EPMO A Tool For The New Normal Robert
EPMO – A Tool For The New Normal Robert Handler Vice President Gartner Research This presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confidential, proprietary or otherwise legally protected, and it may not be further copied, distributed or publicly displayed without the express written permission of Gartner, Inc. or its affiliates. © 2012 Gartner, Inc. and/or its affiliates. All rights reserved.
Successfully Navigating the New Normal Requires an Adaptive Strategy Government, regulatory bodies Suppliers Competitors Economic climate Levels of unemployment Technology Globalization of trade Internet Political ideology Financial institutions Taxes and tax revenue Markets, clients, customers Labor supply Information systems
Slow and Steady Doesn't Win the Race Any More
The Future Requires Building the Adaptive Organization • Current approaches to work need to accelerate • Scanning (sensing) needs to become an art form • Context (what, why, how) becomes the GPS system for the enterprise • Understanding of capabilities becomes a lifeline for rapid response
The EPMO Enables The Adaptive Organization By 2015, 60% of the Fortune 1000 will establish an EPMO to improve the value created by investments in projects and programs. Supporting the Strategic Planning Assumption: Alternate position to the Strategic Planning Assumption: • With continued pressure on financial accountability, organizations will require enterprise-level visibility of where their money is going • Organizations have the structure that suits their real objectives. A strong PMO is often perceived as a threat to other senior managers. • Continued problems with project coordination across silos will further fuel the need for enterprise visibility and coordination of programs and investments • Most PMOs are in IT — a weak PMO operating in a weak matrixed management environment allows the squeaky wheel to get greased.
Key Issues 1. What is an Enterprise Program/Portfolio Management Office? 2. Critical steps toward the EPMO? 3. Example case study
Defining the Enterprise PMO If you are a PMO in IT adding the word Enterprise Does not make you an EPMO
In Uncertain Times, Executives Often Require a Dedicated Staff Function to Help Navigate the Choppy Waters • Top Management becomes more involved when: - The current business model of the enterprise is under attack. - It's clear that long-term viability of the enterprise is in jeopardy. - Planned growth is so significant someone needs to keep an eye on things. • Top Management tends to leave well enough alone when the "outlook" is stable.
The Four Styles of Enterprise Program Management Offices Transformation Strategic EPMO Business Transformation Office Facilitating Controlling Reporting EPMO Operational EPMO Stability
The Reporting EPMO (Facilitating Stability) • Supports executive needs for visibility of what is happening in the organization • Primarily fiduciary in orientation Mantra “We don't care how you do it – just tell us you are getting it done"
The Operational EPMO (Controlling Stability) • Centralizes ALL project and program execution across the enterprise • Generally has staff in the 100 s • Focused on the "production of projects" Mantra “We only do one thing but we do it very well"
The Three Types of Strategy Top Down Middle Out Emergent
The Strategic EPMO (Facilitating Transformation) • Ensures that top down strategy gets executed • A small group of specialists that facilitate agreement about what to do and how to do it. Mantra "It's all about realizing the value of our strategy" BUSINESS SUCCESS MISSION STRATEGY RESOURCES TACTICS CHANGE MANAGEMENT COMMUNICATION
Business Transformation Office (BTO) (Controlling Transformation) • Facilitates the creation of a new "organization" or the evolution into a new market • Focused on building the "web" of relationships necessary to support change Mantra “This is how a caterpillar becomes a butterfly” Photo: Lancaster County Amish by it: Utente: The. Cad. Expert | CC 3. 0 BY-SA
Key Issues 1. What is an Enterprise Program/Portfolio Management Office? 2. Critical steps toward the EPMO? 3. Example case study
Understand What is Driving the Need for an EPMO Survival Induced Change Strategy Induced Change Run the Business Planned Improvements Stabilizing External/Planned Internal/Reactive Adapting
Decide what the "P" in "EPMO" Stands For? • The “P” always stands for some form of Portfolio management (reporting or investment decisions) • In more mature environments EPMO the "P“ stands for "Program • At the highest level of organizational maturity "Project culture and an enterprisewide project capability is added Project Capability Program Portfolio
Build the Project Capability Center The Goal of the Project Capability Center is to ensure that the ability to successfully execute projects is a core capability of the enterprise Skills • Methodology training • Performancebased competencies • Project management training (soft skills) Mentoring • Transforming project managers into project leaders • Creating high performing teams Methodology • • Project methodology Program methodology Portfolio methodology Resource management Knowledge Management • Lessons Learned • Best Practices • Sharing tacit knowledge Tools • • Project scheduling Project Web sites Resource scheduling Collaboration Community • Building a project culture (performance, results, trust) • Sharing tacit knowledge
Key Issues 1. What is an Enterprise Program/Portfolio Management Office? 2. Critical steps toward the EPMO? 3. Example case study
Example case study - Fifth Third bank Fifth Third Bank • (NASDAQ – FITB) Super Regional Bank • Founded in 1862 • Headquartered in Cincinnati, Ohio. • Fortune 500 - #326 • Over $5 B in Revenue • Over $12. 3 B Market Capitalization • Over $274 B in Assets under care Lines of Business • Commercial Banking • Branch Banking • Consumer Lending • Investment Advisors • 49% interest in Fifth Third Processing Solutions/ Affiliate Model (15 Affiliates) • >1, 300 full-service banking centers (>100 Bank Marts) • >2, 450 ATMs • 12 States: Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee, North Carolina, West Virginia, Pennsylvania, Missouri, and Georgia.
Problem “Silo-ed” Operational Model (by LOB/by Affiliate) • Project redundancies PMO = IT Governance • Viewed strictly as an enforcement agency • Adoption challenges Redundant/inefficient approval & prioritization of initiatives • Enterprise Risk’s NPI (New Product & Initiative) = Business Case justification + Risk Identification Questionnaires • Finance’s AR (Appropriation Request) = Business Case Justification + Capitalization Worksheets • IT Architecture’s ITAC Review = Business Case Justification + Architecture Questionnaires
Results Over 900 Active Projects • Health • On-time Delivery • Executive Dashboards Over 900 Projects Proposals • Reviewed & prioritized by Tier 1 / Tier 2 IT Compliance self-regulation • Delegation of Toll Gate Audits except for the Top Level of Rigor 5/3 emerged from TARP in Q 1 2011 • Paid U. S. Treasury back $ 3. 4 B 2011 Bloomberg’s World 7 th Strongest Bank • Only 3 U. S. Banks made it in the Top 20
Final Thoughts • Understand your environment and pace of change • Consider the EPMO as a proven tool to embrace change in the new normal • Select a model that meets your needs • Ensure the basics exist with a project capability center
Recommended Gartner Research è Predicts 2013: PPM Leaders Must Embrace Constant Innovation and Change Handler, Fitzgerald, Light, Apfel, Mieritz, Olding & Hanford (G 00239711) è Deciding Which of Four EPMO Styles Is Right for Your Organization Fitzgerald & Hanford (G 00239503) è PMO Versus EPMO: Symbiosis or Open Warfare Fitzgerald & Hanford (G 00236018) è The Enterprise PMO: An Emerging Force in Strategy Realization Donna Fitzgerald (G 00200779) è Is Your Organization Ready for an Enterprise PMO? Donna Fitzgerald (G 00219055)
EPMO – A Tool For The New Normal Robert Handler This presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confidential, proprietary or otherwise legally protected, and it may not be further copied, distributed or publicly displayed without the express written permission of Gartner, Inc. or its affiliates. © 2012 Gartner, Inc. and/or its affiliates. All rights reserved.
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