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Help! My organization has multiple project management offices (PMOs) and too many projects to count — what can I do to support growing operations and business objectives while maintaining quality?
One answer: an enterprise project management office (EPMO).
EPMOs are the high-level teams responsible for managing multiple PMOs and projects across an enterprise organization. As organizations grow, an EPMO offers the strategic management needed to set standards, track performance, and allocate resources for an increasing number of projects.
Read on to learn more about what is EPMO as a project management concept and how EPMOs promote alignment, collaboration, and continuous improvement for projects pursued by enterprise organizations.
What is an enterprise project management office (EPMO)?
An enterprise project management office (EPMO) is an executive-level department that oversees project portfolios for an enterprise organization. While traditional PMOs focus on individual projects and programs, EPMOs focus on portfolios of projects managed by the company and organization-wide projects.
EPMOs play a critical role in large enterprise organizations, where they can establish structure and increase efficiency for projects big and small. By providing project governance procedures, training, resources, and analysis to project managers and teams, an EPMO can enhance decision-making and maximize value across the organization. With an EPMO, organizational leadership can guarantee projects align with company standards and objectives.
Also read: What is Project Management? Definition, Types & Examples
How are EPMOs structured?
If enterprise organizations are pyramids, an EPMO is close to the top. EPMOs are centralized departments that often report directly to executive leadership, such as the chief operating officer (COO) or CEO. Likewise, an EPMO’s constituents are portfolio, program, and project managers and extend to teams and resources allocated for project needs.
As an enterprise-focused office, an EPMO can oversee multiple PMOs and business units to ensure strategic alignment. As a directive unit, EPMOs can implement project management methodologies, standardized processes, and tools to serve project teams and workflows best.
What are the roles and responsibilities of an EPMO?
An EPMO can take on various forms depending on the organization’s size and structure. EPMO responsibilities typically include demand planning, resource management, program execution, and project closeouts. In a strong matrix organization, EPMOs ensure consistent and quality work throughout the project management lifecycle.
Demand planning
As organizations grow, monitoring project needs becomes increasingly essential to continued success. EPMOs can identify project resources to ensure teams have what they need to be successful and keep on schedule.
Together with department and project leaders, an EPMO can forecast demand for resources based on historical data, current trends, and the long-term business objectives of the organization and its programs. These forecasts can significantly improve resource management to prevent resource underutilization and resource bottlenecks.
Resource planning and management
Joined at the hip with demand planning is the acquisition, prioritization, and allocation of resources. EPMOs assist in managing resources like personnel, technology, and funding to meet project needs and enable success. An EPMO can track resource usage and availability to balance workloads and optimize efficiency.
Read more: Working in Project Management Office | PMO Roles
Project and program execution
The EPMO oversees portfolios, programs, and individual projects to ensure all efforts align with the enterprise’s standards, culture, and objectives.
Through guidance, training, and organizational assets, project managers and teams can follow tried and true project management methods to complete work on time and within the project budget and scope. Similarly, EPMOs can develop risk management procedures to enable issue escalation and prevent mishaps.
Project closeout
Lastly, EPMOs set the stage for closing projects and reallocating resources. Whether ensuring deliverables meet quality standards or documenting lessons learned for continuous improvement, an EPMO can help teams smoothly close out projects. For organizations with similar projects over time, securing the knowledge transfer between team members and project managers is worth its weight in gold. With multiple portfolios or programs, project closeout is also an excellent opportunity to collect data that informs future project management.
As the cycle repeats itself from demand and resource planning to execution and closeout, EPMO responsibilities could touch on all this on the same day when supporting multiple active projects at different stages in the project management lifecycle.
EPMO vs. PMO: What’s the difference?
While EPMOs and PMOs share the domain of project management for organizations, they can vary significantly in their focus and scope.
An EPMO can oversee multiple PMOs and focus on business-wide problems, solutions, and methods. EPMOs offer more strategic oversight for the enterprise’s efforts rather than daily, operational assistance.
Alternatively, a traditional PMO focuses on executing individual projects for an entire program or portfolio. PMOs located farther down the organization chart offer more direct support for project managers and teams, ensuring quality standards, budgets, and project timelines meet expectations.
When to transition from a PMO to an EPMO
When project portfolios grow in size and complexity, an EPMO can be a guiding strategic force for tackling problems that come with organizational growth.
As organizations grow, a PMO becomes an invaluable department for effectively managing an increasing number of projects. With the addition of new departments and the acquisition of new and different business lines, enterprises could have multiple PMOs, sometimes competing for resources. While specific PMOs oversee and promote their project portfolios, an EPMO can look beyond individual portfolios to make decisions that benefit the extended organization.
Organizations should establish an EPMO due to significant growth and the existence of multiple traditional PMOs. This arrangement allows the EPMO to focus on strategic management without sacrificing the direct support offered by PMO units.
Also read: 5 Best Enterprise Project Management Software
Why are EPMOs important?
EPMOs are important for ensuring projects and programs across an enterprise meet not only specific project objectives but also the organization’s strategic overall objectives. As a centralized unit, often reporting to C-suite leadership, an EPMO can inform executive decision-making and develop systems that guide efforts throughout the organization.
Through demand planning, EPMOs can forecast and allocate resources to projects with the most strategic value. As project management experts, an EPMO can implement methodologies, governance, and risk management standards that reduce common pitfalls for teams. An EPMO offers the central oversight that enables business leaders to analyze company-wide performance, plan for the future, and ensure strategic alignment.
What are the benefits of implementing an EPMO?
Implementing an EPMO can offer multiple benefits for enterprises seeking to replicate best practices across organization projects. These benefits include establishing strategic alignment, strengthening collaboration, and continuously improving governance to enable project success and serve the long-term objectives of large organizations.
Strategic alignment
With a bird’s-eye view of an organization’s portfolios and programs, EPMOs can ensure all projects align with the enterprise’s long-term strategic objectives. Unlike traditional PMOs, which focus on the success of a single portfolio or program, EPMOs can track performance and implement governance frameworks across multiple portfolios.
Collaboration and engagement
As an overseer of resources, including personnel, an EPMO can be a force for good in establishing engagement and collaboration across project teams. While projects come and go, most resources are reusable and serve multiple teams over their lifetime. With insight from executive decision-makers and constituent portfolios, EPMOs can bridge the gap between departments, foster collaboration, and maximize engagement to serve project needs best.
Continuous improvement
Managing an EPMO and an enterprise’s universe of projects also means collecting and monitoring data that inform best practices. Throughout and after each work, EPMOs should have mechanisms in place to track performance and lessons learned from projects for deeper analysis. This data is crucial for organizations seeking to improve best practices like risk management, resource management, and project execution.
Read more: Components of Risk Management: Everything You Need to Know
How to implement an EPMO in 3 steps
Adopting an EPMO requires an intentional change management approach to ensure seamless integration of the office into the broader enterprise. By following the below steps — defining objectives, developing governance, and refining with growth — enterprise organizations can implement an EPMO that maximizes project alignment and efficiency.
1. Define strategic objectives and alignment
Implementing an EPMO begins with identifying the enterprise’s strategic objectives. With the input of existing PMOs and portfolio managers, executive decision-makers can work together to enumerate a vision and long-term strategy that informs enterprise-wide objectives. These strategic objectives will be the basis for tracking performance, setting priorities, and developing governance frameworks.
2. Develop structure and governance
Here, organizations will decide how the EPMO operates in the context of the existing enterprise. This step includes defining the EPMO’s roles and responsibilities and their authority in overseeing and setting standards for project management best practices. With executive buy-in, the EPMO can be a guiding force for optimizing resource allocation, risk management, and project execution.
3. Integrate, scale, and refine
After defining strategic objectives and developing a governance structure, it’s time to implement your EPMO. Integrating a new department will come with growing pains, but it’ll also improve the enterprise’s ability to scale and refine operations. As organizations grow and change, an EPMO can fine-tune best practices based on project performance, company culture, and the needs of the enterprise.
Also read: 20 Key Project Management Questions to Ask for Project Success
Best practices for EPMO implementation
Pilot the EPMO: After setting the stage for EPMO implementation, start small with a pilot program where the EPMO can test processes, identify challenges, and refine approaches.
Standardize projects: By developing organizational process assets and templates for common project tasks, EPMOs can build consistency and ease project management across efforts.
Set strategic objectives: An EPMO can help identify, communicate, and implement long-term business objectives that every project and team looks to for guiding instructions.
Establish consistent metrics: By establishing key performance indicators (KPIs) and consistent project management metrics, an EPMO can illuminate performance data and facilitate data analysis.
Encourage continuous improvement: Through data analysis and visibility, EPMOs can help project managers continually improve project methods, processes, and performance.
Manage risk: As the ultimate project overseer, EPMOs can help identify and mitigate risks through structured governance, issue escalation, and accountability mechanisms.
Leverage technology: While different business units recreate the wheel or acquire different project management software for similar needs, EPMOs have the central visibility to leverage technology effectively.
Foster communication and collaboration: An EPMO is a bridge for communication and collaboration between executives and project leadership and between various departments and personnel.
Executive buy-in: With insight into the enterprise’s project management posture, EPMOs can engage and inform executives who are making decisions related to planning and execution.
Train and develop personnel: EPMO’s mission is to enhance and refine every part of the project management process, including project leaders who make success possible.
Promote flexibility: While standardizing processes is a priority, EPMOs should also establish wiggle room for project managers that ensures flexibility for unique projects and teams.
IBM: Example of EPMO success
In 1996, IBM’s CEO Louis V. Gerstner, Jr. read an internal white paper written by a team of project management leaders that convinced him the technology enterprise needed to embrace project-based business. While technology evolved rapidly during the 1990s, IBM recognized the need to standardize project management to consistently deliver complex solutions to global clients. This embrace of project management aimed to establish PM best practices and prevent project failures, revenue erosion, and customer dissatisfaction.
With the IBM Project Management Center of Excellence (PM/COE), the enterprise was able to implement consistent project management delivery approaches, train project managers, adopt consistent performance measurements and metrics, and ensure knowledge transfer between projects. IBM’s success has been a template for other enterprises as it developed and nurtured a vibrant project management competency heading into the 21st century.
Fifteen years after creating the EPMO, the benefits were clear. Whether developing talented project managers, implementing best practices, or holding teams accountable, IBM’s PM/COE helps teams consistently meet business and strategic objectives that push the company forward.
Read more: Essential Project Management Guidelines & Rules to Follow
Easing enterprise project management with EPMOs
The need for enterprise project management offices grows with every additional business unit, department, or portfolio of projects. While a small to medium business may have one PMO, and larger companies can have multiple, there comes a point for every growing enterprise where an EPMO becomes essential to maintaining the strategic alignment between different organization parts. With an EPMO at the helm, enterprises can confidently scale and refine best practices that unite various business units and support the organization’s strategic objectives.
