Portfolio Management Activities Across the PMO Continuum

The PMO is an ideal organizational entity to lead in the establishment of a project portfolio management capability. Its dual ability to view the status of all current projects and to offer assistance in initiating and planning future projects positions it well for the job at hand. In structuring a "project portfolio management" function, its primary responsibilities will be to facilitate the involvement of senior management, to create processes envisioned by senior management, and to manage process implementation.

The stages of PMO evolution along the PMO competency continuum are characterized by an increasing capability to influence and manage senior management participation in the processes of project portfolio management. As well, the PMO's progressive ability to integrate projects with the organization's business interests is a factor in its project portfolio management maturity.

Table 17.1 presents an overview of the range of prescribed PMO project portfolio management activities according to each level in the PMO competency continuum.

Table 17.1: Range of Project Portfolio Activities across the PMO Continuum

Project Office	Basic PMO	Standard PMO	Advanced PMO	Center of Excellence
Provides project data to a higher level PMO or other oversight authority for consolidation	Introduces the fundamental concepts of project portfolio management Develops a process and criteria for project selection Establishes senior managers project reviews Compiles and compares performance data from multiple projects	Establishes and manages collaborative processes for project portfolio management Aligns projects with business strategy Establishes project business case review gateways Implements a process for resource review and allocation Develops methods to prioritize projects	Creates a comprehensive project portfolio management capability Convenes formal portfolio review boards or other authority on a recurring basis Enables real-time project data use in decision making Establishes early project termination process	Develops policies and guidance for project portfolio management Pursues an environment that supports effective portfolio management Examines and manages business issues affecting portfolio management

The project office at the low end of the continuum has minimal direct concern for project portfolio management, except to ensure that accurate project performance information is conveyed in a timely manner. Portfolio management decision makers will rely on this information from every project as a basis for managing the organization's business interests.

It is at the mid-range PMO levels of the continuum that a viable portfolio management function is formulated and implemented. This is where the PMO establishes its ability to collect, manage, and sometimes provide preliminary analysis of the project performance information that is made available to executives and senior managers for review and deliberation associated with the project portfolio management process. The mid-range PMO's efforts also can include some level of collaboration and coordination, which is particularly needed when the project portfolio review authority is a board or committee that crosses organizational boundaries. The PMO can serve to facilitate executive and senior manager participation in project and portfolio reviews, deliberations, and decisions — usually by arranging or otherwise specifying needed meetings, review periods, and decision deadlines. Then, the PMO carries out the direction and guidance of the portfolio review authority's decisions and implements the associated actions at the project level and within the project management environment.

The center of excellence has primary added responsibility for ensuring that the project environment is supportive of the relevant organization's portfolio management activities. To that end, it monitors the effectiveness of other PMO functions already in place and, where needed, implements function expansion and process improvements to better serve the "project portfolio management" function. It also ensures that cross-functional business interests are achieved by this function.

The fundamental objective of the PMO's "project portfolio management" function across this continuum is to involve senior management in the project management process. By ensuring their ability to know what is going on in the collection of current and pending projects, and by enabling them to make relevant business decisions against that knowledge of status, progress, and performance of the project portfolio, the PMO will achieve the requisite senior management participation in project management.