Selecting PSO Organizational Structures

Different organizations have taken various approaches to the structure and placement of the PSO. In this section, I comment on my experiences with each of the structures I have seen in practice.

Virtual versus Real

A virtual PSO performs all of the functions of any other PSO, except that its staff is allocated to the business units. These virtual members of the PSO are available only when their services are needed. They do not perform any routine functions. Other than a director and perhaps an administrative support person, the virtual PSO does not have any other budgeted staff. Professional staffs from the business units that are involved with projects have agreed to volunteer their services to the PSO on an as-needed basis. This is not a permanent volunteer position. These individuals, who are generally project managers themselves, agree to serve for some period of time and are then replaced. In many cases, they volunteer to provide only a specified type of service or services.

A real PSO does have a budgeted staff of professionals, which probably includes several senior-level project managers. They perform several routine functions, such as PMLC process improvement programs, project reviews, training design, training delivery, and software evaluations. The project reviews are a good way to coach other project managers, monitor the adoption of the methodology, and uncover best practices. Their strength will probably be that they offer a healthy dose of project support services to project teams on an as-requested or as-needed basis.

Proactive versus Reactive

The proactive PSO aligns very closely with the real PSO, and the reactive PSO aligns closely with the virtual PSO. The real PSO can be proactive because it has the staff to take leadership roles in a variety of projects to improve project management processes and practices. Conversely, the reactive PSO does not have the staff and does well to just respond to requests for help from project managers and team members.

The PSO can be both proactive and reactive. Its proactive role will extend to monitoring and compliance activities. Its reactive role will extend to supporting project managers and teams on an as-requested basis.

Temporary versus Permanent

What I have called Program Offices in this chapter are the only temporary form of PSO that I know of. They may be very short-lived, and as soon as their portfolio is complete, they are disbanded. Or, they may be very long-lived and continuously add new projects to their portfolio. All other examples of PSOs are permanent and service an ever-changing list of projects.

Program versus Projects

I have already defined programs as collections of related projects. The related projects always have some dependencies between them, so there is a need for an oversight organization such as a PSO. Significant resource management problems will arise because of the inter-project dependencies, and only oversight from the vantage point of a PSO can be effective in resolving such difficulties.

Enterprise versus Functional

PSOs can be attached at the enterprise level or functional level as follows:

• At the enterprise level, they must provide services to all disciplines. They are generally well-funded and well-staffed. They have visibility at the project portfolio level and at the senior management level and may be involved in strategic roles.
• At the functional level, they generally service the needs of a single discipline. They are generally not as well funded or as well staffed as their enterprise-level counterpart.

Hub-and-Spoke

The hub-and-spoke structure is an example of a PSO that is both enterprise-wide and functionally based. In very large organizations, the PSO may be organized in a hierarchical form. The hub is where the enterprise-level unit (also known as the central office) is housed. It is a high-level PSO that sets project management policy and standards for the enterprise. If only the hub form is in place, then all of the functions of the PSO will reside there. In time, as the organization grows in its maturity and dependence on the PSO, these functions may be carried out at the business unit or division level by regional PSOs (the spokes), who take their process and policy direction from the central PSO. The hub is typically staffed by high-level project executives whose focus is strategic. At the end of a spoke is a regional or functional PSO, which has operational responsibilities for the unit it represents. Obviously, the hub-and-spoke configuration works best in those organizations that have a more mature approach to project management. It is not a structure for organizations new to project management. Those organizations should focus on a hub structure first and then expand to the spokes as their practice matures.