Setting up a Project Management Office (PMO)

Introduction

The expectations to successful ERP implementations are increasing. Not only does the ERP solution have to be ready on time and in budget but there are many other expectations. Here are some examples: the stakeholders must be involved, good communication inside and outside the project needs to be done, the expected benefits need to be realized, the end-users well trained and the legacy data migrated. In addition, GDPR expectations can also be relevant.

A project organization consisting of members from the system integrator and from the customer is usually set-up. The project governance includes a Steering Committee, a project management and process owners (sub-project leaders). Almost always the supplier is represented on all these levels. The project management consists of a customer project manager and a supplier project manager. The above-mentioned expectations are usually placed on the shoulders of the customer Project Manager. Giving the customer Project Manager additional Topic Experts for a Project Management Office can be very efficient, effective and can highly reduce risks.

The distribution of these tasks and expectations can greatly support the success of the larger ERP implementations. For smaller implementations (less than 30 users) this could be too bureaucratic.

Contents

When talking about modern Project Management activities we usually understand the following tasks:

• Project Governance
• Organizational Change Management (OCM)
• Deliverables and Milestones
• Project Management Best Practice
• Impact Analysis / Role Definitions
• Quality Management
• Project and Stakeholder Communication
• Training Management
• Partner Management
• Planning, Monitoring and Reporting
• Knowledge and Collaboration Platform
• Test Management
• Risk Management
• Financial Controlling
• Change Request Management

The contents of each of these PMO tasks are elaborated in other 2BCS blogs.

2BCS is a PMO specialist and has supported hundreds of ERP implementations. These implementations have been carried out with all the major ERP vendors in the market such as SAP, Oracle, Microsoft, IFS, Infor, Abacus, Informing, ProAlpha, Opacc, ABAS, etc. Common to all these implementations is the need to have a strong project management on the customers’ size. A PMO can facilitate this. This blog is focused on three best practices when setting-up a PMO.

Best Practice

The following three Best Practices should be adhered to when setting-up a project management office:

• Flexibility in PMO set-up
  The individual importance of each of the 15 PMO tasks varies from customer to customer. In addition, the existing internal resources and their skills should be used as far as possible. If the customer has a financial controller with some availability, then the internal financial controller should become the Topic Expert Financial Controlling. This type of flexibility is greatly needed when assigning the PMO tasks to Topic Experts. I personally think that the following order should be followed:
  1. Customer priority of the 15 PMO tasks (1=low to 3=high)
  2. Estimate of needed resources to carry out the individual PMO tasks (usually between 10%-50% per task)
  3. Identification of available internal resources (this includes the customer project manager) including their skill set and availability
  4. Assignment of PMO tasks to internal Topic Experts
  5. Mandate an external Topic Expert for the “left-over” important PMO activities.
  The assignment of Topic Experts depends on the importance of the PMO tasks, the internal resources, skills, and experience and on the know-how that the external consultant have.
  
  → Best Practice 1: Planning the assignment of PMO tasks to Topic Experts is an iterative process and usually needs more than one try. Fill up missing internal resources with experienced external specialists can help. A PMO should not have more than 7 Topic Experts.
• Weekly Coordination within the PMO
  Sharing the PMO tasks among various Topic Experts is normal. This enables the Experts to focus on their tasks. There are many dependencies between the tasks that need to be aligned. The Manager is the official leader of the PMO. He or she should orchestrate all the Topic Experts and ensure that all the activities are in sync and that the PMO is sending out unified messages to the project. We suggest that the Project Manager periodically holds meetings with the PMO. During these meetings, the cornerstones of the upcoming phases and activities are agreed upon and the progress and dependencies are discussed.
  
  → Best Practice 2: The Project Manager should hold periodic weekly meetings with all the Topic Experts. This meeting should focus on three areas: learnings from the past weeks, planned activities in the upcoming weeks and a forecast to the next stage.
• Individual points of contact for the Topic Experts
  The 15 PMO tasks are very different. In most cases the PMO is the enabler of a task. The Topic Expert defines the method, template, organizes, gives instructs and ensures that the results fit. The tasks are related to different people within and outside the project team. In the past we have found it very beneficial that each Topic Expert has a list of coordinated contact persons. This method ensures that the workload is shared and there are no bottlenecks. Very often the contact persons are called Topic Coordinators.
  
  → Best Practice 3: Defining the points of contact for the Topic Experts enables them to work in parallel without overloading the people within the project.

Who is 2BCS?

2BCS AG is a Swiss leader in business and IT transformation. We support our client’s digital initiatives by providing thought leadership, independent expertise and hands-on implementation support based on dozens of years of experience. Our clients are national and international industrial and trading companies who demand and expect best practice professional support. 2BCS AG is a spin-off of HSG and is based in St. Gallen and Zurich.