PMOs Journey into Digitalization

PMOs Journey into Digitalization

Many PMOs recognize digitalization as an essential step in their organizations’ journey toward project management maturity. As a result, the Project Management Office (PMO) must shift its focus from project governance and delivery to supporting digital transformation.

To keep up with the evolving demands and needs of an increasingly digitized world, digital transformation has to be drifted through organizations of all shapes and sizes. However, many realize that successful digital transformation entails changing foundational cultures, structures, and methodologies and implementing digital tools. As organizations expand to accommodate this change, the PMO’s role within those organizations must change to do the same.

Digitalizing PMOs

Digital transformation is a familiar idea. Businesses constantly look for new ways to adapt and leverage emerging technologies to improve their business processes. Before the pandemic, PTC research found that 70% of organizations had or were working on a digital transformation strategy.

The PMO is crucial to achieving an organization’s strategic goals. If PMOs are to be an organization’s strategic drivers, they must expand their role beyond its traditional boundaries. They must assume their strategic role by leading change and capitalizing on opportunities in the digital space. PMOs must be at the forefront of emerging technologies, constantly evaluating opportunities and implementing new strategies. The recent pandemic and sudden shift to remote work have highlighted the challenges of developing community and culture through digital spaces. Here are some ways that PMOs can help the organization drive into digital transformation.

Five ways the PMO drives digital transformation

  1. PMOs can inspire and encourage change.
  2. PMOs act as the strategic arm
  3. PMOs provide support and insight.
  4. PMOs properly manage transformations.
  5. PMOs enable successful digital adoption.
Discover 5 key ways Project Management Offices (PMOs) can be the driving force behind successful digital initiatives in your organization. Learn how PMOs can inspire change, provide strategic guidance, and ensure smooth adoption of new technologies.

Five ways the PMO drives digital transformation

How PMOs can aid an organization’s digital transformation

The nature, ownership, and stakeholders of IT strategy, governance, and management activities are changing dramatically due to digitization. According to Gartner research, 87% of organizations prioritize digitization. Furthermore, technology is now responsible for 77% of an executive’s top priorities.

Traditional PMO processes struggle with the fast-paced world of digital transformation. This article explores 3 key PMO strengths: neutral perspective, influence, and stakeholder understanding. Learn how to leverage these strengths to drive digital success!

Advantages of PMOs

As a result, PMOs are under intense pressure to transform. Unfortunately, their project, program, and portfolio management processes are designed for predictability and consistency rather than the speed and flexibility required to meet digital demand. Most PMOs have three significant advantages, which are either inherent due to the PMO’s role or location or have been developed through previous experience:

  1. A neutral enterprise perspective: As capital allocation and portfolio prioritization approaches change to enable the funding flexibility required for digital work, the PMO’s impartial, enterprise-wide perspective on demand, investment, and resource utilization is hugely valuable.
  2. The ability to operate via influence: As organizational boundaries become more fluid and who “owns” project management becomes less certain, influencing and enabling others, rather than direct ownership, becomes even more critical.
  3. Stakeholder insight: As digitization spreads throughout the business and accounts for an increasing proportion of work, there are more first-time stakeholders and greater stakeholder complexity for each piece of work. Understanding the preferences of these various stakeholders and experiencing synthesizing their feedback becomes critical in delivering results from digital work.

Elements Driving Digitalization

Traditional businesses worldwide have long recognized that digital transformation is the key to thriving in a fast-paced world. Digital transformation involves integrating digital technology into all aspects of a business. It fundamentally alters how businesses operate and provide value to customers. It increases efficiency, transparency, customer experience, employee engagement, and culture and saves time and money. Modern digital tools have elevated the project management process to new heights.

The following are the seven critical elements of a successful strategic digital transformation framework:

This comprehensive guide explores the 7 elements for a winning strategy, including leadership, culture change, data, technology, and more. Discover how to build a successful roadmap for your business.

Elements Driving Digitalization

  1. Strategy and Leadership

An effective game plan is an obvious but frequently overlooked component of a digital transformation strategy. Instead, what matters is “how and who” formulates the strategy. A basic strategy and the appropriate technologies can help you digitize or digitalize your business, but transformation requires the right mindset and guidance. As a result, strategy combined with the right leadership is the first and most important component of an effective digital transformation strategy.

Visionary leadership combined with the appropriate digital transformation strategy can achieve a better, smoother, more cost-effective, and time-effective plan for your business’s transformation.

  1. Culture Change and Communication

Prepare for a massive cultural shift. A company’s clients and employees are typically resistant to significant changes, making implementing any transformation challenging. However, any successful digital transformation program must include culture. Therefore, giving your employees advanced training in good communication will be advantageous.

  • Discuss the digital transformation strategy with your employees and how it will benefit all stakeholders.
  • Conduct training sessions with your employees ahead of time to prepare them.
  • You can prepare your employees by demonstrating the importance of aligning culture with new initiatives.
  1. Optimization of the Process

Every business has various processes and operations that can be improved to make workflows more efficient and effective. As a result, when developing a digital transformation strategy, consider business process optimization.

The strategy must optimize the business process while meeting customer and internal team goals. The digital transformation strategy must cover all interconnected business processes to achieve maximum output.

  1. Data Curation

One of the primary reasons for implementing digital transformation is to eliminate your business’s pain points for your team and your customers. But how will you know what these aches and pains are?

Data analysis and integration can assist you in locating them. People frequently choose their preferred technologies when developing transformation strategies before analyzing their data. Data analysis and the dissemination of its results can assist the team in identifying the best solutions to problems, leading to developing a better digital transformation strategy and making the most of the transformation process.

  1. Technologies to be Implemented

Finding the right technologies for your business is one of the most crucial steps in creating a digital transformation strategy. Introducing new technologies into your business will necessitate a significant financial investment, so it must be done correctly to avoid the need for additional funds. Any impactful strategy for digital transformation will always include options and budget constraints to help you make the best decision possible. Whether dealing with legacy system updates, application modernization, or implementing entirely new digital systems, you must find the best technology.

Some cutting-edge technologies that must be incorporated into your digital transformation strategy are:

  • Cloud and Distributed Platforms
  • Data Analytics & Artificial Intelligence
  • Digital Experience and Digital Reality
  1. Team Structure

Harvard Business Review says digital transformation is about people, not tools. As a result, team structure is a determining factor in delivering results by the Digital Transformation Strategy.

The scope of the project should determine the team structure. The following components should be included in the digital transformation initiative:

  • Pack of Leaders
  • Business Experts
  • The cast of Coders and Designers
  1. Results – How to Measure the Success of Your Digital Transformation Strategy

Your company’s digital transformation outcomes will greatly influence how you lay out your strategy. The outcomes will always vary depending on the practices and technologies used. Your digital transformation strategy’s success is dependent on its agility. First, of course, you must stick to your detailed strategy, but you must also be open to changes if things don’t go as planned.

By developing an effective, clear, and robust digital transformation strategy, you can ensure your company’s digital transformation goes as smoothly as possible. A digital transformation strategy is similar to a personalized road map for significant changes in your business operations. However, it requires significant financial investment, time, and technical expertise.

From Traditional PMO to Agile 

Traditionally, PMOs have focused on maintaining project control to complete projects on time and within budget. However, in today’s increasingly complex and changing competitive environments, agile management is gradually displacing more traditional management methods; PMOs that remain anchored in this “classic” management model risk disappearing if they do not set the following objectives:

Discover how PMOs can evolve from a command-and-control model to a strategic business partner. This article explores the shift from traditional PMO to agile PMO, emphasizing collaboration, value stream alignment, and adaptability in today's dynamic business environment.

Transforming the PMO

  1. Empowering PMOs in the organization’s value streams

Organizations are now focusing on the value they provide to their customers and how different areas and departments contribute to that value creation. Suppose PMOs stick to their command and control model to ensure that projects are delivered on time and within budget. Their contribution to the organization’s value streams will be marginal, and senior management will view them as an unnecessary expense for the company.

  1. Collaboration and agility at all levels of business

Silo-based organizational models need to gain ground in agile and collaborative environments. As a result, PMOs must evolve beyond simply providing Project Managers with the tools they need to complete the organization’s projects.

On the one hand, PMOs must maintain open lines of communication with senior management to align the Project Portfolio with the organization’s goals. On the other hand, it serves as a reference point for stakeholders and project work teams, providing real-time information on project status and support at all levels for proper project implementation.

  1. Towards Agile Project Portfolio Management

Change is the norm in this new competitive environment, with highly volatile markets demanding businesses to bring products and services to market as quickly as possible. As a result, company objectives can shift dramatically quickly, necessitating a rethinking of project portfolio prioritization. This phase is where PMOs must adapt to this new environment and manage key project management issues like prioritization, resource management, budgets, or delivery dates in an agile manner, as well as learn to react to changes in their project portfolios in an agile and efficient way without losing sight of the organization’s objectives.

Post-pandemic challenges for PMO

If PMOs establish these three goals, they might avoid extinction because senior management will no longer recognize their value to the organization.

It will be challenging, and the Project Management Office will face several challenges as it adjusts to the new reality. In particular, the PMO will face some challenges for its role to be perceived as critical to the organization’s value streams:

  • Coincide the project portfolio with the overall strategy of the organization.
  • Resource management is a real challenge for PMOs.
  • Responsiveness to changes in the project portfolio.
  • Fluent in communication with the organization’s senior management.
  • Embrace Agile Leadership.
  • Standardization of processes and workflows.
  • Renewal of project portfolio management tools.

Mitigating mediocre implementation of Programs

There are always equal chances of success and failure in programs/projects. As a result, it is critical to understand how to avoid and overcome project failure. There are numerous reasons why a PMO succeeds or fails. Still, the most common reasons for failure are often not related to process or technology issues but to “people issues” in an organization.

Discover the common pitfalls that lead to project failure and learn how to overcome them. This article outlines essential strategies for successful project management, including planning, risk management, stakeholder engagement, and methodology selection.

How to avoid PMO Failures

Here are the most common reasons why PMOs fail:

  1. Adopt the Proactive Approach

After many years, project managers gain the skills and knowledge needed for the current project from their experience. As a result, an experienced and highly skilled project manager is equipped to deal with customers and avoid project failure. If you are new to project management, consult a professional mentor to discuss your concerns and receive appropriate advice based on their experience. If you have project management experience, you should apply your skills and knowledge to the project and be aware of the common causes of project failure.

  1. Plan the Project’s Strategy and Project Implementation

The most important stage of any project is planning. Most of the time, proper attention is not given during the planning stage. If you plan properly, you will increase the project’s chances of success. After scheduling your project, use the Project Management Life Cycle to begin project execution.

  1. Manage the Project Goals

It would be best to document the project’s decisions, actions, and outcomes before beginning, during, and after completion. To avoid project failure, it is always necessary to ensure project deliverables and work appropriately with customer requirements. Never rely on understanding, verbal agreements, or memory for project implementation decisions.

  1. Avoid Unrealistic Expectations

Always set realistic expectations and time frames with stakeholders, team members, or customers to meet your project’s deadline. This move is related to the proper project start but goes deeper until completion. To avoid project failure, realistic expectations for team members must be set based on their capabilities. It would help if you encouraged them to work enthusiastically and push themselves beyond their comfort zone to meet the project’s objectives.

  1. Track Project’s Progress

Project planning will assist you in determining where your project should be now. In addition, you should know how much of the work has been completed, whether your work is on schedule, proceeding as planned, and so on. These three parameters govern any project and are critical in preventing project failure.

  1. Identify Risk Factors

The best way to avoid risk is to identify, analyze, and respond to risk factors. So, if you identify the risks and potential issues early on in the project, your project team can avoid them with appropriate actions. In addition, identifying and resolving risk factors will assist the project manager in lowering the likelihood of project failure. As a result, you can perform proper risk management and avoid project failure.

  1. Use Correct Methodology

One of the most important decisions a project manager must make is the methodology to use for project management. What you choose will have a significant impact on teamwork. However, each methodology has advantages and disadvantages depending on the project type and scope. Here are some top project management methodologies to consider.

  • Waterfall method
  • Agile/Scrum
  • Hybrid approach
  • Critical Chain Project Management
  • Integrated Project Management Technique
  • Critical Path Method (CPM)

All project management methodologies cannot be regarded as the best for all projects, so one can understand the project requirements and select the best option. The correct methodology will assist you in achieving the project goal within the specified time frame, thereby avoiding project failure.

  1. Focus on Stakeholder’s Requirements

As we all know, a project will only succeed if it meets its objectives and exceeds the expectations of its stakeholders. Therefore, to be successful in project management, all team members must be actively involved in the project and committed to its success. Devoting entails writing down the following stages:

  • The competent initiative assists the team in implementing various tasks throughout the project life cycle.
  • Adequate funding ensures the organization’s cost-generating department has enough money to fund the projects.

Final Thoughts

In today’s fast-paced and dynamic business environment, agile working methods might provide significant added value that should be noticed.

Digitalization is making projects more complex. As a result, the use of technology to manage projects is growing, and project teams must be cross-functional to achieve project goals. Agile project management provides an opportunity to respond quickly to new requirements and be more visible in the market. For organizations that use a traditional approach to project management, the transition to an agile PMO is part of their digital and agile transformation.

It should be noted that this is not an evaluation of “better” or “worse” methods. When used correctly, each project management method can reveal its strengths. It is critical to think about, use, and improve them.

The Agile Mindset

The Agile Mindset

Agile (.adj) means “to move quickly and easily”. It is a mindset of being more responsive. Humans are born agile. Off late, agile has been highly adopted by the software industry, but, in reality, it has been adopted by organizations of different domains to bring on success.

Agile Manifesto, created by seventeen software developers in 2001, embraces four core values: individual interactions over process and tools; working software rather than through documentation; collaboration with customers; and responding to change rather than following a plan.

Agile mindset is not only about that, but it would have those four principles as a foundation for a successful agile transformation bringing on agility in the organization. This transformation would certainly change the way organizations handle their portfolio, programs and projects. Steve Denning, an authority on Agile management, argues that hardware developers need to embrace Agile principles to keep up with the pace of innovation.

Agile Transformation

Agile Transformation

Tesla creates a lot of 3D Models and continuously iterates them to create many models to test them in different ways rapidly. 3D Printing techniques have empowered Tesla to pursue this methodology.

With this capability, rapid changes in hardware component level are iterated until the best design is evolved. SpaceX also exhibits a similar continuous iteration. Continuously improving and managing to incorporate customer feedback is all about having an agile mindset. The agile mindset is more of the management and leadership problem, which needs a cultural shift of thinking in an agile way.

Problems for existing project managers

Problems for existing project managers

What are the problems for existing project managers for an agile mindset?

  1. Typically, project managers assume that Agile is another project management approach.
  2. Ability to unlearn and learn to avoid the lens of project management previously done.
  3. Lack of familiarity with Agile concepts (e.g., Self-Organizing Teams)
  4. Confusion between the agile principles and frameworks such as Scrum, XP, etc.,
  5. Undermining the benefits of agile and not having trust in those principles

Agile Mindset

When we talk about the agile mindset, I would like to share with you all the below Zen Ex Machina diagram from Ahmed Sidkey’s “Agile mindset” presentation done in Agile Alliance conference 2014. The agile mindset reflects upon the actions and behaviors, thereby creating an agile culture. These can be brought to action based on 4 Values, 12 Principles as outlined in the diagram here.

Agile Mindset

Agile Mindset

Agile mindset is all about exhibiting certain behaviors. In an organization, we need to respect the worth of every person. Always exhibit truthfulness in communication by being transparent on the data, actions and decisions made. Commit to the team and organization through the collaboration for the common goal, trusting that support will be available from each other.

The following table outlines the differences in terms of agile vs. fixed mindset.

Fixed Mindset vs. Agile Mindset

Fixed Mindset vs. Agile Mindset

When you are working on portfolio/programs/projects, you don’t see all the necessary outcomes, but you keep evolving it. Typically, when we are talking about an agile mindset, it always keeps evolving. This evolution can be referred to IKIWISI – I know it when I see it. So, when you can show the progress, customers or stakeholders can relate it better and conceive better.

It’s important to have an agile mindset, to “be agile,” but you also need to have the requisite skills to “do agile” and the experience to do “enterprise agile.” Though we understand the benefits and tenets of the agile mindset, when it comes to implementation, there is a lack of guidance for the team on what to adopt and how to go about the same. Typically, when teams follow a prescriptive framework, things fall in line and provide better results. It provides a better improvement which is consistent over time. One such prescriptive framework for adopting agile practices is DAD (Disciplined Agile Delivery) framework.

How DAD (Disciplined Agile Delivery) can be leveraged for mindset?

DAD

DAD

DAD approaches agile as a people-first, learning-oriented methodology for delivery. PMI DAD Toolkit is free for use. The focus of the toolkit is on the delivery, which is achieved by being hybrid which can take the best across multiple methodologies. The agile mindset can be accomplished by leveraging the Disciplined Agile mindset recommendation from PMI, which encompasses PPG (Principles, Promises and Guidance). DAD can help us transform ourselves into an agile mindset in practice. Easier said than done, but DAD could be the guiding light toward it.

Disciplined Agile mindset

Disciplined Agile Mindset

For having and improving the agile mindset, the locus of control needs to be more internal. The focus on outcomes and giving the necessary empowerment to people makes a significant difference. It should be embracing rather than imposition to people or one’s self. Disciplined Agile provides guardrails, guidance and enterprise awareness so your life as PM would be easy to advocate and embrace. DAD’s toolkit helps an organization to adopt common vocabulary while adoption of agile becomes easier with principles such as Delighting the customers, Optimizing the flow, etc.,

The following are some of the philosophies which could help the portfolio to be managed better based on DAD’s toolkit:

The motivation of resources:

There could be projects wherein there is a need for reduction in resources, some places it might cause cost overrun. Have the portfolio resources spread across the projects and rotate them across projects based on interests. Having a stable team who have good knowledge and understanding of domain can be cross-trained easily as well. Enable the team by building a safe culture and environment, and by motivating them to excel.

Business Value:

In this pandemic time, the customer would also suffer. There is no other good time than now to support them. One of the key portfolio strategies would be to maximize the stakeholder value by minimizing the risk in building the whole thing. So, approach such as “Prove Architecture Early” by building architecture components earlier would help achieve balance in risk profile and provide better value. This move helps the team to arrive at consensus early and re-prioritize activities after discussing with the customer. 

DAD's Toolkit

DAD’s Toolkit

Managing change:

With an agile mindset, fundamental thinking is accepting or embracing the fact that change is natural. A change could be influenced by a situation like a pandemic, technology changes, political factor, economic and legislative changes, and many more reasons. This change needs to be managed by Managing work items, prioritizing who has to work on it with details on How? and What?. Use of tools like Kanban boards can be very handy here.

Agile Governance:

  1. Incorporate simplified governance model across the portfolio and programs.
  2. Identify common risk areas and try to revisit the vision on what is to be accomplished.
  3. Relook strategies where the PMO efforts can be focused on creating business value for the stakeholders.

Alignment of the portfolio strategy with enterprise strategy would help to bring the stakeholders on the same page as well.

Effective Communication Strategy:

Interacting with the stakeholders is a very important component in seamless, agile implementation. The right choices of the communication channel based on the given context are very influential and can make a big difference.

Right choices of the communication channel

Right choices of the communication channel

Creating trust:

  1. Ensure the safety and well being of the team members.
  2. Take smaller initiatives which can lower the risk and enable frequent deliveries, thereby creating a trust of both the customer, teams and vendors.
  3. Act on action items after taking all stakeholders into confidence, which would create trust, resulting in a long-term relationship and also would enable us to maneuver key initiatives smoothly across the portfolio.

Bridging with the help of metrics:

Look at the gaps in the portfolio due to the current situation by evaluating portfolio metrics such as ROI, ROA, NPS, Velocity, etc., This would help on how to embrace the change and why that change is to be made. Manage the portfolio better by interacting with other teams based on the metrics.

Conclusion:

Overall this article aims to impart the essential aspects of the Agile Mindset. It highlights some key ingredients which can be applied during the current pandemic times to improve the situation better from Agile Context.