It was late Friday afternoon, and the bank’s CFO faced a daunting task: to evaluate and report on the status of 635 projects that were in varying stages of completion. The list had taken six weeks to compile and ranged from efforts associated with a major profit-improvement program to a huge number of standalone projects from all parts of the organization. The CFO had no idea which projects were on track, which would deliver real value, which overlapped. Nor did he have a sense of what resources were being consumed. But on Monday, the CEO would need answers to seemingly impossible questions: Will we reach our financial targets? Which projects are at risk and need management attention? And which projects, if any, should we cut? It would be a long weekend.
In today’s business environment, scenarios such as this one are not uncommon. Few companies have the right governance structures, data transparency, and tracking mechanisms in place to effectively manage ambitious change initiatives. In most businesses, resources are tight and must be carefully allocated. The initiatives themselves are often more complex and interdependent than they were five years ago. Moreover, fierce global competition and quickly changing markets require fast results and real impact. And from corporate boards to capital markets, demand is growing for greater proof of the impact to be delivered and the organization’s ability to deliver it.
The traditional project management office (PMO) wasn’t designed for today’s environment, and few have adapted to the new challenges. Often associated with bureaucracy and unproductive meddling, many PMOs are better suited to running a set of departmental projects on time and on budget than they are to managing a complex, interconnected set of cross-enterprise efforts tied to high-risk, mission-critical outcomes such as aggressive cost reduction, revenue enhancement, and turnaround situations.