Insight

Does Agile mean the end of the PMO?

Sep 12, 2016

Clients often ask us whether Agile delivery removes the need for a Project Management Office (PMO). The answer, you may not be surprised to hear, is that it depends on the size and complexity of the project, programme and portfolio.

Before explaining why that’s the case, it’s important to establish a common view of what a PMO should do. In recent years, they’ve gained a bad reputation as many organisations have used them as a project administration function. But the PMO should be a small group of highly skilled people who support or extend the delivery capability of the programme leadership. As programmes and portfolios become more complex, the leadership team needs help with day-to-day delivery responsibilities – the PMO provides visibility and assurance to senior stakeholders and supports the wider team.

So, how do Agile projects fit in with this?

In smaller development projects with two or three Agile teams, there isn’t a need for a PMO. Agile teams are self-organising and value tangible deliverables over reporting. In smaller projects, the teams take responsibility for all process, governance and reporting, so there’s no need for a PMO.

However, where Agile projects are part of a wider transformation programme that uses a mixture of project management disciplines, a PMO can integrate projects that are operating in different disciplines. In our experience of operating large business transformation programmes in the life sciences and finance sectors, such a PMO role has proven essential to success. For example, we helped a global pharmaceutical company take their entire US$200 million change portfolio agile. It was clear from the outset that they would still deliver interdependent projects via different disciplines for some time. A strong PMO supported these projects to plan and manage their dependencies effectively, thereby diluting the risk of differing delivery mechanisms.

Did you know the top 10% of financial performers are 30% more agile than the rest?

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And now that Agile has moved beyond software development to organisational agility, we find there’s an even greater need for PMOs. In Scaled Agile programmes and portfolios, roles such as the Release Train Engineer (RTE) and Value Stream Engineer (VSE) are responsible for steering delivery and facilitating Agile processes. This includes escalating impediments, managing risk and driving continuous improvement – all of which are core capabilities of a PMO team. And as the scale of agility grows, it’s a team that’s necessary.

The key lesson is that you must be clear about the capabilities you need to deliver your programme or portfolio successfully, but worry less about what you call them. These capabilities could include:

  • coaching people in the adoption of new practices
  • subject matter expertise in Agile delivery or change management
  • the ability to prioritise a portfolio and align projects to strategy
  • demand and resource planning
  • financial and data analysis
  • programme and portfolio planning
  • creating and maintaining Agile reporting and governance
  • risk, issue and dependency management.

When you’re clear about which of these you need and the resource mix, you can choose the name for the team that works best for your organisation.

We took this approach in our work for a leading global pharmaceutical company. We provided end-to-end support for the largest transition to the Scaled Agile Framework (SAFe©) in the world to deliver a vision of ‘twice as much for half the cost’. A key element in the success of the programme was the Agile Centre of Excellence, which had overall accountability and set the strategy for Agile adoption. The centre of excellence also carried out some of the roles traditionally associated with a PMO, such as portfolio assessment to understand the best Agile pilot projects and providing visibility and assurance about progress to key stakeholders.

It’s clear that if the PMO is an extension of your delivery capability, it still has an important role to play in larger and more complex Agile programmes and portfolios. The most important factor is the focus on the capabilities you need, which should then allow you to design the right team to support the success of your project or program.

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