In the latter part of the year, KeyedIn conducted a survey to get an understanding of the challenges and goals of the PMO. We surveyed hundreds of project practitioners from various levels of the organization to uncover some key insights to help moving forward.
Thank you, Rachel. And thank you to our audience, wherever you may be joining us from. I’m confident you’ll find the next 45 min as time well spent. Here is the agenda. I’ll briefly highlight the origin of the survey, and then we’ll dive into the big takeaways and trends before finishing with some possible next steps.
Why did we create this survey and the accompanying report?
First, because we feel portfolio management is an under-represented piece of the broader IT market. A quick internet search will show you there’s no shortage of research on the efforts of project managers or the opinions of CIOs, but virtually nothing on the art of portfolio management.
Second, because we deal with PMO leaders everyday, we see that they face unique challenges. While project management is always a function of portfolio management, it’s clear that portfolio management poses distinct opportunities and obstacles to success.
Finally, transformation is the name of the game in IT and Operations today. The role that portfolio leaders can and should play in organizational change cannot by overstated. Hopefully, this research will help them in that weighty task.
Survey responses were anonymous.
We collected information based on 16 questions.
These are the types of organizations represented in the data:
213 responses over the roughly 3 months we ran the survey.
A wide range of industries, from financial services to manufacturing to healthcare.
Majority came from enterprise organizations with more than 1,000 employees.
And then finally, as one last piece of background on the survey, this shows the titles of survey respondents, as well as whether or not the organizations for whom they work have a formal PMO. True to the intent behind the survey, you can see that the majority of the respondents are PMO or portfolio leaders, with almost ¾ having established a formal PMO.
Alright, we now want to hear from you on two poll questions. The first will help us see how our audience today compares with the survey respondents, and the second will add some color around the impact of the COVID-19 pandemic, a dimension we deliberately did not cover in the original survey. Rachel?
As we explore the survey data, let’s begin with some of the top insights:
First… For me this was probably the most interesting takeaway from the entire survey, and possibly the most troubling. We speak with PMO leaders every week who are looking to elevate the stature of their organizations, from tactical delivery to strategic partners. But until alignment improves, they won’t even be able to start the climb.
Next… This one might seem unsurprising – almost all of us could use more resources if given the option – but it’s actually very interesting because the solution to this challenge is relatively simple, and we’ll discuss that more in a few minutes.
These last two deal with project and portfolio failure. The second number – showing the respondents who say at least 10% of their portfolio is failing – may seem small compared to the others, but if you consider the PMO for an enterprise organization is probably managing a portfolio in excess of $30M, that’s a lot of money potentially being wasted.
Drilling into the data behind those key takeaways, let’s take a closer look at strategic alignment. You can see the breakdown in this chart with only ¼ of project practitioners feeling confident that the work they are doing supports the strategic priorities of their respective companies.
As you think about the implications of this lack of alignment, here are a few key considerations…
One more intriguing point on the subject of alignment. These three charts show the answer to the alignment question broken out by title. Notice just the red slices. While the majority of executives feel their strategies and the PMO’s execution are not just aligned but very well aligned, the leaders and practitioners under them report only a fraction of that confidence. In other words, solving the problem of alignment might need to begin with a reality check.
Taking a closer look at project failure, we can see that the largest segment of respondents says up to a ¼ of the projects in their portfolios are failing and that scope creep is the most common culprit. However, where this gets really interesting is when we look at the definition of failure…
Nearly ½ of the project practitioners surveyed consider a lack of stakeholder satisfaction to be the defining factor in a project’s success or failure. Yet if we look at how most PMOs are measured, stakeholder satisfaction barely makes the list. Is it any wonder project failure rates are so high if the PMO and the stakeholder are working off of different scoresheets?
We also took a look at the ongoing adoption of Agile project management within the PMO. The chart on the left can get a little confusing since we’ve got percentages of percentages, but the upshot is, the use of Agile work methodologies continues to rise, and the reasons why are fairly diverse across a broad set of benefits, including…
That brings us to one of KeyedIn’s specialties. We asked project practitioners… 67% felt it would be significant. As you consider whether your organization has a need for more agility at the portfolio level, here are a few points to consider…
Next, let’s take a closer look at some of the most challenging obstacles your peers in the industry are facing. This is a collection of some of the statements we hear often from portfolio leaders, which gives some color to the data trends we’ll explore next.
Resource management topped the list again of the biggest challenges project practitioners face, with nearly half the respondents who cited RM saying that capacity planning is the most significant obstacle. That’s what I was referring to in the beginning when we noted 81% of project practitioners don’t have enough resources to meet demand. The solution to that challenge is better capacity planning. There will never be ”enough” resources, per se, it’s the understanding of what can actually be accomplished in a given timeframe – i.e., capacity planning – that solves resourcing problems.
Next was project prioritization with the largest segment of respondents citing an inability to say “no” to new projects as the biggest inhibitor of success. That’s an area where value-based scoring and scenario modeling can be tremendously valuable. Without data, someone will always assume they know the PMOs job better than its leaders do. In other words, saying no is more about quantifying value and demonstrating trade-offs than it is political maneuvering.
The next most cited challenge was visibility and reporting, and it’s 3rd-party apps like Jira or TFS that cause the biggest challenge for the PMO. That’s why in selecting PPM software, it’s so important to consider system integration options; otherwise, those Agile tools and other task-based systems remain a black box for the PMO.
Finally, rounding out the top 4 is project financial management, with its associated challenges noted on the last chart.
Back to those initial key insights, we found it interesting that the leading cause of resource gaps wasn’t simply headcount but rather certain specialized skillsets – which makes an accurate skills database another important element of the capacity planning we discussed earlier.
As for alignment, one of the key considerations we noted was the need for value-based scoring of projects, and 84% of project practitioners are having to operate in a program without that – which is going to continue to make project prioritization a struggle until it changes.
Our final topic is about the tools portfolio leaders use to gain visibility. Less than ¼ of our respondents are using project portfolio management software to prioritize, plan and analyze their efforts from the top down. Simple project or task management solutions, as well as spreadsheets are much more common…but not sufficient.
The fact is that effective PPM software – management at the portfolio level – makes everything better for the PMO. Starting with…
If you’ve identified with the challenges we’ve discussed today and would like to take a closer look at PPM software, I’d invite you to consider KeyedIn…