Programme Management Office (PMO)

Effective project management can ensure initiatives are delivered to specification, budget, and within agreed timeframes, whilst a PMO can improve organisational efficiency, increase collaboration, support transformation, and generate savings.

Furthermore, PMOs can support governance requirements and provide confidence to leaders.

The first step in building a successful PMO is understanding the specific needs of the council and what problem it is trying to solve – both strategically across the organisation and operationally in the delivery of projects.

Where a PMO is run effectively the benefits can amount to the following – please see image

A newly formed PMO should be supported by a robust project management framework with relevant documentation, templates and tools.

A framework will set out the council’s requirements for running projects, outlining the different steps, stages, roles and accountabilities, as well as providing clarity over terminology which can often be overlooked.

The framework and documentation relating to project management needs to be drafted in a clear and concise manner, using language that is easy to understand for a broad audience.

There are generally three models that can be adopted when establishing a PMO to suit the needs and structure of the council.

PMOs provide a range of dynamic business functions that support other services within a council.  The table below provides a core list of functions for a PMO, though important to note that the functions are delivered in collaboration with services across the council and the PMO by its nature provides a co-ordination role:

The terms “project” and “programme” often become interchangeable, though are distinct. In simple terms a project is a specific, single initiative with tangible outputs, whilst a programme is a collection of related projects.

Defining what is a project and what is business as usual (BAU) is a key parameter in establishing the role of a PMO, as doing this will clearly set out what a PMO will take responsibility for and provide support to. The below provides a comparison of project work and BAU and can be used as a guide to define what a project is.

PMOs can be structured in a number of different ways, and the roles that are included depend on the model that is implemented. A PMO will generally have a head of service, with a set of project managers and officers.  Some PMOs include strategic support, such as resource planners or practice leads, that act as a resource to project managers, as well as assisting with longer term planning. The PMO will work collaboratively with service areas to deliver projects, and these relationships are important in maximising the value that the function provides to the organisation.

The PMO is often linked to change, modernisation or transformation programmes either supporting delivery or as part of the same division.

An overview of common roles within a PMO is illustrated:

♦ Senior Responsible Owner (SRO)

It is good practice, if not essential, for a project to have an SRO, particularly if the project is high priority. The SRO has overall responsibility for a project, ensuring it keeps to budget and time to meet its objectives – as part of this responsibility they will chair the project board. They might not be involved in the day-to-day operation but will need to be kept up to date and able to talk confidently about the project’s progress. Their experience will allow them to spot when intervention is required at an early stage or escalation is needed.

• Traits: forward planning; experienced in project and service delivery; decisive; able to interpret information quickly and communicate concisely.

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♦ Service Lead and Representatives

A PMO will have frequent contact with services. The service lead is critical in ensuring the service objectives are met and often are the “go-to person”. A service lead may report to the SRO, give updates to the project board and might be asked to accompany or fill-in for the SRO at programme boards. The service representatives will be other officers that support the lead with detailed knowledge of the outcomes the project aims to achieve.

• Traits: good collaborator; agent for change and improvement; know the service and particularly the requirements of users; can recognise risk and its impacts; able to communicate effectively.

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♦ Head of Service – PMO

A head of service (sometimes a service or assistant director) will lead the PMO. They will manage the PMO team and have oversight of the projects being supported – therefore will need to proactively manage the pipeline and allocate resources accordingly. They will have ownership of the project management framework and the processes it outlines. This will mean having good connection across different levels in the council, including regular reporting to senior officers and members. They may also be responsible for the transformation programmes and be key in having oversight in how projects are progressing.

• Traits: excellent at relationship building; experienced manager of people and projects; can form policy; proactive in forward planning and horizon scanning; can quickly spot when something is going wrong and be decisive in addressing it.

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♦ Project Managers

A project manager within the PMO will be involved in day-to-day operation of a project: organising the project boards, recording and following up actions; co-ordinating update reports or ensuring others input the relevant information. They will be proactive in raising any concerns and seeking mitigation to risks, and as a member of the project board can use their experience to contribute to decision making.

Whilst the project officer (see next) may be involved in a number of initiatives the project manager will usually oversee one or two key projects that are more complex, and will often line manage project officers.

• Traits: proactive; well organised; management experience; decisive; persuasive; negotiation skills; adaptable and flexible; diplomatic whilst assertive.

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♦ Project Officers

The project officer will be involved in the delivery of a project, ensuring the right people are involved at the right time. They will do similar functions to the project manager, but for less complex projects – this includes organising the project boards, record and follow up actions; they will co-ordinate information for updates and reporting. Their role is to drive the project, ensuring there is pace with the decisions made at the right point. It is worth noting they are not administrative support. They will often be involved in several projects across the council at one time.

• Traits: well organised; forward thinking; co-ordination skills; ability to negotiate to find solutions; adaptable and flexible; doesn’t easily take no for an answer.

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The cost of a PMO will vary – from consisting of a small core team of a few officers, through to a large team with a wide scope.  Funding for PMOs can come from a variety of sources. The three most common sources of funding.

Core funding: Core funding (also referred to as revenue) is ideal in creating stability and generally used to fund the backbone of a PMO. This can cover its head of service and permanent project managers / officers who will often be involved in council wide / corporate change projects – and the team could have savings targets to create a return on investment. However, there is often a need to flex-up the PMO when projects need resourcing quickly. Therefore, some authorities will appoint and retain project managers at risk before funding is confirmed.

Project funding: Project funding generally involves the cost of the PMO being built into project budgets. This can include a percentage spend in capital programmes or grants that allow for project management and administrative overheads. When project funding is used, there is often provision within the revenue budget for a Head of PMO position to coordinate the function.

Resourcing is a key risk when relying on project budgets – therefore it is essential that a forward pipeline is maintained so that the PMO can ensure its project managers are always assigned to project work.

Service funding: Services sometimes have project management allocations built into their base budgets. This type of funding generally works best for embedded PMOs, which have project managers permanently based within service areas. Services may be protective of these resources, and they can often only be part of a person’s job rather than their whole role.

Supporting Software

Software supporting project management is commonly used in the public sector. Software packages range from off-the-shelf products to fully customised suites of digital services, and whatever route is chosen needs to be consistent with the council’s IT strategy. Considerations for procuring PMO related software packages include:

• ♦  Availability and flexibility of licences – whilst it would be ideal to have licences for many, realistically the cost will be a factor, so moving licences around to different people would be useful with the ability to quickly see when a licence has not been utilised.
• ♦  Ease of use and user friendly – easy navigation is important, particularly for people who are not familiar with the software or do not use it regularly.
• ♦  Ability to be proportionate – this involves scaling what is needed, for example reducing the requirements for smaller scale projects.
• ♦  Document storage and management features – ideally all documentation for a project is actioned or recorded through the software. This means different parties can be sighted on a project, plus it provides an effective audit trail. There might be unique documents that need producing outside of the system (e.g. templates from funders) but these should still be uploadable.
• ♦  Integration with other software – this can sometimes be tricky but something to be understood early so a decision can be made on the capability of the software being purchased.
• ♦  Reporting features that allow one report to be prepared and shared many times – this allows for information to be submitted once and extracted for the right audience to the right level of detail.
• ♦  Paperless – that the software is used to “design-out” any remaining paper based process and used to streamline procedures.

Governance and assurance are an essential part of any PMO to ensure that projects are carefully monitored to avoid failures and ensure delivery, with links to the council’s formal governance processes.

Assurance arrangements should be established early in the PMO’s development, setting clear expectations of what is required. The layers of assurance means that different parts of the organisation can have sight of a project, bringing their perspective to avert and mitigate when it looks as though something might go wrong. The assurance processes need to be proportional to the project, with the high priority and higher risk projects having more checks and balances in place. Those risks might not just be financial, but include reputational risk and impact on vulnerable people in the community.

Below is a suggested assurance structure:

• ♦  Project boards: oversee day to day management of projects, meeting at a maximum weekly and monthly as a minimum, chaired by the SRO.

• ♦  Programme boards: meeting monthly to agree business cases, receive dashboard reports on different projects in the programme area, and escalate when needed, agree and record changes, as well as providing a strategic overview in that programme area. Each authority will have different arrangements for programme boards – these can be based on directorate structures or the priorities of the corporate plan.

• ♦  Assurance board: meeting monthly to receive progress and health dashboards from the chairs of the programme boards, troubleshoot when necessary, provide strategic overview and review the pipeline of projects – chaired at director level (on rotation) to provide gravitas and leadership, supported by the membership containing specialist officers to spot and address pitfalls.

• ♦  Leadership Team (senior officers): reports on projects built into the performance reporting cycle, highlighting risk and progress.

• ♦  Cabinet (member executive): as with the Leadership Team, cabinet will receive formal reports on projects as part of the quarterly performance reporting linked to ambitions in the corporate plan as part of usual governance, with these papers published in the public domain to support transparency.

This assurance structure should not deviate from usual line management reporting and escalations, ensuring senior management is sighted on key projects and risks, including briefing portfolio holders on their relevant schemes. The review of capital schemes can be integrated into the model as illustrated below, though your council may have an additional requirement to monitor capital spend that contributes to financial reporting.

Although reporting is a critical aspect of project management, it is important that processes are simple and slick, ensuring that reports capture only meaningful information and not turn reporting into an industry in itself. If reporting is well defined, it is possible to create a single report that can be used multiple times – potentially in the form of a visual dashboard.

The BRAG (Blue, Red, Amber, Green) status is a good way of creating simple reports that can be quickly interpreted. The system utilises colour coding to highlight project elements that are on track or require attention.

The following figure provides an overview of the key elements for reporting:

An outline of how often reporting needs to occur and what should be reported at each stage of the reporting cycle can be based on the following:

The foundation for reporting – the outcomes, measures, timescale, cost – should all be included in the original business case which enabled the decision makers to reach informed choices when agreeing to a project. There will inevitably be events that means a project could go off course, and minor change can be addressed through the described assurance structure. However, where there is major change that impacts the intent or delivery as set out in the business case then the case needs to be reviewed.

Where a business case was agreed through formal governance the same route will be needed to revise any decision. This is important for accountability, transparency and audit.

Measuring the return on investment and actual performance of a PMO can be challenging because they are heavily reliant on the results and behaviours of others in the council.

There are a number of metrics that can demonstrate a PMO’s value, and where possible, data should be collected over a period of time so that the impact of a PMO can be observed. Metrics include:

• ♦  Savings attributed to the activity of the PMO – often relevant in transformation projects
• ♦  Savings achieved through support of the PMO – though attributed to a directorate
• ♦  Projects delivered on time / percentage of projects delivered on time
• ♦  Projects delivered in budget / percentage of projects delivered to budget
• ♦  Contribution to delivery plan / corporate plan objectives
• ♦  Meeting the specific KPIs of the project e.g. reports on funding or level of improvement
• ♦  Culture and behaviour change – staff surveys on skills, abilities and approach to operating projects.

The performance metrics can form a key part of evaluation when assessing the results of a project and the impact of a PMO.

Along with metrics, part of the project close process should include “lessons learned”, which helps shape future delivery. Input from different stakeholders and parties should be included in learning the lessons to give a rounded view of the areas of improvement. Based on the result of the evaluation the role and purpose of the PMO could adjust to meet the changing requirements of the council.

It is also important to celebrate success – ultimately at the centre of public sector projects is the goal of improving outcomes for residents which provides great value.

Download the Project Threshold Tool here