Sunday, June 11, 2006

Payback of PMO - 1


Recently, lot of people asked me .. What’s the payback of PMO? So I thought to write this brief note.

To understand the payback of PMO, First you should understand the following,

1. Understand the cost of your current project issues

The Current Project issues you have, and the cost incurred to your organization due to these issues. (Ex: Cost of Effort Slippage and Cost of Duration Slippage etc. There is a CD with a very good XL sheet to calculate the Effort Slippage and Duration Slippage which comes with Jolyon Hallow’s “The PMO Tool Kit” book.).

Understand the hidden costs. Think of the time taken by your senior management to go through various types of inconsistent project reports from various project managers. You may not have any standard method to calculate the time taken by teams to complete each work package, due to that there must be lot of unproductive time hidden in your project resource planning. Understand and calculate the cost of your current issues which can be eliminated once you initiate your Project Office.


2. Understand the cost of setting up a Project Office


Estimate the cost of setting up the Project Office. What are the common types of costs?

    1. You may need a consultant who has experience in setting up a project office., Or you can do by yourself with some support from your senior management
    2. If you don’t have good experienced Project Managers, You may need to recruit them. Or you may have to train your existing PMs and mentoring them., There is a cost for that too.
    3. You may need to Purchase some PMIS software, Or you can create your own one.,
    4. You may need to purchase some good PM templates or you can simply create them

(Start Small , Then you can keep your budget low.)

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