1. business and industrial
2. business operations
3. management
4. project management

Building a PMO from the Ground Up
Karl Knapp, MBA
AmerUs Group / Indianapolis Life
Agenda
 Steps to Building & Maintaining a PMO:
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Step 1:
Step 2:
Step 3:
Step 4:
Assessment
Approach
Application
Repeat
 Case Study
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Step 1: Assessment
Step 2: Approach
Step 3: Application
Results
Revised Approach
 Questions & Answers
The Greatest Tool For a PMO
Common Sense
Step 1: Assessment
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History
Culture
Perceptions of PM
PM Maturity
PM Talent Review
Mission & Vision
Gap Analysis
Historical Assessment
 A historical assessment of the company allows you
to understand where the company came from, what
path it has traveled and how it has gotten to where it
is currently at.
Cultural Assessment
 The culture of the company has a major impact on
the approach to take implementing a PMO.
Perceptual Assessment
 The perception of project management in the
company will GREATLY affect the right approach
to implementing a PMO.
 Find out about project failures. Drill down into why
the happened, who got hurt, and who might be
harboring ill thoughts about project management.
 Find out about process successes, and drill down
into these.
Maturity Assessment
 At the outset of establishing a PMO, assess the
project management maturity of the organization.
 This early assessment will:
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Guide the areas of focus for the PMO
Establish the baseline to track improvement in the project
management maturity level of the organization.
Talent Assessment
 The level of available project management talent in
the organization is another key indicator of the
approach to take.
 Identify experienced and influential individuals.
 Involvement of project managers throughout the
organization is a key to success.
Mission Assessment
 The mission answers the question, “why do we
exist?”. The mission should:
 Provide a sense of timelessness
 Involve both “ends” and “means”
 Appeal to all stakeholders
 Address all four basic needs (physical/economic,
social/emotional, mental/ intellectual, &
spiritual/holistic)
 Be developed and owned at all levels
Vision Assessment
 Vision communicates the future desired state and
answers the questions, "Where are we going?
Where do we want to be one year from now? Five
years from now? Twenty years from now?“
 Qualities of Vision:
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Is challenging, inspiring, and energizing
Creates purpose, direction and commitment
Goes beyond individual self-interest
Becomes an integral part of the culture
In uncomplicated, concise, easy to understand, and
simple to communicate
GAP Assessment
 Given where you are &,
 Where you want to be
 Identify the gaps as
potential areas for
development
Step 2: Approach
 Given the results of the
Assessment, determine
the Approach that fits
organizational:
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History
Culture
PM Maturity
Available PM Talent
PM Mission & Vision
Gaps & Opportunities
Current Situation
Steps in Developing an Approach
1. Given your organizational history, culture, and
available talent, choose the proper spot on a
Continuum of Approaches
2. Given your mission, vision, and available talent,
choose the initial, and eventual Menu of Services
3. Target specific opportunities for success. Build
Visible Wins.
PMO Continuum
Continuum
of
Approaches
Control
Oversight
Influence
• PMO At Highest Level
• Prioritization Leadership
• Information Ownership
• Project Managers Report
• Project Staff May Report
• Projects Run By PMO
• Strict Standards
• PMO System Reporting
• Education Standardized
• Certification Standardized
• PMO At High Level
• Prioritization Participation
• Information Coordination
• Project Managers Dotted
• Project Staff Affiliated
• Projects Coordinated
• Standards Co-Developed
• System Co-Selected
• Education Offered
• Certification Supported
• PMO At Any Level
• Prioritization Input
• Limited Information
• Project Manager Members
• Project Staff Separate
• Projects Not Coordinated
• Standards Recommended
• Systems Recommended
• Education Is Key
• Certification Encouraged
Develop a Menu of Services
 Portfolio Management
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Project Selection
Project Prioritization
Project Scheduling
Project Closure
 Standards &
Information
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Project Dashboard
Project Status
Project Records
Management & Archive
Benchmarking
Forecasting
Lessons Learned
Develop a Menu of Services
 Consulting Services
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Project Scope
Project Estimation
Project Planning
Full Lifecycle Project
Management
Mentoring
 Tools
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PM Information
Systems
 Professional
Organizations
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PMI Membership
Encouragement
PMI Membership Fee
Reimbursement
Host Chapter Meetings
Develop a Menu of Services
 Education & Training
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Curriculum Design
Course Design
Course Delivery
Tuition Reimbursement
 Certification
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Internally Developed
PMP Encouragement
PMP Reimbursement
Opportunities for Success
 Actions speak louder than words
 Demonstrate the positive effect of good project
management practice
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Find a runaway project to rein in
Better yet, find a visible project, choose your best project
manager and let them execute
Step 3: Application
 Implementing a PMO
is implementing
change.
 Use the eight steps to
successfully leading
change proposed by
John Kotter in his 1996
book, Leading
Change.
8 Steps to Leading Change (Kotter)
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Step 1:
Step 2:
Step 3:
Step 4:
Step 5:
Step 6:
Step 7:
Step 8:
Establish a sense of urgency
Create the guiding coalition
Develop a vision & a strategy
Communicate the change vision
Empower employees
Generate short-term wins
Consolidate wins & produce more change
Anchor new approaches in the culture
1: Establish a Sense of Urgency
 Build awareness of project management with the
corporate management team
 Highlight the results of good examples of project
management
 Highlight the need for project management in
runaway projects
 Compare the speed and effectiveness of your firm
in others in your industry. Can you execute as well
and as fast as your competition?
2: Create the Guiding Coalition
 Identify the key influential stakeholders
 For senior managers, pick one of their key projects
as a pilot project (choose low-hanging fruit)
 Create a project management counsel, steering
committee or board of directors
 Involve key project managers in the development of
the PMO and in the determination of standards
3: Develop a Vision & Strategy
 After creating the initial vision and strategy, refine
it along with the guiding coalition
 Have the key project managers involved in refining
the mission, vision and strategy
 Get the feedback of the project management
counsel (senior management) on the mission, vision
and strategy
4: Communicate the Vision
 COMMUNICATE, COMMUNICATE,
COMMUNICATE!
 Communicate the mission, vision and strategy to
the organization
 Package your message well
 If possible, ask for help in designing professional
looking logos to spruce up the presentation
 Use town hall meetings, newsletters and the
company Intranet to communicate
5: Empower Employees
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Support or supply project management training
Support PMI membership
Support project management certification (PMP)
Supply project management tools
Create an environment for success - set realistic
goals
 Supply information
6: Generate Short-Term Wins
 Pick low-hanging fruit (VERY IMPORTANT)
 High visibility, FUNDED project as a pilot
 Runaway projects (more negative but quick)
7: Consolidate Wins
 Win Friends and Influence People
 Build on project successes
 Highlight project successes outside of the PMO for
good examples of project management
 DEMONSTRATE SUCCESS TO SENIOR
MANAGEMENT AND BUILD
 Once the ball is rolling, GO GO GO!
8: Anchor New Approaches
 Involve more and more people in project
management
 Train project participants in the basics of project
management
 Embed project planning into organizational
planning
 Prioritize, schedule and fund projects
 Project management should be embedded in every
organizational change
Reevaluate and Repeat
 Evaluate lessons
learned
 Reevaluate mission and
vision
 Reevaluate the menu of
services
Summary
 Assessment
 Approach
 Application
Case Study
Grass-Roots PMO
 Larry Halbach – Sr. VP of Planning & eBusiness 25%
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Business Planning
eBusiness Strategy
Project Management Organization
 Karl Knapp – Executive Consultant
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50%
Balanced Scorecard
Executive Consulting
Project Management Organization
 Colleen O’Brien – Project Manager (Part-Time) 100%
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Program Manager – Demutualization
Project Management Organization
PMO Members
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Part-Time Focus
Other ‘jobs’ were primary
Well respected
Well qualified
Belief in importance of project management
Assessment
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History
Culture
PM Perceptions
PM Maturity
PM Talent Review
Mission & Vision
GAP Analysis
Assessment - Culture
 Management
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Low morale
Heavy politics
Uncertainty
Management versus Project
Management
Unrealized potential for
synergy
Ownership concerns
Lack of accountability
 Organizational
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Multiple Project
Organizations
High maintenance
Distribution complexity
IT disconnected from the
business
Multiple uncoordinated IT
organizations
Assessment –
Perceptions/Maturity
 Perceptions
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Have not completed projects
within specifications, time or
budget
Don’t know performance
Don’t track performance
Expenses high
Runaway projects
 PM Maturity
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Inconsistent analysis of
alternative approaches
Varying methodologies
Varying tools – no effective
utilization
No standards
No tracking of performance
vs. budget
No communication across
business units
Lack of prioritization
Don’t track internal costs
Assessment – Mission
 Promoting consistent use of basic project management
standards, reporting procedures, and tools
 Providing a clearinghouse for critical project information
across the enterprise
 Enabling senior officers to prioritize strategic projects by
analyzing project commitments and results
 Educating employees on leading project management
methodologies
 Providing the organization with a nucleus of project
managers who can run projects
Assessment – GAP Analysis
Area
Methods
Current State
Desired State
Varying methods, no
standards
Standards, reports, tools,
guidelines & prioritization
Training
Minimal training, seat of
the pants
Standard classes (tools, soft
skills, methods), PMI
Consulting
None available internally
Project reviews, mentoring,
manage projects
Support
Multiple tools, no political
support
Standard tools, templates &
documentation
Managers
Only a few trained, no
PMPs, no focused PMs
All PMP certified, career
paths, sponsorship
Approach
 Continuum of
Approaches
 Menu of Services
 Visible Wins
Approach - Continuum
 Key Determinates:
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Lacked a ‘mandate’
Uncertain support from senior management
Needed to show rationale for project management and
demonstrate success
 Approach Selected:
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Influencing the Organization
Approach – Menu of Services
 Prioritization Assistance
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Summary major project status report
Prioritization process consulting
Standard PM Templates & Forms
Training Classes (Initiation & Planning class)
Project Management (pilot project)
PMP Reimbursement (anyone passing exam)
The Project Center Is Born
Approach – Visible Wins
 Manage Large, Visible Project
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Demutualization
Put best project manager in charge of the project
Involved from the planning process forward
 Assist Prioritization Committee
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Information – bi-weekly summary status report
Process – facilitated design of prioritization process
Application
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Sense of urgency
Guiding coalition
Vision & strategy
Communicate vision
Empower employees
Generate short-term wins
Consolidate wins
Anchor new approaches
Reevaluation & Repeat
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Accomplishments
Lessons Learned
Mission & Vision
Menu of Services
Reevaluation - Accomplishments
 Expanded the consistent use of project management
standards, reporting procedures & tools
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Adopted the Project Management Institute (PMI) body of knowledge
as our basis
Extended the Project Center to include key project managers
throughout the organization in a Project Management Counsel
Created a Project Management Handbook including new project
management forms & processes
 Reported critical project information
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Provided bi-weekly status and resource projection reports to the
prioritization committee on key projects
Deployed a web-based project dashboard for executives
Reevaluation - Accomplishments
 Grew the base of Project Management knowledge
and experience throughout the company
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Conducted two ‘town hall’ meetings on project management,
Designed, developed and implemented two classes covering the five
PMI processes - 20% of entire employee base trained
Developed job descriptions for two levels of Project Manager
Five PMP certified project managers
 Provided the organization with a nucleus of project
managers, focused on the key corporate projects
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Demutualization project ($15M) completed meeting strenuous
regulatory & quality goals, on schedule, exceeding cost by 15%
Variable project ($5M) completed one month late, 7% under budget
Approach – “Virtual” Project
Center
Dept.
Dept.
Dept.
PM
PM
PM
The “Virtual”
Project Center
Dept.
PO
Dept.
PM
PM
PM
LH
CO
KK
PM
Project
Management
Council
PM
CHANGE
 Merger with AmerUs
Group
 Senior management
combined
 Loss of guiding coalition
and sponsorship
 The Project Center moved
to the IT Department
 What to do?
Of Course!
 Assessment
 Approach
 Application
 Reevaluation & Repeat
Open Discussion