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Todays PMO isnt designed to make sure technology programs
deliver business outcomes. Thats where the Results
Management
Office comes in. By Diane Murray and Al Kagan
Does this sound familiar? Your team is
celebrating the on-time, on-budget launch
of yet another big technology program, but
its feeling like a hollow victory. Because while the
program meets all the criteria you established at
kickoff, whether its actually going to deliver what
the business needs is anyones guess.
What happened?
Lately, we are seeing a lot of fingers being pointed
in the direction of the Program Management Office
(PMO). After all, theyre the ones who are responsi-ble for
guiding the program to a successful launch.
So if its not a success, its their fault. Right?
Well, not so fast.
The PMO is usually designed to just make sure
programs are delivered on time and on budget.
Making sure they actually deliver results that are
in alignment with broader business objectives is
another job altogether.
Too often, the PMO gets caught up in the day-to-
day responsibilities of program administration and
program management, even as bigger issues loom.
Their inability to drive the program within the
context of big-picture business goals and objectives
means that many PMOs deliver programs that are
technically successful according to the technology
teams standardsbut fail the business value test.
Most companies with PMOs are aware that some-
thing more is needed. As a result, weve seen a lot
of companies asking more of their PMOs. Theyre
rethinking how theyre structured to see what
worksand what doesnt.
The most effective approach weve seen so far is
what we call a Results Management Office (RMO)
an approach that builds on the most effective
elements of the PMO, expanding its scope in a struc-
tural way to keep strategic outcomes in the cross-
hairs. The RMO approach is grounded in linking
smart business choices and rigorous technology
implementations, often with hundreds of millions
of dollars on the line. That takes discipline above all
elsewith a relentless focus on creating business
value through an orderly, structured process.
Exactly how the RMO is designed depends on
the individual needs of each organization, but we
believe there are four core principles that should be
part of every RMO.
1Program Strategy and Mission Alignment
Business outcomes have to be front and
center in any new programand an RMO
should make this a standard part of doing business.
With an RMO, the first step is to establish a clear set
of benefits that should be delivered by the program
directly from the business case; then develop a
program strategy and road map for achieving them.From that point
on, every decision the team makes
is scrutinized through the lens of the overarching
program strategy.
Every decision has trade-offs. Thats not news.
The challenge is to determine the right trade-offs
based on business goals. For example, option A will
improve cross-sell opportunities in the call center
by an incremental 10 percent, but it will delay the
implementation date by six months.
Whats the right answer? It depends on the busi-
ness problem you are trying to solve. Is your current
call-center platform failing, resulting in the loss of
customers every day? That points the way to one
decision. But if your top priority is taking market
share from your chief competitor, that may lead to
a different choice.
Measurement is another key to an RMO-based
approach. Theres always a lot of talk about measur-
ing outcomes when the program is completed, but
it rarely happens in practice. Why? Because nobody
knows how to do it. The RMO should provide a clear
set of criteria for evaluating whether or not the
program is delivering the desired business bene-
fitsboth during the lifetime of the program and
after its completed.
When it comes to measurement, start simple. Use
standard measures that can be easily tracked and
make sure you can obtain a reasonable baseline.
Its also important to avoid the temptation to over-
analyze the choice of measures. This isnt an exact
science. Be specific wherever possible, but remem-
ber that it can be just as valuable to identify over-
arching trends.
Just as important, make sure accountability for
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measuring results is clearly spelled out. Establish
accountability (often within your strategic planning
function), and do it consistently across the enter-
prise. In the end, this isnt the job of the PMO or the
IT department. If nobody is on the hook for mea-
suring and reacting to business results, the odds ofachieving
those results are slim.
2Integration Across All Projects
Its easy enough to say that a PMO needs to
achieve program integration, but how does it
actually do that? In an RMO, thats the job of what
we call the domain authority. This team of busi-
ness and IT specialists should be responsible for
establishing a common business and technical
architecture for the program. Perhaps even more
important, they should have the authority to make,
communicate and enforce integration decisions
consistently throughout the life of the program.
The success of the domain authority rests
squarely on two things: the strength of its members
and its ability and authority to drive overall direc-
tion without having to tangle with day-to-day
delivery details. You need to have the right domain
specialists in place to drive integrationpeople who
have a demonstrated ability to see the big picture
and are unlikely to get sucked into the minutiae of
program management along the way.
3Stakeholder Buy-In
Without a focus on people, even the most
elegant solutions wont be successful, which
isnt news to anyone who has ever been involved
with a successful program implementation. In an
RMO, this responsibility should be clearly assigned
to a team responsible for generating awareness,
involvement and ownership among the community
of people who will be affected by the program.
At this stage, what, when and how are impor-
tant, but dont forget why. If all involved under-
stand why his or her world might be changingas
well as what it means to the companythey are
more likely to truly adopt change. Linking people
with outcomes is a key aspect of an effective RMO.
Whats the expected result? You will finally have
stakeholders who are aware of the program and
know what business impact it will have on theirorganizations.
The organization will also be pre-
pared, trained andmost importantready to
adopt whatever changes are necessary to make the
program successful.
In the end, you will have a program that has a
much better chance of actually being adopted and
embraced once its launched throughout the busi-
ness. If youve ever seen a technically great program
fail at the hands of an apathetic community of busi-
ness users, you already know just how big a deal
this can be.
4Program Management
Yes, program management! Keep in mind
that the RMO isnt designed to replace the
PMO. An effective PMO already does an effective job
of tracking, monitoring and reporting, which are all
key elements of any successful program.
So why mess with a good thing? The RMO should
complement what is already working in the PMO,
staying focused on ensuring that business value is
being delivered.
The principles that shape the RMO approach
shouldnt look new. What is new is that an effec-
tive RMO builds them into a structured, orderly
process designed with one goal in mind: Deliver-
ing real business value from investments in tech-
nology programs.
An effective PMO already holds program man-
agement accountable for hitting timing and budget
milestones. Isnt it past time to make sure these pro-
grams hit the mark when it comes to delivering
business results?n
Diane Murray is a principal and Al Kagan a director
with Deloitte Consulting LLP.
If nobody is on the hook for measuring and reacting to
business results, the odds of achieving those results are
slim.
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