what we are doing?

Do we have the commitment to deliver?


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Visualizing Risk Using PPM

Is there the right balance?

P1

P2

P3

P4

P5

P6

P7

P8

P9

P10

P12

P3

P24

0

1

2

3

4

5

6

7

8

9

10

0 1 2 3 4 5 6 7 8 9 10

Reward-->

Risk -->

Portfolio Mix(bubble size = investment)


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PPM Benefits

Project investments discussed strategically Feasibility and risk assessed and mitigated before investing

Transparency to stakeholders

Resources deployed on only the highest-value projects

Detailed trade-offs understood when new ideas are

suggested


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PPM Summary

Project Portfolio Management involves applying thetools and discipline of financial management to

project management

PPM requires competencies in strategic planning,

financial and project management

Overall objective of PPM: Manage projects, people,

processes, and information assets for maximum

business benefit

PPM requires leadership to be successful


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Project Leadership

Project Leadership is expertise that combines the scienceof project management with the art of leadership essential

to solving tough problems and getting business results.

PMO/PPM/Project Leaders:

See the big picture Get people to agree on priorities

Are decisive

Accommodate different executive styles, processes do not

Are accountable; they address issues and mistakes Understand how to turn vision into reality

Conquer uncertainty

Deliver results


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Managing & Leading

Enforcing Standards

Resolving Issues

Budgeting

Planning

Reviewing Status

Coaching

Providing Vision

Motivating

Aligning Stakeholders

Demonstrating Standardsand Providing Structure

Managers are people who do things right and leaders are people who do the right thing.Bennis and Nanus, 1985

Most U.S. corporations today are over-managed and under led.Kotter, Harvard Business Review 2001


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Management & Leadership Behaviors

Manag

ement

L

eadership

Identifies

Project Tasks

Estimates

Accurately

Manages

Schedule

Manages

Budget

Identifies

Issues/RisksCommunicates

Leverages Adapts Challenges

Supports

Promotes

Teamwork

Acts with

Integrity

Makes Sound

DecisionsSolicits Input

Mitigates

Issues/Risks

AnticipatesSeeks

Feedback

Fosters

Ownership

Innovates Motivates

Envisions

Project Leadersh ip behaviors augment and complement

pro ject management behaviors to enhance execut io n


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Leadership In Action Strategic Execution

The Problem: The client needed to evolve its online platform in order togrow and better serve customers.

The Challenge: Complex, transformational projects often fail

Project Leadership Behaviors:

Created a shared vision and a process for achieving it

Established high trust at the executive level

Created an entrepreneurial atmosphere focused on execution

Garnered crucial support from around the organization

Forced tough decisions that kept the project focused and moving forward

The Result: A successful open, scalable new technology platform


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Project Leadership Testimony

Point B brought in a way of thinking that elevated

the internal mindset and successfully got us through

this inflection point. They helped us focus our

innovation and gave us a lasting understanding ofhow to handle large-scale projects in times of

extreme transition.

- CEO


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Conclusions

Business issues abound 90% of corporate strategies are never implemented

Project success rates are only 35%

Most PMOs rate themselves at 2 out of 5

PMOs should strive to be a business partner, not an

order-taker

PPM will help improve business results PMOs, PPM, and Project Execution will not be

successful without leadership


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Contact Information

For a copy of these slides or other questions, contact:

Gaylord Wahl

[email protected]

206.517.2762
mailto:[email protected]:[email protected]


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About Point B

Point B is the first professional services firm focused on project leadership

and execution. Founded in 1995, the firm provides a diverse and experienced

team of locally-based project leaders to companies in Seattle, Denver,

Portland, Phoenix, San Francisco, Los Angeles and Chicago. Organizations

ranging in size from startups to Fortune 100 corporations turn to Point B for its

ability to step into any segment or role of a mission-critical project and helplead it to success. And, unlike many professional services firms, Point B

works exclusively for its clients and does not enter into alliances, reseller

agreements, or other relationships that might compromise the firm's

objectivity. Point B has attracted top project leaders from various industries by

offering a culture that promotes flexible work schedules and well-rounded

lifestyles for its more than 300 professionals. Additional information on thefirm and its offerings can be viewed online at http://www.pointb.com.
http://www.pointb.com/http://www.pointb.com/

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