While PMOs aren’t new in the project management space, their implementation continues to provide benefits to all project teams and organisations. As your projects increase in number and complexity, establishing a PMO within your organisation may be worthwhile. In this article, we highlight the top 10 benefits of having a PMO in your organisation and explain the effects of this on your efficiency and overall project management process.

What is a PMO?

A project management office (PMO) is a group, department or office that establishes and maintains the standards and practices for project management within an organisation. The PMO can either be external or internal, depending on the resources available to the organisation, as an external PMO, for example, may be more costly and require greater resources than an internal one. PMOs can play a significant role in supporting and improving strategic decision-making. This is particularly important when the organisation has programs and portfolios, which require greater precision in effective decision-making. An organisation like this could benefit from either the establishment of an Enterprise Project Management Office (EPMO), or a PMO with a strategic focus. 

Understanding a project’s progress and strategic value can be difficult in organisations running hundreds of concurrent projects. A PMOs job is to be the supportive backbone of your project management program. They ensure your organisation is executing projects in the right way, and choosing the right people for the task.

Benefits of a PMO for your organisation

1. Gives organisations transparency and a big picture understanding of their projects

The completion of projects is not always a product of the work of the project team. When organisations use top-down structures, those who choose the projects may not understand their feasibility or strategic impact. This then limits the executive team’s understanding of the impact and value of projects, leading to poor project optimisation.

The PMO is responsible for being an authoritative source for all project information. It should ensure all processes maximise project value, while most effectively identifying, reporting, and managing activities and risks.

2. Aligns the organisation’s activities with their strategy

PMOs make sure that your organisation’s portfolio is actually producing value, in line with your strategy. This is the key way to maximise and optimise your portfolio. Without a proper PMO, organisations often fall into the trap of simply using their resources to complete as many projects as possible, rather than selecting the optimal projects to reach their strategic goals. However, more projects doesn’t always mean more value. Research by PMI shows that having a body overseeing portfolios and strategic value can improve strategic alignment by 23% and portfolio reporting services by 20%. 

3. Optimises an organisation’s resources and portfolio

One of the main tasks of the PMO is to ensure resources are used as efficiently and effectively as possible. All projects should be managed according to priorities, schedules, and budgets. PMOs also ensure that teams are employing processes that increase productivity. Some common processes that many PMOs use include governance frameworks and project pipeline management structures.

It can be a challenge for PMOs to stay on top of these tasks as the number of projects increases. To complete all these tasks well, it’s essential to invest in effective PPM software. pmo365 is an excellent example, with hundreds of PMOs utilising its resource management, native scheduling, and Power BI reporting capabilities to achieve effective project management across their enterprise.

4. Eases your risk management activities

Project managers know the importance of identifying and managing risks to successfully execute a project. We know that high risk doesn’t always result in a high return. PMOs are responsible for ensuring organisations take on the right risk for the right returns. PMOs can help organisations identify, prioritise, and evaluate all the risks associated with projects. A PMO might evaluate risks through a RAID log, and produce contingency and risk response plans to mitigate these uncertainties. Risks aren’t as scary or damaging when an effective PMO is managing them.

5. Enhances the decision-making process

The key benefit of a PMO is their ability to gather data across all projects. Then, they can analyse this information and provide any relevant data to the key decision-makers of the organization. to give key decision-makers within an organisation relevant information. To make informed decisions, managers need continuous real-time, accurate, and reliable data.

Many organisations haven’t put in place processes to ensure that the right data is collected. To address this issue, PMOs should be gathering data that provides tangible measurements of value. This will reduce the likelihood of ‘pet projects’ being chosen. Instead, an organisation will choose the projects that generate the most strategic value.

6. Facilitates the sharing of knowledge to achieve success 

A recurring issue in many large organisations is individual departments working in individual silos. Ideally, an organisation should be using standardised processes and tools to execute their projects to ensure consistency across the board. Sometimes departments use highly effective processes, but are too separate from the rest of the organisation to share them with others. PMOs are there to make sure teams don’t keep good things to themselves!

By acting as a central hub, PMOs facilitate the sharing of knowledge and ensure project teams use standardised and effective processes. The PMO will gather, identify, develop, and implement the most effective project management methodologies and best practices for the organisation as a whole.

7. Governance initiatives are easier to implement

This point works hand-in-hand with point 6. When processes are standardised, any governance initiatives are applicable across the whole organisation. This reduces costs, improves the traceability of successful models, and ensures the organisation can repeat successful frameworks. PMOs generate all of these benefits as part of their role to create, implement and maintain effective governance frameworks. These frameworks should clearly define responsibilities, accountability, and oversight responsibilities for projects.

8. Improves communication, collaboration, and coordination across departments

As your organisation’s central hub, PMOs can facilitate smooth and efficient communication between different departments or teams. Open and organised communication improves collaboration and coordination within an organisation. Often, simply due to a lack of communication across the business, organisations fail to fully optimise their skills and resources. With an effective PMO, those issues will be long gone!

9. Supports project teams so they can do their jobs better

PMOs act as the project managers’ guide; they don’t just tick boxes and manage quality control, but also direct decision-makers who make choices based on analyses of data. An effective PMO will ensure that project managers have all the tools they need to achieve the results that executives are expecting. Members of the PMO should work alongside project delivery support, and provide the necessary training and mentoring to project managers. This includes training for project managers to use any PPM solution effectively. PMOs don’t just push for what the head of organisations wants; they make sure the teams have everything they need to meet expectations.

10. Increases your organisation’s ROI

Ultimately, the most important benefit of having a PMO is the potential to increase organisational ROI. The reason for increasing efficiency, strategic alignment, and portfolio optimisation is to generate the most value for investment. An effective PMO should guarantee a higher chance of achieving better results in an organisation’s project investments. Improved results will come from the activities of the PMO, which exists to ensure an organisation is working effectively to accomplish their most valuable projects.

pmo365 brings the best out of your PMOs

Ready to establish a PMO? The rewards you’ll gain will be well worth the effort you invest. Make the process of establishing a PMO easier with pmo365. With over 15 years of industry experience, we know how to implement an integrated PMO solution so you see the results as quickly as possible.

If you want to know more about how pmo365 can revolutionise your PMO activities, make sure to book a free trial and speak directly with our PMO experts.

Laith Adel
Laith Adel