Too many operating models only pay lip service to the idea of committing to superior customer experience and strong customer relationships. To implement a true customer-centric operating model, project management offices (PMOs) and stakeholders must innovate and embrace strategic portfolio management practices and solutions that enable continuous improvement.
Many PMO leaders are relegated to a tunnel vision approach that is constricted by outdated practices that rely on spreadsheets, unproductive meetings and limited visibility. Your project management (PM) maturity assessment will reveal where you stack up against your Agile and customer-focused competitors. For example, when you look at your organization:
- There are no formal PM processes in place.
- You are looking to standardize Project, Program and Portfolio Management activities.
- Formal PM processes are in place, but tools are needed to help standardization, or to consolidate multiple systems.
- Standard tools are in place, but you have additional, more complex requirements, such as billing and integration.
- You have complex project management needs, operating at a detailed work/task level.
Whether your organization is tackling one of these challenges, or any combination of them, a change in how you approach project portfolio management can increase PMO maturity levels and dramatically improve your results.
Four Competencies for Assessing Your Current Portfolio Maturity
A recent Forrester report titled “Assess Your Strategic Portfolio Management Maturity” lists four competencies that are imperative to an Agile, customer-focused portfolio management strategy. By measuring your current portfolio management practices against these four elements, you can establish a clear baseline for beginning your transformation.
Structure. The foundation of your strategic portfolio management methodology, should, at its very core, align with a customer-obsessed operating model. If your customer — not project delivery, not growing revenue, not beating competitors — is the focus of your strategy from the get-go, achieving the other goals will become a positive consequence of your actions. This means establishing a system of portfolio traceability that comes directly from your organization’s strategic plans and overarching corporate vision.
This also means creating a system of ownership founded in end-to-end planning and delivery - facilitating a system of consistency and predictability. If your current strategy is lagging in this area, it is the first place you need to start making changes. In short, you need to shore up your overall structure.
Measurement. The key to measuring the success of any project or strategy lies in timely, plentiful and accurate data. As the saying goes, you don’t know what you don’t know. A successful, mature portfolio tracks results at all phases of execution so there is a clear understanding of progress both internally and externally. This has multiple benefits, the greatest being the support of continuous improvement resulting in customer satisfaction.
Internal: With constant insight into how all projects within your portfolio are being executed, PMO leaders are empowered to make real-time adjustments that enhance value. When a project is faltering, for example, the PMO will be able to make swift changes, be it investing more time and resources, tweaking the overall strategy or even scrapping it altogether.
External: By consistently keeping a finger on the pulse of customer demands, PMO leaders are equipped with critical insights that support improvement — all backed by data direct from the field. That not only supports internal goals, it delivers on the promise to customers to provide the best possible products and services.
Process. To accurately measure progress, key performance indicators must be established and then tracked by a portfolio management tool, such as a PPM or BI solution. Dynamic digital tracking and reporting enhances the speed and responsiveness of a portfolio by allowing for continuous planning, Agile resource management, strategic investment, consistent monitoring, and an ever-ready backlog of projects. A portfolio management tool reduces manual data analysis that forces the PMO to chase projects from start to completion and limits their ability to accurately forecast time and resource allocation. It breaks down silos by centralizing portfolio management, which supports the PMO in making swift, accurate changes that deliver value internally and externally.
Governance. An Agile, customer-focused portfolio requires buy-in from the top down, including overall governance. An organization’s product, program and financial governance all impact the success of the above competencies. Establish an overarching mindset and methodology of delivering products not projects. This changes the organizational focus to one of continuous improvement instead of simply completing a list of finite goals.
Continuous improvement is customer-focused and value-driven; finite goals hinder growth and innovation. This methodology requires a shift in financial governance, as well. To accomplish a product-delivery model, your financial investments will need to transition from traditional, annual project-based funding to iterative, product-based or value-based funding. Your PMO can then make rapid changes and ensure all dollars spent and time invested deliver the best results.
PMO Transformation and Benefits of Portfolio Maturity
As you develop your project management processes in the early stages, you will see increased project visibility and more standardized planning. As project management involvement increases in the day-to-day operations of the business, you will see more standardized project management processes and improved collaboration and resource utilization.
As a result of the project management's increasing influence, there will be a need to optimize your tools and processes. Here you will see improved project selection, increased efficiency with resource capability planning, increased effectiveness with project financial management, and standardized project status reporting.
Finally, as your requirements become more transformational, you will see benefits at the business and customer level.
- Reduced costs
- Increased productivity
- Proactive project and resource management
- Faster delivery times
- Innovation, growth and advancement
- Better forecasting
- Measurable data
- Enhanced communication
- Fulfillment on commitments — promises made are promises kept
- Improved customer satisfaction
If your organization wants to embrace a customer-obsessed, Agile strategy, the process begins within. In our experience, the current and desired levels of maturity, and the budget and complexity of the implementation are the most critical factors that influence the decision on which solution to select. By aligning your strategic portfolio management methods and PMO best practices with the competencies discussed above you can achieve a transformation that delivers internal and external value.
Rachel Hentges
Rachel Hentges is challenging PMO leaders to think differently about their role. Rachel is the author of key industry related surveys, reports, blogs and more that challenge the status quo of today’s PMOs.