The Project Management Institute’s
Organizational Project Management
     Maturity Model or OPM3

    A Presentation by Jo...
Presenter
•   John was the volunteer program manager of
    PMI's OPM3 Program for over four and a half
    years, from Ma...
Agenda

• Background
• Benefits of OPM3
• Terms and Concepts
• Structure of the
  Standard
• Implementing the
  standard
•...
“The corporation as we
 know it, which is now
 120 years old, is not
 likely to survive the
 next 25 years. Legally
 and f...
Globalization and technology are
    sweeping away the market and industry
    structures that have historically defined t...
The 21st Century
• The fundamental transformations under way in the global
  economy have only just started!


• Only 20 p...
The 21st Century




     The world’s market and
    industry structures will
    be in continuous flux.


7
           1-...
The 21st Century



    Are you managing change or
     is change managing you?
Consider your own projects.




8
        ...
The 21st Century

    1 out of 2 projects will cost nearly twice
     their original estimates.

    3 out of 4 profession...
10
     1-404-728-0650   info@opmexperts.com
• Successful organizations must adapt to today’s
  environment.

  – achieve the strategic intent of your business
    thr...
The 21st Century


     PMI’s OPM3 Standard is designed
     to help your organization adapt to
       today’s business en...
PMI Standards
• PMI was accredited in October 1998 as a Standards
  Development Organization by the American National
  St...
PMI Standards in Print




14
     1-404-728-0650   info@opmexperts.com
OPM3 Program

 • In 1998 a program was chartered to develop an
   international standard for industry and government
   st...
The OPM3 was developed with
the widespread participation of
the larger PM community.

Over 800 professionals from
over 34 ...
Benefits of OPM3

• Help organizations understand current project
  management, program management, and portfolio
  manage...
Benefits of OPM3

• Help those responsible for project management (e.g.
  PMO’s) identify drivers of project results and s...
Benefits of OPM3
• Rally an organization or its partners to focus on project
  management improvements.

• Facilitate orga...
Terms & Concepts

•    Organizational Project Management
•    Maturity Model
•    Best Practice
•    Capability
•    Outco...
Organizational
                                       Project Management
• Organizational Project        vs.
             ...
The PMBOK Guide’s
                                                             Process Groups




     A Guide to the Proj...
The OPM3’s
                             Organizational
                       Project Management
                         ...
Maturity Model

• Capabilities are developed over time.

• “Maturity implies a state of being fully developed.
  Maturity ...
Process Maturity




      Portfolio       Program        Project
      Management      Management     Management
25
     ...
Best Practice

• A Best Practice is a technique or methodology that,
  through experience and research, has proven to reli...
Achieving
                                                  Maturity in OPM
                                              ...
Capability


• A Capability is a specific ability to perform, resulting in
  measurable outcomes.

• A Capability may depe...
Dependencies


       Best                Best                             Best
     Practice A          Practice B       ...
Dependencies


       Best                Best                             Best
     Practice A          Practice B       ...
Dependencies


       Best                Best                             Best
     Practice A          Practice B       ...
Outcome and KPI

• An Outcome is an observable result produced by using
  or having a Capability.

• Outcomes have Key Per...
OPM3 Architecture


              Best
             Practice
 Maturity




            Capability           Outcome       ...
OPM3 Architecture


Continuously
Improving



Controlling




Measuring




Standardizing




                Portfolio   ...
Best Practice:
                                                                         The value of the
                A...
Best Practice:
                                                               Portfolio managers and
     Ability of portf...
Implementing OPM3


1. Study the
  Standard                    To implement the OPM3 standard,
                           ...
Implementing OPM3: Step 1
                              In step 1, you read the introductory
                             ...
Implementing OPM3: Step 2
               In step 2, you answer a concise list of questions that
               allow you t...
Implementing OPM3: Step 3
               In step 3, using the results of the previous step, you
               decide whic...
Implementing OPM3: Step 4
               In step 4, you refer to a directory that shows you the
               Capabilitie...
Implementing OPM3: Step 5
               In step 5, you evaluate the Capabilities leading to
               each Best Prac...
Implementing OPM3: Step 6
               In step 6, you reflect on the results of the previous
               step and dec...
Implementing OPM3: Step 7

               After deciding which improvements to make in step
               6, you actually...
Implementing OPM3: Step 8
               In step 8, after you have finished your Capability
               Development Pro...
OPM3: ask the experts
•    Business drivers, critical success factors
•    Assumptions, constraints
•    Roles and respons...
Schedule

• The team will hand the standard off to PMI in September
  2003.

• PMI will release the standard to the public...
Summary

• OPM3 helps organizations to assess and improve their
  project management capabilities as well as the
  capabil...
Summary


1. Study the
  Standard                    To implement the OPM3 standard,
                              you per...
50
     1-404-728-0650   info@opmexperts.com
Develop the capabilities to do
    the right projects right.



51
          1-404-728-0650   info@opmexperts.com
Q&A




52
     1-404-728-0650   info@opmexperts.com
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The Project Management Institute's Organizational Project ...

  1. 1. The Project Management Institute’s Organizational Project Management Maturity Model or OPM3 A Presentation by John Schlichter 1 1-404-728-0650 info@opmexperts.com
  2. 2. Presenter • John was the volunteer program manager of PMI's OPM3 Program for over four and a half years, from May 1998 when the program was chartered to November 2002, when he resigned his volunteer position and launched OPM Experts, a firm that will offer supporting products and services to help organizations get the most out of the OPM3 standard once it is released later this year. • John Schlichter is a principal of OPM Experts, LLC, "the organizational project management experts," located in Atlanta, Georgia, USA. • John has spoken about the OPM3 hundreds of times, all over the world. Disclaimer: The contents of this presentation represent the presenter’s own views and do not necessarily represent the views of PMI. This presentation does not imply an endorsement by PMI of the presenter’s own products or services. 2 1-404-728-0650 info@opmexperts.com
  3. 3. Agenda • Background • Benefits of OPM3 • Terms and Concepts • Structure of the Standard • Implementing the standard • Summary • Question and Answer 3 1-404-728-0650 info@opmexperts.com
  4. 4. “The corporation as we know it, which is now 120 years old, is not likely to survive the next 25 years. Legally and financially, yes, but not structurally and economically.” Peter Drucker, Business 2.0 (08.00) 4 1-404-728-0650 info@opmexperts.com
  5. 5. Globalization and technology are sweeping away the market and industry structures that have historically defined the nature of competition. 5 1-404-728-0650 info@opmexperts.com
  6. 6. The 21st Century • The fundamental transformations under way in the global economy have only just started! • Only 20 percent of the world’s GDP comes from industries that can be called global. • It will take 30 years or more before anything reasonably approaching a truly integrated global economy will be realized. • What can you expect over the intervening period? 6 1-404-728-0650 info@opmexperts.com
  7. 7. The 21st Century The world’s market and industry structures will be in continuous flux. 7 1-404-728-0650 info@opmexperts.com
  8. 8. The 21st Century Are you managing change or is change managing you? Consider your own projects. 8 1-404-728-0650 info@opmexperts.com
  9. 9. The 21st Century 1 out of 2 projects will cost nearly twice their original estimates. 3 out of 4 professionals believe their organizations are not balancing the portfolio of projects to achieve the strategic goals of their organizations. 9 1-404-728-0650 info@opmexperts.com
  10. 10. 10 1-404-728-0650 info@opmexperts.com
  11. 11. • Successful organizations must adapt to today’s environment. – achieve the strategic intent of your business through multiple, inter-related projects – manage change – cultivate organizational and individual project management capabilities – deliver projects successfully, consistently, and 11 predictably 1-404-728-0650 info@opmexperts.com
  12. 12. The 21st Century PMI’s OPM3 Standard is designed to help your organization adapt to today’s business environment. 12 1-404-728-0650 info@opmexperts.com
  13. 13. PMI Standards • PMI was accredited in October 1998 as a Standards Development Organization by the American National Standards Institute (ANSI). • A PMI standard is: – A document consistent with the PMI Ends Policies & PMI Standards Program Vision, Mission, Purpose and Standards Setting Process – A document created by an appropriate diverse group through an open consensus-building process – A document covering commonly accepted knowledge and/or practices and dealing with core concepts for the practice of the profession Read about the PMI Standards Program at http://www.pmi.org/info/PP_Standards_Overview.asp 13 1-404-728-0650 info@opmexperts.com
  14. 14. PMI Standards in Print 14 1-404-728-0650 info@opmexperts.com
  15. 15. OPM3 Program • In 1998 a program was chartered to develop an international standard for industry and government strictly through the grassroots efforts of unpaid volunteers – to help organizations to assess and improve their project management capabilities as well as the capabilities necessary to achieve organizational strategies through projects – to set the standard for excellence in project, program, and portfolio management best practices – to explain the capabilities necessary to achieve those best practices Read the history at http://www.pmforum.org/library/papers/TheHistoryofOPM3.htm 15 1-404-728-0650 info@opmexperts.com
  16. 16. The OPM3 was developed with the widespread participation of the larger PM community. Over 800 professionals from over 34 countries contributed to its development. 16 1-404-728-0650 info@opmexperts.com
  17. 17. Benefits of OPM3 • Help organizations understand current project management, program management, and portfolio management capabilities. • Enable executives to assess their own organization’s or partner’s ability to a achieve strategic priorities through projects. • Identify areas for improvement and ways to make coordinated improvements incrementally. • Help all levels of management understand how to create an environment for successful projects. 17 1-404-728-0650 info@opmexperts.com
  18. 18. Benefits of OPM3 • Help those responsible for project management (e.g. PMO’s) identify drivers of project results and set standards for excellence. • Enable organizations to achieve consistent implementation of project management work methods through standardization. • Demonstrate relationships between executive functions and project management functions. • Explain how to make project management measurable within an organization. 18 1-404-728-0650 info@opmexperts.com
  19. 19. Benefits of OPM3 • Rally an organization or its partners to focus on project management improvements. • Facilitate organizational change associated with developing project, program, or portfolio management functions. • Develop consistency and predictability in project delivery. • Distinguish one’s own organization from competitors. 19 1-404-728-0650 info@opmexperts.com
  20. 20. Terms & Concepts • Organizational Project Management • Maturity Model • Best Practice • Capability • Outcome • Key Performance Indicator 20 1-404-728-0650 info@opmexperts.com
  21. 21. Organizational Project Management • Organizational Project vs. • Project Management Management (OPM) is (PM) is the application of the application of knowledge, skills, tools, knowledge, skills, tools, and techniques to project and techniques to activities to meet the organizational activities project requirements. and project activities to (PMBOK Guide) achieve the aims of an organization through The OPM process combines project projects. management, program management, and portfolio management to enact organizational strategies through projects. 21 1-404-728-0650 info@opmexperts.com
  22. 22. The PMBOK Guide’s Process Groups A Guide to the Project Management Body of Knowledge-2000 Edition, ANSI/PMI 99-001-2000. Newtown Square, PA: Project Management Institute, Inc. 22 1-404-728-0650 info@opmexperts.com
  23. 23. The OPM3’s Organizational Project Management Process 23 1-404-728-0650 info@opmexperts.com
  24. 24. Maturity Model • Capabilities are developed over time. • “Maturity implies a state of being fully developed. Maturity also connotes understanding or visibility as to why success occurs, and as to ways to prevent common problems.” - John Schlichter, “Surveying Project Management Capabilities,” PM Network, 13(4), 39, April 1999. • A model outlines the steps for achieving maturity. 24 1-404-728-0650 info@opmexperts.com
  25. 25. Process Maturity Portfolio Program Project Management Management Management 25 1-404-728-0650 info@opmexperts.com
  26. 26. Best Practice • A Best Practice is a technique or methodology that, through experience and research, has proven to reliably lead to a desired result. • In the OPM3, maturity is represented in terms of Best Practices. One applies OPM3 to achieve maturity, that is, to enact Best Practices. • In the OPM3, Best Practices are comprised of constituent Capabilities. 26 1-404-728-0650 info@opmexperts.com
  27. 27. Achieving Maturity in OPM 1 – Best Practices associated with Standardizing Project Management 2 - Best Practices associated with Standardizing Program Management 3 - Best Practices associated with Standardizing Portfolio Management 12 11 10 4 – Best Practices associated with Measuring Project Management 5 – Best Practices associated with Measuring Program Management 9 8 7 6 – Best Practices associated with Measuring Portfolio Management 7 – Best Practices associated with Controlling 6 5 4 Project Management 8 – Best Practices associated with Controlling Program Management 3 2 1 9 – Best Practices associated with Controlling Portfolio Management 10 – Best Practices associated with Portfolio Program Project Continuously Improving Project Management Management Management Management 11 – Best Practices associated with Continuously Improving Program Management 27 12 – Best Practices associated with Continuously Improving Portfolio Management 1-404-728-0650 info@opmexperts.com
  28. 28. Capability • A Capability is a specific ability to perform, resulting in measurable outcomes. • A Capability may depend on pre-requisite Capabilities. • A Best Practice is comprised of constituent Capabilities. • To achieve a Best Practice, one must develop the constituent Capabilities of the Best Practice. 28 1-404-728-0650 info@opmexperts.com
  29. 29. Dependencies Best Best Best Practice A Practice B Practice C Capability Capability Capability A3 B3 C3 Capability Capability Capability A2 B2 C2 Capability Capability Capability A1 B1 C1 29 1-404-728-0650 info@opmexperts.com
  30. 30. Dependencies Best Best Best Practice A Practice B Practice C Capability Capability Capability A3 B3 C3 Capability Capability Capability A2 B2 C2 Capability Capability Capability A1 B1 C1 30 1-404-728-0650 info@opmexperts.com
  31. 31. Dependencies Best Best Best Practice A Practice B Practice C Capability Capability Capability A3 B3 C3 Capability Capability Capability A2 B2 C2 Capability Capability Capability A1 B1 C1 31 1-404-728-0650 info@opmexperts.com
  32. 32. Outcome and KPI • An Outcome is an observable result produced by using or having a Capability. • Outcomes have Key Performance Indicators that demonstrate either quantitatively or qualitatively that an Outcome exists. 32 1-404-728-0650 info@opmexperts.com
  33. 33. OPM3 Architecture Best Practice Maturity Capability Outcome KPI Capability Outcome KPI Capability Outcome KPI 33 1-404-728-0650 info@opmexperts.com
  34. 34. OPM3 Architecture Continuously Improving Controlling Measuring Standardizing Portfolio Program Project Management Management Management 34 1-404-728-0650 info@opmexperts.com
  35. 35. Best Practice: The value of the Ability to select projects and make project continuation/termination decisions to portfolio is managed. manage the value of the portfolio. Ability to determine the riskiness of each project, i.e. the variance per period in project returns for each project. Ability to determine length of time the decision to invest in each project may be deferred. Ability to compare the present value of assets of proposed projects to the discounted present value of the capital expenditure. Ability to determine expenditure required to acquire assets of each project. Ability to determine present value of assets of each Ability to determine the time value of money, i.e. project proposed for investment. the risk free rate of return. 35 1-404-728-0650 info@opmexperts.com
  36. 36. Best Practice: Portfolio managers and Ability of portfolio managers and program managers to assess confidence in project plans. program managers Ability to confirm the availability of resources throughout critical paths necessary to achieve assess confidence in Work within allotted Duration for each project. project plans. Ability to identify dependencies among all projects. Ability to analyze the critical paths of all projects and to measure variance in the critical paths of all projects. Ability to measure variation in activity duration values for all projects. Ability to develop best, worst, and most likely estimates for durations all tasks of each project. Ability to estimate duration and work for each project. Ability to develop a WBS dictionary for each project. Ability to confirm the scope of work for each project Ability to understand the business drivers, with the project sponsors and project customers. constraints, and assumptions for each project. 36 1-404-728-0650 info@opmexperts.com
  37. 37. Implementing OPM3 1. Study the Standard To implement the OPM3 standard, you perform a series of steps that comprise a repeatable process. 2. Self- assess Organization 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 37 1-404-728-0650 info@opmexperts.com
  38. 38. Implementing OPM3: Step 1 In step 1, you read the introductory sections of the standard, which explain 1. Study the Standard - the purpose and scope of OPM3 - the meaning of maturity - how process improvement works 2. Self- assess - how information in the standard is Organization organized - how to use it 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 38 1-404-728-0650 info@opmexperts.com
  39. 39. Implementing OPM3: Step 2 In step 2, you answer a concise list of questions that allow you to draw an inference about your organization’s maturity across a spectrum of areas 1. Study the addressed by the standard. Standard This is not a Caveat: the only way to comprehensive maturity determine truly whether or not 2. Self- assessment. It is an your organization has a Best assess interim step designed to Practice is to evaluate the Organization help you focus on Best Capabilities associated with Practices you may need that Best Practice, i.e. step 5. to work on the most. 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 39 1-404-728-0650 info@opmexperts.com
  40. 40. Implementing OPM3: Step 3 In step 3, using the results of the previous step, you decide which Best Practices to evaluate. 1. Study the Standard If the previous step Alternatively, if the previous indicated that your step indicated high maturity in organization is immature an area, you may wish to in a certain area, you may validate that indication to 2. Self- ensure it is accurate. assess wish to find out exactly Organization what your capabilities are Determine your area of focus. in that area. 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 40 1-404-728-0650 info@opmexperts.com
  41. 41. Implementing OPM3: Step 4 In step 4, you refer to a directory that shows you the Capabilities associated with each Best Practice. You refer to the Best Practices that you decided to focus 1. Study the Standard on in the previous step. Each Best Practice is In this step you are simply comprised of a series of locating the lists of 2. Self- Capabilities leading to assess Capabilities. In this step, you Organization see the sequence of each of the Best Capabilities that result in Practices you have development of a Best Practice. chosen to evaluate. 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 41 1-404-728-0650 info@opmexperts.com
  42. 42. Implementing OPM3: Step 5 In step 5, you evaluate the Capabilities leading to each Best Practice. Start with the lowest Capability in the sequence, and move up. If your organization 1. Study the Standard has some of the Capabilities but not all of them, then the Best Practice has been achieved only partially. You evaluate Capabilities by Once you know which 2. Self- learning the Outcomes Capabilities the organization assess associated with each doesn’t have, you can see Organization Capability, and verifying Key clearly which Capabilities Performance Indicators. remain to be developed. 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 42 1-404-728-0650 info@opmexperts.com
  43. 43. Implementing OPM3: Step 6 In step 6, you reflect on the results of the previous step and decide how to proceed. By now, you know the sequence of Capabilities leading to the Best 1. Study the Practices you have chosen to focus on, and you Standard know which of those Capabilities have not been achieved. Plan the required improvements! 2. Self- Because you know exactly where you stand on the path assess toward a Best Practice, you can see the next Capability Organization ahead. You also know the Outcomes that should result from having that Capability. Decide whether to develop it. 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 43 1-404-728-0650 info@opmexperts.com
  44. 44. Implementing OPM3: Step 7 After deciding which improvements to make in step 6, you actually make those improvements in step 7. 1. Study the Standard You have selected the Projects to develop Capabilities that you wish to organizational capabilities are develop, and now you must often organizational change 2. Self- initiate, plan, execute, projects. In the steps leading assess Organization control, and close projects up to this one, did you involve to achieve those the stakeholders you need Capabilities. now? 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 44 1-404-728-0650 info@opmexperts.com
  45. 45. Implementing OPM3: Step 8 In step 8, after you have finished your Capability Development Projects to advance toward the Best Practices you have focused on, you can revisit the 1. Study the self-assessment questions in step 2, or you can go Standard directly to step 3 to select Best Practices to focus on. You may wish to re-select Alternatively, you may wish the same Best Practices to focus on entirely new 2. Self- assess chosen last time, in order to Best Practices. Organization validate progress toward those Best Practices. 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 45 1-404-728-0650 info@opmexperts.com
  46. 46. OPM3: ask the experts • Business drivers, critical success factors • Assumptions, constraints • Roles and responsibilities • Stakeholders • Scope of implementation • Accountability • Timing, personnel, internal costs • Measuring progress • Communicating throughout the process • Managing risks • 46 Getting the expertise you need 1-404-728-0650 info@opmexperts.com
  47. 47. Schedule • The team will hand the standard off to PMI in September 2003. • PMI will release the standard to the public in December 2003. 47 1-404-728-0650 info@opmexperts.com
  48. 48. Summary • OPM3 helps organizations to assess and improve their project management capabilities as well as the capabilities necessary to achieve organizational strategies through projects • OPM3 sets the standard for excellence in project, program, and portfolio management best practices • OPM3 explains the capabilities necessary to achieve those best practices. 48 1-404-728-0650 info@opmexperts.com
  49. 49. Summary 1. Study the Standard To implement the OPM3 standard, you perform a series of steps that comprise a repeatable process. 2. Self- assess Organization 4. Identify Capabilities 3. Determine Leading to 5. Evaluate 6. Plan 7. Implement 8. Repeat the Focus Best Capabilities Improvements Improvements process on Best Practices Practices 49 1-404-728-0650 info@opmexperts.com
  50. 50. 50 1-404-728-0650 info@opmexperts.com
  51. 51. Develop the capabilities to do the right projects right. 51 1-404-728-0650 info@opmexperts.com
  52. 52. Q&A 52 1-404-728-0650 info@opmexperts.com

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