Project Office conjures up an image of a large team of people in a big company carefully monitoring plans, counting project costs, monitoring risks and issues and generally keeping the project management team honest. So what relevance can this possibly have to small and medium companies?
Well if you are company developing products or selling expertise and are starting to grow beyond the small and towards medium, then you should start thinking hard about establishing a project office discipline.
If you are small enough, then everyone mucks in, talks to everyone else and generally make things happen, even if it’s all held together with chewing gum and string. Team spirit goes a long way and makes you greater than the sum of parts.
However once you start to grow, this can start to dissipate and making the team work effectively needs a lot more organization.
Lack of organisation leads to money being wasted and chips away at morale, so it’s important to get this right.
So what are the key actions for a project office function in this scenario?
First of all, all companies need a strategy. It won’t be the project office’s job to provide this, but it will be the project office who remind management that making decisions about what product development to prioritise or what markets and projects to sell expertise into, is a whole lot easier if the company has a clear strategy. Otherwise you will be making decisions on the hoof and according to the flavour of the month.
The simplest way to devise strategy is to carry out a SWOT analysis. ‘What do we do well ?’, ‘What do we do badly?’, ‘Where do we want the company to go?’. Of course no strategy is set in stone, it needs to be reviewed at least on an annual basis, but it’s important to have one.
Build a Project Portfolio
The next thing you need is a project portfolio – everyone wants change and it’s always more than you can possibly do, so get the bids together from the various stakeholders in your company, measure their fit with strategy and then do a brief assessment of costs and benefits for each project.
Senior managers will then need to meet to agree the priority order for the project portfolio, based on outline costs and benefits and fit with strategy.
Manage your Portfolio
Portfolio management by your project office function then:
- Facilitates building full business cases for each of the projects in the portfolio, showing detailed costs, benefits and risks for senior managers to agree to proceed
- Captures time spent on each project, to allow project managers to monitor actual costs against estimates
- Monitors resource usage to ensure that valuable staff are fully utilised
- Is able to let senior management know the impact on the rest of the portfolio of a change in project priorities or a serious overrun in a project or a loss of an important member of staff
It’s important to understand that for smaller companies, portfolio management is a function, not a huge department of project office staff. In this case, it’s likely to be one member of staff, maybe part time to start with.
Portfolio management is an important function to introduce when small companies start to grow otherwise there is a danger that decisions about project initiatives and priorities become uninformed with a consequent debilitating effect on both company growth and staff morale.
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Gren Gale is a consultant specialising in Project Management and Procurement and is owner of PM Results