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Gartner Headquarters Gartner EXP Premier Reports

Taking Your PMO to the Next Stage

Corporate Headquarters
Growing IT’s Contribution: The 2006 CIO Agenda
56 Top Gallant Road
January 2006
Stamford, CT 06902-7700
U.S.A. Building Business Smarts in IS
+1 203 964 0096 November 2005
Overcoming Change Obstacles in the Public Sector
Europe Headquarters October 2005
Tamesis
The Glanty Applying Enterprise Architecture
Egham September 2005
Surrey, TW20 9AW The CIO’s Personal Contribution Scorecard

Taking Your PMO

UNITED KINGDOM July 2005
+44 1784 431611
Changing Business Processes
Asia/Pacific Headquarters
Gartner Australasia Pty. Ltd.
May 2005
Perception Is Reality: Communication Strategies to the Next Stage
Level 9, 141 Walker Street for Public Sector CIOs
North Sydney March 2005
New South Wales 2060 Contents
Playing to Your Advantage: Proven Practices
AUSTRALIA Executive summary 4
of Midsize-Enterprise CIOs
+61 2 9459 4600 PMOs evolve through three stages as they mature to meet ever-increasing business
March 2005 needs. CIOs must ensure that their PMOs master the basics of their current stage
before evolving them to the next stage.
Japan Headquarters Delivering IT’s Contribution: The 2005 CIO Agenda
Gartner Japan, Ltd. January 2005 Section 1 PMOs must evolve as business needs change 8
As business needs evolve from risk reduction to resource management to business
Aobadai Hills 6F growth, CIOs evolve their PMOs through the project, program and portfolio
Making Time: The Office of the CIO management stages.
4-7-7 Aobadai, Meguro-Ku
November 2004
Tokyo, 153-0042 Section 2 Reduce business risk with a project management
JAPAN The New Shape of IS office 18
+81 3 3481 3670 September 2004 A project management office can reduce the risk of project schedule slippage,
cost overruns and scope creep by focusing on a standard project management
process, basic tools and project manager development.
Improving the CEO’s View of the CIO
Latin America Headquarters July 2004 Section 3 Optimize resource use with a program management
Gartner do Brasil office 32
Av. Das Nações Unidas, 12.551 – 9º andar Upgrading the IS Scorecard A program management office can improve resource management across
business and IT projects and programs by combining related business and IS
World Trade Center – Broklin Novo May 2004 projects into programs, as well as by implementing governance, communications
programs and collaboration tools.
04578-903 – São Paulo – SP Preparing for the Upswing: The 2004 CIO Agenda
BRAZIL March 2004 Section 4 Contribute to business growth through a portfolio
management office 46
+55 11 3443 1509
Building Brilliant Business Cases A portfolio management office can contribute to business growth by optimizing
the mix of project and program investments and focusing on benefits realization
January 2004 and knowledge management.
For more information,
visit gartner.com. CIO Credibility: Proven Practices From the Appendix A Organizing the PMO 62
Public Sector Appendix B Representative PMO tools and frameworks 66
November 2003 Further reading 67
Geosourcing IS: Is It Right for You?
November 2003
© 2006 Gartner, Inc. and/or its affiliates. All rights reserved.
Gartner is a registered trademark of Gartner, Inc. or its affiliates.
GARTNEREXPPREMIER20060315 ®
 Further reading
Gartner EXP reports Eglund, R., Graham, R. and Dinsmore, P.,
Creating the Project Office: A Manager’s
Aron, D., Tucker, C. and Hunter, R., Show Me Guide to Leading Organizational Change,
the Money: Advanced Practices in Benefits San Francisco, CA: Jossey-Bass, 2003
Realization, Gartner EXP CIO Signature Report,
December 2005 Jeffery, M. and Leliveld, I., “Best Practices in IT
Portfolio Management,” MIT Sloan Management
Tucker, C. and Rowsell-Jones, A., Getting Review, Spring 2004
Priorities Straight, Gartner EXP Premier Report,
September 2002 Maizlish, B. and Handler, R., IT Portfolio
Management Step-by-Step: Unlocking the
Tucker, C. and Woolfe, R., Building Brilliant Business Value of Technology, Hoboken, NJ:
Business Cases, Gartner EXP Premier Report, John Wiley & Sons, Inc., 2005
January 2004
Pennypacker, J. S., PM Solutions’ Project
Portfolio Management Maturity Model,
Core research Havertown, PA: Center for Business
Practices, 2005
Light, M. and Stang, D., “Magic Quadrant for
IT Project and Portfolio Management—2005,” Project Management Institute, A Guide to the
G00129208, June 22, 2005 Project Management Body of Knowledge,
Newton Square, PA: PMI Publications, 2004
Light, M., Rosser, B. and Hayward, S.,
“Realizing the Benefits of Project and Portfolio Rad, P. F. and Levin, G., The Advanced Project
Management,” G00125673, January 4, 2005 Management Office, Boca Raton, FL: St. Lucie
Press, 2002
Light, M., Hotle, M., Stang, D. and Heine, J.,
“Project Management Office: The IT Control
Tower,” G00132836, November 22, 2005 Web sites
Project Management Institute, www.pmi.org
Books and other publications
The Online Community for IT Project Managers,
Layout/Production: Gartner Corporate Marketing Crawford, J. K., The Strategic Project Office: A www.gantthead.com
Guide to Improving Organizational Performance,
Entire contents © 2006 Gartner, Inc. and/or its affiliates. All rights reserved. Reproduction of this publication in any form
New York, NY: Marcel Dekker, Inc., 2002
without prior written permission is forbidden. The information contained herein has been obtained from sources believed to
be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner
shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.
The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions
expressed herein are subject to change without notice.

© 2006 Gartner, Inc.

Taking Your PMO to the Next Stage 67

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Taking Your PMO to the Next Stage 1

 Foreword
PMOs are evolving. Shifting from the tactical to

the strategic, PMOs are performing a widening

range of work. They’re supporting business

programs outside IS, such as product launches

and post-merger integration. And they’re helping

ensure that the enterprise invests in the best set

of projects and programs—and achieves the most

benefits. Their stakeholder set is broadening as well

to include business partners and external resources.

2 Gartner EXP Premier

PMOs evolve through three stages to perform
a wider range of work. Each stage builds on
the prior stage. Moving from one to the next
depends both on the PMO’s maturity and the
needs of the business. CIOs play a leading role
in this evolution.
Chuck Tucker and Hilda Agopian led the
research on Taking Your PMO to the Next
Stage. This report answers the question, How
can CIOs make their PMOs more effective?
Fifteen CIOs, PMO heads and IS executives
from 10 enterprises with established PMOs
were interviewed as part of this research.
Their best practices and lessons learned are
summarized in the report.
Many individuals from around the world
contributed to this work, including:
• Contributors to the case studies: San Retna,
AAA of Northern California, Nevada and Utah;
Garry Whatley and David McBeth, Corporate
Express Australia Ltd.; Mike McLaughlin and
Taking Your PMO to the Next Stage
Ken LeBlanc, EMC Corporation; Merissa
Smith, Hallmark UK; Jan Cronje and André
Michau, Metropolitan Holdings Ltd.; Avi
Duvdevani and Ron Rigores, New York City
Housing Authority; Richard Shapiro, Royal
Caribbean Cruises Ltd.; Patrick Anglard,
Thales Group; Ana Paula Keil, TIM Brazil;
and Valerie Adamo and Katherine McLean,
Workplace Safety and Insurance Board
(Ontario, Canada).
• Other members of the Gartner EXP research
team: Dave Aron, Mark McDonald, Tina
Nunno, Andrew Rowsell-Jones and Gartner
adjunct researcher, Barbara McNurlin.
• Other Gartner colleagues: Nicky Basset,
Francois Bonnel, Lyne Bouchard, Ione de
Almeida Coco, Tim Goetz, Robert Handler,
Amanda Hatten, Matt Hotle, David Lentz,
Matt Light, Anna Maria Nenna, Venessa
Penov, Bridgette Randolph, Jonathan Rosen
and Ruth Steinberg.
3
 Executive summary
A PMO is a center of expertise that provides

the organizational focus on improving the

management of projects, programs and portfolios.

PMOs evolve through three stages as they mature

to meet ever-increasing business needs. CIOs

play an important role in ensuring that their PMOs

master the basics of their current stage, employ

best practices and demonstrate results, before

evolving them to the next stage.

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PMOs must evolve as business
needs change
From the case studies it is clear that PMOs are
not static. They evolve over time through the
three stages—even though the term “PMO” is
used to refer to all three. Through this evolution
the scope of work changes from tactical to
strategic, and the scope of initiatives changes
from IT-intensive projects to combined
business-IT programs and finally to
enterprisewide initiatives (see figure below).
Disciplines established in previous stages
don’t disappear. They provide the foundation
to succeed in the current stage.
PMOs at all three stages perform the basics of
maintaining the project management process,
supplying tools and centrally tracking status.
The project management stage is where project
manager training, coaching and mentoring have
the most focus.
High-level governance programs and
communications programs are most frequently
implemented at the program management
stage to coordinate business and IT projects.
The portfolio management stage is where
benefits realization management and knowledge
management most frequently take place.
CIOs play an important role in matching the
PMO stage to business needs, and planning
the evolution. Getting too far out in front of the
business or lagging too far behind have similar
disadvantages.

PMO scope of work and scope of initiatives change across the three stages

Strategic

Portfolio management
• Portfolio scope definition
• Overall investment, benefit, risk optimization
• Active portfolio performance monitoring
• Business environment change adaptation

Program management
• Comprehensive program planning
Scope
• Change and risk management
of work
• Coordination of project delivery
• Measurement of results
• Business-IS collaboration

Project management
• Initiation • Deliverables
• Budget • Scope
• Schedule • Risks
• Resources • Metrics

Tactical
Scope of initiatives

IT Business-IT Enterprise

Source: Adapted from New York City Housing Authority (NYCHA).

Taking Your PMO to the Next Stage 5

 Reduce business risk with a
project management office
Defining and implementing an end-to-end
project management process is the first step
in establishing a project management office.
This requires implementing a flexible project
management process and basic tools for
project planning and reporting.
CIOs should also devote resources to
developing competent project managers
through formal training, coaching and
mentoring. Not all projects require the same
level of experience. Use a mix of internal and
external hires, contractors and external service
providers to provide project manager staffing
flexibility.
Once you have best practice basics in place,
demonstrated improvement in project delivery
and gained credibility, consider broadening the
PMO’s scope beyond IT-intensive projects and
evolving to the program management stage.
Optimize resource use with a
program management office
The next stage in the PMO’s evolution is to
become a program management office.
Program management offices coordinate related
business and IT projects. Programs usually
impact multiple stakeholders, last longer and
involve external resources, so they are more
complex to manage. Cross-project visibility and
focusing on the interdependencies between
related projects allow program management
offices to ensure that the right business and IS
resources are used at the right time.
To move to the program management stage, an
enterprise must first institutionalize its project
6 Gartner EXP Premier
management functions. A PMO cannot manage
complex functions if it still spends most of its
time on the basics.
At this level CIOs must focus on establishing
an effective governance structure and
communicating early and often with the
programs’ extended stakeholder groups.
In addition to being the communications hub, a
program office facilitates collaboration between
business and IS project teams that are working
in the same program.
CIOs with mature program management offices
who can demonstrate improved program
delivery and resource utilization should start
thinking about moving the PMO out of IS and
evolving to the portfolio management stage.
Contribute to business growth
through a portfolio management
office
Portfolio management offices contribute to
business growth by optimizing the enterprise’s
portfolio of projects and programs. They
allocate scarce resources toward enterprise
objectives, while factoring in risk, desired
returns and interrelationships between these
investments.
The portfolio management office typically
operates independently of IS, reporting to the
CFO, COO or other senior executive. This gives
it the clout to raise portfolio management issues
to the highest levels and make decisions based
on the best interests of the entire enterprise.
CIOs can help extend the portfolio management
office’s influence by getting it involved in
strategy formulation and benefits realization.
They can upgrade governance to deal with
portfolio-level issues.
PMO staff now require new competencies, such
as strategic planning and investment analysis,
and more powerful tools to measure, manage
and report benefits realization, portfolio
alignment and health, and PMO performance,
as well as capture lessons learned and promote
positive change.
The figure below summarizes best practices
for improving PMO effectiveness. The three-
stage framework and the self-assessment at
the end of each section can help CIOs manage
expectations, fill in gaps and plan when and
how to take their PMO to the next stage.
See Appendix A to see how case-study
CIOs organize their PMO resources. Refer
to Appendix B for representative examples
of PMO tools and frameworks.

Summary of PMO case-study best practices

Reduce business risk with a Optimize resource use with a Contribute to business growth
project management office program management office through a portfolio management
office

1. Establish a flexible, end-to-end 1. Expand PMO oversight to include 1. Position the PMO organizationally
project management process that business and IT projects, and outside IS to give it indepen-
balances rigor with overhead projects sourced externally dence and senior management
sponsorship

2. Support the process with 2. Institutionalize project manage- 2. Enlarge the breadth of PMO
simple-to-use tools to plan, ment discipline into the culture influence to extend from strategy
manage, track and report all to free up resources to focus formulation through benefits
project activities on program management realization

3. Make the tools available over 3. Use program-level visibility to 3. Design governance to focus
your intranet along with examples identify and alleviate resource senior management on strategic
and instructional support contention issues issues

4. Provide formal training, coaching 4. Educate the business, IS and 4. Integrate benefits realization into
and mentoring to both IS and the external stakeholders about their the entire life cycle starting with
business to develop competent shared responsibilities for planning, and report on it
project managers ensuring program success regularly

5. Be flexible in sourcing and 5. Expand governance body 5. Implement portfolio management

providing project management membership to represent the tools that provide high-level
resources expanded stakeholder set of visibility and analysis that inform
programs decision makers

6. Provide project management 6. Establish communications 6. Broaden PMO staff competen-

assistance, e.g., consulting, programs to keep all stakehold- cies to include strategic planning
problem solving, audits and ers informed and committed to and investment analysis
expertise program success

7. Provide collaboration tools 7. Implement knowledge manage-

to facilitate the work of the ment tools to capture, categorize
business, IS and external and distribute best practices and
project teams lessons learned

Taking Your PMO to the Next Stage 7

PMOs must
evolve as business
needs change

8 Gartner EXP Premier

 1
As business needs change—from risk
reduction to resource management, to
accelerating business growth—CIOs
must help their PMOs evolve through the
associated project, program and portfolio
management stages in a planned fashion.

Taking Your PMO to the Next Stage 9

 1
PMOs change their scope as they evolve
A PMO is a center of expertise that provides the organizational focus
on improving the management of projects, programs and portfolios.

This report is based on analysis of 10 case studies from enterprises

with established PMOs, and review of the PMO literature. The analysis
uncovered a three-stage pattern of PMO maturity, shaped by the PMO’s
own capabilities and by the changing needs of the business.

But there is no standard terminology. All 10 case-study PMOs use

different names for the office (see figure below). They also have different
reporting relationships and organizational structures, which may or may
not include project and program managers (see Appendix A).

This report is structured around the three stages. All PMOs must start
at the initial stage, project management, before they can evolve to the
program management and then the portfolio management stages. The
scope of work changes from tactical to strategic, while the scope of
initiatives broadens from IT-intensive projects to enterprisewide business
and IT initiatives (see figure opposite).

A project management office is usually created to solve a specific

problem: generally, the IS organization’s inability to deliver IT projects
on time, on budget and in scope. It focuses on implementing the basic
project management process, introducing simple tools and developing
competent project managers. Project managers may “live” in the PMO,
or in different IT units, such as application development, or in the
business. Seven of the 10 case-study enterprises have their project
and program managers reporting into their PMO.

The 10 case studies use varying names for their PMOs

PMO name Case-study organization

Enterprise Portfolio Management Office (EPMO) AAA of Northern California, Nevada and Utah
Program Management Office (PMO) Corporate Express Australia Ltd.
IT Project Management Office (IT PMO) EMC Corporation
Program Management Office (PMO) Hallmark UK
Project Support Office (PSO) Metropolitan Holdings Ltd.
Virtual IT Project Management Office (VPMO) New York City Housing Authority (NYCHA)
Program Administration (PA) and PMO Royal Caribbean Cruises Ltd.
Program Office (PO) Thales Group
IT Program Management Office (IT PMO) TIM Brazil
Strategic Project Management Office (SPMO) Workplace Safety and Insurance Board (WSIB)

10 Gartner EXP Premier

It can easily take two to three years for a project
management office to build a track record of
delivery performance. The disciplines
established at the project management stage
underpin the two subsequent stages. Once the
PMO has earned credibility with the business,
it usually receives requests to help manage
business projects. At this point it needs to
evolve to the next stage.
A program management office manages
programs as well as projects. A program is a
group of related business and IT projects that
support a common goal. The PMO focus shifts
to the more complex management of programs,
which are larger, take longer, require more
business-IS collaboration and involve a more
diverse set of stakeholders. Program-level
visibility and governance give a program
management office a way to better coordinate
business and IS resources.
Evolving to a portfolio management office
starts when greater visibility into program costs
(provided by the program management office)
prompts senior executives to question whether
the enterprise is making the right investments
and getting the best returns. The portfolio
management office provides the information,
analysis and oversight to answer these
questions enterprisewide. Governance focuses
senior management on strategic issues. The
PMO is supported by portfolio management
and knowledge management tools.
For clarity and simplicity, this report assumes
a single PMO in an enterprise. In reality, large
enterprises may have many, both in the
business and IS, and at different stages.

PMO scope of work and scope of initiatives change across the three stages

Strategic

Portfolio management
• Portfolio scope definition
• Overall investment, benefit, risk optimization
• Active portfolio performance monitoring
• Business environment change adaptation

Program management
• Comprehensive program planning
Scope
• Change and risk management
of work
• Coordination of project delivery
• Measurement of results
• Business-IS collaboration

Project management
• Initiation • Deliverables
• Budget • Scope
• Schedule • Risks
• Resources • Metrics

Tactical
Scope of initiatives

IT Business-IT Enterprise

Source: Adapted from New York City Housing Authority (NYCHA).

Taking Your PMO to the Next Stage 11

 1
As they evolve, PMOs add new functions
PMO characteristics change significantly at each stage. The disciplines
established in previous stages don’t disappear; they provide the
foundation, credibility and competencies to succeed in the current
stage. Each stage builds on the accomplishments of the previous
stage(s) (see top figure opposite).

Four case-study PMOs are at the project management stage; four

are at the program management stage; and two are at the portfolio
management stage. But some are also planning their evolution, or
are in transition, to the next stage. The bottom figure opposite lists the
functions performed by all the case-study PMOs at the same stage,
and shows which functions they retain from previous stages.

But the commonalities and differentiators are clear:

• All the case-study PMOs at all three stages perform the basics of
maintaining the project management process, supplying tools and
centrally tracking status.
• The project management stage is where project manager training,
coaching and mentoring most frequently take place.
• The program management stage is where high-level governance,
collaboration and communications programs are most frequently
implemented.
• The portfolio management stage is where benefits realization
management and knowledge management most frequently occur.

12 Gartner EXP Premier

 The characteristics of each PMO stage differ

Project management Program management Portfolio management

Benefit Reduce risk Optimize resource use Contribute to growth

Focus Project mgmt. process, Program coordination, Investment optimization,

project manager development governance, communications benefits realization

Scope Individual IT projects Multiproject programs Proposals/projects/assets

Typically CIO or application Usually CIO, but sometimes to Outside IS, e.g., CFO, COO
reports to development the business

Role Project manager Program coordinator, program Investment advisor, portfolio

overseer overseer

Engagement Primarily IT project managers Business leaders, external Senior management decision
and project owners partners, ESPs makers

Tools Time tracking, project Program management, Portfolio management,

management, risk mgmt., resource management, knowledge management
deliverable templates collaboration

Skills Process implementation Change management Benefits realization

Metrics Project and project manager Program performance and Portfolio and PMO
performance resource utilization performance

PMOs add functions as they evolve, while retaining most functions from
previous stages

PMO functions Case-study frequency

Knowledge management
Portfolio
management Benefits realization management

Project portfolio management

Communications programs
Program
Governance body support
management
Management and delivery of programs

Project manager mentoring and coaching

Project manager training coordination

Project Standards, methods and best practices

management
Centralized tracking/reporting for all projects

Tool selection/implementation/support

Process development/implementation/support

Taking Your PMO to the Next Stage 13

 1
Corporate Express Australia Ltd.’s PMO provides a wide range
of services

Corporate Express (CE) Australia Ltd. is one of Australia and New

Zealand’s leading suppliers of business supplies and services. CE’s
PMO is in transition from the program management stage to the
portfolio management stage. The PMO manager and 15 project
manager contractors currently oversee 54 active projects with costs
of AU$300,000 (US$221,000) to AU$5 million (US$3.7 million). The
figure below shows the wide range of functions the PMO provides.

CE’s PMO services range from tactical to strategic:

1. Operational Services handles the methodology, tools and actual
running of projects.
2. Competency Services provides education and training services for
both the business and IS and acts as the center of excellence and
repository for project management knowledge.
3. Strategic Services handles portfolio management, strategic alignment
of projects and operational and management reporting.

Corporate Express Australia Ltd.’s PMO services range from tactical

to strategic

PMO

Operational Services Competency Services Strategic Services

• Provides PMO methodologies, • Provides project management • Reports at a strategic,

templates, tools and governance expert assistance executive level

• Project managers directly “run”
projects
• Offers project management
training to project managers and
the business
• Acts as central repository of
project management knowledge
• Manages strategic priorities
and milestones for projects
• Prioritizes and aligns projects
to the business strategy and
objectives

Tactical Strategic

Source: Adapted from Corporate Express Australia Ltd.

14 Gartner EXP Premier

 Case Study:
Corporate Express Australia Ltd.—Moving from program management to portfolio management
Corporate Express (CE) Australia Ltd., headquartered in
Sydney, is one of Australia and New Zealand’s leading
suppliers of business essentials, such as office and
computer supplies, business furniture and print
management services. Its 2,100 staff in 42 locations
generate revenues of AU$1 billion (US$750 million).
CE’s IS organization faced similar issues as other IS
organizations: how to better deliver infrastructure and
development projects, how to more effectively use
existing operational resources and how to maximize
business benefits in an environment of too many
projects. To meet business expectations, IS needed
greater control over its projects, which meant instituting
governance.
CE’s business culture was not project-oriented. In fact,
the business executives feared that a PMO would add
bureaucratic overhead and reduce their entrepreneurial
success. But CE’s need to comply with Sarbanes-
Oxley and the PMO’s success in delivering projects
changed management’s mind; they saw the PMO’s
value and became its advocates.
Moving toward portfolio management
The CIO formed a PMO steering committee,
comprising himself, the CEO, COO, CFO, chief
logistics officer and the general managers of major
regions and strategic supply. The committee’s charter
is to prioritize and align all proposed projects against
the organization’s strategic plans to ensure maximum
benefits realization from investments, enforce the
project management process and identify and eliminate
roadblocks to project success.
To consolidate projects and provide the basis of
portfolio management, the PMO is implementing
Microsoft Project Server and the Enterprise Project
Management (EPM) tool suite. “It is critical that all
projects align with the business strategies to ensure
control and the delivery of business benefits,” says
David McBeth, manager, PMO. “This will help us
identify potential resource contention and give us an
enterprise-level view of the project portfolio and the
organizational resource commitments. The PMO
Taking Your PMO to the Next Stage
steering committee will be able to select projects that
support the business strategy and stop or reorient
those that don’t.”
CE is expanding its PMO education to business
people, to help them be better project sponsors,
team members and system testers. The PMO
methodology is also expanding to include a detailed
change management strategy and its associated
communications plans and computer-based training.
PMO management is evaluating using the enterprise
content management systems as the central repository
for all project documentation. And the PMO is
implementing a scorecard that initially measures the
overall performance of the PMO and all projects, the
progress of each individual project, the performance of
each project manager and the effectiveness of risk
management.
The long-term aim is to measure each competency
area in the Project Management Institute Project
Management Book of Knowledge (PMBOK). Benefits
realization will also become a new and central focus
of the PMO.
Lessons learned
The following factors have contributed to the success
of CE’s PMO:
• Getting the basics implemented quickly and matching
project management methodology and approach to
CE’s maturity level
• Improving the delivery on a few very visible projects,
to demonstrate value, earn credibility and develop
key business advocates to help sell the concept
enterprisewide
• Investing in tools ahead of the need, to deal with
expected challenges, such as managing resources
across multiple projects
Based on interviews with, and material from, Garry
Whatley, CIO, and David McBeth, manager, PMO,
Corporate Express Australia Ltd., December 2005.
15
 1
“Understand the role Plan to evolve your PMO to meet changing
the business wants business needs
the PMO to play. Don’t
Because of the long lead time required to set up a project management
deliver a battleship
office and to demonstrate results, planning should start as soon as the
solution you can’t
need is recognized. This is the job of the CIO because the initial work of
support and that the
PMOs is typically with IT-intensive projects. From there, though, the
business doesn’t need.”
PMO can evolve.
— Mike McLaughlin
Director New York City Housing Authority (NYCHA) is the largest housing
IT PMO and cross- authority in the U.S., serving 417,000 tenants. It has a three-year
functional services
EMC Corporation plan to provide more PMO functions as both the business and IS
mature (see box opposite).

CIOs play an important role in matching the PMO stage to business

needs. Getting too far out in front of the business or lagging too far
behind have similar disadvantages, as shown in the bottom figure
opposite.

The PMO and the business need to evolve and mature together.
CIOs must ensure that their PMOs are responsive to business needs:

1. Begin with a project management office to improve project delivery

and develop competent project managers—to reduce business risk.

2. Move to a program management office to coordinate business and

IS project teams—to better manage resources.

3. Evolve to a portfolio management office to optimize the enterprise’s

project portfolio and its realization of benefits—to contribute to
business growth.

The next three sections of the report discuss best practices for each
PMO stage.

16 Gartner EXP Premier

 NYCHA’s plan to enhance its IT PMO and governance model

Q1 2006: Portfolio prioritization and management

Q3 2006: IT procurement standards and processes

Q2 2007: Knowledge management capability

Q4 2007: Capability Maturity Model (CMM) assessment

Q3 2008: IT governance model, version 2

Q3 2009: Enterprise content management system

Don’t let your PMO get too far ahead of, or behind, the business needs

PMO stage

PMO is seen as overkill

Portfolio PMO has capabilities the ds

management business does not value s nee
s
ine
et bus
me
s to
Program bilitie
pa
management t ca
righ
the
has
O
PM PMO is seen as ineffective

Project PMO does not have the capabilities

management to meet business needs

Enable
Reduce resource Contribute
risk management to growth

Primary PMO benefit

Taking Your PMO to the Next Stage 17

Reduce business
risk with a project
management office

18 Gartner EXP Premier

 2
CIOs in enterprises with weak project
management capabilities need to focus
on the basics. By implementing a standard
project management process, providing
basic tools and developing competent
project managers, a project management
office can reduce the risk of project
schedule slippages, cost overruns and
scope creep.

Taking Your PMO to the Next Stage 19

 2
Project management offices develop the process,
tools and managers
CIOs can improve project delivery to reduce business risk by getting
the basics right and building a strong foundation for subsequent PMO
stages. The basics include a repeatable project management process,
simple tools for project planning and reporting, and competent project
managers—usually developed initially for IT-intensive projects (see top
figure opposite).

The PMOs in all four case studies at the project management stage
focus on the same six basic functions:
1. Process development, implementation and support
2. Tool development, implementation and support
3. Centralized tracking and reporting for all projects
4. Standards, methods and best practices
5. Project manager training and coordination
6. Project manager mentoring and coaching

All concentrate on improving the delivery of individual IT projects and

developing the competencies of the project managers (see bottom
figure opposite).

20 Gartner EXP Premier

 Project management focuses on the delivery of individual IT-intensive projects

Strategic
Project management
Portfolio management
Benefit Reduce risk

Focus Project management process,

project manager development

Scope Program management Scope Individual IT projects

of work
Typically CIO or application development
reports to

Role Project manager

Project management
• Initiation • Deliverables Engagement Primarily IT project managers and
• Budget • Scope project owners
• Schedule • Risks
Tactical • Resources • Metrics Tools Time tracking, project management,
risk management, deliverable templates

Scope of initiatives Skills Process implementation

IT Business-IT Enterprise Metrics Project and project manager

performance

Project management offices develop the process, tools and managers that
deliver projects
Project management office functions Project management office case-study frequency
Project manager mentoring and coaching
Project manager training and coordination
Standards, methods and best practices Most common project
Centralized tracking/reporting for all projects management office functions

Tool development/implementation/support
Process development/implementation/support

Project
management office

Taking Your PMO to the Next Stage 21

 2
“We’d like our IT PMO EMC Corporation’s IT PMO is driven by the business’s need for
toolset to function cost and resource control and SOX compliance
like an MRP for IT.”
EMC Corporation is a leader in information storage and management
— Mike McLaughlin products and services. Its IT project management office (IT PMO)
Director
focuses on process compliance, reporting and training.
IT PMO and cross-
functional services
It aims to improve compliance by implementing project management
EMC Corporation
standards, increasing the use of project management tools and
improving the accuracy of project information for the business, senior
management and the CIO.

“We’re driven by the business’s need for better cost and resource
control, as well as SOX compliance,” says Mike McLaughlin, director,
IT PMO and cross-functional services. He has a staff of three project
managers and two business analysts who support and track
approximately 300 projects and 1,000 enhancements.

22 Gartner EXP Premier

 Case Study:
EMC Corporation—Focusing on process compliance, reporting and training
Based in Hopkinton, Massachusetts, U.S.A., EMC
Corporation is the world leader in products, services
and solutions for information storage and its
management. EMC had 2004 revenues of US$8.2
billion and employs nearly 23,000 people worldwide.
EMC’s IT PMO has a staff of three project managers
(PMs) and two business analysts (BAs). It is part of the
IT group that handles central operations and IT portfolio
and process management. PMOs in other parts of
EMC are responsible for very large projects and
corporate initiatives such as Six Sigma.
The IT PMO handles work typical at the project
management stage. It is responsible for supporting and
enforcing technical process standards, tracking project
and portfolio metrics and providing core training for
PMs and BAs.
One PM is managing the initial definition and design
phase for a project and portfolio management (PPM)
system. The new system will augment five systems
the IT PMO currently uses: Documentum’s eRoom,
which is used for project tracking and collaboration; an
internally developed time-tracking system; Excel, which
is used for project and portfolio management; and two
systems used to track smaller maintenance and
enhancement projects.
The system will answer questions such as: “What will
the next project gate require?” and “What is the real
status of a project based on milestones, spend and
estimates-to-complete?”
The other two PMs are currently working on
implementing IT Infrastructure Library (ITIL) processes.
Timely and accurate reporting builds trust
To improve the IT PMO’s processes, Mike McLaughlin,
the office’s director, is working on gaining the trust of
business management by giving them timely and
Taking Your PMO to the Next Stage
accurate project status information. Then they will be
comfortable canceling projects that are not meeting
criteria. “Being able to establish get-well plans early on
and track progress can make all the difference in
ensuring timely and cost-effective delivery of solutions
to our customers,” says McLaughlin.
The BAs handle project reporting and support cross-
functional IT projects. They report project status and
performance to the CIO for shared services, application
development and client services. Information tracked
includes the number of projects and the number of
business cases reviewed, approved and rejected.
Service-level statistics include applications uptime and
service desk statistics, such as time-to-answer and
time-to-resolve. Annually, the IT PMO reports on total
spend and resource allocation.
Project manager training is key
EMC developed its project manager training with
a local college. The training covers such topics as
business case development, business case financial
and risk analysis and management, estimating
techniques, requirements gathering, project
management methodology and client engagement.
Some BAs are involved in training PMs and BAs in
other EMC IS departments.
“People will operate under the radar if they don’t see
the IT PMO’s value,” says McLaughlin. “So we offer
training. Our approach is to influence and direct, rather
than dictate. I also expect to use more industry-
standard approaches and tools, such as supporting
Project Management Institute training and certification.”
Based on interviews with, and material from, Mike
McLaughlin, director, IT PMO and cross-functional
services, and Ken LeBlanc, senior director, IT business
operations and IT portfolio management, EMC
Corporation, November 2005.
23
 2
“Because the Implement a flexible project management process
toolset enforces and basic tools
the methodology
Defining and implementing an end-to-end project management process
and standards, I
is the first step for a project management office. Being flexible and
don’t have to be
having “just enough process” is a best practice. To ensure consistency
the bad cop. I
many enterprises use a standard methodology, like the one from the
have more time to
Project Management Institute (PMI). But they develop a “lite” version to
coach and advise
achieve a balance between process rigor and overhead.
to increase project
management skills.” Corporate Express (CE) Australia Ltd. provides a good case in point.
— Ron Rigores When David McBeth was hired as the manager to set up the PMO in IS,
Program manager he focused initially on improving IT project delivery. During the first year,
Virtual IT project he developed a streamlined project management methodology, with a
management office
New York City toolset and controls to support it. “Because CE is a fast-growing,
Housing Authority entrepreneurial enterprise, we wanted ‘just enough’ methodology to
improve project delivery, but not so much to slow it down,” says McBeth.

The “lite” version is based on the PMI’s Project Management Book

of Knowledge (PMBOK) and rapid application development (RAD)
techniques. The supporting tools for standard project proposals, project
plans and project status dashboards are based on Microsoft Office.
Microsoft Project is used for project scheduling and reporting.

New York City Housing Authority (NYCHA) facilitates process

compliance with tools

The New York City Housing Authority’s IT PMO took a different approach
to gain flexibility. Its methodology is risk-driven. Low-risk projects have
less stringent deliverables and reporting requirements than higher-risk
projects. The office provides Web-based tools to encourage process
compliance.

NYCHA’s IT PMO has taken its tools to the next level. The toolset not
only provides templates, examples and procedures, but also enforces
process compliance and delivers just-in-time training for project
managers over the intranet. See the key features of NYCHA’s toolset
in the figure opposite.

The IT PMO is virtual, in that none of the project managers report to

it. Its program manager, aided by consultants, supports 12 enterprise
projects, 12 infrastructure projects and proposed business projects.

24 Gartner EXP Premier

 Key features of NYCHA’s IT PMO toolset

“Smart” templates and electronic project management forms

• All project management forms and templates, such as project charter and change control forms, are available online
for one-time data entry.

Simple and route-specific workflow automation

• All project management processes are available online as “clickable” processes that provide online help for the
phase and required forms.
• Each form has built-in business rules that reinforce the process, including executive review and approval, e-mail
notifications and reporting.

Integrated reporting
• An executive dashboard includes project reporting using specific criteria, such as schedule and budget health.
• Common reporting processes are automated and simplified by pre-loading data from project schedules or
issues/risks lists into a weekly or monthly status report form.

Source: Adapted from New York City Housing Authority (NYCHA).

Taking Your PMO to the Next Stage 25

 2
“To develop project Develop competent project managers through
management skills, we formal training, coaching and mentoring
use and support the
CIOs should plan on devoting resources to developing competent
Project Management
project managers to ensure long-term success. Case-study enterprises
Institute methodology,
use many kinds of training. The Project Management Institute (PMI) is
membership,
an often-used source. Many of the case-study enterprises use PMI for
professional
professional development and certification.
development and
certification for our Project management education and training are critical to Corporate
project managers.” Express Australia Ltd.’s success. The focus is on two areas. One is how
— Katherine McLean to use the methodology and tools, develop clear business requirements
Director, strategic and track benefits realization; both project managers and the business
program management receive this training, but the project managers receive more detailed
office and business
advisory services training. The second area is understanding what a PMO is and how it
Workplace Safety and achieves buy-in; the business receives this training.
Insurance Board
One of the most difficult changes that Mike McLaughlin, director of
EMC’s IT PMO and cross-functional services, has experienced while
coaching and mentoring project managers is helping them overcome the
fear of marking their projects yellow (at risk) or red (in trouble). Yet doing
so escalates the problem, gets management’s attention, resolves issues
and can gain additional support. By identifying problems and getting help
early, project managers can get their projects back to green status while
they still have time and budget to recover.

26 Gartner EXP Premier

 Case Study:
New York City Housing Authority (NYCHA)—Benefiting from its virtual IT PMO and governance
NYCHA is the largest housing authority in the U.S.,
with 13,300 employees overseeing 36,700 residential
buildings and 181,000 apartments, as well as 86,000
leased housing units. NYCHA serves 417,000 tenants.
NYCHA recently developed an enterprisewide IT
governance model (see page 38) and virtual IT project
management office (VPMO). Together they align
NYCHA’s business and IT strategy and address four
major IT shortfalls:
• High project failure and slippage rates
• High rates of projects over budget
• Senior management inability to mitigate delays,
failures and financial losses in a timely fashion
• Lack of transparency/visibility of project plans and
status reports
The PMO is virtual in that the project managers report
elsewhere. “The PMO integrates process flows,
templates, online tools and collaborative techniques
to standardize IT project selection and management
throughout the organization,” said Ron Rigores, PMO
program manager. He reports to Avi Duvdevani, CIO
and deputy general manager for IT.
The PMO toolset makes the virtual PMO possible.
Rigores leverages the toolset, which uses mainly the
Microsoft Enterprise Project Management (EPM) suite,
delivering it via a Web-based project management
application integrated with Microsoft Project Server.
Via its IT governance framework and toolset, the PMO
transfers project management skills to NYCHA staff,
including the business units and IT strategic partners.
Projects are managed by NYCHA staff, not the PMO.
The PMO assists and mentors these dispersed project
managers in using the toolset, often on a just-in-time
basis.
PMO benefits are evident
The PMO procedures and toolset have fostered
organizational collaboration, document management
and control over standard reporting. The PMO has also
improved governance of IT projects by making the
projects, the issues and risks surrounding them and
Taking Your PMO to the Next Stage
their strategic importance all visible. Projects are more
consistent, and the project management process is
continually improving.
NYCHA has realized significant benefits from its virtual
PMO. First, it has avoided spending US$1.2 million
hiring additional project managers. Second, it has
increased business unit satisfaction and collaboration
with IT. Third, it has streamlined the business-IT five-
year strategic planning process. Fourth, it has improved
the quality, timeliness and cost-effectiveness of its
strategic IT programs. And fifth, it has increased IT
capital spending because the business is confident the
work will be well managed.
Five factors have contributed to success
CIO Duvdevani attributes PMO and governance
success to five factors:
1. Negotiating and developing an IT governance model
that supports the use of a consistent and repeatable
project management methodology
2. Aligning business and IT strategic initiatives by
fostering a strategic partnership with senior
management
3. Allowing the governance framework to guide the
business through the project management life cycle,
developing a project management tool to enforce
compliance and letting the business determine the
technology portfolio
4. Meeting frequently to review the IT project portfolio
5. Investing in project management training and
mentoring
“Together with the business, we can identify new
revenue-generation and cost-saving opportunities.
Creating a partnership between IT and the business
owners leads to a more effective use of technology
and more successful projects,” says Duvdevani.
Based on interviews with, and material from, Avi
Duvdevani, CIO and deputy general manager for IT,
and Ron Rigores, virtual IT project management office
program manager, New York City Housing Authority,
November 2005.
27
 2
“We have seen a Provide flexible project management staffing
direct impact on
Demand for experienced project managers varies. Not all projects
project success
require the same level of experience. A PMO best practice is to be
rates as a result of
flexible by providing project manager resources from internal sources,
implementing the
hiring externally and using contractors and external service providers.
PMO. Early warning
and intervention in Corporate Express Australia Ltd.’s PMO selects qualified contractors as
troubled projects project managers to get the right expertise and experience for each
have really begun project, as well as to flex staffing levels based on demand. Initially,
to pay off.” finding the hands-on, jack-of-all-trades type of project manager for its
— Ken LeBlanc mid-size business was challenging. The PMO learned to avoid selecting
Senior director project managers from very large companies because their approach
IT business was “overkill.”
operations and IT
portfolio management
TIM Brazil has outsourced part of its PMO
EMC Corporation
TIM Brazil provides mobile phone service to 20 million subscribers.
Ana Paula Keil, senior manager of its IT program management office,
has outsourced part of the office to a large IT consulting firm. Of her
25 staff, 13 full-time equivalents are consultants. By using external
resources she has increased her staffing flexibility, added specialized
project management expertise and taken advantage of some of the
consultants’ tools. Her staff supports approximately 300 projects. The
project managers reside in other IT departments, such as application
solution delivery.

Best practice PMOs do more than just provide project managers and
tools. They provide other types of resources, such as consulting,
problem solving, audits and specialized expertise to ensure project
success.

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 Case Study:

TIM Brazil—Upgrading its IT program management office

TIM Brazil, headquartered in Rio de Janeiro, is a
subsidiary of Telecom Italia S.p.A. It provides mobile
phone services to 20 million subscribers in Brazil.
Its 7,500 employees generate revenues of over
US$1 billion.
TIM Brazil created its first PMO to manage the rollout of
its GSM network. Now it has seven PMOs. A strategic
PMO reports directly to the president. The six major
lines of business, including IT, each have their own
PMO.
The IT PMO’s mission is to ensure that the IT portfolio
aligns with company strategy, all the way through
project follow-up. Its budget is 2 percent of the total IT
capital expenditure, which includes PM tools and
resources to follow up on projects. The IT PMO is
responsible for: portfolio management, to ensure
alignment between IT projects and company strategies;
project follow-up, to ensure on-time, on-cost, quality
project delivery; selection and support of PMO tools;
methodology, skills and coaching of project managers;
and metrics and reports.
The IT PMO is upgrading its capabilities and tools
Ana Paula Keil became senior manager of the IT PMO
in mid-2003, reporting to the head of business IT. Her
staff of 25 includes external consultants but excludes
project managers who reside in the other IT
departments, such as application solution delivery. She
also draws on external resources to gain staffing
flexibility, project management expertise and tools.
Her first priority was to develop a complete project
management methodology. What she developed is
based on the Project Management Institute Book of
Knowledge (PMBOK), which transformed TIM Brazil’s
view of PMOs from managing IT projects to managing
business projects.
During 2004, Keil rapidly upgraded the PMO’s
capabilities and tools:
• Implemented a subset of the new PM methodology;
divided the IT PMO team into strategic and
operational activities
• Commenced weekly follow-up on all projects in the IT
portfolio
• Developed the ToDoList application to manage
project follow-up
• Worked with the presidential-level PMO to define an
IT portfolio aligned with company strategies
• Managed special projects for IT organizational
change and balanced scorecards
• Customized the Microsoft Enterprise Project
Management (EPM) suite to support the new
methodology
In 2005, Keil created 10 task forces to focus IT
resources on important company problems. Their
work is reviewed daily. At midyear she transferred
responsibility for demand management to a newly
created relationship management function.
This PMO function consolidates and reports all
information about IT projects, including:
• Weekly reports to the IT steering committee and to its
Italian parent
• Monthly status reports for all IT projects and task
force work
• Semiannual and annual performance summaries
• On-demand presentations about IT projects or IT
strategic plans
In 2006, Keil expects to be more involved in developing
the IT strategic plan and reporting the status of the
project portfolio to the board. She will work with the
presidential-level PMO to extend EPM to the other
PMOs, and to include non-IT projects. “We will
integrate projects into programs and develop high-level
company views of all programs, not just IT, for senior
management,” says Keil.
Based on interviews with, and material from, Ana Paula
Keil, senior manager, IT program management office,
TIM Brazil, November 2005.

Taking Your PMO to the Next Stage 29

 2
Assess your project management office against
best practices
Focusing on IT projects is the universal starting point for project
management offices. CIOs should ensure that they have the basics
in place before attempting to broaden the PMO’s scope beyond IT
projects. If you’re starting from scratch, plan to recruit an experienced
PMO leader and to spend at least two years establishing a consistent
process, gaining compliance, improving delivery and measuring results.

Use the self-assessment opposite to determine if you have best

practices in place and to develop a plan to fill in any gaps.

CIOs with high-scoring project management offices can start building

management support for the next stage—a program management
office—by demonstrating project management office successes and
having business leaders advocate for the PMO by communicating why
they value it. This will create momentum for expanding the PMO’s scope
to include business projects and integrated programs comprising related
business and IT projects.

The program management office is the topic of the next section.

30 Gartner EXP Premier

 Do you have the basic project management elements in place?

Done poorly/ Done somewhat Done Done well/

not at all poorly somewhat well completely
0 1 2 3

1. We have established a flexible, end-to-end project

management process that balances rigor with overhead

2. We support the process with easy-to-use tools to

consistently plan, track, manage and report all projects

3. We make tools available over our intranet along with

supporting materials to increase adoption and compliance

4. We provide formal training, coaching and mentoring to

both IS and the business to develop competent project
managers

5. We are flexible in sourcing and providing project

management resources

6. We provide project management assistance, such as

consulting, problem solving, audits and resources

Scoring:
14 – 18 You’re in good shape; start planning for the next stage Total score
7 – 13 Determine what else stakeholders need and fill in the gaps
0 – 6 Focus on the basics; get the process and trained project managers in place

Taking Your PMO to the Next Stage 31

Optimize resource
use with a program
management office

32 Gartner EXP Premier

 3
CIOs can improve resource management and
ensure that the best resources are available
for the most important projects by combining
business and IT projects with common goals
into programs that are managed by a program
management office.

Taking Your PMO to the Next Stage 33

 3
“As the project and Program management offices focus on
system managers coordinating related business and IT projects
become more skilled
CIOs increase the scope of their program management offices
in project management,
by integrating business projects and focusing more on the
the PMO will shift
interdependencies between related projects, to ensure that the right
focus from ensuring
business and IS resources are used. Programs usually impact multiple
delivery to improving
stakeholders, last longer and include external resources, so they are
project integration
more complex to manage. CIOs should provide leadership in setting
and planning for
up governance bodies and communications programs because both
interdependencies at
are needed to make coordinated decisions across the organizational
the program level.”
boundaries that programs cross (see top figure opposite).
— Ana Paula Keil
Senior manager All four case-study PMOs at the program management stage focus on
IT program the management and delivery of programs, governance body support
management office
TIM Brazil and communications programs. All also retain three of the most common
project management functions (see bottom figure opposite):
1. Centralized tracking and reporting for all projects
2. Tool selection, implementation and support
3. Process development, implementation and support

Metropolitan Holdings Ltd., a South African financial services

organization, distinguishes between project and program management
not by size or cost but by scope and breadth of change. For example,
some programs may have low cost, but have a huge impact on the
business—affecting a few thousand people or spanning multiple
disciplines. Some large programs are subdivided and managed as
individual projects but report at a program level. Ultimately, the project
board decides “program” or “project.”

34 Gartner EXP Premier

 Program management coordinates both business and IT project resources

Strategic
Program management
Portfolio management
Benefit Optimize resource use

Focus Program coordination, governance,

communications

Scope Program management Scope Multiproject programs

of work • Comprehensive program planning
• Change and risk management Typically Usually CIO, but sometimes to the
• Coordination of project delivery reports to business
• Measurement of results
• Business-IS collaboration
Role Program coordinator, program overseer
Project management
Engagement Business leaders, external partners,
ESPs

Tactical Tools Program management, resource

management, collaboration

Scope of initiatives Skills Change management

IT Business-IT Enterprise Metrics Program performance and resource

utilization

Program management offices support program delivery with governance

and communications
Program management office functions Program management office case-study frequency
Communications programs
Most common program
Governance body support
management office functions
Management and delivery of programs
Centralized tracking/reporting for all projects
Most common project management
Tool selection/implementation/support office functions retained by a program
Process development/implementation/support management office

Program
management office

Taking Your PMO to the Next Stage 35

 3
“Our project Program management requires an institutionalized
management office project management culture
success is due to our
To move to the program management stage, an enterprise must
establishing a culture,
first institutionalize its project management functions. A program
not a project office.”
management office cannot manage complexity unless these skills
— Jan Cronje are widely dispersed throughout IS and the business. A program
Executive manager
Shared solutions management office cannot focus on managing complex programs
Metropolitan Holdings Ltd. if it must spend much time training, coaching and mentoring.

Metropolitan Holdings Ltd. has institutionalized its project

management culture

Metropolitan reports success in establishing a project management

culture companywide. By 2003 it had entrenched its “managing by
project” (MBP) culture by using it to successfully deliver projects, and
training people on the methodology and mentoring them. Everyone
understood that all projects had to use the program support office
(PSO) and be monitored by it.

In mid-2004, business units began forming their own project offices,

independent of the PSO. The PSO’s main challenge then became
establishing clear project frameworks and reintroducing the concept
of project portfolio management throughout Metropolitan.

Today, Metropolitan’s project management culture is mature. “Project

management is just another management tool. It is a normal discipline
that each and every manager in the organization uses. It’s the way we
do business—an everyday event. It’s not something special that we do,”
says Jan Cronje, executive manager, shared solutions. As a result, the
PSO is not always involved in delivering projects. It only provides project
management resources when requested. Otherwise, it does not actively
drive project management, training or adherence to Metropolitan’s MBP
methodology.

Consequently, PSO head count has dropped from 55 to 10. The six
project managers and four project administrators currently support 27
projects. “The business units are self-governing and self-driven. They
are deriving the benefits to such an extent that we don’t have to use
a whip anymore,” says Cronje.

36 Gartner EXP Premier

 Case Study:
Metropolitan Holdings Ltd.—Making project management part of the enterprise culture
Founded over 100 years ago and headquartered
in Cape Town, South Africa, Metropolitan Holdings
Ltd. has grown from a life insurance company to
a full-fledged financial services organization. Today,
Metropolitan is the third most recognized brand in
the insurance industry, employing approximately
7,000 people and insuring the lives of 4.3 million
South Africans.
CEO Peter Doyle sponsored Metropolitan’s project
support office (PSO) in 1999. His primary goal was to
develop an enterprisewide “managing by project”
(MBP) culture and discipline. The PSO reports to
shared solutions in the IS organization.
The project support office is flexible
Metropolitan’s PSO was never meant to have a large
number of project managers. Rather, its staff is
supplemented, as needed, with consultants and
contractors. While it looks favorably on project
management credentials, such as PMI certification,
project management experience carries more weight.
The PSO provides five services: project portfolio
management, project management, project
administration, project resourcing and project
management training.
The office plays different roles in different types of
projects. For business change projects, the PSO plays
a leadership role, encouraging business participation
and ensuring alignment with group strategy. For proof-
of-concept projects, the PSO uses a consultative
approach to align the project with business-critical
success factors. For strategic projects, the PSO uses a
flexible methodology to fit the projects’ deliverables to
business-critical success factors. And for maintenance
projects, the PSO uses Metropolitan’s MBP framework.
Taking Your PMO to the Next Stage
The PSO currently provides five tools on its Web
site: Managing By Project, which it developed
in-house using the PMI PMBOK, X-Pert, Word and
Excel; Microsoft Project; Time Sheet Professional;
Documentum, for storing project documentation;
and Project Register.
For low-impact, low-risk projects, Metropolitan uses
a “lighter” version of X-Pert project management. Its
two methodologies are essentially the same. The initial
scoping and reporting differ, and the lighter version
contains only the absolute minimum requirements a
project must meet.
“The PSO has brought great value to Metropolitan,”
says Cronje. “It has been a huge turnaround for
the company, with great impact. In the past,
group executives wasted time discussing project
non-performance. Today, projects are generally not
discussed at the executive level because they are being
delivered on time, within budget and per requirements.
As a result, group executives can now focus on
organizational strategy.”
“We plan to implement project and portfolio
management to track the health of projects and
ensure that they deliver the critical success factors
needed by our business strategies,” says André
Michau, acting head of the PSO. “Information such
as implementation status, risks and performance
will provide our executives with a quarterly, rather
than annual, view of implementation progress.”
Based on interviews with, and material from, Jan
Cronje, executive manager, shared solutions, and
André Michau, acting head of the project support
office, Metropolitan Holdings Ltd., November 2005.
37
 3
“The PMO and
governance structure
are achieving buy-in
and support from
the business. This
creates more
opportunities to
leverage technology,
re-engineer existing
business functions,
automate processes
and drive greater
efficiencies.”
— Avi Duvdevani
CIO
Deputy general
manager for IT
New York City Housing
Authority
38
Make governance and communications key
program management functions
The broader scope of programs requires that CIOs support their program
management offices properly to ensure effective joint business-IS
governance, as well as communicate early and often with the extended
stakeholder group.
New York City Housing Authority governance ensures business
alignment
NYCHA’s governance structure ensures that projects align with the
business’s mission and strategy—and gives the PMO teeth. The general
manager’s operations committee (GMOC) has the people to provide the
clout—all the deputy general managers, including the CIO and the CFO,
and other directors who report directly to the authority’s general manager
(see figure opposite).
The GMOC reviews project status quarterly and determines which
projects will be funded and their priority. “We can now align priorities,
projects and resources with business priorities to meet organizational
needs,” says Avi Duvdevani, CIO and deputy general manager for IT.
NYCHA’s CIO also linked his PMO to the architecture review board
(ARB). Review gates ensure that the ARB provides input on new project
design, beginning at the concept stage and extending throughout the
project life cycle. “Linking the PMO with the ARB helps stop external
service providers from introducing nonstandard architectural components
into our environment,” says Ron Rigores, program manager.
The diversity of stakeholders and the high level of project
interdependencies typical of programs demand that communications
programs keep everyone informed and synchronized.
Gartner EXP Premier
 NYCHA’s PMO plays an important role in project and program governance

NYCHA board

NYCHA general
manager (GM)

Input & Provide

feedback membership
GM’s operations Deputy general
CIO/CFO
committee (GMOC) managers
Architecture
review board Monthly executive project status reports

Business
PMO unit staff
Project Project Project
Project repository, PM Provide reporting
manager or team or steering
consulting & advice liaison structure
committee
• PM standard methodology
& tools
• PMO reporting standards
• Assistance & coaching Weekly/monthly project manager status reports

Dept. project
managers
Governance body

Source: Adapted from New York City Housing Authority (NYCHA).

Taking Your PMO to the Next Stage 39

 3
“Don’t view the program Thales Group’s program offices keep all stakeholders informed
office as just a way to
Thales is a global aerospace, defense and security contractor. It has long
provide visibility and
been in the program management business for its customers, managing
metrics, but a way
large, multiyear defense and aerospace programs. The divisions fully
to increase program
understand and use this discipline.
success. Governance,
sponsorship and But there is no central program management office. Instead, specific
resources are all part program offices are established for large initiatives, such as
of the program office enterprisewide ERP rollouts and the rationalization and outsourcing of
solution.” voice and data networks. Each has its own dedicated program office
and governance structure. Besides planning, budgeting and quality
— Patrick Anglard
Group CIO assurance, each program office is responsible for:
Thales Group
• Providing all stakeholders with global visibility into budget, resources,
schedule and functional and technical contents
• Communicating all major events and disseminating general information

Help business and IS project teams coordinate

their work
In addition to being the communications hub, a program office can
facilitate collaboration between business and IS project teams that are
working on the same program. The PMO can schedule both parties’
resources to ensure that the best resources are assigned to the most
important programs at the right time.

The PMO can also provide collaboration tools. NYCHA’s PMO uses
Microsoft Windows Share Point Services. EMC’s PMO uses
Documentum eRoom. It is important to capture the outcomes of
collaboration activities so they can be used elsewhere in the enterprise.
PMOs in the next stage (portfolio management offices) support
knowledge management systems for this purpose.

Educating the business about its program management responsibilities

is also a best practice.

40 Gartner EXP Premier

 Case Study:
Thales Group—Linking multiple program offices via a consistent process and tool
The Thales Group is headquartered in Paris and has
revenues of 10 billion euros (US$12.3 billion). It
develops advanced technologies for its customers,
leveraging a global network of 60,000 experts and the
highly complementary nature of its aerospace, defense
and security businesses.
The Thales Group is in the process of simplifying its
businesses and centralizing IT. Ten business groups
(lines of business) have been reduced to six divisions,
each with its own divisional CIO. Patrick Anglard, group
(corporate) CIO, is responsible for centralizing control of
IT enterprisewide. He reports to the COO and has 20
direct reports: six staff executives, six divisional CIOs
and eight executives for IT domains such as ERP,
infrastructure and geographic regions.
To enable centralized control of IT, Anglard created a
governance structure that makes decisions on IT
budgets, project priorities and central funding to
develop technologies. The divisions submit their IT
budgets to Anglard for approval. After approval the
divisional CIOs manage their own projects, architecture
and contracts, and subcontract to the Thales Group
Services division for recurring services, such as
application maintenance, desktop, local area networks
and data center operations. The Thales Group Services
division provides IT services to Thales units, as well as
to the open market.
Each major initiative has a dedicated program
office
Divisions temporarily transfer program managers to
manage the design, build and roll-out phases of
major transverse initiatives. These program managers
are coached by the corporate IT domain managers
in charge of the enterprisewide initiative. Program
managers come out of the divisions and return to the
divisions once the programs are delivered. Much of the
actual implementation work is outsourced to the Thales
Group Services division.
Taking Your PMO to the Next Stage
Program offices play an important role in providing
visibility for informed decision making and keeping
communication channels open. Each program office is
responsible for: providing all stakeholders global
visibility into budget, resources, schedule and functional
and technical contents; planning delivery dates,
deadlines and resource requirements; managing
budget and resources; ensuring quality for all projects;
and communicating all major events and disseminating
general information.
A consistent process unifies the program offices
CIO Anglard is unifying project and program
management processes across the enterprise to
improve project execution performance, make risks
transparent and managed and ensure consistency
between program and financial views.
Group IT spent 18 months designing the standard
PMO process and selecting Primavera as the tool to
support it. Eighty percent of the effort involved process
design, and only 20 percent was spent on tool
selection and establishing parameterization. Funding
came from Group IT and the COO.
Thales Group will use a single instance of Primavera
parameterization for program planning and tracking
across all programs. The ERP system will provide time
and cost reporting. To institutionalize this new PMO
process, the company is undertaking a major change
management and user training program because
program management changes the way program staff
and finance staff cooperate.
“Having a standard process and tool will reduce the
risk of divergence. By being able to measure progress
in a standard way across divisions, we expect to
improve project execution,” says Anglard. “We are
being explicit in formally defining and documenting who
does what in the process to ensure we have no role
ambiguity.”
Based on interviews with, and material from, Patrick
Anglard, group CIO, Thales Group, November 2005.
41
 3
Hallmark UK’s program management office fosters business-IS
collaboration

Educating business executives about the need for program management

has been a challenge at Hallmark UK. PMO management therefore took
small steps, first showing the benefits of basic project management
discipline, then getting business management to think about selecting
the right projects and their desired outcomes. Hallmark’s culture had to
shift in five areas:

• Change had to become a joint business IS-responsibility, not just an

IS responsibility.
• IS had to have a seat at the table when business changes were
planned.
• Teams had to explore interdependencies and overlaps among business
and IT projects.
• Management had to integrate different parts of the business and IS
when considering projects.
• Management had to consider projects to rationalize previous
acquisitions.

An early success combined three projects with common objectives and

close start dates into one program. The PMO also held cross-functional
workshops for the three projects to jointly define their common
requirements. In another case, the executive board challenged the
strategic misalignment of an in-progress project. The project was
stopped, its scope was realigned, and the revised project was restarted.

42 Gartner EXP Premier

 Case Study:
Hallmark UK—Moving its PMO out of IS into the business
Hallmark UK was established in 1958 and through
a series of mergers and acquisitions is now the
U.K.’s leading greeting card publisher, representing
60 percent of Hallmark’s international business.
Headquartered in Bradford, Yorkshire, U.K., the
company’s 3,100 employees produce approximately
2 billion cards a year, with almost 20,000 designs.
Established in January 2005 by Merissa Smith,
European program delivery manager, Hallmark UK’s
program management office (PMO) is responsible for
delivering strategic business initiatives. Its four project
managers support 24 projects.
The PMO began in IT, with accountability to the
board
The PMO has been part of the IT organization. Smith
reports to the CIO for international IT, but she also
has had dotted-line accountability to Hallmark UK’s
executive board. This board comprises the managing
directors of the lines of business and the functional
heads of finance, human resources, international IT
and operations. These executives are the business
sponsors for most of the PMO’s major projects. Smith’s
dual reporting structure fosters business-IT
collaboration.
Smith initially recommended that the board use nine
project-prioritization criteria in its decision making:
benefits, risks, impact on people, and support for each
of the six key business strategies. At first, executives
presented the PMO with lists of the projects they
wanted. But over time Smith has gotten them to
consider the interrelationships among projects,
Hallmark UK’s collective goals and the realities of costs
and resources.
The executive board has taken ownership for the entire
portfolio of PMO projects. Small projects—which only
impact a single function and require less than a month
of work—are managed by a business user, mentored
by the PMO.
The PMO is responsible for mentoring all program
and project team members and managers. Smith
encourages all program and project managers to get
Taking Your PMO to the Next Stage
their practitioner qualification, a professional
certification based on the Managing Successful
Programs (MSP) curriculum.
The PMO is also responsible for methodology. It uses
Microsoft Project on the desktop and Visio as its basic
project management tools. Its project management
methodology is adapted from Prince 2. It is considering
using PlanView as its portfolio management and
workflow tool; it is used by its parent company in the
U.S.
In the past, benefits estimates were used solely to gain
funding approval for projects. But recently the PMO
began reviewing actual benefits achieved six and 12
months after project delivery, to improve return on
investment.
The PMO is moving from IT to the business
improvement organization
The PMO is transitioning from the international IT
organization into a new central function called business
improvement, chartered to deliver strategic programs.
It reports to Hallmark’s PLC board. The move will put
project ownership and accountability squarely in the
business.
Quality management is also part of the business
improvement department, as is the business
improvement team, which challenges current
processes, and documents, maps and analyzes
them to identify improvement opportunities.
As part of this reorganization, Smith became director
of business improvement. She plans to make the
PMO more formal and structured. “Combining the
three groups will focus the conversation on business
strategy first, before discussing projects or programs.
The new department is expected to drive best
practices, develop a better understanding of priorities
and influence the business on how to become a
world-class organization,” says Smith.
Based on interviews with, and material from, Merissa
Smith, director, business improvement, Hallmark UK,
November 2005.
43
 3
Assess your program management office against
best practices
If you’re already at the program management stage, or planning to
evolve there soon, compare your PMO with the identified best practices
by scoring yourself on the self-assessment opposite. Determine what
needs to be done and where you can help the most.

CIOs must lead in establishing effective PMO governance and ensuring

clear communication channels with all stakeholders.

CIOs with mature program management offices should start thinking

about evolving the PMO to the portfolio management stage. That’s
the subject of the next section.

44 Gartner EXP Premier

 How effective is your program management office?

Done poorly/ Done somewhat Done Done well/

not at all poorly somewhat well completely
0 1 2 3

1. We have combined related business and IT projects into

programs, including those sourced externally

2. We have institutionalized our project management

discipline; our PMO focuses on program management

3. We use program-level visibility to identify and reduce

resource contention and improve resource utilization

4. We educate business, IS and external stakeholders about

their shared responsibilities for ensuring program success

5. We have expanded the PMO governance board

membership to represent the wider set of stakeholders

6. We have established communications programs to keep all

stakeholders informed and committed to program success

7. We provide collaboration tools to facilitate the work of

internal and external project and program teams

Scoring:
17 – 21 You’re in good shape; prepare for the next stage Total score
10 – 16 Determine what else stakeholders need and fill in the gaps
0 – 9 Focus on the basics; educate the business and get buy-in
for program management

Taking Your PMO to the Next Stage 45

Contribute to
business growth
through a portfolio
management office

46 Gartner EXP Premier

 4
CIOs can contribute to business growth
by evolving their PMO to the portfolio
management stage. By optimizing the mix
of project and program investments, a
portfolio management office can increase
the benefits the enterprise realizes from
these investments.

Taking Your PMO to the Next Stage 47

 4
Portfolio management offices focus on enterprise
portfolio optimization
As members of the enterprise’s senior management team, CIOs use
portfolio management as a way to optimally allocate resources toward
an organization’s objectives, factoring in risk, desired returns, resource
availability and interrelationships between investments. Portfolio
management can drive business-IS alignment, consistent justification,
risk management, disciplined execution and benefits realization.

Portfolio management contributes to business growth by optimizing the

enterprise’s portfolio (see top figure opposite).

The case-study PMOs at the portfolio management stage focus on

actively managing the project portfolio, ensuring that benefits are realized
and making project management knowledge easily available. At the
same time, they retain the most common functions from both their
previous project management and program management stages
(see bottom figure opposite).

Ontario, Canada’s Workplace Safety and Insurance Board (WSIB)

oversees Ontario’s workplace safety education and training system,
provides disability benefits, monitors the quality of healthcare and
assists in early and safe return to work. WSIB’s strategic PMO has
responded to changes in business needs and evolved to the portfolio
management stage.

48 Gartner EXP Premier

 Portfolio management focuses on optimizing the mix of enterprise initiatives

Strategic
Portfolio management
Portfolio management
• Portfolio scope definition Benefit Contribute to growth
• Overall investment, benefit, risk optimization
• Active portfolio performance monitoring Focus Investment optimization, benefits
• Business environment change adaptation realization

Scope Program management Scope Proposals/projects/assets

of work
Typically Outside IS, e.g., CFO, COO
reports to

Role Investment advisor, portfolio overseer

Project management
Engagement Senior management decision makers

Tactical Tools Portfolio management, knowledge

management

Scope of initiatives Skills Benefits realization

IT Business-IT Enterprise Metrics Portfolio and PMO performance

Portfolio management offices focus on portfolio optimization and benefits

realization
Portfolio management office functions Portfolio management office case-study frequency
Knowledge management
Benefits realization management Most common portfolio management office
functions
Project portfolio management
Communications programs
Most common program management office functions
Governance body support maintained by a portfolio management office
Management and delivery of programs
Centralized tracking/reporting for all projects
Most common project management office functions
Tool selection/implementation/support maintained by a portfolio management office
Process development/implementation/support

Portfolio
management office

Taking Your PMO to the Next Stage 49

 4
“The entire WSIB’s PMO has evolved to the portfolio management stage
organization is
Over five years’ time, WSIB’s CIO evolved the PMO’s role, organizational
maturing faster now.
placement and name:
The controllership
framework, including • In 2000, Valerie Adamo, WSIB’s CIO and vice president of business
governance, has technology services (BTS), formed a program management office
improved as a result (PMO) to manage the complexities of a large transformation initiative.
of widespread
• In 2002, the PMO transitioned out of BTS, and became the enterprise
exposure to project
PMO (EPMO) in the agility program led by its vice president. The intent
management
was to expand into project portfolio management.
discipline.”
• In 2003, EPMO returned to BTS to focus on improving project
— Valerie Adamo
CIO execution.
Vice president
Business technology • In late 2003, management increased the EPMO’s strategic focus to
services managing all business change projects. It was transferred to a new
Workplace Safety
and Insurance Board division called Corporate Strategy, in the Prevention Services cluster,
and renamed the strategic PMO (SPMO).

• In late 2005, the SPMO moved under the chief corporate services
officer as part of the Strategic Communication, Policy and Research
group.

The benefits of this evolution are clearly stated in the PMO’s value
proposition (see figure below).

WSIB’s strategic PMO charter communicates its value proposition

Charter Services Benefits

SPMO’s mandate is to assist in
creating and managing an effective
portfolio of projects that:
• Are well managed
• Realize their deliverables
• Create value (ROI)
The SPMO exists to facilitate project
success by enabling informed and
effective decision making by senior
management
• Expert project management
• Project portfolio selection
facilitation and oversight
• Project management support
and guidance
• Project management compliance
• Informed decision making: Facilitate
and consolidate project proposals to
enable senior management decision
making
• Strategic alignment: Ensure that the
project portfolio is strategically
aligned with the organization’s
objectives
• Quality assurance: Ensure that
project deliverables meet customer
expectations

Source: Adapted from Workplace Safety and Insurance Board (WSIB).

50 Gartner EXP Premier

 Case Study:
Workplace Safety and Insurance Board—Accomplishing much with a small PMO staff
Headquartered in Toronto, Ontario, Canada, the
Workplace Safety and Insurance Board (WSIB)
oversees Ontario’s workplace safety education and
training system, provides disability benefits, monitors
the quality of healthcare throughout the province and
assists in early and safe return to work. Its 4,400
employees administer a budget of C$4.5 billion
(US$3.9 billion) and operate a network of 14 offices.
“Our strategic project management office has resulted
in the business asking for fewer projects,” says Valerie
Adamo, CIO and vice president of business technology
services, “and those requests are better justified and
planned. Project execution and results are enhanced
because the business owns the work. We have
increased collaboration between the business and IS,
and we enforce our project management discipline.”
Katherine McLean, director, strategic program
management office and business advisory services,
has 12 full-time staff on her SPMO team: eight
project/program managers (PMs), two project
management specialists, a chartered accountant
and a business administrator.
The SPMO’s operational budget is C$1.1 million
(US$950,000), or 3.7 percent of the annual project
budget. It supports three major programs covering
31 corporate, business and IT projects. The projects
represent C$13.3 million (US$11.5 million) in expense
and C$7.4 million (US$6.4 million) in annual capital
investment.
The SPMO sources all program and project managers
for corporate WSIB project work. Project managers
manage projects costing up to C$5 million (US$4.3
million) and lasting one or two years. Program
managers manage very large-scale programs that last
three years. They coordinate the work of three to five
project managers and typically have seven to 10 years
of project management experience.
Project and program managers have solid-line reporting
to their project’s business owner and dotted-line
reporting to the SPMO. Subject-matter experts, such
as project architects and organizational effectiveness
consultants, also report on a solid line to the project
owner and on a dotted line to their home base.
Taking Your PMO to the Next Stage
To attract PMs, WSIB uses a “hot market” concept,
initially implemented for Y2K work. Project managers
can temporarily work as program managers and
receive additional compensation.
The PM specialists in the SPMO provide portfolio
selection facilitation and oversight and report project
status monthly and quarterly to WSIB’s executive
committee and project owners. The accountant
analyzes projects costs and oversees the portfolio
from a financial perspective. McLean also draws on
professional contractors and part-time employees to
handle peak workloads.
The SPMO is improving its processes
With the basic disciplines implemented, the SPMO is
working to streamline its processes.
WSIB’s executive committee maintains an absolute
“override capability” so that for specific situations,
senior management can exercise its judgment and
override assigned priorities, as appropriate. These
exceptions are made visible and explained.
“Projects must be owned by the business leader most
impacted by them, and the project portfolio must be
managed by the most senior decision makers,” says
Adamo. “A difficult aspect has been agreeing on
decision criteria and weighting for project prioritization.
WSIB has selected four criteria: alignment with the
strategic plan, financial viability, business continuity and
risk mitigation.”
McLean is working with PMs to adjust their level of
rigor and discipline to fit project and program size
while still following the methodology rules and
guidelines. She is considering a number of long-term,
innovative ideas for the SPMO, such as developing
a PM mentoring program, developing a set of PM
conferences and even exchanging PMs with other
organizations to learn from the experiences of others.
Based on interviews with, and material from, Valerie
Adamo, CIO and vice president business technology
services, and Katherine McLean, director, strategic
program management office and business advisory
services, Workplace Safety and Insurance Board,
October 2005.
51
 4
“We have moved the Position the portfolio management office outside IS
PMO from reporting for greater independence
to me in IS, to
reporting to the The case-study CIOs evolving to the portfolio management stage have
finance director moved their PMO outside IS to ensure its independence and to avoid
[CFO]. This gives any perception of bias. Operating independently of IS and reporting to
the PMO a needed the CFO, COO or other senior executive give a PMO the clout to raise
level of autonomy, portfolio management issues to the highest levels and make decisions
where it can be seen based on the best interests of the entire enterprise. Maintaining that
as successful apart independence and objectivity is critical for long-term success.
from IS.” To prepare for this stage, some CIOs have separated the tactical and
— Garry Whatley strategic functions so that each can be more focused and have the
CIO appropriate resources.
Corporate Express
Australia Ltd. Royal Caribbean Cruises Ltd., a global cruise and vacation company,
has split its PMO’s strategic and tactical functions into two units. The
CIO made program administration responsible for project and program
management (PPM) tools, methodology, auditing project plans, and
the knowledge base of best practices, standards and lesson learned.
Program administration, which has a staff of six full-time equivalents
including its manager, reports to the director of IT finance, who reports
to the CIO.

The tactical functions—essentially, project execution—are handled by

the project management office, which reports to the CIO. The PMO
supervises the 40 project managers, oversees capital and large expense
projects on a day-to-day basis, collects and presents monthly executive
status reports and ensures use of best practices.

The advantages of this split are that program administration can take a
longer-term, enterprisewide view of the project portfolio, unencumbered
by the daily demands of managing 200 capital projects and 800 small
projects. The PMO, on the other hand, can focus on project execution,
tracking the time and skills of 500 IT full-time equivalents and improving
the skills of its 40 project managers.

52 Gartner EXP Premier

 Case Study:
Royal Caribbean Cruises Ltd.—Separating strategic and tactical PMO functions
Royal Caribbean Cruises Ltd. (RCCL), headquartered in
Miami, Florida, is a global cruise and vacation company
that operates Royal Caribbean International and
Celebrity cruises. RCCL has 29 ships in service and
three under construction. The company’s 36,000
employees also offer unique land-tour vacations in
Alaska, Canada and Europe through its cruise-tour
division.
Two factors shaped RCCL’s approach to project and
program management. First, management was
frustrated with the lack of alignment between IT
projects and the business. Second, as IT projects
became more strategic and expensive, IT had to
become more efficient, productive and reliable.
To address these issues, RCCL created two PMO
units. Program administration, the strategic unit,
manages the portfolio. The PMO, the tactical unit,
handles project execution. They work side by side.
Five portfolio managers (PFMs) in the IT department act
as relationship managers and business analysts. They
work with the lines of business to identify and define
large projects by developing concepts and scoping
new project opportunities, preparing preliminary project
cost estimates and developing project business cases.
Governance is tailored to project size
RCCL divides its projects into three types. Each is
governed in a different way.
Projects over US$100,000 and capital expenditures are
governed by the business opportunity council (BOC),
which comprises the COO, CFO, CIO and other senior
vice president-level executives. It meets monthly to
review requests and review the status of large projects
underway.
New expense projects reviewed by the BOC are then
governed by the expense project initiation committee
(EPIC), which comprises senior IT management. It
meets quarterly to review new projects.
Taking Your PMO to the Next Stage
Small projects, such as fixes, support and small
enhancements, are governed by the “checkbook”
approach. At the beginning of each year, the portfolio
managers budget these expenses in terms of gross
hours. During the year, they work with business
sponsors to stay within budget by monitoring the
burn rate.
RCCL’s project and portfolio management system,
which is based on Computer Associates’ Clarity, helps
the company comply with Sarbanes-Oxley standards
by providing documentation and consistency. Clarity
stores all project plans and efforts, providing a
complete audit trail of all labor costs. It tracks and
documents due-diligence paths, enabling senior
management and auditors to review standards project
by project. It also provides project plan templates and
guidance to PMs, ensuring consistency across all
project plans.
Richard Shapiro, manager of program administration,
sees three areas that need continued improvement
over the next few years. The first is management of the
resource pool. An ongoing topic of discussion is: “How
best do we maintain the skill-set inventory of our 500 IT
staff and contractors and allocate these personnel
optimally to projects?”
The second challenge is increasing granularity in
resource tracking, from the project level down to the
task level. Finer granularity would make staff
commitments and availability more visible, enabling
improved resource allocation.
The third challenge is interfacing Clarity with the
Remedy Change and Problem Management system.
Then data could be interchanged and total-cost-of-
ownership information better captured and reported.
Based on interviews with, and material from, Richard
Shapiro, manager, program administration, Royal
Caribbean Cruises Ltd., October 2005.
53
 4
“We are changing our Extend the portfolio management office’s influence
PMO focus from on-time,
The CIO can lobby to extend the portfolio management office’s influence
on-budget projects to
by getting it involved in strategy formulation, on the front end of a
improving business
project’s life cycle, and remaining involved through benefits realization,
benefits realization.”
on the back end of a project’s life cycle (see figure below). This helps the
— David McBeth PMO keep projects aligned with business strategy, as well as contribute
Manager, PMO
Corporate Express to shaping it.
Australia Ltd.
Focusing on benefits realization contributes to business growth. While
many case-study interviewees expressed the need for better benefits
realization at the project and program stages, they get most serious
about it at the portfolio management stage. A best practice is to
integrate benefits realization into all PMO processes, reviews and
reporting (see the December 2005 Gartner EXP CIO Signature report,
Show Me the Money).

AAA of Northern California, Nevada and Utah provides automotive and

travel insurance and other financial services to motorists in the western
U.S. Its enterprise portfolio management office (EPMO) reports outside
IS to the CFO. It has end-to-end responsibility for all business and IT
programs, from strategy formulation to benefits realization.

AAA's EPMO has a staff of 30, including program managers but not
project managers. It supports a portfolio of 15 major programs covering
more than 80 business and IT projects, with an annual investment of
US$150 million to US$200 million. The EPMO operating budget is
US$5 million.

Extend the portfolio management office’s influence beyond the project

life cycle

Strategy Strategy Initiation Feasibility Execution Delivery Implemen- Benefits

formulation translation tation/closure realization

Project life cycle

Portfolio management office

54 Gartner EXP Premier

 Case Study:
AAA of Northern California, Nevada and Utah—Supporting strategic investments and
managing how projects are executed
The second largest of the more than 70 auto clubs in
North America, AAA of Northern California, Nevada and
Utah serves 4 million members from its San Francisco,
California, headquarters. Its 6,000+ employees
generate over US$2 billion in revenues from a wide
array of automotive, travel, insurance and financial
services.
AAA’s project management office (PMO) was formed in
1999 to improve IS’s execution. In late 2002, San
Retna was recruited from a major consulting firm as
chief portfolio officer (CPO). He reports to the CFO, at
the same level as the CIO.
Retna reorganized, moving the newly named enterprise
portfolio management office (EPMO) outside the IS
organization. His charter was end-to-end responsibility
for all business and IT programs enterprisewide,
covering six areas: strategy formulation, strategy
translation, portfolio management, program
management, project management and benefits
realization.
Retna inherited a staff of 28, but their skills did not fit
the EPMO’s expanded mission. He replaced them with
more senior candidates with extensive consulting
experience, mostly from outside AAA. His current staff
of 30 has developed and nurtured a portfolio of over
200 project and program stakeholders.
From a strategic perspective, the EPMO works with
groups in AAA to define activities, projects and
programs to reach AAA’s strategic objectives. At the
execution level, the EPMO manages how the company
executes the projects and programs in the portfolio.
EPMO benefits have been impressive
The EPMO uses a comprehensive set of metrics to
measure success. Two core measures—delivery
excellence and benefits realization—account for 70
percent of the EPMO’s overall performance rating.
Customer satisfaction is the third main component.
Taking Your PMO to the Next Stage
Retna explains: Delivery excellence is the number of
projects completed on budget, in scope, on schedule
and with the required quality; benefits realization is the
percentage of planned benefits actually achieved; and
customer satisfaction comprises quarterly online
assessments by 250 project managers and project
staff on how well the EPMO supported their work.
Progress on these metrics has been impressive, he
says. “The initial rating for delivery excellence was 33
percent; its current rating is up to 88 percent. The initial
rating for customer satisfaction was 65 percent and is
now over 80 percent. Benefits realization goes against
the trend. Its initial rating was 88 percent and it’s now
82 percent because of the increased complexity and
risk of recent projects, coupled with more aggressive
planned benefits.”
Each percentage point increase in the combined score
of delivery excellence and benefits realization translates
to some US$2 million of benefit to AAA’s bottom line.
“Balancing executing well, delivering benefits and
customer satisfaction is how we measure success,”
says Retna.
EPMO tool use increases as it matures
The EPMO started with the basic Microsoft Office tools,
and now Microsoft Office Project Server has become
the standard for project management. Time-reporting
tools feed into PeopleSoft, and ProSight Portfolios has
been added for top-down portfolio management.
The EPMO is considering using the earned value
functionality of Project Server in the future. Retna is
also looking at improving the precision of the revenue
benefits realization metrics, which are now based on
correlation. By developing an integrated driver model,
the EPMO will be able to show greater causality
between program delivery and revenue increases.
Based on interviews with, and material from, San
Retna, chief portfolio officer, AAA of Northern California,
Nevada and Utah, October 2005.
55
 4
“To add portfolio Portfolio management is the focus of AAA’s EPMO
management value, you
Introducing portfolio management was key to AAA answering four senior
have to start top-down
management questions:
at the enterprise level
and have a seat at the 1. Are we investing in the right programs and projects?
priority-setting table.
2. Do we have the operational capacity to execute?
Otherwise, you’re fighting
a losing battle, and you 3. Can we absorb the impact of executing multiple projects?
are only doing demand
management.” 4. Are we realizing the expected benefits from our investments?

— San Retna AAA’s EPMO provides a wide range of portfolio management services
Chief portfolio officer so that the company can create, execute, balance, manage and realize
AAA of Northern
benefits from its portfolio of internal investments. By bringing together
California, Nevada
and Utah people and processes from disciplines throughout the enterprise, the
EPMO is the focal point for delivering portfolio success. Enterprise
planning drives the five major processes of AAA’s enterprise portfolio
management model (see top figure opposite).

AAA’s EPMO provides a common language, approach and toolset for

all levels of the enterprise, as shown in the bottom figure opposite.
The EPMO provides four major services:

1. Core disciplines are common management processes that are

deployed at the project, program and portfolio levels to ensure
effective execution.

2. Program management is a guide to increase the likelihood of

achieving expected business results through the program life cycle,
and the detailed financial management processes to accurately
account for program costs.

3. Portfolio management describes the processes and tools required to

obtain funding and sets expectations on performance reporting at all
levels of the portfolio.

4. Enterprise transformation considers the entire portfolio and assesses

whether organizations have the capacity to support initiatives, and
focuses on defining and monitoring the benefits of all programs.

These services map well to the project, program and portfolio

management stages framework of this report.

56 Gartner EXP Premier

 AAA’s portfolio management model is driven by enterprise planning

Enterprise governance (program management team, EPMO)

Strategic Create portfolio Balance portfolio

direction • Initial prioritization • Forecasting/analysis Enterprise Operational
• Collation • Fund appropriation operating performance
• Compilation • Continuous ratio
• Reconciliation prioritization
Manage portfolio • Capacity mgmt.
• Issue mgmt. • Variance mgmt.
Enterprise • Risk mgmt.
planning • Financial mgmt.
Execute portfolio • Trends and analysts Resources
• Funding release • Control Realize benefits Operational
• Audit capacity
• Definition
• Data compilation • Calculation Asset
Operational • Business case • Post-implementation management
direction validation reviews Depreciation

Project/program management

Source: Adapted from AAA of Northern California, Nevada and Utah.

AAA’s EPMO provides the enterprise with a common language, approach

and tools

Enterprise transformation
Operational
Enterprise EPMO capacity

Change Benefits
assessment realization

Portfolio management team Portfolio management

Funding Performance Capacity
process reporting assessment

Program managers Program management

Program Financial Program Program
life cycle management capacity reporting

Project managers Comm-

Core disciplines
unications Risk Issue Change Quality
management management management management assurance

Source: Adapted from AAA of Northern California, Nevada and Utah.

Taking Your PMO to the Next Stage 57

 4
“Probably any of the Design governance to focus senior management’s
tools in the leader’s decision making on strategic issues
quadrant of the Gartner
While choosing which projects and programs to approve and which to
IT project and portfolio
stop must remain the responsibility of senior management, the PMO
management Magic
can facilitate the process. It can provide objective information and
Quadrant will work. But
analysis, ensure that the right people have input, and provide the
80 percent of the work,
decision makers with a consistent process and rational decision criteria
and the critical success
based on strategic concerns for making and monitoring decisions. PMO
factors, involve working
staff competencies must now include strategic planning and investment
on the process and
analysis.
methodology and getting
staff adherence.” “Portfolio management governance is very important at AAA because
— Richard Shapiro it’s the framework that supports our strategic investments,” says San
Manager Retna, chief portfolio officer. Governance bodies operate at the business
Program administration strategy, portfolio and program/project levels, to ensure alignment from
Royal Caribbean
Cruises Ltd. top to bottom (see top figure opposite).

Implement tools to facilitate informed portfolio

decision making and organizational learning
As portfolio size increases and different stakeholders require different
portfolio views, more powerful tools are needed. Many vendors provide
tools for project and portfolio management (see bottom figure opposite).
And best-in-class portfolio management offices provide senior
management with a realistic overview of an enterprise’s project portfolio,
complete with standard reporting across business units and functional
areas. When important problems or opportunities appear, the PMO
analyzes the information and makes recommendations.

Portfolio management offices track benefits realization, portfolio

alignment and health, and PMO performance. They teach managers
how to measure, manage and report benefits, not just costs.

They also implement knowledge management tools to capture lessons

learned and promote positive change. And they share lessons learned,
best practices and research, and foster a culture that uses this
experience to make project decisions and take actions.

58 Gartner EXP Premier

 AAA’s governance operates at three levels to ensure alignment

Strategy and
financial guidance Executive Executive decision
Business
strategy leader team making and
involvement

Strategic Prioritization
initiative and investment
roundtable decisions
Portfolio
management
Portfolio Oversight and
management accountability for
team enterprise portfolio

Program and Steering teams Consistent,

project repeatable program
management and project delivery
Program teams

Program and project management process

Source: Adapted from AAA of Northern California, Nevada and Utah.

Implement tools to support decision making at the portfolio level

Challengers Leaders
EPM=Enterprise Project
Mercury Management
Oracle Projects IBM RPM
SAP xRPM Compuware RPM=Rational Portfolio
Primavera Niku Manager
Microsoft Project EPM
Ability to PlanView
execute UMT=United
Lawson Software Management
Technologies
Planisware Artemis
Interna- Business
tional Sciforma Engine
Tenrox ProSight
Augeo Software Pacific
eProject UMT Edge
Genius Inside PowerSteering Software
Automation Centre Instantis
Atlantic Global ITM Software
As of June 2005

Niche players Visionaries

Completeness of vision

Taking Your PMO to the Next Stage 59

 4
Royal Caribbean Cruise’s PMO provides a knowledge
management system

Royal Caribbean Cruise’s program administration developed an IT life-

cycle (ITLC) knowledge base that contains all IS standards, practices,
policies and procedures. The ITLC is available to all IS team members
via the company’s intranet. Items are cataloged by life-cycle phase
or activity, for easier search and retrieval. Process guidance is also
integrated with “Tool How-Tos,” where appropriate, to mentor IS staff. In
addition to the specific life-cycle guidance, the knowledge base includes
cross-enterprise disciplines that span life-cycle and functional areas,
such as project management (see box opposite). The 500-member IS
department contributes content to the ITLC knowledge base.

Assess your portfolio management office against

best practices
If you are considering evolving to the portfolio management stage, or are
already operating at that level, compare yourself with the best practices
identified by completing the self-assessment opposite.

CIOs considering the move to portfolio management should use the

assessment as a checklist to plan what needs to be accomplished.

CIOs already at the portfolio management stage should use the

assessment to determine how effectiveness can be improved, even
if it means relinquishing control of the PMO.

Mature PMOs at the portfolio stage refine the techniques and metrics
they use. AAA is evaluating earned value analysis to better measure
project status, and an integrated driver model to better tie revenue
increases to program delivery.

According to AAA chief portfolio officer Retna, “Portfolio management is

a long, arduous journey. You won’t see immediate results, so you need
to manage expectations carefully and ensure that you have sustained
commitment from senior management.”

The three-stage framework and self-assessments can help you manage

expectations, fill in gaps and plan when and how to take your PMO to
the next stage.

60 Gartner EXP Premier

 ITLC knowledge base topics

• Project management

• ITLC templates

• Financial management

• Metrics

• Enterprise standards

• Peer reviews

• Configuration management

• Resources

How effective is your portfolio management office?

Done poorly/ Done somewhat Done Done well/

not at all poorly somewhat well completely
0 1 2 3

1. We have positioned the PMO outside IS to give it

independence and senior management sponsorship

2. We have extended the PMO’s influence to reach from

strategy formulation through benefits realization

3. We have designed governance to focus senior

management on strategic issues

4. We have integrated benefits realization into our processes,

starting with planning, and we report on it regularly

5. We have implemented tools that provide high-level

portfolio visibility and analysis to decision makers

6. We have broadened PMO staff competencies to include

strategic planning and investment analysis

7. We have implemented tools to capture, categorize and

distribute our best practices and lessons learned

Scoring:
17 – 21 You’re in good shape; see what needs fine-tuning Total score
10 – 16 Determine what else stakeholders need and fill in the gaps
0 – 9 Focus on the basics; educate the business and get buy-in for
portfolio management

Taking Your PMO to the Next Stage 61

 Appendix A: Organizing the PMO

EMC Corporation’s IS and PMO organization

CIO

Customer Enterprise Office of info. Applications Human

operations/ programs security & risk development resources
Field mktg. mgmt.

SPO/ESG/ IT PPMG/ Client services Global Finance

G&A Operations technology

IT PMO & IT communi- Mergers & Security & risk Global Client services
cross-functional cations & acquisitions PPMG technology PPMG
services mktg. PPMG
3 project managers
2 business analysts

Source: Adapted from EMC Corporation.

NYCHA’s IT organization and virtual PMO

CEO/General
manager

CIO/deputy general Business

manager information decision
Office of technology makers
the CIO

Business
Enterprise Program Director
units
architect manager information
virtual IT PMO management
1 manager, and
Quality Information consultants
assurance security office

Director business Director Senior director

enterprise system application IT infrastructure
transformation development

Source: Adapted from New York City Housing Authority (NYCHA).

62 Gartner EXP Premier

 TIM Brazil’s IT PMO structure

CTO

Business IT

Senior
manager PMO
Methodology:
Manager Portfolio management: Manager • Implementation
• Portfolio management • Alignment • Methodology • Coaching
• PMO tools • Project prioritization • Metrics & reports • Metrics & scorecard
• Project follow-up • Special projects • Interface with
• Requirements management tool president’s PMO
• PMO management tool Special projects:
Coordinator Coordinator
• Project management tool • 4 projects
PMO tools special projects
• Time tracker • 8 task forces
1 analyst
2 analysts
3 outsourced resources

• SharePoint development center

3 analysts • Collaboration portal tools Consultant

Weekly follow-up:
Outsourced PMO • 300 projects
(13 FTEs) • 750 open requirements
• 4 special projects, 8 task forces
• 500 risks/issues

Source: Adapted from TIM Brazil.

Metropolitan Holdings’ project support office

Group CEO

Group
Corporate Retail technology & MetHealth group International
strategy (GTS)

Market Shared Shared Shared Group Group

intelligence infrastructure solutions facilities technology procurement
planning

Business Solutions Project Solutions Problem Relationship

process design & support office management & management management
analysis development maintenance
6 project managers
4 project administrators

Source: Adapted from Metropolitan Holdings Ltd.

Taking Your PMO to the Next Stage 63
 Hallmark UK’s PMO is part of its new business improvement organization

PLC exec
board

Director
business
improvement

Quality Business Program

Management improvement management
System (QMS) office (PMO)

4 program managers

Source: Adapted from Hallmark UK.

Workplace Safety and Insurance Board’s strategic PMO organization

President

Chief prevention Chief Chief Chief

& corporate operating corporate financial
strategy officer officer services officer officer

Prevention Service delivery Human resources Finance

Program
Corporate strategy Legal services Investments
development

Health & safety Specialized Regulatory services Actuarial services

associations claims services & appeals

Communications,
Business services Internal audit
policy & research

Strategic project Business technology

Health services management office services

8 project/program managers
2 project specialists
1 chartered accountant
1 business administrator

Source: Adapted from Workplace Safety and Insurance Board.

64 Gartner EXP Premier

 AAA’s enterprise portfolio management office organization

CEO

CFO

Chief portfolio
officer EPMO

Portfolio Special Portfolio

strategic projects operational
services services

Business Strategic Portfolio Portfolio Portfolio

consultant initiative management manager manager
roundtable team

Program Program Business Program

manager manager consultant manager

Program Program Business

manager manager consultant

Program Business
manager consultant
Governance body

Source: Adapted from AAA of Northern California, Nevada and Utah.

Royal Caribbean Cruise’s PMO organization

CIO

Director
IT finance

Manager Manager project

program management
administration office

2 business 2 technical 1 financial 2 analysts 40 project

analysts support analyst FTE managers

Source: Adapted from Royal Caribbean Cruises Ltd.

Taking Your PMO to the Next Stage 65

 Appendix B: Representative PMO
tools and frameworks
Representative PMO tools and frameworks

Project portfolio management Project management Risk management

• Artemis (Artemis 7, Viewpoint) • Microsoft Project • C/S Solutions: Risk+ for MS
• Compuware (Changepoint) • Niku (Clarity) Project
• IBM (Rational Portfolio Manager) • PlanView • Palisade: @RISK
• Lawson (Services Automation) • Primavera • Pertmaster: Risk Expert
• Mercury (ITG) • X-Pert • Primavera: Monte Carlo
• Microsoft Project (w/Business Engine, • Risk Services and Technology:
Pacific Edge, ProSight) Risk Trak
• Niku (Clarity) • RMC Project Management
• Oracle (Enterprise Project Management) • SmartOrg: Portfolio Navigator
• PlanView and Decision Advisor
• Primavera (Prim. IT Proj. Offc.; Prim. IT Ops. • Welcom: WelcomRisk
Mgmt.)
• SAP (xRPM)
• Sciforma (PS Next)
• United Management Technologies (UMT)

Requirements management Quality management Time reporting

• Borland – CalibreRM • Compuware • Best Software
• IBM Rational – RequisitePro • Empirix • Journyx
• Serena – Requirements Traceability • IBM Rational • Kronos
Management • Keynote Systems • Replicon
• Telelogic – DOORS • Mercury • Tenrox
• UGS – Teamcenter • Segue Software
• Telelogic

Project management methodology Maturity models Training and certification

• IBM Rational • Gartner • Association for Project
• PlanView • PM Solutions Management
• PM Solutions • Project Management Institute • Boston University
• PMI Project Management Book of (PMI) • CompTIA
Knowledge (PMBOK) • Software Engineering Institute • ESI International
• Primavera (SEI) • George Washington University
• PRINCE2 (Projects in Controlled • International Institute for
Environments) Learning
• PM Solutions
Content and document management Collaboration • Project Management Institute
• EMC/Documentum • Cisco/Latitude (PMI)
• FileNet • EMC/Documentum/eRoom • Project Solutions Group
• Hummingbird • Genesys • Stanford University
• IBM/Lotus Notes • IBM
• Interwoven • Intralinks
• Open Text • Microsoft/Placeware
• Stellent • SiteScape
• Vignette • Vignette/Intraspect
• Xerox • Webex

66 Gartner EXP Premier

 Further reading
Gartner EXP reports Eglund, R., Graham, R. and Dinsmore, P.,
Creating the Project Office: A Manager’s
Aron, D., Tucker, C. and Hunter, R., Show Me Guide to Leading Organizational Change,
the Money: Advanced Practices in Benefits San Francisco, CA: Jossey-Bass, 2003
Realization, Gartner EXP CIO Signature Report,
December 2005 Jeffery, M. and Leliveld, I., “Best Practices in IT
Portfolio Management,” MIT Sloan Management
Tucker, C. and Rowsell-Jones, A., Getting Review, Spring 2004
Priorities Straight, Gartner EXP Premier Report,
September 2002 Maizlish, B. and Handler, R., IT Portfolio
Management Step-by-Step: Unlocking the
Tucker, C. and Woolfe, R., Building Brilliant Business Value of Technology, Hoboken, NJ:
Business Cases, Gartner EXP Premier Report, John Wiley & Sons, Inc., 2005
January 2004
Pennypacker, J. S., PM Solutions’ Project
Portfolio Management Maturity Model,
Core research Havertown, PA: Center for Business
Practices, 2005
Light, M. and Stang, D., “Magic Quadrant for
IT Project and Portfolio Management—2005,” Project Management Institute, A Guide to the
G00129208, June 22, 2005 Project Management Body of Knowledge,
Newton Square, PA: PMI Publications, 2004
Light, M., Rosser, B. and Hayward, S.,
“Realizing the Benefits of Project and Portfolio Rad, P. F. and Levin, G., The Advanced Project
Management,” G00125673, January 4, 2005 Management Office, Boca Raton, FL: St. Lucie
Press, 2002
Light, M., Hotle, M., Stang, D. and Heine, J.,
“Project Management Office: The IT Control
Tower,” G00132836, November 22, 2005 Web sites
Project Management Institute, www.pmi.org
Books and other publications
The Online Community for IT Project Managers,
Layout/Production: Gartner Corporate Marketing Crawford, J. K., The Strategic Project Office: A www.gantthead.com
Guide to Improving Organizational Performance,
Entire contents © 2006 Gartner, Inc. and/or its affiliates. All rights reserved. Reproduction of this publication in any form
New York, NY: Marcel Dekker, Inc., 2002
without prior written permission is forbidden. The information contained herein has been obtained from sources believed to
be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner
shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.
The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions
expressed herein are subject to change without notice.

© 2006 Gartner, Inc.

Taking Your PMO to the Next Stage 67

 march2006
march2006
Gartner Headquarters Gartner EXP Premier Reports

Taking Your PMO to the Next Stage

Corporate Headquarters
Growing IT’s Contribution: The 2006 CIO Agenda
56 Top Gallant Road
January 2006
Stamford, CT 06902-7700
U.S.A. Building Business Smarts in IS
+1 203 964 0096 November 2005
Overcoming Change Obstacles in the Public Sector
Europe Headquarters October 2005
Tamesis
The Glanty Applying Enterprise Architecture
Egham September 2005
Surrey, TW20 9AW The CIO’s Personal Contribution Scorecard

Taking Your PMO

UNITED KINGDOM July 2005
+44 1784 431611
Changing Business Processes
Asia/Pacific Headquarters
Gartner Australasia Pty. Ltd.
May 2005
Perception Is Reality: Communication Strategies to the Next Stage
Level 9, 141 Walker Street for Public Sector CIOs
North Sydney March 2005
New South Wales 2060 Contents
Playing to Your Advantage: Proven Practices
AUSTRALIA Executive summary 4
of Midsize-Enterprise CIOs
+61 2 9459 4600 PMOs evolve through three stages as they mature to meet ever-increasing business
March 2005 needs. CIOs must ensure that their PMOs master the basics of their current stage
before evolving them to the next stage.
Japan Headquarters Delivering IT’s Contribution: The 2005 CIO Agenda
Gartner Japan, Ltd. January 2005 Section 1 PMOs must evolve as business needs change 8
As business needs evolve from risk reduction to resource management to business
Aobadai Hills 6F growth, CIOs evolve their PMOs through the project, program and portfolio
Making Time: The Office of the CIO management stages.
4-7-7 Aobadai, Meguro-Ku
November 2004
Tokyo, 153-0042 Section 2 Reduce business risk with a project management
JAPAN The New Shape of IS office 18
+81 3 3481 3670 September 2004 A project management office can reduce the risk of project schedule slippage,
cost overruns and scope creep by focusing on a standard project management
process, basic tools and project manager development.
Improving the CEO’s View of the CIO
Latin America Headquarters July 2004 Section 3 Optimize resource use with a program management
Gartner do Brasil office 32
Av. Das Nações Unidas, 12.551 – 9º andar Upgrading the IS Scorecard A program management office can improve resource management across
business and IT projects and programs by combining related business and IS
World Trade Center – Broklin Novo May 2004 projects into programs, as well as by implementing governance, communications
programs and collaboration tools.
04578-903 – São Paulo – SP Preparing for the Upswing: The 2004 CIO Agenda
BRAZIL March 2004 Section 4 Contribute to business growth through a portfolio
management office 46
+55 11 3443 1509
Building Brilliant Business Cases A portfolio management office can contribute to business growth by optimizing
the mix of project and program investments and focusing on benefits realization
January 2004 and knowledge management.
For more information,
visit gartner.com. CIO Credibility: Proven Practices From the Appendix A Organizing the PMO 62
Public Sector Appendix B Representative PMO tools and frameworks 66
November 2003 Further reading 67
Geosourcing IS: Is It Right for You?
November 2003
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