PROJECT MANAGEMENT OFFICE (PMO) KPI S KEY PERFORMANCE INDICATORS (KPI S) HELP AN ORGANISATION DEFINE ITS GOALS AND MEASURE AGAINST THEM. THIS ARTICLE OUTLINES WHAT TYPE OF KPIS YOUR OWN PROJECT MANAGEMENT OFFICE COULD IMPLEMENT TO SHOWCASE THE EFFECTIVENESS OF THE FUNCTION.
PROVING THE VALUE OF YOUR PMO In a competitive environment it is more important than ever that the PMO function is able to prove its value to the organisation. By setting up clear measurable and realistic goals, in the form of KPI's, the PMO is able to demonstrate its worth and effectiveness.
PMO KPI S A PMO KPI SHOULD ALWAYS BE FINANCIALLY MEASUREABLE As your PMO KPI s should always come back to their return on investment (ROI) they should always be financially measureable. We have a few examples at the end of this article. MEASURING THE VALUE OF A PROJECT MANAGEMENT OFFICE The existence of the PMO (Project Management Office) plays a critical part in driving successful programmes and project delivery across an organisation, ensuring the required level of planning, control and delivery assurance are in place so how can we measure this? 5 TOP TIPS FOR PMO KPI S 1. A PMO KPI should be focused Too many PMO KPI s and you re likely to lose focus on what you re trying to achieve. Keep them balanced, measurable and focused, representative of how PMO performance is critical for the organisation s overall success. 2. A PMO KPI should reflect what you do The PMO function will vary widely across different organisations one KPI does not fit all. When establishing your KPI s ensure that they are measuring the core functions your PMO delivers. If your PMO function has the responsibility for training you could measure training hours against certified Project Managers within your organisation for example. 3. Is there a place for soft metrics? It s good practice to have at least one PMO KPI that reflects some type of cost saving (hard metric). This can be particularly difficult for a PMO that is yet to establish itself. Softer metrics can be used to illustrate how the PMO s existence can affect the bottom line. For example, a PMO that trains x number of Project Managers is helping those Project Managers deliver more efficiently which ultimately has a positive effect on the bottom line. 4. Collaboration PMO leaders should work with stakeholders to agree and determine how the PMO function will measure its effectiveness. The PMO leader must understand the kind of ROI the organisation expects and apply that to the PMO function. This expectation will change as the organisational need changes the PMO function will be expected to keep up with the change and measure against it. 5. Don t leave your KPI s in the cupboard Once you ve agreed your KPIs the PMO will need to put a process in place to collect and track the data. You will need to review performance on a regular basis. Comparing data month-on-month or year-on-year is a powerful way of demonstrating the effectiveness of the PMO function.
Using the tools you have at your disposal the PMO is best placed to provide effective dashboards and reports that really showcase the KPI performance. THREE KPI S EVERY PMO NEEDS Finally if you re looking for some PMO inspiration here are three KPI s that can be used and measured to illustrate your organisational value: 1. Project Management Office KPI - ROI ROI is an important KPI for top management however slightly more difficult for a PMO to measure. The PMO provides the framework in which success is built so this KPI is a softer metric that illustrates the influence of the PMO on the overall performance of the organisation. Tip, at least one of your KPIs should try to illustrate this. 2. Project Management Office KPI - Time to market This is an easy one to build a KPI around. Your PMO should be increasing the speed at which Projects are delivered thus improving time to market. Likewise with better compliance to Project schedules the PMO also helps ensure that a product meets its release date. 3. Project Management Office KPI Resource Utilisation An effective PMO ensures that time is being used in the most efficient way possible by assigning resources to the tasks that are most suited to them thus maximising the value of that particular resource. Building a KPI around this principle will highlight the value the business is receiving from its own resources.
SUMMARY With the average lifespan of a PMO being 4 years the need to consistently prove the value of the PMO relies of clear and tangible KPI s.