Monitoring the performance of projects takes a lot of effort and time. It is common to create a project management office (PMO), to give an independent view of project performance. This is a great way to measure the success of projects. It is important that a PMO has a process for measuring their own success.
It is important because at some point, someone will question the value of the PMO (especially if there is a downturn). A smart PMO will have processes in place to track and communicate success so they are ready to show value.
The PMO will need to build up many metrics over time to show progress. Therefore, the sooner they start collecting data, the better chance of being able to communicate the value added using facts.
There are many metrics you can use, but some metrics will be unique to your organization. Here are some examples of powerful metrics that can be used to demonstrate success.
Time to Mobilize
Slow mobilization is a common cause of project failure. The PMO has made it easier to measure the time between project kick-off and mobilization. This can be done by measuring the time from the beginning of a project to the signing-off of a business case (the usual gate to project execution).
% of Projects Completed
This metric will show how many projects are actually delivered each year, or in the appropriate time frame. To track this, you will need to be capable of looking at the performance of previous years to show how it has improved.
Variation of this metric refers to % of projects abandoned and % that do not deliver benefits.
Realization of Benefits
Most projects are initiated to provide some benefit to an organization, with the exception of mandatory or regulatory upgrades. The best way to ensure that benefits are realized is to track them against business case. The % of benefits realized should be compared to previous years.
Return on Investment
The calculation of the return on investment (ROI), for a portfolio of projects, can be done by tracking the costs and benefits of each project. This is a useful metric for senior managers as it will give them insight into the return on investing in change.
Summary
Smart PMOs will have processes in place to track key metrics to show the value they add to project delivery. The metrics will eventually help to identify problems, e.g. Slow mobilisation due to the time required to get approval from management. This will allow for the problems to be addressed.
Last but not least, don’t hesitate to be asked for value. Senior management will be more likely to take an active role and give regular updates. Then they won’t even think about whether the PMO adds any value.
Software for Project Management
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