Question: Several weeks ago, you wrote about when a project-management office makes business sense. What is the appropriate design for a PMO?

Our Advice: Project-management offices are entrenched in the telecom, aerospace, and defense industries, where multimillion dollar projects have long been the norm, but the concept is becoming popular in other sectors as the size and importance of IT projects increases. Ideally, such an office is responsible for developing and maintaining project management best practices, standardizing templates for critical project-management deliverables (charters, work-breakdown structures, change-control processes, etc.), and coordinating projects throughout the company or division. Although the PMO normally functions as a central office, serving as the coordinator of the various project portfolios, it can be organized either as a centralized function serving the entire organization, or it can be integrated into each business unit. The most appropriate design will depend on particular industry and organizational factors.

In most enterprises, the IT group is either organized at the corporate level as an independent horizontal department that supports IT initiatives across all business units, or it's tightly aligned with each individual business unit, only interacting with other IT groups as needed. In larger organizations, the second model generally includes an enterprise-level IT governance or operational audit group which verifies that projects in one division don't negatively affect the rest of the company.

If information technology is your core or strategic business, or your organization has an independent IT department, then the PMO can be thought of as just another functional group within the IT division structure. You have the choice of the PMO actually providing project-management resources to individual projects, or acting as a clearinghouse for support and best practices. If project-management talent is scarce in the rest of the organization, then pooling the resources in a centralized, coordinated department makes sense. If the company culture or business model encourage project-management skills throughout the organization, then the PMO will be more effective as a clearinghouse.

If your organization has multiple IT departments aligned with individual business units, then the PMO should be under the IT governance group to ensure uniform IT best practices. Many business units choose to assign project managers from within the line-of-business, preferring someone they feel knows their business and technical needs in ways no "outsider" could. If this is the case, then the PMO would supply guidance, support, and best practices to the individual project managers.

Because of the specialized nature of IT projects, it's often best to have a separate centralized IT project-management office to help manage the entire technology project portfolio across the organization, not merged into any other organizational PMOs. An independent IT PMO verifies that technology best practices are disseminated properly throughout the organization, creates IT-specific templates, and manages the IT project portfolio on an integrated level rather then as individual projects. Overseeing IT projects at this level ensures that all projects meet strategic and core business goals without negatively affecting existing technology architecture and solutions.

-- Sue-Rae Rosenfeld