Andrew Amrhein

Transformational IT Leader

Expert Series: What the CEO Wants From the Program Delivery Organization in the Digital Economy

Transformational IT Leader

Introduction

It is simply incredible the pace of business and technology change in the last twenty, ten, and even the last five years. New business models and novel approaches for delivering value to customers are disrupting entire industries overnight. As the need for acceleration drives organizations beyond what anyone thought possible, tried and true methodologies in technology delivery that worked over many years are now being tossed aside for new approaches that are not just cosmetic but fundamental in nature.

A PMO or project professional from even just 10 years ago would be shocked. Agile was just beginning to take root in some organizations, various scaling agile approaches were emerging, and DevOps was barely in its infancy. Fast forward to today, and the Program/Project Management Delivery Organization (we’ll call it the “PMO” for our shorthand) is a critical part of major transformational changes sweeping across IT organizations. With the current pace of change, what was “good enough” for yesterday is barely adequate today and will certainly fail tomorrow.

PMOs sit at the crossroads of functional organizations – they understand resources, strategy, and change – and now they themselves must not only adapt but become a critical driver of these transformational changes or they themselves will fail.

“Deliver, Deliver, Deliver”
(Business Benefit Realization and the Adoption of New Methodologies)

It wasn’t long ago that many PMOs could focus primarily on the traditional elements of a PMO – standards for documentation, status reporting, risk management, and so on. While PMOs must necessarily have standards and processes, too many PMOs focused on adhering to strict standards and reporting that didn’t add value and took their sights off the resulting business benefits their programs and projects would deliver. Smart PMO leaders in contrast have thought of themselves as a “benefits realization office” or a “results management office” rather than a project management office to ensure the team’s focus on business value over process was clear.

While PMOs continue to focus on benefits realization, new methods of delivery have been introduced in recent years and have rapidly proliferated and matured. Once introduced within specific pockets of the organization by specialists, organizations are quickly leveraging agile methodologies across a wide spectrum to pull business and technology teams together to ensure rapid and successful delivery of value to customers. Other methodologies with their roots in manufaturing (think Lean) and elsewhere have proliferated into technology organizations as well, each offering their own distinct advantages.

Today’s program and project managers must be versatile with multiple delivery methodologies and adopt a “fit-for-purpose” process approach. Some projects with well-defined requirements may utilize a waterfall approach, others may agile to take advantage of iterative delivery cycles, while still other projects require a continuous improvement process approach. Very large programs may even use different methodologies for different sub streams. PMO’s need versatile leaders who are comfortable with multiple approaches in their toolkit who can utilize the best methodology for the project at hand. This improves the likelihood of success and reduces non-value added process overhead, keeping in mind the focus is always on value and results rather than the methodology itself.

Bottom line is the CEO wants the delivery organization to DELIVER, and he/she doesn’t care which methodology is used so long as the delivery organization is being efficient and effective for the task at hand. It’s the delivery organization’s job to ensure the team is skilled and using the best tools for the job.

“Invest Our Resources Wisely”

To leverage a saying from Peter Drucker, if the choice of project management methodology is doing things right, portfolio management is going the right things. PMOs have always been responsible for successfully aligning company strategies to business goals to specific capabilities delivered via programs and projects. The better PMOs are able to ensure pareto optimal delivery of IT solutions with a constrained set of resources and dollars in the face of rising levels of demand from across the business. The best PMOs enable executives to make well informed decisions on a portfolio level by clearly articulating program business benefits versus schedules, costs, timelines, risks, etc. with transparent options of expected benefit vs. level of investment, and thoughtfully managing the portfolio and resource mix.

Portfolio management in today’s PMO has also needed to change to accommodate the increased speed of business. Rather than yesterday’s annual planning cycles with little change during the year, today’s organizations need portfolio management itself to be more agile while still protecting the value of the portfolio. Today’s PMO’s need to think more in terms of rolling wave planning at an enterprise portfolio level with more frequent reviews (at least quarterly, if not monthly) to ensure the organization is still “doing the right things” in the context of an accelerated business environment. What was important six months ago may be completely replaced with something new that was unforeseen at the time.

In this environment transparency has become non-optional as the entire organization needs to stay in sync across multiple work streams of business outcomes and dependencies – potentially using new data analytics capabilities to provide insightful views of the portfolio. Note that this is at an enterprise level of portfolio management rather than a team level, where agile sprints are measured in weeks and each team does their own backlog portfolio management as part of the methodology.

Many PMOs in the future will look very different. In fact, the term “PMO” may evolve to represent “Product Management Offices” because of the decentralized approach to portfolio planning that comes with many flavors of enterprise scale agile models that self-contain customer value streams and products within autonomous teams. These teams will include the necessary leadership, technical, and business skills to create customer value from concept to delivered product for each stream of business. These PMO’s of the future in a scaled agile framework will likely aggregate higher level product portfolio information for executive decision-making, share knowledge across teams, watch for interdependencies, and be a shared resource for expertise and support with methodologies.

“Be a Leader in Adapting to Change to Enable Our Organization”

Most of all, today’s PMO leaders must drive business value by being a strong enabler of organizational change. As any senior experienced leader would attest to, adopting any new methodology or tool and rolling it out across an organization is challenging enough, but today’s organizations must also do an entire shift of mindset.

Three major transformational changes impacting IT organizations include (1) the shift in thinking about products and customer value streams rather than projects, particularly in the context of (2) the growing adoption of enterprise agile frameworks such as SAFe and the Spotify Model; (3) fully integrated business and technology teams working on products together as one organization rather than two; and (4) the impact of DevOps breaking down the walls between the solutions development teams and the operations / infrastructure teams.

Success in bringing these elements together promises the opportunity to deliver a continuous flow of value to the customer with the agility and speed required to operate in today’s digital world. Moreover, this will unlock the ability to enable new channels of top line revenue growth rather than just bottom line cost reductions or cost avoidance.

The PMO needs to be a leading player in bringing this substantial transformation and organizational change into the organization, even as the PMO must transform itself as part of the journey. Now more than ever, today’s IT leadership and PMOs must be expert at transformation and organizational change management.

Prescription for PMOs and for Program and Project Practitioners

Relentless self-reflection and continuous learning is absolutely critical as organizations across all industries are going through transformational change.

For program management organizations it will be critical to develop a growth mindset among the members of the team and to create an institutionalized continuous learning environment. It will take substantial effort to understand and implement new delivery methodologies and new ways of thinking about delivering value to the customer, all while reducing as much process friction and overhead as possible along the way. New tools and capabilities will allow more efficient and effective governance, flexible portfolio management, project/product delivery approaches, data analytics, and more. Program management offices should also implement continuous improvement processes for the PMO itself to make sure that there is a constant feedback loop for all aspects of PMO delivery and to support the changes underway.

Continuous learning is absolutely critical for individuals in this environment as well. As delivery models, DevOps, and even company organization models change to support new business value delivery, it will be incumbent upon each professional to make sure they stay current on new processes, new techniques, new tools, and even new mindsets. At the same time, as business and technology comes together it will be increasingly important to understand the business environment (the industry, the company, challenges and opportunities in the business segment, the value stream, etc.) one is operating in as well. Throughout these transitions, every professional will need to remain constantly thoughtful of both the value they are delivering and how they are delivering it.

Lastly – this is all within the context of continued reliable delivery in the PMO’s current level of maturity as it moves up the maturity model ladder. Members of the delivery organization must understand continuous improvement in the organization and in their own capabilities are essential to maturing organizational capabilities and personal growth, with the pace of change dictated by the business environment and organization specific strategies.

Conclusion

The tremendous pace of change in today’s digital economy necessitates new approaches to delivering value to the customer affecting all aspects of managing and running a program management organization. New delivery methodologies, new practices in IT, new tools and technologies, and even new organizational models are necessitating that PMOs institutionalize a continuous learning and growth mindset and be ready to lead organizational change.