Keeping track of projects is easy with a small team. Many startups do just fine with informal procedures and close communication. However, this setup only works until you start experiencing real growth. The growing pains companies experience when they have no project management office in place can cut growth before it starts. Like most problems in business, prevention is the only cure.
As your business starts expanding, you’ll need a way of communicating your projects, policies, guidelines, and processes. Think about what you do if someone left and you had to train their replacement from scratch when the information lived in your employee’s head. Or, how would you keep a department organized if it were to double within the year? These are all questions that a project management office, or PMO, would address.
In our last article, we reviewed the structure of project management offices, who’s involved, and what systems support their operations. Here, we’ll discuss why you need a PMO, including the benefits you’ll reap and the problems you’ll avoid by having one. Let’s get started with a review of what a PMO is and its purpose within your company.
The role of your project management office
A company’s project management office provides a backbone to its operations. They closely monitor progress and support teams so they can adhere to deadlines, especially in tech operations. This department designs the best practices that companies will use and ensures that they’re implemented properly. Especially when a team works across different time zones, the extra support keeps things running smoothly.
A PMO serves as the liaison between upper management and staff. They define the milestones and metrics that will measure success and communicate them to the stakeholders on a project. Another aspect of their role is ensuring that your team has the resources, time, and tools to complete their projects. It’s their job to communicate with the team to see that all relevant needs are being addressed.
Once a task is complete, your project management office will archive the materials and use them as a template for future endeavors. They will note what went well, the challenges the team faced, and how you can use this for better direction in your future goals. This is only a brief overview of what your project management office will do. Their day-to-day tasks will include far more and fit specifically with your company and its goals. Next, let’s move on to why you should prepare a project management office for your startup.
Why do successful startups have PMOs
Often, startup owners are concerned that documenting their project management will smother the creative energy. In fact, teams function better with structure. Choosing where you need to be firm and where you can allow flexibility directs your energy and more productive ways. If you’ve been doing something well, documenting it and repeating the process locks down your procedure and frees up more mental energy for new developments.
Don’t confuse your startup’s PMO with that of a larger company. There will be significant differences, such as size, resources, and duties. For example, a project management office in a startup will typically be smaller and rely on technology more than those within a larger company. Often, they will look for more efficient ways to do the tasks that keep your company organized. While part of their job will involve reporting, like larger companies, these reports will be more tailored and typically over shorter periods of time as compared to their larger counterparts. Ultimately, the goal is to replicate the strategies used in larger organizations to pave the way for growth.
The reason that successful startups have project management offices is that these organizations plan for the future. Rather than limiting your thinking to the current moment, look to the future to see what your later needs will entail. In few circumstances will a business intend to stay small. Even in this case, having a plan in order allows you to prepare for training new staff and taking on new projects. Remember that part of this is documenting your success so you can later repeat it.
Now that you understand what a project management office is and what it means to your startup, let’s move on to seven reasons why you need to create one within your business.
Why do you need a project management office?
We’ve gone over the benefits of project management offices. But what do you do when you’re already experiencing issues? Often, these problems will come up without an obvious cause. However, when you look deeper, the root of these problems has to do with a lack of organization and oversight. This issue will not always have an easy fix. However, the sooner you handle it, the sooner your team can move forward. Some instances where you’ll want to implement a PMO in your startup include when:
- Your team is constantly missing deadlines
- Your projects come in routinely over budget
- You don’t have reliable training procedures
- You’re struggling to organize a distributed team
- There’s a disconnect between management and staff
- You lack accurate reporting
- Your startup is experiencing rapid growth
Let’s look at each of these in more depth to understand how a project management office affects the outcome.
1. Your team is constantly missing deadlines
Miss deadlines are not unheard of in the corporate world. However, there’s a difference between occasional missteps and a larger systemic problem. Teams that consistently Miss deadlines often lack structure and organization. A project management office will document their current procedures and the software that they use. Then, they’ll step in if they see that a part of the task is running behind schedule. Their role in this instance is to step in and see what the team needs to keep moving. If it’s more resources or a different approach, they’ll be the ones to organize this and translate the needs to upper management.
2. Your projects come in routinely over budget
Without the proper structure, budget tracking can be one of the more challenging aspects of your operations. If your team is frequently coming in over budget, this signifies that there is a larger problem with resource tracking and allocation. When your project management office analyzes previous tasks, they’ll have a more accurate reference for what similar endeavors cost in the past. Since this will be one of their dedicated rules, they can devote more time to log in, tracking, and predicting expenses for your team. This division of roles prevents your team from becoming overwhelmed with the administrative parts of their job and lets them focus on the specific details of the task at hand.
3. You don’t have reliable training procedures
This problem is most evident when your team is trying to hire a new member. You’ll experience the most growing pains when you’re building off of your core team. You may have done fine with a small group of individuals in the past, but if someone leaves or you need to hire a hand, translating their knowledge can get messy. Often, this will start as soon as the hiring process. Your team may not know exactly what they’re looking for, making it harder to sift through the resumes and find candidates for interviews. Later, during the training process, you’ll find that training sessions involve mostly verbal walkthroughs of what the rule will have to do on any given day. However, they lack structure, printable or downloadable materials, or procedures that they can reference in a common drive.
A project management office will work to document your rules and procedures before it’s time to train someone new. While you can expect your new hire to take notes, it’s important that they have a place to reference back to in case they need extra information. Even though your team may recount the details of their roles as well as they can from memory, there are always parts that get left out. Usually, this is because they’re so routine that they hardly realize they’re doing it. Giving a reliable framework lets the new hire design their approach to each task without missing out on the crucial aspects of the job.
4. You’re struggling to organize a distributed team
Distributed teams are becoming more commonplace, not only for startups but for established companies too. One challenge of this arrangement is organizing your team when they live in different time zones, but it requires more planning than having your team together in one office. Your PMO will keep track of each person’s contributions to a project and communicate needs from one individual to the next. The extra hand helps you avoid delays, especially if one person’s morning is another person’s evening. Think of your PMO as an extension of each department. They’ll lend an extra hand and connect each department’s ideas, making sure that each project is delivered on time.
5. There’s a disconnect between management and staff
Often, you won’t realize that there’s a disconnect between management and staff until something boils over. One example of this is when your team needs resources to complete a project but management either doesn’t understand the purpose or doesn’t know what they need. Both sides end up frustrated, deadlines get missed, and often, the project comes in over budget. This can be avoided with structured communication and organization.
Your project management office communicates with your employees and management, making sure that each side has their ideas expressed clearly and finds a way to get their needs met. While there is a responsibility for both parties to communicate and follow up on their requests, your project management office facilitates the process for both sides. This makes communication easier and projects flow smoother overall. An address bonus of this arrangement is that your team will experience lower turnover rates as their interactions with management will be clearer and more productive.
6. You lack accurate reporting
How many times have you gone to take a look at your analytics and not found the results you need? Can you really tell the performance of your campaigns if you can’t see the results? Sometimes, this results from unclear priorities about analytics and reporting. However, it also indicates that your efforts may be focused on the present rather than structured so they acknowledge your successes and failures in the past. If your team is zeroed in on the task at hand and doesn’t have the knowledge gained from the past, they’ll struggle when looking to the future and anticipating their needs.
Your project management office aids team members by planning realistic goals based on what they did in the past. Then, because of the reporting needed to keep them on track, you’ll have more accurate data to pull from when analyzing how effective your campaigns have been. This makes it easier to convey the needs and results of your projects to internal and external stakeholders. Then, you can fine-tune your efforts and perform better than next time.
7. Your startup is experiencing rapid growth
If your startup is growing at a rapid pace, now’s the Time to get your project management office in order. The extra support will help you find, onboard, and retain talent while pushing further with your operations. Don’t wait until you start experiencing issues to invest in your project management office. The best time to set it up was yesterday. The second best time is now. Even a little bit of effort can save you from major issues that could happen later, so especially if you’re seeing rapid growth in your business, meet with a professional who can help you design your project management approach.
When your business is getting along just fine, it’s harder to see the impacts stemming from underinvestment in your project management. However, with even a little thought towards the future and where you want your company to go, the effects are clear. A project management office provides unmatched support for established companies and startups alike. Read up on your options and when you’re ready to act, consult with a professional who can help you put your plan into action.
You’re not alone when it comes to your project management office. A fractional CMO or fractional COO can help you organize your approach and find the best way to implement it. Each of them has its specialties, and it’s as important to know about your company as it is your choice for fractional c-suite positions. So, do you need a fractional CMO or a fractional COO for your PMO? For more information on who can help, see our article here on improving your process management.