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Have you ever tried to decide what to eat for lunch with a group of friends? A group of people with varying opinions trying to decide what to eat for lunch can be an unfruitful exercise in chaos, discord, and wasted opportunities benefiting no one involved.
Instructional parallels to efficient business practices can be found in the group lunch example. It can be tough and almost impossible to get a large group of people coordinated and dedicated to work together for one goal and purpose.
However, when it comes to success in the business world, failure is never an option. Still, instead of trying to get a handful of people to agree and coordinate on a goal, it could be hundreds or thousands.
According to classifications defined by the U.S. Small Business Administration, a “small business” can be defined as one that makes anywhere between $1 million to $40 million annually and employs anywhere between 100 to 1,500 people.
If the CEO and department heads of a corporation can’t get all of their employees coordinated on a common goal, operational inefficiencies and financial waste will follow.
That is why most companies have a preexisting program management office already in place.
A program management office is the head office that oversees various departments, project managers, and workers to make sure that operations, practices, and procedures are being efficiently followed to ensure overall success.
Over 85% of companies now have a program management office in place. And of the remaining companies that don’t have a program management office in place, over 30% plan to implement one.
So, let’s fully explore the tenets of program management, the roles, and the responsibilities of everyone involved. And we will also explore some reasons why program management offices sometimes fail in their endeavors.
We will start with one real-life example of an organization that didn’t take the necessity of program management seriously until it was too late.
If your company requires professional business office solutions to become more efficient and successful, contact B STATE today.
What is a Program Management Office?
Before we explain the business philosophies of program management, let’s first start with some real-life examples that illustrate why program management is needed.
In June 2021, state officials in Maine were bracing for lawsuits, firings, and a complete management system overhaul after $35 million dollars was wasted over five years in a misguided and unprofessional attempt to update the state’s human resources computer programs.
Maine’s human resources offices, which employ 12,000 people, operate on a computer software program over 40 years old. The programming language that the software system runs on is now obsolete.
And currently, only one Maine state employee knows how to read the ancient language and run the system.
Maine officials are currently suing a California-based company called Workday for failing to update the system. However, all of the blame for the failure to update the state’s human resources software can’t be attributed to one out-of-state company.
Inept, poorly qualified, and inexperienced Maine state officials ran the project at different levels and cross-purposes for years.
A Maine official hired a program management head to oversee the project but hired the husband of another official to do the job, a move that hampered morale.
According to press reports, the project overran two governor administrations, botched three deadline delivery promises, and resulted in several official oversight hearings.
Maine is hardly the only state, or corporate entity-like infrastructure, to have ever experienced executive management inefficiencies. The point is that if a properly installed program management office was in place from the beginning, this 5-year and $35 million-dollar corporate waste crisis might not have happened.
And in the end, the work and efforts of over 12,000 workers, and uncountable work hours, was wasted and misappropriated over a five-year period.
If any real-world case study in corporate mismanagement should convince you of the need to implement a full-time program management office in your business infrastructure, it should be this one.
Program management is the strategic management and oversight procedures to efficiently ensure the deliverables of large-scale, fiscally important, company-dependent initiatives.
Think of the program management office as the top engineer. Program management ensures that a company, like a machine, runs smoothly and does what it is designed to do at its most optimal.
The various offices, divisions, projects, and workers in a company can be compared to the cogs, gears, and machine components.
Suppose a company is as large as the 12,000-employee workforce of the Maine human resources division. In that case, everyone must work in a coordinated, strategic, and efficient manner to realize a large-scale initiative.
So, a program management office oversees the management of the operational delivery strategies of individual projects or company-wide endeavors. The program management office manages linked projects, project managers, and related offices to help realize shared, beneficial company goals.
It is not necessarily the job of the program management office to define the functional strategy of achieving the large-scale initiative goal.
The programmatic responsibility of the program management office is to coordinate the efficient delivery of a large-scale initiative and provide the synergistic management skills to make sure the work is completed efficiently and on schedule.
The program management office does not exist to tell office managers, project managers, or employees how to do their jobs. But it is the responsibility of the program management office to make offices, managers, and workers aware of more efficient processes, shared company-wide goals, and timetables for everyone involved.
The program management office does not step on the toes of offices, managers, and workers; it tries to make everyone dance to the same rhythm, move in the right directions, and make everyone aware of the other’s movements to arrive in the same place as efficiently as possible.
The program management office oversees disparate, multiple levels, if not all, of a company and manages them as a whole.
Let’s use the Maine state human resources debacle example to better explain the program management office’s role. But instead of Maine, let’s imagine a company with 5,000 employees who are grappling with an outdated company-dependent software crisis.
Each project manager in the company is responsible for their own project and employees; project managers tend to their issues without coordinating with colleagues or caring about how such working discord affects company productivity.
There is only one employee who understands the outdated software system. There is no backup redundancy in several employees or an entire office who understand the obsolete software. If that one crucial employee gets sick for an extended period, quits, or is fatally injured, the whole business’s operations can come to a standstill.
You can probably see the endpoint narrative of these examples. The program management office oversees the entirety of the company, its operations, how offices and workers are interlinked, and ensuring that everyone works synergistically to achieve the same goal.
However, the program management office has several roles and responsibilities related to overseeing best-operating practices.
Program Management Sponsor or Sponsorship Group
The program management sponsor is an individual or group of executives who initiate the need for oversight or changes in operating practices.
The program management sponsor calls the shots and provides the funding for the program management office to operate.
The program management office answers to the sponsor or sponsorship group, usually through the SRO.
SRO (Senior Responsible Owner)
The senior responsible owner is directly appointed by the sponsor or sponsorship group. And the senior responsible owner, or the SRO, is the liaison between the sponsor and the program management office.
The SRO monitors the progress of the program management office’s efforts at the highest level.
Additionally, the SRO stays in contact with senior executives and shareholders and keeps them apprised of the program management office’s progress.
While the program management office answers to the sponsor, it will usually do so through the SRO or the BCM.
BCM (Business Change Manager)
The business change manager, also known as the BCM, is directly appointed by the SRO.
And the business change manager works in tandem with the program manager to make sure the goals of the program management office are being implemented efficiently and correctly.
The BCM, in coordination with the program manager, may regularly confer with office department heads and directors to make sure the large-scale initiative goals are being met efficiently.
The last tier from the sponsor level to the SRO and the BCM is the program manager.
The program manager is the liaison officer between the project managers and workers and the upper echelon program management officers.
The program manager works more in a strategic, hands-on approach with offices and project managers to get projects finished on time.
So, when the term “program management” or “program management office” is mentioned, it refers to the roles of the sponsor, SRO, BCM, and program manager collectively.
Still, the program manager for most workers under the executive tier of the company is the ostensible go-to person in the program management setting.
Now, let’s consider some of the responsibilities of the program management office.
Program Management is Beholden to the Financial Calendar and Shareholders
We have explained at length the oversight powers of the program management office. But one of the most overlooked aspects of the program management office is making sure large-scale initiatives are profitable and don’t overrun predetermined expenditures.
Individual office projects and project managers only have a myopic view of how their respective projects’ expenses are tied to the entire finances of the business.
The program management office keeps a close eye on the financial calendar, budgetary expenses, and quarterly results. And the program management office is responsible in many situations for keeping shareholders and senior executives apprised of the progress of large-scale endeavors.
Individual offices can only see the impact of their work from the view of their office. They can’t see beyond the cog vantage point in a machine to realize that the timeliness or delay of their work affects the finances of the whole machine.
The program management office must keep an accurate day-to-day view of company finances as they are affected by company initiatives.
Individual projects are short-term endeavors. While such projects are essential, the project managers, offices, and workers involved only have to stay involved in them until the end.
The program management office has to monitor all short-term office projects in a continuum. Program management strategies must consider how past, present, and future project initiatives tie into the company’s long-term financial and proprietary goals.
Additionally, the program management office may have to research projects from previous corporate management administrations to assess financial projections for the future.
The point is that the program management office must always have a long-term and bird’ eye view of individual projects and how they tie into the company’s continual success as a whole.
Every new short-term project that begins is another opportunity for program management to consider its long-term proprietary and financial ramifications.
Conflict Resolution and Problem Solving
Obstacles, problems, resistance, ineptness, and interpersonal conflicts will inevitably arise in high-pressure work environments.
And individual offices, project managers, and workers sometimes get competitive and territorial over their roles and projects. While not out of the ordinary, professional rivalries and misunderstandings do occur from time to time.
However, if such problems aren’t mitigated promptly, office feuding and rivalries can cause individual offices to forget they are a team working for the betterment of the company.
The program management office, which always has to maintain a big picture view of circumstances, can offer conflict resolution solutions and action plans to resolve conflicts and help individual offices understand everyone must work together.
Contact B STATE Today to Maximize Your PMO’s Potential
Astonishingly, three out of every four program management offices will shut down after three years of operations. Some program management offices may have unrealistic goals, the wrong operational setup, the wrong people in charge, or charged with a good purpose for the wrong reasons.
It isn’t enough to open a program management office within itself; the program management office must understand the big picture of company operations and how offices and departments link together to ensure the delivery of large-scale initiatives.
Such effort takes time, planning, research, and relying on the right professional to get the job done.