It depends, but often perceived as the latter isn’t it?
Executive management has invested a lot in project improvement. Since early 2000 we, as a community, have observed that many companies have embraced the idea of installing a Project Management Office (PMO) – a centralized organization dedicated to improving the practice and results of project management. The assumption is that each project contributes to the strategic objectives of the company. If this is not the case, why do the project?
Because projects’ benefits are not realizing in full, the company does not reach, in due time, the expected strategic objectives.
Why does this happen? Is it, because everything is ‘out of our hands’? Is it because of bad luck? Or could it be something else, something we are able to change, from within.
Assuming that you are running an excellent company which realizes the necessity of project management. You already have some kind of centralized supportive organism to improve project management results to drive ROI and create value. This centralized supportive organism does have a charter and it shows which value it plans to generate, by when and how, justifying the money invested.
According to Gerald I. Kendall and Steve Rollins in their bestselling book ‘The Advanced PMO: How to generate ROI at warp speed’, such a PMO must deliver through all following processes:
- Choosing the right balanced project portfolio, with enough market-side (marketing and sales) projects that are strategic (not rather focused on short-term, tactical sales support) , and not too many supply side projects(focus on cost, efficiencies, supportive functions)
- Aligning the current and planned projects to the executive team’s strategies
- Managing the project portfolio in an effective manner
- Measuring the PMO to tangibly improve project performance relative to the executives’ strategic goals
The essential element of effectively managing a PMO is that the projects themselves are delivered in full according to scope, time and budget.
Many studies by research companies tell us that only 26% of the projects they surveyed were successful (For IT projects, the figure is only 16%). If most projects are not realized within their initial commitments, the strategic objectives are not met. Why? If we don’t find out why, what will be our project results? How would we expect to have success resulting from our project?
In order to know why, we first must look for the complaints. Most common complaints are that projects take too long to complete, they over-run budgets, over-run schedules, finish later than their original target date, do not have enough resources, there are too many changes, project information is misleading or non-existent, people have too much to do, project people have to work overtime, people are stressed and there is too much rework. Unfortunately we don’t see much change in the type of complaints from several decades ago.
Now, when you look in your own company what are the official reasons given for project overruns?
