The KPIs for PMOs are discussed

In this final part of our blog series about the Project Management Office (PMO), we will show you how to measure the success of your PMO. If you already have established KPIs (Key Performance Indicators) and measure them regularly you can give yourself a pat on the back. However, the majority of companies have not yet objectively assessed whether their PMO actually creates value. KPIs for PMOs? They have none.

The problem is that the PMO’s contribution to the improvement of the project management landscape is generally underestimated. This is the reason why the department, despite initial excitement, is often dissolved relatively quickly. However, if PMOs are given a chance and are regularly evaluated, they can bring great value to a company.

But how do you measure the performance of a PMO to prove its worth?

The PMO Series in the Meisterplan Blog

  • Part 1: “What Is a PMO and Why Do I Need It?”
    Read Now

  • Part 2: How the PMO Fits into Your Company and the Expectations It Must Fulfill
    Read Now

  • Part 3: How to Get Your PMO Accepted by Your Company
    Read Now

Why KPIs Are so Important for PMOs

Nearly half of PMOs are eventually dissolved because it’s thought they don’t bring enough value to the organization. Most stakeholders focus on the cost, bureaucracy and organizational changes that a PMO brings. But is this a mistake? Companies that measure the success of the PMO see unrivaled project performance. Plainly speaking, this means less project failure, higher productivity and lower project costs.

PMOs themselves should work to prove their value by tracking appropriate metrics. This will allow PMOs to identify areas that could use improvement while validating other areas that are working extremely well. Because it can be tedious to evaulate your PMO, you may choose to hire an external consultant to analyze your performance for you. Regardless of who is doing the analysis, KPIs for your PMO will depend primarily on the role and the task spectrum of the Project Management Office. If you don’t know where to start with KPIs, here are some of the most common KPIs for PMOs to give you an idea.

Common KPIs for PMOs

GoalKPI
Improved Project CompletionRatio of successfully completed projects to all projects in the portfolio (per period)
Ratio of successful, strategically important projects to all strategically important projects in the portfolio (per period)
Ratio of successfully completed, strategically important projects to all projects in the portfolio (per period)
Improved PredictionsRatio of estimated project costs to actual costs
Ratio of estimated project duration to actual duration
Improved Stakeholder SatisfactionAverage customer satisfaction compared to previous years
Average project employee satisfaction compared to previous years
Faster Time-To-MarketTime elapsed between project conception and project start compared to previous years
Time elapsed between project conception and project completion compared to previous years
Percentage of projects that have the same progress over X reporting periods
Improved Resource ManagementNumber of training courses completed compared to previous years
Relationship of internal project leaders/specialists to externally recruited project leaders/specialists
Number of employees who are assigned to several projects at the same time
Number of projects with resource conflicts compared with previous years
Improved Project ManagementTime elapsed between the occurrence of deviations, risks, conflicts and/or corrective actions
Proportion of active projects without conclusion of contract or placing of order
Percentage of project status reports older than X days
Relation of projects with complete documentation compared to projects without documentation
Optimized FinancesAnalysis of the annual ROI of all projects coordinated by the PMO
Percentage of projects under the agreed budget (compared to previous years)

(Source: Gartner)

Success Is More Than Just Data

The success of your PMO can’t only be measured quantitatively. A successful PMO will also have a profound effect on your employees. To evaluate whether or not your PMO is successful for your employees, try asking them these yes or no questions. Their responses will not only tell you what is and what isn’t working, but also the current level of acceptance of the PMO throughout your company.

  • Is the PMO a time saver for you?

  • Does the PMO make work easier for you?

  • Are you aware of the portfolio’s priorities?

  • Does the PMO promote cross-project communication and transfer of information?

  • Do you feel the PMO supports you in resolving resource conflicts?

  • Are the predefined PM methods useful for you?

  • Are the training courses offered helpful?

PMO Power

If given the chance, a new PMO can add measurable and meaningful value to your company. Many companies struggle with the implementation and adoption of a PMO, but if you work through the challenges you can obtain the rewards offered by efficient and successful PMOs. In order for PMOs to provide value, they need powerful tools to manage their project portfolios. Meisterplan supports PMOs by providing real-time scenario planning, easy resource allocation, and clear visuals into your project portfolio. You can align your business strategy and goals with projects in multiple portfolios, see clear dependencies, and monitor project financials all in one place. To see how Meisterplan can help your PMO be successful, you can schedule an one-on-one demo or try a free trial.

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