Metrics for Project Office Management

By Bob McGannon, PMP

The project management office (PMO) concept is gathering momentum within the project management industry. More and more organizations are reaping the benefits of consolidating their project management functions, thus standardizing methodologies and templates for use in the management and delivery of projects. The Project Management Institute has added fuel to this trend toward PMOs with the release of the Organizational Project Management Maturity Model OPM3™, providing guidelines to increase the maturity and effectiveness of an organization’s project management resources. What is to prevent this positive momentum from becoming a fad that comes and goes? Metrics are the answer – to reinforce the positive aspects of the PMO and its affect on the organization. Not just project management focused metrics however – specialized metrics that is centered on the work and contributions of the PMO.

Measuring the effectiveness of project management in terms of the accuracy of triple constraint management (scope, time and resources) and the number of people coached to attain the PMP® certification is a start. However, positive results from these measurements could easily be contributed to a growing skill set in the ranks of the project managers. Metrics that track the growing contributions of the PMO will assist the management team to validate the ongoing relevance of the PMO. In addition, these metrics can used to justify additional funds and personnel to expand the PMO role within the organization, as appropriate.

Measuring Organizational Influence – Best Practice Adoption and Maturity

The positive influence of the PMO within the organization can best be quantified by its management of change across the enterprise. As OPM3™ provides the project management world with a number of “best practices”, these can be the basis for improvement measurements. What is needed is a metric to track the number of best practices adopted by each business unit within the organization, as well as within the organization as a whole. This provides a set of highly visible metrics that can clearly demonstrate the degree of change introduced and managed by the PMO. Along with these measurements, using OPM3™ and performing the self-assessment on a regular basis can reinforce the positive nature of the changes brought about by the PMO.

Metrics for Multi-Project Leverage

A pivotal contribution that can be made by the PMO is saving time and money for the organization via leveraging of staff and process consolidation. Similar to the way information technologies organizations measure “reuse” of code modules, the PMO can measure the reuse of specially designed processes or modified techniques to manage projects. Secondly, instances where centralized project knowledge (that would not exist without the centralized control brought about by the PMO) provides opportunities for the leveraging of skill across several projects should be measured. Along with this leveraging measurement, PMO management can track the cost savings achieved via that leverage, when compared with the engagement of multiple internal or contract personnel.
Other metrics of note in this area include tracking the number of instances where project schedules were altered to avoid “customer collisions” – instances where deliverables from multiple projects would have been implemented at the same time, causing an undue and difficult-to-manage disruption to the business.

Process Management and Compliance

A primary function of the PMO is to centralize and standardize project processes. This is addressed in the OPM3™ documentation as one of the project management “best practices”. The PMO’s contribution to process compliance can be measured in a number of different ways: by tracking the number of process errors that were identified in projects managed by the PMO; by measuring the number of project reviews conducted and the number of findings that resulted from them; and the number of new processes created or adjusted to improve the organizations project management methodology.

Assessments of Projects and Project Teams

Quality in an organization is increased through continuous improvement initiatives. Although the contribution made by each of the initiatives may be difficult to measure individually, the culmination of a series of initiatives can increase quality demonstrably. The PMO can engage in a metric to assess the increasing quality of its projects and the teams that execute them. Creating an “incidents index”, with the intent of it decreasing over time, is a notable way to measure project improvement. This index consists of accumulating points for:

• The variance from a triple constraint variable (1 point for each $5000 over budget or weeks over schedule upon project completion or 3 points for each scope item missed in the project’s deliverables)
• Any “findings” that result from project reviews that aren’t corrected within 2 weeks (1 point each);
• Unplanned project changes (1 point for each change);
• Each unknown error found in the project’s deliverables after implementation (3 points each).

This “incidents index” can cause project managers and their teams to focus on the areas of greatest importance to the enterprise. Improvement in this area across the organization can be tied to PMO improvement initiatives. The dollar values, time variances and “findings correction” timeframes in this index can be adjusted to best suit each application environment.

Results Improvement Metrics

The ultimate contribution a PMO can make to the organization is improved business results. Realization of project goals, in terms of return on investment (ROI) or other measures are where the “rubber meets the road” for any corporate initiative. These should be measured by the PMO, for all projects. Recommended metrics to be applied in this endeavor are as follows:

Estimation accuracy – Estimation is an issue for most organizations. Measuring the absolute value of the difference between the definitive estimate (the last, most detailed and accurate project estimate) against the actual cost of the project gives PMO management a means to demonstrate estimation improvement. (Don’t forget to add in any approved changes to the definitive estimate!)

Sponsor satisfaction surveys – Projects are ultimately executed for their sponsors – all the measurements in the world about the process won’t mean much if the customer isn’t happy. On a 1-5 scale, measure the overall satisfaction of the project sponsor, and record improvement opportunities – increased performance here can easily substantiate a PMO’s efforts. Issues surfaced from sponsors while tracking this metric can be added to quality and/or risk templates.

ROI attainment against plan – A well run, focused PMO can contribute directly to the “bottom line” by helping to ensure the ROI for the projects meet what was detailed in the original business case for the project. The PMO should ensure that after-implementation reviews are performed to measure ROI. This can be more difficult as a number of factors – many of which are out of the control of the PMO or the project teams – can contribute to ROI. The ROI attainment against plan metric is still valid however, and recording the “issues” that cause ROI targets to be missed are great items to be incorporated into the PMO’s standard risk checklists.

The PMO concept supports an infrastructure that encourages growth while maintaining basic repeatable success factors. The PMO concept is helping organizations in many industries – succeed in creating metrics to measure their success. The PMO concept can help ensure their contribution continues for years to come.

Bob McGannon is a Founder and Principal of MINDAVATION, a company providing project management training and consulting, leadership workshops and team building programs throughout North America. Mindavation can be reached at or by calling 866-888-MIND (6463).


The Mindavation Foundation is proud to donate 5% of profits towards development of youth leaders.
Copyright © 2011 Mindavation - All rights reserved.