Does a Service Firm Need a PMO?

Being unfamiliar with Project Management Offices I wanted to spend more time researching their function and role within organizations so I read an article on entitled “Why You Need Project Management Office” and learned several interesting facts. First, is that generally the purpose is to “complete more projects on time and on budget with fewer resources” which sounds ideal and led me to believe that this could not be inexpensive, and I was right. According to a survey by CIO and PMI, 74% of respondents said that lower cost was not a benefit of their PMO’s. The article also noted 7 functional areas for PMO’s, all of which we have touched on in class:


  1. To support Project Managers in the business units
  2. Implement standard processes and methodology
  3. Maintain training programs
  4. Act as a home for Project Managers
  5. Internal consulting and mentoring
  6. Portfolio management software tools
  7. Staff of program managers who can handle multiple projects at that same time

The article also discussed how to measure successful PMO’s and the objectives of the PMO specific to each company’s culture. Three years seems to be a reasonable time period before measurable results are achieved and one company listed its objectives for the PMO as based on the accuracy of the estimates, the accuracy of the schedule estimates and project stakeholder satisfaction. Additionally, the article advised against a PMO that only approves and rejects projects but one that instead has the power to cancel based on regular interaction with senior management.

While reading the article I tried to think about how a service industry would apply the concept of a PMO and thought of some ways these ideas and principles could be applied. First, when considering the completion for Requests for Proposals to bid for new business there should be some criteria in place that needs to be met even before resources are allocated to completing the RFP; examples include financials – will the account be large enough to generate fees to cover the cost of the necessary resources? Strategic fit with business model – is this the kind of account we want to grow our business (discretionary – we have full control over investment decisions therefore making the process easier or non-discretionary – the client has full control over everything including the process for making a yes or no decision). Second, when launching a new product there should be a formal process in place; right now it is mostly “gut instinct” based on what the sales people have “heard” from clients but perhaps a more standard process would make product launches more successful.

What I have learned from this is that there are likely facets of my service oriented business that could be improved or made more efficient by utilizing at least some of the functionality of a PMO.

One thought on “Does a Service Firm Need a PMO?

  1. This is interesting. I think the case could definitely be made for PMOs in service organizations, since RFPs, project teams, shared resources, and scope are all still in consideration when a project is undertaken. You’re right about about having a formal process in place vs. a gut instinct. Depending on the service, sometime that gut instinct – whether from a team, founder, or strong personality – can be hard to overcome!

    I’m in an interesting scenario in my current workplace where we offer services, but would benefit from a matrix overlay or formal PMO structure. As is, everyone has their own contribution to our overall service, but when the project changes, the roles aren’t dynamic enough to flex with the changes.

    In your research, did you find any PMO solutions (structures, software) that seem to work quite effectively for service-oriented businesses vs. product or manufacturing based?

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