A Review of Risks that Occur in Establishing a PMO

A Review of Risks that Occur in Establishing a PMO
Page content

What Is a PMO?

A project management office or PMO is a dedicated department in a business or organization that guides, manages, and monitors every project within the organization. The PMO is usually set up with facilitators, a reference library, and knowledgeable managers that can help implement any project management methodology. Learn more about a PMO right here on Bright Hub by reading, What is a Project Management Office (PMO) and Why is It Needed? To help your PMO run effectively, learn the ten major PMO risks.

#1. One of the major PMO risks, related to establishing a PMO is the exclusion of experienced line managers from the project planning process. Organizations unable to afford experienced project managers to complete process work in the PMO deploy untrained managers in actual projects, leaving the PMO in the hands of people who do not have significant experience or training to deliver projects.

#2. Any project plan invariably requires some changes at the implementation level. While scope creep needs avoidance, organizations need to be able to show some amount of flexibility and incorporate genuine changes from the PMO chosen methodology. Failure to establish a PMO risks the business in remaining rigid and inflexible, leading to both customer dissatisfaction and poor execution of projects.

#3. The PMO is set up to train and mentor project managers. Such project managers implement the PMO methodology, but organizations face the risk of such managers looking to PMO for all decisions, not handling contingencies that arise, or identifying flaws in the process design that become apparent during project execution.

#4. A PMO defines roles and responsibilities at the onset. This raises the risk of defining “roles” before describing the problem domain which can lead to a lack of customization that cater to a project’s special requirements.

#5. An effective PMO ensures standardization of processes that risk embracing a “one solution fits all” approach. What works for one project may not work for another project. Each project is different and project managers have their own different styles as well as their own unique approach.

#6. The PMO risks enforcing an “unnatural” level of cooperation with the project members. Experienced project managers usually become frustrated explaining things to an inexperienced PMO and resent taking directives from them.

#7. The roles and responsibilities of team members fixed by a centralized PMO risks non-involvement of the team members, making them reluctant to take up responsibility or ownership of project tasks.

#8. One major role of the PMO is leveraging resources such as technology. While this improves organizational efficiency and benefits the organization’s bottom line, the risks lie in over emphasis of technology, over processing, and end results. A PMO risk can be a project’s team adopting technology for the sake of technology per the chosen PMO methodology, even when it is possible to achieve the desired result without such technology or using a technology in a different manner.

#9. Establishing PMO requires staff and infrastructure. The economic rationale is that such investments yield positive returns in terms of the money saved by delivering projects better, faster, and cheaper. The risks lie in the cost of running the PMO exceeding the savings resulting from the PMO operations. The economic viability of the PMO mandates the organization being reasonably big and having many projects running simultaneously.

Risk of Unrealistic Expectations

#10. Among the major risks that occur in establishing a PMO is the risk of unrealistic expectations. The PMO is only a facilitator to improve the project process. The involvement of the PMO may, however, generate all round unrealistic expectations regarding the scope and success of the project. The success or failure of a project ultimately depends on the leadership of the project manager and the skill of the project team. A PMO can ensure meeting the goals set in the project charter in an efficient manner, but cannot ensure the attainment of higher goals.

A proper understanding of PMO risks and taking steps to mitigate the ill-effects of such risks is a sign of sound and competent project management.


Image Credit: EverJean. https://www.flickr.com/photos/evert-jan/