Imagine a big company where they have a huge PMO with a large amount of projects. Some group of PMs feel that they are doing good projects but they are not getting enough profit in these projects. Why? mainly because the resources they can hire are limited in the market and because there is a lot of quality/risk/communication management that makes the executions slow and cut the final profit they can take.
In this scenario the PMO is under pressure becuase these lobby of PMs wants to change the methodology of the projects in order to be more competitive. After all this pressure, the PMO give up to these requests and they decide not to change the Project Management methodology; they prefer to make it wider including a new type of projects under different conditions and that cover the requests claimed by this lobby of PMs.
They decide to call these projects SubProjects. Now a PM can execute projects with easy conditions that provides them a better profit, being able to offer projects with a lower cost than the competence. The expectations are huge and there is not need so much time to convince the clients to execute projects with this new innovative model.
The orders of new projects start to arrive and the clients feels very confortable with this model that will allow them to have deliverables in a better way. The risk? No problem, the conditions are risky but the market is growing up quickly and it’s able to assume these conditions. The competence is doing the same so I’m not going to be less competitive than others.
PM starts to hire people that don’t have the enough knowledge to execute the projects, integrating them in groups where there are some experienced people. It’s supposed that the experience of a some people is going to feed the absence of experience of the majority, so everything seems to be right.
On the other hand, the procedures about how to control the deliverables of the projects are minimized and the projects have not to communicate the status of the budget to the PMO each week, it can be done each 6 months; they don’t need to perform peer reviews ; they don’t have to evaluate the risk management plan… this allows the PM concentrates in the execution and don’t loose time in reports. This is the competitive advantage that PM sees and he feels very proud about how is doing business.
The projects are being executed and the confidence in the evolution is good: the model cannot fail. Suddenly some time later, when clients start to see the final deliverables of their projects, they check that the product they hired is not as they expected. They are not satisfied and they are not agree in the payment of the project price.
This situation is not good and the PM decides to complete the project deliverables with other resources of other projects. This fact allows them to complete the firsts projects but makes the other projects to be delayed from the first day of the execution.
In this situation, PMO starts to see that things are not going right and starts to advice to PM about the problems they are provoking. PM are overloaded and they only have time to save their inmediate problems.
The problems continue growing up and the PM have not more margin to resolve their problems: they cannot deliver the projects to the customers and they continue accumulating cost/delay in their accounts.
As the situation is critical for the company, the PMO starts to help PM with some amount of money to try to finish some projects. This measure is not enough and the situation continues being the same.
What can PMO do?
PMO now is thinking in taking all the cost accumulated by PMs in order to resolve the problems with their customers and recover the trust in their company. Nevertheless these SubProjects will be transformed in regular projects in order to execute them with the PM methodology applied in the company that so much credibility has provided to the firm.
To be continued…