by Moira Alexander

4 secrets of successful EPMOs

Jun 19, 20206 mins
Business IT AlignmentIT LeadershipProject Management

Setting up and running an enterprise project management office (EPMO) takes a deliberate and strategic effort. Here are four key areas to focus on in establishing an EPMO.

planning / organization / strategy / development / project management / notes
Credit: PeopleImages / Getty Images

Poor project performance is a bane to enterprises. Not only do projects that miss targets challenge an organization’s ability to remain competitive, they are a drain on resources, as The Project Management Institute’s 2020 Pulse of the Profession report shows that 11 percent of investment is wasted due to poor project performance.

As organizations strive to hit their targets during uncertain times, and with resources likely to remain limited for the foreseeable future, they should consider the value of deploying an enterprise project management office (EPMO) tuned to perform at the top of its game.

An EPMO differs from a traditional PMO in that it operates at a strategic level in collaboration with executives to ensure that projects and portfolio activities are conducted to the benefit of the overall business. Many organizations have transitioned from the traditional PMO structure to an EPMO and some newer organizations have begun by establishing an EPMO right out of the gate. EMPOs offer real benefits, including higher rates of project, program, portfolio, and strategic goal execution. 

Building an efficient and effective EPMO takes a significant amount of time, effort, and coordination. Successful EMPOs focus on the following four key areas to achieve success.

Culture and talent management

Your people and culture are among the most critical elements for EPMO success. And that means hiring and training for the right mix of skills — and establishing team-wide resiliency and empathy.

These days most organizations value developing leadership skills as much as they do technical skills, at 65 percent and 68 percent, respectively, according to PMI’s Pulse report. High-performing EPMO focus their hiring practices and training programs on technical skills (68%), leadership skills (65%), business acumen (58%), and digital skills (50%), according to the survey.

When it comes to leadership, successful EPMOs are focused on being “empowered from the top.” The execution of projects, programs, and portfolios relies heavily on not only how teams and functional units work together, but also on how resilient they are during times of disruption. Their leaders are expected to be able to demonstrate empathy, with a study by Businessolver showing that 91 percent of U.S. CEOs believe empathy is directly related to a company’s financial performance.

Strategic alignment

The key mission of an EPMO is to align all project, program, and portfolio activities with company-wide strategic objectives. When projects are executed but do not align with company-wide goals, they result in wasted resources, time, and budgets.

Ultimately, this translates to lower company performance at a higher cost. High-performing organizations recognize this and only approve projects that have a solid business case that outlines the benefits and how each benefit ties back to goals set out by the leadership team. As company-wide goals change, EPMOs should re-evaluate projects and programs to ensure they are still in alignment with the direction of the company and not be shy about cutting projects that no longer align with the business.

Standardized project management

To be successful, EMPOs must standardize project management practices to ensure alignment with the organization’s high-level strategic goals. Doing so requires careful and methodical planning. But by creating and implementing project management processes and procedures that must be adhered to across the organization, EPMOs can improve overall project efficiency, while decreasing risks and wasted resources, and increasing the chance of achieving success at every level.

To be more innovative, organizations must tune their internal processes and best practices to be efficient and effective. If your organization doesn’t have a solid handle on current activities or resources, it’s unlikely that it will be able to undertake additional innovative projects without suffering failure at some juncture. Simply put, you can only juggle so many objects with two hands. Having standardized and efficient EPMO practices allows your organization to allocate more of its resources and budget toward innovating and increasing its competitive advantage.

Benefits-driven approach

Successful organizations recognize that investment dollars must be spent wisely and that projects must drive meaningful, measurable results. EPMOs are instrumental in helping organizations to identify and achieve sustainable benefits. A project without a clear goal and benefit is like driving a car without having a destination in mind.

Each potential project must be backed by a comprehensive business case that explains the purpose of the project, links that purpose to your organization’s goals, and clearly defines each benefit expected to be realized upon completion. It should also identify key performance indicators (KPIs) that measure the outcome, help to determine whether the project was successful, and demonstrate how the project achieved this success.

As a whole, successful organizations place a higher priority on a culture that centers on accountability, delivering customer value, receptiveness to organizational change, investment in technology, and placing value in project management. By developing an EPMO culture focused on talent management, strategically aligned projects, standardized practices, and benefits realization, your organization can increase its performance and achieve higher rates of success.