IT Project Management Office Paul R. Astiz, MBA, PMP, CDP [email protected] (703-610-2435)

IT Project Management OfficeIT Project Management Office

Paul R. Astiz, MBA, PMP, CDPPaul R. Astiz, MBA, PMP, [email protected]@Mitretek.org

(703-610-2435)(703-610-2435)

Presentation ObjectivesPresentation Objectives

Provide an overview and general Provide an overview and general understanding of PMO models, understanding of PMO models, functions, success factors, and functions, success factors, and implementation implementation

Introduce the CobiT PM CMM as a Introduce the CobiT PM CMM as a framework for establish and evolving framework for establish and evolving the PMO Project Management the PMO Project Management functionsfunctions

OutlineOutlineIT PMO TrendsIT PMO TrendsPMO Models PMO Models PMO Key ConsiderationsPMO Key Considerations– CharterCharter– Culture ChangeCulture Change– Implementation StrategiesImplementation Strategies– Staffing/SkillsStaffing/Skills– Performance MetricsPerformance Metrics

Critical Success FactorCritical Success FactorIntroduction - CobiTIntroduction - CobiT®® CMM CMM

IT PMO TrendsIT PMO Trends67% of IT organizations in 2003 have PMOs 67% of IT organizations in 2003 have PMOs (Forrester Survey)(Forrester Survey)

More than half established since 2000 More than half established since 2000 (Forrester Survey)(Forrester Survey)

Government is moving to standardize IT Project Government is moving to standardize IT Project ManagementManagement– Nov, 2003, Federal CIO Council recommends setting up Federal Nov, 2003, Federal CIO Council recommends setting up Federal

PMO to standardize PM practicesPMO to standardize PM practices– Jun, 2004, SC requires management of major and inter-agency Jun, 2004, SC requires management of major and inter-agency

IT projects to use standard practices and be managed by PMPIT projects to use standard practices and be managed by PMP– Jan, 2001, NY sets up PMO to standardize management of Jan, 2001, NY sets up PMO to standardize management of

technology projectstechnology projects– Jun 2002, CA CIO established objectives for statewide project Jun 2002, CA CIO established objectives for statewide project

management standardsmanagement standardsIT PMOs are becoming strategic IT PMOs are becoming strategic IT PMOs are gaining more influenceIT PMOs are gaining more influence

What’s Driving IT PMO What’s Driving IT PMO Proliferation? Proliferation?

Late and over budget IT projectsLate and over budget IT projects– Lack of coordination of activitiesLack of coordination of activities– Poor project management practicesPoor project management practices– Lack of standardization of PM methodologyLack of standardization of PM methodology

Need for consolidated project reporting to drive Need for consolidated project reporting to drive prioritization/decisionsprioritization/decisions– More focus on IT project ROI More focus on IT project ROI – More focus on alignment of IT projects with business strategyMore focus on alignment of IT projects with business strategy– Strategic value and dependency on IT applications/technologiesStrategic value and dependency on IT applications/technologies

Increase in IT Project workloadIncrease in IT Project workload– Proliferation of IT project proposalsProliferation of IT project proposals– Delays in getting projects approvedDelays in getting projects approved

More complex IT environment and solutionsMore complex IT environment and solutions– Enterprise solutions/cross-functional projectsEnterprise solutions/cross-functional projects– Distributed development organizationsDistributed development organizations– Outsourcing and contracting out of IT projectsOutsourcing and contracting out of IT projects

PMO BenefitsPMO BenefitsCompanies that implemented Companies that implemented successful PMOs achieved:successful PMOs achieved:– 80% ROI80% ROI– 20% reduction in project time20% reduction in project time– 30-35% successful project delivery30-35% successful project delivery

Companies without a PMO Companies without a PMO experience 74% project failure rateexperience 74% project failure rate

Source: Forrester Research

PMO ModelsPMO ModelsOne size does not fit allOne size does not fit all– PMO drivers/business needsPMO drivers/business needs– PM maturityPM maturity– Vision and goals of sponsorVision and goals of sponsor– Business/organization missionBusiness/organization mission– Organization sizeOrganization size– Number of projectsNumber of projects– Political and cultural environmentPolitical and cultural environment

Tactical vs. strategicTactical vs. strategicInternal vs. external focusInternal vs. external focusDepartmental vs. enterprise (IT vs. LOB)Departmental vs. enterprise (IT vs. LOB)Single vs. multipleSingle vs. multipleStaff vs. line organizationStaff vs. line organization

SUPPORT CONTROL

Project administrative support

PM standards, methodology, processes

Project Consulting and mentoring

PM coaching/training/certification

Integrated Project Reporting

Issue Tracking/Reporting

Master Project Schedule

Project Document Repository

PM tools and tools support

Project Audits

Cost and Schedule Control

Business Case

Project Approval

Project Prioritization

Project Management

Resource Management

IT Asset Management

Project Portfolio Management

PMO Support/Control ModelPMO Support/Control Model

Key ConsiderationsKey Considerations

PMO charterPMO charter

Culture changeCulture change

Implementation strategyImplementation strategy

StaffingStaffing

Metrics/PerformanceMetrics/Performance

Success factorsSuccess factors

Maturity of Project Management Maturity of Project Management PracticesPractices

PMO CharterPMO CharterCharter ScopeCharter Scope– Business NeedsBusiness Needs– SponsorSponsor– Public vs. Commercial Public vs. Commercial – PM MaturityPM Maturity

Charter DocumentCharter Document– Mission/VisionMission/Vision– Goals/Objectives Goals/Objectives – SponsorSponsor– Service OfferingService Offering– PMO GovernancePMO Governance– Key Performance MetricsKey Performance Metrics– Funding modelFunding model

PMO - Culture ChangePMO - Culture ChangeNatural resistance to changeNatural resistance to changePolitical landscapePolitical landscape– Winners/LosersWinners/Losers– Management Support Management Support

Degree of cultural changeDegree of cultural change– PM maturityPM maturity– PMO charterPMO charter– Existing skill levelExisting skill level– Key driver implementation strategyKey driver implementation strategy

Change ManagementChange Management– Assess impact of change Assess impact of change – InformInform– EducateEducate– InvolveInvolve

PMO Implementation StrategiesPMO Implementation StrategiesStrategy driversStrategy drivers– PMO charterPMO charter– PM maturity PM maturity – Sponsor and management supportSponsor and management support– PMO driversPMO drivers– Perception of valuePerception of value– Political environmentPolitical environment– Culture/Value SystemCulture/Value System

Evolutionary/IncrementalEvolutionary/Incremental– Lower implementation risksLower implementation risks– Lower start up costsLower start up costs– Will take longer to demonstrate ROIWill take longer to demonstrate ROI– More suitable if high resistance to change and low management supportMore suitable if high resistance to change and low management support

Revolutionary/WholesaleRevolutionary/Wholesale– Higher implementation risksHigher implementation risks– Higher startup costsHigher startup costs– May be able to demonstrate ROI quickerMay be able to demonstrate ROI quicker– More suitable if crisis or recognition at high level that change is More suitable if crisis or recognition at high level that change is

imperativeimperative

PMO Staffing/SkillsPMO Staffing/SkillsStaffing ApproachesStaffing Approaches– In-house resourcesIn-house resources– Hybrid (In-house/contractors)Hybrid (In-house/contractors)– Ad hoc contractors augmentationAd hoc contractors augmentation

SkillsSkills– PMO Director/ManagerPMO Director/Manager– Project ManagerProject Manager– Project Portfolio ManagerProject Portfolio Manager– PM Process/Methodology TrainerPM Process/Methodology Trainer– Relationship/Account ManagerRelationship/Account Manager– Tools Support/AdministrationTools Support/Administration– Administrative SupportAdministrative Support– Librarian/Document ControlLibrarian/Document Control

PMO Performance MetricsPMO Performance MetricsPMO vs. Project metricsPMO vs. Project metricsLess that 15% of PMOs employ formal metrics program (Source: Forrester Research)Less that 15% of PMOs employ formal metrics program (Source: Forrester Research)Metrics are essential for growth and support – demonstrate progress, value, and Metrics are essential for growth and support – demonstrate progress, value, and productivityproductivityPerformance metrics are driven by charter – no such thing as typical metricsPerformance metrics are driven by charter – no such thing as typical metricsBusiness value metricsBusiness value metrics

– Executive focus - Measure and demonstrate value to businessExecutive focus - Measure and demonstrate value to business– Help justify existence during downsizingHelp justify existence during downsizing– Expressed primarily in dollars savings/revenue or ROIExpressed primarily in dollars savings/revenue or ROI– Tend to be few and harder to deriveTend to be few and harder to derive

Functional performance metricsFunctional performance metrics– Internal focus - Measure and demonstrate performance or quality of PMO functionsInternal focus - Measure and demonstrate performance or quality of PMO functions– Help justify PMO budgetHelp justify PMO budget– Help improve PMO performance Help improve PMO performance – May require baseline or benchmark to demonstrate performanceMay require baseline or benchmark to demonstrate performance– Expressed primarily in percent or counts Expressed primarily in percent or counts – Tend to be many depending on functions performedTend to be many depending on functions performed– Must be selectively chosen so as not to overwhelm Must be selectively chosen so as not to overwhelm

Service level metricsService level metrics– Customer focus - Measure and demonstrate service level or quality of service to customerCustomer focus - Measure and demonstrate service level or quality of service to customer– Help improve and maintain customer satisfactionHelp improve and maintain customer satisfaction– SLA/SLOSLA/SLO– Expressed in a variety of waysExpressed in a variety of ways– Select on key and most important value to customer communitySelect on key and most important value to customer community

Success FactorsSuccess FactorsClear CharterClear Charter– Creates clear expectationsCreates clear expectations– Defines boundaries for implementationDefines boundaries for implementation

Top-Down SupportTop-Down SupportBottoms up Buy-inBottoms up Buy-inSponsor - Reporting to senior executiveSponsor - Reporting to senior executiveStrong LOB representation Strong LOB representation Communication/PRCommunication/PR– Promotion of servicesPromotion of services– Education of valueEducation of value– Performance metrics that demonstrate business and Performance metrics that demonstrate business and

customer valuecustomer value

PM Capability Maturity ModelsPM Capability Maturity ModelsValuable tool for establishing PMO and Valuable tool for establishing PMO and help define objectives, charter, and help define objectives, charter, and processes processes

Assess current statusAssess current status

Compare against best practicesCompare against best practices

Develop strategy and road map for PMODevelop strategy and road map for PMO

Help communicate vision and get buy inHelp communicate vision and get buy in

Different models (CobiT, OPM3, ISO 15504, Different models (CobiT, OPM3, ISO 15504, CMM/CMMI) CMM/CMMI)

CobiT CobiT ®® Capability Maturity Model Capability Maturity ModelCobiTCobiT®® CMM is valuable and comprehensive framework for CMM is valuable and comprehensive framework for assessing maturity of IT organizationassessing maturity of IT organizationCobiTCobiT®® CMM CMM – International Open Standard for IT GovernanceInternational Open Standard for IT Governance– IT Governance Institute (ITGIIT Governance Institute (ITGI®)®)– Information Systems Audit and Control Association (ISACAInformation Systems Audit and Control Association (ISACA®)®)

ITIG ITIG ®® not associated with Software Engineering Institute not associated with Software Engineering Institute (SEI), Carnegie Mellon(SEI), Carnegie MellonCobiTCobiT®® CMM uses same conceptual framework as SEI’s CMM uses same conceptual framework as SEI’s CMM CMM Defines maturity of IT organizations in four domainsDefines maturity of IT organizations in four domains– Planning and OrganizationPlanning and Organization– Acquisition and ImplementationAcquisition and Implementation– Delivery and SupportDelivery and Support– MonitoringMonitoring

PM CMM part of CobiTPM CMM part of CobiT®® Planning and Organization domain Planning and Organization domain

Sources: WWW.ISACA.ORG and WWW.ITGI.ORG

CobiTCobiT®® Maturity Levels Maturity Levels0 Non-Existent – Not applied0 Non-Existent – Not applied

1 Initial – Ad hoc and disorganized 1 Initial – Ad hoc and disorganized

2 Repeatable – Follow regular pattern 2 Repeatable – Follow regular pattern

3 Defined – Documented/communicated3 Defined – Documented/communicated

4 Managed – Monitored and measured4 Managed – Monitored and measured

5 Optimized – Best practices followed/ 5 Optimized – Best practices followed/ automatedautomated

Source: CobiT 3rd Edition, Management Guidelines

CobiTCobiT®® Model Components Model Components

Defines processes within each domainDefines processes within each domain

Defines high-level control statement Defines high-level control statement for each processfor each process

Defines maturity levelsDefines maturity levels

Defines success factors for each Defines success factors for each process process

Defines key goals for each processDefines key goals for each process

Defines key performance indicatorsDefines key performance indicators


CobiTCobiT®® Project Management Project Management Process Control StatementProcess Control Statement

Control of project management process Control of project management process with the business goal of setting with the business goal of setting priorities and delivering on time and priorities and delivering on time and within budget within budget

Is enabled by the organization Is enabled by the organization identifying and prioritizing projects in identifying and prioritizing projects in line with the operational plan and the line with the operational plan and the adoption and application of sound adoption and application of sound project management techniques for project management techniques for each project undertakeneach project undertaken


Level 0 – Non ExistenceLevel 0 – Non Existence

PM techniques not usedPM techniques not used

Organization does not consider Organization does not consider business impact of poor project business impact of poor project performanceperformance


Level 1 – Initial/Ad HocLevel 1 – Initial/Ad HocAware of need for project structure and risks of poorly Aware of need for project structure and risks of poorly managed projectsmanaged projectsUse of PM techniques left to the individualUse of PM techniques left to the individualProjects are generally poorly defined and do not incorporate Projects are generally poorly defined and do not incorporate business or technical objectives of the organization or business or technical objectives of the organization or stakeholdersstakeholdersLack of management commitment and project ownershipLack of management commitment and project ownershipCritical project decisions are made without user Critical project decisions are made without user management or customer inputmanagement or customer inputLittle or no customer and user involvement in defining IT Little or no customer and user involvement in defining IT projectsprojectsNo clear organization within IT projects and No clear organization within IT projects and roles/responsibilities are not definedroles/responsibilities are not definedProject schedules and milestones are poorly defined Project schedules and milestones are poorly defined Project staff time and expenses are not tracked and Project staff time and expenses are not tracked and compared to budgetscompared to budgets


Level 2 – Repeatable but IntuitiveLevel 2 – Repeatable but IntuitiveSr. Management has gained and Sr. Management has gained and communicated an awareness of the need communicated an awareness of the need for IT Project Managementfor IT Project ManagementOrganization is in the process of learning Organization is in the process of learning and repeating certain techniques and and repeating certain techniques and methods from project-to-projectmethods from project-to-projectProjects have informally defined business Projects have informally defined business and technical objectivesand technical objectivesLimited stakeholders involvement in PMLimited stakeholders involvement in PMSome PM guidelines developed, but left to Some PM guidelines developed, but left to discretion of project managersdiscretion of project managers


Level 3 – Defined ProcessLevel 3 – Defined ProcessPM process and methodology formally established and PM process and methodology formally established and communicatedcommunicatedIT projects defined with appropriate business and technical IT projects defined with appropriate business and technical objectivesobjectivesStakeholders are involved in the management of IT projectsStakeholders are involved in the management of IT projectsDefined project structure with roles and responsibilitiesDefined project structure with roles and responsibilitiesDefined and updated project milestones, schedules, budget Defined and updated project milestones, schedules, budget and performance measurementsand performance measurementsIT Projects have formal post systems implementation IT Projects have formal post systems implementation proceduresproceduresInformal project management training providedInformal project management training providedNo established policies for using combination of internal No established policies for using combination of internal and external resourcesand external resourcesQuality assurance procedures are definedQuality assurance procedures are defined


Level 4 – Managed and MeasurableLevel 4 – Managed and MeasurableFormal and standardized project metricsFormal and standardized project metricsPM measure and evaluated throughout organization not just PM measure and evaluated throughout organization not just ITITPM process enhancement formalized and communicated, PM process enhancement formalized and communicated, and project team members are trained on all and project team members are trained on all enhancementsenhancementsRisk management performed as part of PMRisk management performed as part of PMStakeholders actively participate in projects or lead themStakeholders actively participate in projects or lead themProject milestones and criteria for evaluating success at Project milestones and criteria for evaluating success at each milestones are establishedeach milestones are establishedValue and risk are measured and managed prior to, during, Value and risk are measured and managed prior to, during, and after project completionand after project completionManagement has established a program management Management has established a program management function within ITfunction within ITProjects are defined, staffed, and managed to address Projects are defined, staffed, and managed to address organizational goals, rather than only IT specific ones.organizational goals, rather than only IT specific ones.


Level 5 - OptimizedLevel 5 - OptimizedProven full life-cycle project methodology is implemented and Proven full life-cycle project methodology is implemented and enforced, and integrated into organizational cultureenforced, and integrated into organizational cultureOn-going program to institutionalize best practices has been On-going program to institutionalize best practices has been implementedimplementedStrong and active project support from Sr. Management Strong and active project support from Sr. Management sponsors and stakeholderssponsors and stakeholdersImplemented project organization structure with documented Implemented project organization structure with documented roles, responsibilities, and staff performance criteriaroles, responsibilities, and staff performance criteriaLong term IT resources strategy is defined to support Long term IT resources strategy is defined to support development and operational outsource decisionsdevelopment and operational outsource decisionsIntegrated Program Management Office is responsible for Integrated Program Management Office is responsible for projects from inception to post implementationprojects from inception to post implementationProgram Management Office is under the management of the Program Management Office is under the management of the business units and requisitions and directs IT resources to business units and requisitions and directs IT resources to complete projectscomplete projectsOrganization-wide planning of projects ensures that users and Organization-wide planning of projects ensures that users and IT resources are best utilized to support strategic initiativesIT resources are best utilized to support strategic initiatives


CobiTCobiT® PM ® PM Success Factors Success Factors Experienced and skilled project managers are availableExperienced and skilled project managers are availableAccepted and standard project management process in placeAccepted and standard project management process in placeSr. Manager sponsorship of projects, and stakeholders and IT Sr. Manager sponsorship of projects, and stakeholders and IT staff share in the definition, implementation, and management staff share in the definition, implementation, and management of projectsof projectsThere is an understanding of the abilities and limitations of the There is an understanding of the abilities and limitations of the organization and the IT functions in managing large, complex organization and the IT functions in managing large, complex projectsprojectsOrganization-wide project risk assessment methodology is Organization-wide project risk assessment methodology is defined and enforceddefined and enforcedAll projects have a plan with clear traceable work breakdown All projects have a plan with clear traceable work breakdown structures, reasonably accurate estimates, skill requirements, structures, reasonably accurate estimates, skill requirements, issues to track, quality plan, and transparent change process issues to track, quality plan, and transparent change process (my note – effective PM methodology enforced)(my note – effective PM methodology enforced)Transition from implementation team to operational team is a Transition from implementation team to operational team is a well-managed processwell-managed processSystem development life cycle methodology has been defined System development life cycle methodology has been defined and is used by the organizationand is used by the organization


CobiTCobiT® PM® PM Key Goal Indicators Key Goal IndicatorsIncreased number of projects completed on time Increased number of projects completed on time and on budgetand on budgetAvailability of accurate project schedule and Availability of accurate project schedule and budget informationbudget informationDecrease in systematic and common project Decrease in systematic and common project problemsproblemsImproved timeliness of project risk identificationImproved timeliness of project risk identificationIncreased organization satisfaction with project Increased organization satisfaction with project delivery servicesdelivery servicesImproved timeliness of project management Improved timeliness of project management decisionsdecisions

CobiTCobiT® Project Management® Project ManagementKey Performance IndicatorsKey Performance Indicators

Increased number of projects delivered in Increased number of projects delivered in accordance with defined methodologyaccordance with defined methodologyPercent stakeholders participation in Percent stakeholders participation in projects (involvement index)projects (involvement index)Number of project management training Number of project management training days per project team memberdays per project team memberNumber of project milestones and budget Number of project milestones and budget reviewsreviewsPercent of projects with post-project Percent of projects with post-project reviewsreviewsAverage number of years of experience of Average number of years of experience of project managersproject managers

ConclusionConclusionIT PMOs can improve IT project delivery IT PMOs can improve IT project delivery performanceperformanceOne size does not fit allOne size does not fit allPMO Support/Control model most usefulPMO Support/Control model most usefulClear charter, top down support, & bottom Clear charter, top down support, & bottom ups buy is key to PMO successups buy is key to PMO successPMO performance metrics should focus on PMO performance metrics should focus on value to key stakeholdersvalue to key stakeholdersCMM valuable framework for establishing CMM valuable framework for establishing and evolving PMOand evolving PMO

Documents

IT Project Management Office Paul R. Astiz, MBA, PMP, CDP [email protected] (703-610-2435)