How to choose the right PMO type and organizational structure

There’s no template for building a Project Management Office (PMO). And this is a good thing. After all, different companies will have different goals, different infrastructures, different methodologies. A singular framework that answers everyone’s needs is simply a fallacy.

Instead, project management thought leaders provide their take on the different PMO types and organizational structures. This gives you the freedom to create a PMO that aligns with your business objectives, and change direction should you realize you need to shift focus.

PMO Types and Organizational Structures

There are several ways to look at the PMO. The PMI (Project Management Institute) identifies 5 separate models:

1. Organizational PMO. Provides project-related services to support a strategic business unit.
2. Project support services. Provides processes to support the management of project, program, or portfolio work.
3. Enterprise PMO. This aligns project and program work to strategy.
4. Center of Excellence. Provides an organization with standards, methodologies, and tools to support project work.
5. Project-specific PMO. Provides project-related services on a temporary basis to support a specific project or program.

Then there’s Gartner, one of the main analysts in the Project Management space. Because their focus is on IT, they’re less concerned with PMOs that deal with non-IT projects such as the R&D or enterprise PMO. They define PMOs using the following 4 categories:

1. The activist PMO. This takes a broad view instead of a controlling approach. It supports decision makers by analyzing business cases for alignment and risk.
2. The delivery PMO. Also known as the project delivery PMO, this office plans and controls the execution of projects to business expectations.
3. The compliance PMO. This model ****establishes standard practices for measuring project performance. It also develops an understanding of key initiatives.
4. The centralized PMO. This model enables representatives from various project support organizations to share best practices. As such, it fosters faster onboarding for new project management hires.

Yet, most organizations use the PMBOK (the Project Management Book Of Knowledge), a set of standard terminology and guidelines for project management managed by the PMI. It defines 3 types of PMO, providing a basic definition for each. But, we’re going to dig a little deeper and provide more context.

The Supportive PMO

This model provides “a consultative role to projects” and is a good fit for organizations with low project management maturity. It does the following:

• Centralizes ownership of processes, tools and capacities
• Provides and develops materials, tools, and templates
• Enables data access and enhances data quality through post-review controlling
• Provides on-demand support for projects
• Provides analysis and governance
• Develops and maintains the PMO’s capabilities

A real-world example of a supportive PMO is Fannie Mae. This financing company for housing lenders was only 8 years old when it won PMI’s PMO of the year in 2019. The focus of their Enterprise PMO (EPMO) was to continuously mature program governance, centralizing best practices, investing in tools, and evolving processes. As such, they were able to support their company’s strategic vision, and grow from managing projects to managing programs and portfolios.

The Controlling PMO

Also known as the administrative model. This model is good for organizations that already have the supportive model in place, or have a higher level of project management maturity. The PMBOK says that this model “provides support and requires compliance through various means”. But what are those means, exactly?

The controlling model does the following:

• Centralizes ownership of process and tools
• Provides and develops materials, tools, and templates
• Enables data access
• Exercises basic control of the data and its processes
• Provides basic support for projects
• Maintains analysis capabilities
• Maintains critical PMO capabilities

Let’s look at Intel’s IT PMO as an example of the Controlling type. Before they implemented their IT PMO in 2009, they frequently missed deadlines—sometimes pushing projects to the next quarter.

Their PMO model does the following:

• Sets standards for project deliverables, including tracking and communicating schedules
• Sets measurable delivery goals and milestones
• Performs stage-gate reviews
• Conducts quality measures

However—and this point is key to a controlling model—it still gives project teams the flexibility to determine which processes they need, and which they don’t.

“Having a standardized project management framework creates consistency while giving them the flexibility to engineer the deliverables of the project life cycle however they’d like.” - Mark Brodnik, Intel program/project manager

Intel steadily increased the number of projects they released—all without breaking the budget—thanks to this IT PMO.

The Directive PMO

Organizations with a higher level of maturity that already have the supportive or directive model in place will benefit from the directive PMO model. This model “takes control of the projects by directly executing them”, according to the PMBOK guide. It does this by:

• Centralizing ownership of process and tools
• Managing project evolutions
• Maintaining and developing tools
• Ensuring data quality
• Providing support and expertise
• Providing analysis to support decision making
• Organizing and supporting governance
• Developing and maintaining PMO capabilities
• Developing and maintaining some delivery capabilities

Take Suncorp Metway Ltd. as an example. This Australian financial services company developed its strategic building blocks program (SBBP) to ensure every project delivered business benefits. So, they needed a high level of project management discipline and capabilities.

The SBBP created a strong governance framework around costs, benefits, and delivery management. It also monitored progress and metrics closely throughout the project lifecycle to ensure teams delivered the expected outcomes.

Furthermore, the SBBP stipulated that business units have to make a business case for every project, and understand they are accountable for the results.

“It’s clear to everyone what is expected and that every project will be seen as a business improvement act.” - Adrian McKnight, PMP, SBBP program director

When the SBBP undertook a project to deliver a system that would improve home and motor insurance claims, they turned to their project management methodologies. The team broke the project into smaller deliverables for the client, which helped the client become more invested in the project. A review showed that these practices improved client satisfaction. Also, they delivered a more user-friendly system that significantly reduced the cost of claims handling.

Find a PMO Type or Structure That Fits

Is your Project Management maturity high or low? Is your organization global or local? Do you have industry and company regulations that might impact your PMO needs?

There are many questions you must ask yourself before you decide on the PMO that’s right for you. But know, whatever type you do choose, it’s not gospel. Analyze your results. If it doesn’t align with your business objectives you can course-correct, and find a model that fits your mold.