Organization and Structure Function Model | The Complete Project Management Office Handbook, Second Edition (ESI International Project Management Series)

The PMO should establish a viable position of authority and business function alignment within the relevant organization — for itself and for affiliated project teams. Otherwise, a business entity other than the PMO, which does not have the same level of vested interest in achieving project management excellence as the PMO, and which is presumably less qualified than the PMO to lead professional project management activities in the project management environment, will apply general experience and rules of thumb rather than practices of precision to guide project management efforts.

This is not intended to suggest that other business units are unable to accomplish project management. Rather, it is intended to emphasize that the PMO is established for that very purpose, and it should be given the mandate, through appropriate organizational alignment, to represent, lead, and otherwise influence the activities of the project management environment.

To achieve the desired level of influence, the PMO will have to demonstrate greater capability and business benefits than have been shown by the business units it supports. To that end, this PMO function is likely to be one of the more difficult PMO functions to fulfill. However, it can be accomplished in due course under managed and collaborated PMO growth and expansion efforts within the relevant organization.

The prominent activities of the PMO's "organization and structure" function model are depicted in Figure 7.1. Each activity is described in the following subsections.

click to expand
Figure 7.1: "Organization and Structure" Function Model

Set Up the PMO Structure

The PMO should conduct initial planning to establish its structure, and then ongoing planning to expand its structure and reach the desired level of organizational alignment. The PMO can use the suggested guidance presented in the following three subsections to set up the PMO structure and operational alignment within the relevant organization.

Identify Staff Needs for PMO Functions

The PMO charter is the guiding document for this effort, as it contains the specification of PMO responsibilities for the PMO functions to be pursued. The PMO charter should adequately convey the functionality to be established. In this activity, the PMO will have to translate functionality into staffing requirements.

It is fairly common that the core staff of a brand new PMO is made up of one or two senior project managers, individuals deemed competent to organize the efforts within the project management environment. Furthermore, this full-time PMO staff may be the one that is expected to remain in place for the foreseeable future, with no anticipated staff additions. This condition prompts two considerations. First, this small PMO staff must accurately estimate current and near-term (i.e., one year) workload requirements to ensure that it can achieve performance expectations with limited resources. Second, the core PMO staff should conduct an early and active search for reliable, part-time assistance, particularly in technical areas.

The PMO will need to set up functional capability according to the PMO charter. It can begin by reviewing and prioritizing its responsibilities and activities in each of the 20 PMO function areas designated for implementation. Presumably, a new PMO will not tackle all 20 PMO functions at the onset. Rather, the several most important functions will be introduced and accomplished by the core PMO staff. Then, for each selected PMO function, the core staff will highlight the anticipated work requirements and identify the staff position responsible for its accomplishment. In essence, a PMO staff responsibility matrix is constructed.

PMO staff planning should be an ongoing effort unless the PMO has become stagnant in its growth and expansion efforts. However, both initial and ongoing PMO staff planning activities can benefit from a general analysis of PMO staffing requirements from a staff-category perspective. The PMO can define staff needs according to three primary PMO staff categories.

PMO Business Staff

The PMO business staff is represented by the designated PMO manager and by any designated PMO function managers or other operational leaders in the PMO. Usually, the limited cadre of initial PMO staff members in a new PMO will all have business-staff responsibilities. The depth and extent of business-staff responsibility will increase as the PMO and the project management environment become more mature. General business-staff responsibilities for small and large PMOs alike could include:

Managing PMO operations and PMO staff performance
Establishing PMO functionality for oversight, control, and support of project management
Collaborating with business units to integrate business needs, interests, and objectives
Collaborating with technical discipline managers to integrate technical management
Advising executives and senior managers in professional project management practices
Contributing to management of customer and vendor/contractor business relationships
Monitoring and managing project performance
Maintaining and tracking project cost, schedule, and resource utilization

These PMO business-staff responsibilities transcend virtually all of the 20 PMO functions, so they have some applicability regardless of which functions are selected for implementation.

PMO Technical Staff

The PMO technical staff is represented by individuals aligned with the PMO who develop, implement, and manage professional project management practices within the project management environment. It also may include experts in the one or more technical disciplines pursued within the relevant organization.

The initial staff members of a new PMO will fulfill this technical-staff role on a full-time basis. Other project management and technical discipline experts in the project management environment can contribute their skill and competency on a part-time basis. If PMO growth and expansion is anticipated, part-time technical-staff roles could be transitioned to full-time PMO positions. Of course, project managers and technical leaders are prominent candidates for full or part-time PMO technical-staff positions. The PMO may also want to consider qualified project team members to fill PMO technical-staff roles.

General PMO technical-staff responsibilities for either full-time or part-time PMO staff members could include:

Developing, implementing, and managing project management processes and practices
Integrating technical discipline and business processes and practices
Performing project management and technical audits and reviews
Researching, recommending, and implementing project management tools and systems
Developing and implementing project management and technical discipline standards
Analyzing and implementing improved project management capability solutions
Facilitating project manager and project team activities — planning, mentoring, etc.

Unless the PMO is a mature organization, it will likely have to rely on part-time PMO staff support that is aligned with a specific event or purpose over a prescribed period of time. A common approach to part-time PMO staffing is the creation of a task force or development team from among qualified resources available within the project management environment. Per the sample of PMO technical-staff responsibilities cited above, it can be seen that senior level project and technical managers will be prime task-force candidates. These ad hoc teams will contribute a valuable service to the relevant organization and to the PMO as it heads up and provides business and technical direction to the team's efforts.

PMO Administrative Staff

The core PMO staff will likely have primary responsibility for accomplishing administrative activities that accompany their work in PMO business and technical management areas. However, to the extent that the PMO's administrative burden can be reduced, the more effective it will be in providing timely project management capability improvements. Like administrative aspects of project management, the PMO will have to identify prominent needs and requirements, substantiate the cost, and acquire the necessary resources.

It should be noted that PMO administrative staff responsibilities tend to have a broader connotation beyond that of administrative assistant, although such an individual would be an invaluable PMO staff member. More so, the PMO administrative staff will likely require some fundamental comprehension of project management concepts and practices, which makes this an ideal role for emerging project manager candidates and talented project team members.

General PMO administrative staff responsibilities for either full-time or part-time PMO staff members could include:

Collecting, compiling, and distributing recurring project management progress reports and other documents from various project managers for PMO and senior management review
Preparing project performance analyses for PMO and senior management review
Preparing and managing PMO business and technical correspondence
Coordinating and administering training in the project management environment
Performing project schedule management using an automated tool and creating master schedules of all projects for PMO and senior management oversight
Establishing and maintaining the project management library and archives and any associated on-line project knowledge management system capability
Supporting PMO task force efforts by coordinating, compiling, and producing documents and materials resulting from task force efforts
Coordinating arrangements and scheduling routine project audits, mentoring services, and project planning support and facilitation

Per the set of sample PMO administrative staff responsibilities presented, it can be seen that, at times, there may be little distinction between administrative staff and technical staff. This category of PMO staff responsibilities is presented to illustrate the workload that can be encountered to warrant additional PMO staff assignments.

Introduce PMO Staff

The initial core PMO staff will usually be positioned through executive mandate (or through other similar senior management action) to establish the PMO capability. This one-, two-, or perhaps three-person team will be charged with creating the preliminary PMO design and implementing initial PMO functional capability. Ultimately, the PMO will need to enlarge its staff, via introduction of full-time or part-time resources, if full project management capability and maturity are specified as business objectives within the relevant organization.

The PMO can use the PMO staff responsibility matrix cited earlier to contrast business, technical, and administrative staff responsibilities against the current capacity to fulfill them. In turn, the PMO should identify any prescribed functional areas that are not adequately covered and specify the staff resource(s) needed to close the responsibility gap relative to the required PMO functionality.

This staffing plan may be an element of the PMO charter for a newly formed PMO, but its review and preparation should be a recurring activity, possibly annually. A staffing plan worksheet can be developed and can include the following elements for examination:

Current PMO resources assigned
PMO functional areas not adequately covered
- Functional area identification
- Functional performance absent or lacking
- Impact of inadequate functional coverage
- Resource(s) required to fulfill functional coverage
New or expanded PMO functionality to be implemented
- Functional area identification
- Functional performance to be achieved
- Requirement for function implementation — mandate or natural expansion
- Intended impact of function implementation, e.g., business benefit
- Resource(s) required for function implementation
Adjusted PMO staff requirements

This sample worksheet can be used to compile requirements and justification that will be presented to senior management for approval and allocation of resources to the PMO.

The PMO staffing plan is presented to appropriate authority within the relevant organization for review and approval. The PMO will have to decide if other affected business units will also receive copies of the PMO staffing plan for purposes of coordination and collaboration. One example of this is found in coordination with the human resources department. Another example is when the staffing plan includes requirements for a part-time PMO task force involving representatives from various business units and resource managers. Those entities should be aware of and included in coordination for specific or general PMO resources.

The PMO also may want to personally present its staffing plan and associated strategy to senior management and other key participants as a means to further solicit their support and ensure proper conveyance of needs. This may include being available for executive or senior management team meetings at which PMO staffing deliberations will take place.

The final step is that of acquisition and assignment of approved resources to complement the PMO staff. The PMO will usually coordinate with the HR department for any full-time staff acquisitions and with resource managers for part-time acquisitions.

Analyze and Establish PMO Relationships

The PMO should be recognized as a viable business entity that represents the interests and activities of the project management environment. In some cases, PMO recognition within the relevant organization will facilitate relationship development, and in others, relationship development will foster PMO recognition. The PMO will need to examine which perspectives can be pursued to establish the necessary organizational relationships it needs to conduct business effectively.

In general, PMO recognition is usually achieved through the combined influence of three factors:

Executive mandate and support: The PMO is established and maintained under executive direction as the means to undertake centralized oversight, control, and support within the project management environment.
Business need: The PMO emerges from a fundamental technical or business support team, possibly a methodology development team or capability assessment task force, to acquire broader responsibility and authority within the project management environment.
Distinct business contribution: The PMO grows and expands when it is viewed as a contributor to the achievement of business objectives (revenue generation), improvement of project management capability, or realization of customer satisfaction.

These are prominent factors to be considered and analyzed when defining the PMO's role and position within the project management environment, and in establishing its relationships with other business units within the relevant organization or enterprise.

Internal and external business relationships also will be established according to the overall responsibilities of the PMO, consistent with its stage of maturity, i.e., its level of progression along the PMO competency continuum. Less-mature PMOs will usually have limited need for far-reaching business relationships, and most will be internal. More-mature or advanced PMOs will operate more like a business unit and will require business relationships comparable with peer business units within the relevant organization.

An analysis of current PMO recognition, current PMO responsibilities, and current PMO business unit peers will provide insight to the business relationships that warrant pursuit. The following are a few key points for examination and analysis of PMO business relationship needs.

Appropriate technical representation: The PMO will need to integrate the expertise and participation of technical departments — design, manufacturing, product development, etc.
Alignment with senior managers and decision makers: The PMO will implement policy guidance conveyed by executives, senior management teams, and oversight committees.
Affiliation with internal business-support units: The PMO will need support to initiate and conduct customer projects and to manage business processes within the project management environment. Some representative affiliations could include:
- Information systems
- Human resources
- Procurement and contract management
- Business development
Affiliation with project resource managers: The PMO may not have project resources directly assigned and thus will rely on resource managers to provide project managers and project team members.
Affiliation with external project stakeholders: The PMO will need to conduct business associated with project performance that could extend outside the relevant organization:
- Customer relationships
- Vendor/contractor relationships
- Regulatory agency relationships

A review of these points of examination will enable the PMO to identify and pursue the appropriate business relationships needed to accomplish its mission.

Establish Project Team Structure

The PMO has a vested interest in achieving the prescribed level of oversight, control, and support in the project management environment. All that it can accomplish is influenced by the degree of formal alignment of project managers and other project resources within its purview. Likewise, the structure by which project team members are aligned under a project manager influences the project manager's ability to oversee, control, and support the performance of project team members. The third consideration of project team structure includes defining the extent to which external participants will be regarded as members of the project team. This refers primarily to customers and vendors/contractors, but it also includes potential designation of other participants within the relevant organization as members of the project team.

Essentially, the project team structure is defined to include the project manager and project team members, the integration of external participants into that team, and the relationship each project participant has with the PMO. These considerations are addressed in the following three subsections.

Specify Project Team and PMO Relationship

The nature of project team alignment with the PMO is generally associated with the PMO's stage of development along the PMO competency continuum. That is, it is more likely that there will be formal affiliation of project managers and project resources with the PMO when the PMO is operating at an advanced stage. Notwithstanding, there appears to be a prevalent approach in many organizations where project managers and project team members are not aligned with the PMO, regardless of the PMO's stage of development. However, at least some professionals in the project management discipline would agree that greater project effectiveness is achieved when all project resources are aligned to some degree under the PMO, and this function model recommends that at least project managers be aligned to some extent with the PMO.

The concept of project resource alignment presented here means the PMO has some range of control over project resource assignments, activity schedules, and performance. A generally acceptable range of control extends from reasonable influence, where project resources inherently respond to PMO oversight and guidance as a natural approach to project participation, to direct assignment, where the project resource reports to the PMO director, an aligned project manager, or other manager associated with the PMO.

The following are four progressive configurations that the PMO can consider in specifying its relationship with project managers and project team members. The PMO can identify variations of these configurations to better describe resource alignment in its project management environment. This specification is valuable because it can be associated with impacts on project performance. As well, it can indicate conditions that limit or facilitate advancements in project management capability and maturity.

No Alignment of Project Resources

This configuration is one in which the PMO has no apparent influence or control over resources assigned to perform work within the project management environment. This is normally associated with the smaller PMO operating at the basic stage of development. However, it is not unusual for a standard PMO to also encounter this condition. The following list identifies a few of the prominent impacts of this condition on the PMO and the project management environment:

Strong and extended-period communication and collaboration will be needed to develop and implement project management governance and guidance, project management standards, and common project management tools and systems.
Recurring executive and senior manager involvement may be needed to direct and monitor timely project resource input for cross-project reporting and adherence to the standards of report content for PMO review, analysis, and aggregation.
The ability to implement preferred practices can be limited by individual professional interests and conflicting business and professional priorities encountered outside the project management environment.
Training for project manager and project team members arranged through business units or individuals could be inconsistent with preferred project management practices.
Capability to identify cross-project needs and reassign project resources on short notice to priority projects may be limited.
Resource utilization across multiple project assignments may not be effectively planned and tracked when there is no central oversight, resulting in resource overcommitments and undercommitments to project efforts and project task work that is based on personal schedules and availability instead of business priorities.
Project resource performance evaluations can be inconsistent across the various reporting officials serving as performance evaluators.

Indirect Alignment of Project Managers

This configuration is one in which the PMO develops active working relationships with project managers who are directly aligned with business units. In turn, those project managers will usually accept and apply PMO governance and guidance when an advantage is identified. As well, some of these project managers will demonstrate a willingness to participate with the PMO in developing and implementing standards and practices in the project management environment. This provides a reasonable level of PMO influence, albeit very limited control over project resource assignment and performance. The following list identifies a few of the prominent impacts of this condition on the PMO and the project management environment:

Project management practices may vary across different project efforts, and project team members will need to differentiate the approach and preferences used by the project manager on each project to which they are assigned.
The PMO will likely need to compete for project manager time and influence with the project manager's reporting official in the business unit.
The capability to develop a cadre of professional project managers within the relevant organization may be limited by an inherent focus on the technical aspects of project performance rather than on effective implementation of modern project management practices.
Modest levels of affiliation with the PMO will facilitate communication and an exchange of ideas and concepts among project managers who share the PMO as a central point of coordination and collaboration on project management practices.
Project managers will gain a better understanding of the PMO's support capability in the project management environment, particularly identifying PMO support available for use on their projects. Ideally project management efficiency and effectiveness will improve as a result of the PMO relationship.

Direct Alignment of Project Managers

This configuration is one in which project managers work for the PMO when assigned to lead efforts in the project management environment. For the most part, they will receive their assignment from the PMO, and they will be responsible to the PMO for successful project completion and the associated achievement of project objectives. In turn, the PMO will monitor project progress and project manager performance. Note, however, that direct alignment does not necessarily require direct assignment to the PMO, although that would be the preferred condition. Moreover, this alignment of project managers does not infer alignment of project team members, which is discussed in the next section on project team structure. The following list identifies a few of the prominent impacts of this condition on the PMO and the project management environment:

This influential position of the PMO can be used to ensure that business interests and objectives of the relevant organization are integrated and managed across all projects.
The PMO will be able to prepare performance reports that are consistent across all designated project managers, but it will likely have to coordinate and manage the incorporation of its individual performance evaluations with those of the business unit if project managers are not directly assigned to the PMO.
The PMO will have greater ability and a more effective means of introducing a viable and repeatable project management methodology process that is mandated for use by all project managers. Similarly, common project management practices and tools will be more likely to achieve widespread use.
The PMO will need to establish the capability and infrastructure to properly manage aligned project managers, whether that group is small or large, and that need is increased if project managers are assigned directly to the PMO.
The PMO can qualify and assign project managers to projects consistent with their skill and knowledge, not just because they are available. The PMO can also prescribe and provide technical and professional competency improvement activities for individual project managers to broaden their availability for more types of projects.

Direct Alignment of All Project Resources

This configuration is one in which all project managers and project team members are assigned to the PMO as a component of the PMO staff. There may be a distinction made between these project resources and members of the PMO staff working in specific function or support roles. However, once resources are assigned to the PMO, that distinction may be reduced as resources become available for work assigned on projects or on PMO functional efforts. The following list identifies a few of the prominent impacts of this condition on the PMO and the project management environment:

The PMO can hold central accountability for the assignment and performance of all resources in the project management environment.
The PMO can identify and commit the specific project resources that are qualified to perform approved project efforts.
The PMO can analyze skill and competency requirements, prescribe professional development activities, and forecast project resource strength in specific technical and professional competency areas in advance of needs.
The PMO can monitor and manage resource utilization across all projects and redirect resources to critical tasks as warranted by project needs and business priorities.
The PMO can effectively implement standard, repeatable processes within the project management environment.

Define Standard Project Team Structure

The project team structure is primarily a function of project resource ownership and project manager authority, as prescribed by most project management standards applied in industry today. Project manager responsibility for achieving project performance objectives must be supported by an appropriate level of authority to control project resource utilization, assign and manage project task performance, and enforce accountability of project team members. Otherwise, the designated project leader is merely serving as a project schedule coordinator or project report administrator and cannot reasonably be held responsible for project outcomes.

The PMO should be influential first in evaluating the effectiveness of the current project team structures that exist within the project management environment. Then it should define and recommend the project team structure that fits within the established organizational culture and serves the project management needs and interests of the relevant organization.

This PMO function model examines project team structure in a manner that is generally consistent with most prominent standards. It presents three models for the PMO to consider in defining and establishing a project team structure:

Functional project team structure
Matrix project team structure
Integrated project team structure

These structures represent a progressive state of project team cohesion that could exist or be established within the relevant organization. Upon examination of these different structures, many professionals in project management would likely agree that the most effective project team structure is probably represented by a combination of a prominent integrated project team structure, with a matrix project team structure applied for some elements of project participation when needed. In reality, most PMOs will probably implement structures that represent a variation of one or more of the structures presented.

Functional Project Team Structure

This represents a project team structure where the project manager has little or no authority over project resources. Instead, project resources are aligned with the resource provider, usually a functional manager in a business unit, who has primary authority over assignments and management of project resource contributions to the project effort. Other likely conditions resulting from this project team structure include:

A project manager may be designated, but that individual probably fulfills only a portion of the responsibilities normally associated with professional project management. Decisions affecting project performance often are made outside the purview of the designated project manager by one or more functional managers, business managers, and technical managers.
Direction, guidance, and the ability to apply effective project management processes and practices can come from various sources. The oversight of multiple functional managers could result in an inconsistent approach to project management and the uncertainty of project outcome. This condition of authority shared across functional managers also may indicate that there is no central project management authority below the executive or senior management level.
Functional manager position and business experience may serve in lieu of formal project management skill and competency to guide project management activities and affect project progress and outcome.
Project resources serve under the direction and conditions of a functional manager, who — instead of the designated project manager — will evaluate their performance and influence their career progression. At best, a designated project manager will coordinate the efforts of these assigned resources and achieve resource performance results primarily through personal attributes of influence and persuasion.
Technical managers may be called to perform as project managers solely because of their demonstrated technical skill and competency rather than on capability and experience to manage the full range of project management life cycle activities.

Matrix Project Team Structure

This represents a project team structure where the project manager has limited authority over project resources, which are now aligned with the project manager for purposes of project work. Some project management standards distinguish between a strong matrix structure and a weak matrix structure. In a strong matrix structure, the project manager has significant authority and control over project resources during their project assignment. In a weak matrix structure, the resource provider (i.e., functional manager) retains primary authority and control of the resource but fulfills resource commitments to the project manager. Other conditions that are often associated with this project team structure include:

The role of the project manager is distinct and presumably associated with an individual qualified on the basis of skill and experience in project management concepts and practices. It is a role that is generally recognized and appropriately regarded by all project resources and functional managers within the relevant organization.
The project manager will normally evaluate project resource performance as an element of project management. If the resource's project assignment is an extended one, the project manager may be solely responsible for conducting the annual performance review. If the assignment is shorter, the project manager is usually requested to provide an interim resource performance review for the assignment period, and that is entered into the individual's personnel records and serves as contributing input to performance reward and career progression decisions.
The qualification and designation of project managers as the central point of project management responsibility facilitates the introduction of common and repeatable project management processes and practices. In turn, this capability is readily conveyed to those project resources in the matrix team structure, and they become increasingly effective in their accomplishment of project responsibilities across all project assignments.
The assigned project resource normally cannot be assigned to other project tasks or other projects without the concurrence and commitment of the resource provider. Similarly, if there is a precise period of performance specified for a particular project matrix team resource, untimely completion of associated project tasks could affect project resource availability.
The resource provider or functional manager who "owns" the resource can assert control or influence to remove or replace the resource assigned to the project. In turn, project managers will need to collaborate with resource providers at regular intervals to ensure current resource commitments and planned resource assignments are fulfilled in a timely manner. This is a small administrative burden that is encountered primarily when a weak matrix team structure is applied.

Integrated Project Team Structure

This represents a project team structure where the project manager has primary authority over project resources, which are usually aligned through a direct and full-time assignment to a project manager or to the PMO. Certain project management standards refer to this as a "projectized" project team structure. This model uses the term "integrated" to represent the full-time, ongoing alignment of project team members, project managers, and the PMO in the project management environment. In the next section, the further integration of external project participation will again be considered. Other prominent conditions for this project team structure include:

A distinct central point of authority and responsibility for project management and project performance is established at the project level and at the PMO level.
Accountability and actions for integration of strategic business objectives into project management efforts becomes less cumber-some. Executives and senior managers can influence project management direction toward achievement of business objectives without having to personally manage projects.
The project management needs of all business units can be served. Professional project management processes and practices can now be applied to all applicable business and technical interests within the various business units of the relevant organization.
Project management resources can be developed and grown within the culture of the relevant organization as they are acquired. This structure promotes measurement of project management skill and knowledge alongside technical capability as a qualifier for professional advancement.
Project resources have reduced task performance and scheduling conflicts. These results stem at least from their full-time alignment with a central project management authority and, possibly, by having one supervising project manager.
Project resource utilization planning and management should be more effective. Project resources can be assigned within the project management environment to respond to projects having business priority, to fill in temporary resource vacancies, to apply specialized skills, and to contribute to the development and implementation of PMO function areas. Any nonproject time can be accounted for in developing capabilities within the project management environment.
Project resources have common performance standards across all projects to which they are assigned. Project managers contribute to establishing these standards and are instrumental in applying them to all project efforts.

Define Extended Project Team Alignment

The PMO will need to examine its culture and business environment in making decisions regarding extended project team alignment. This involves the need to determine how closely other project participants who are external to the relevant organization are aligned with the project and with the project manager. Specifically considered are three project stakeholder groups — customers, vendors/contractors, and regulatory agents. Other stakeholder groups presented in the next section can also be considered, as the PMO deems appropriate. Project performance benefits when representatives from these groups, as well as specifically assigned project team members, know and recognize who are members of the project team.

The PMO can create a default approach for the inclusion of extended project team members. However, unless the nature of project work is so homogenous and the same project stakeholders tend to be present on recurrent projects, each new project will warrant independent examination regarding the need for extended project team alignment.

The consideration of extending project team begins with understanding the conditions that warrant project team alignment. This is followed by establishing protocols for project team participation and alignment. Then the value of combining tasks and work activities in a common project work plan or keeping them in separate plans is examined.

An overview of these factors is presented for PMO consideration for each of the stakeholders who could be aligned as extended participants of the project team. Decisions concerning stakeholder alignment should be made in collaboration with applicable stakeholders to obtain their concurrence. Alignment consideration should account for current and potential business relationships, particularly with customers and vendors/contractors. To that end, also see the information presented in the chapters on the PMO "customer relationships" function (Chapter 18) and the PMO "vendor/contractor relationships" function (Chapter 19).

Customer Project Team Alignment

Some customers will collaborate on the project's technical solution and the plans to achieve it, and then they will essentially remain uninvolved outside of routine status meetings and progress report reviews. This is probably not characteristic of a project effort that warrants customer inclusion as part of the project team.

Conversely, some project work inherently requires ongoing customer involvement in the development and delivery of the project's technical solution. This bears consideration for having one or more customer representatives on the project team. In some cases, the customer may even have its own intact project team to be integrated. Presumably, there will be a customer contact or customer project manager who will serve as the point of integration.

The PMO or project manager should establish the protocol for this relationship early in the project effort, at or before the project kickoff meeting. In particular, the parties will need to decide how project team members will be assigned responsibilities and perform work together. A common approach is for the two project managers to coordinate their plans and then collaborate on the nature and extent of participation by necessary project resources. A related protocol point is establishing how technical or other subteams having combined participation will be managed, including specifying who will be the subteam leader. Finally, an important point of protocol is made when the customer distinguishes between being a project team participant and being a representative for acceptance of project deliverables obligated under a contract or agreement.

Many project managers find it useful to have key customer activities included in their work plan. Even subtle customer activities associated with the project take time — a few days for a document review, allocation of time for meeting preparation and attendance, a period for customer deliberation and decision, etc. The project work plan should account for these types of customer "deadlines" and activities. In many cases, the project work plan can become the customer's work plan, and the inclusion of assigned tasks for the customer will allow everyone to see the sequence of activities for which they are responsible. Besides, if it is not specified in the work plan, how will everyone know that it is an important and timely project activity, or even an activity on the project's critical path?

Vendor/Contractor Project Team Alignment

The vendor/contractor is too often a forgotten entity in some project management environments. If not specifically aligned as part of the extended project team, the vendor/contractor must be distinctly aligned with the project manager. This is a subtle difference in some cases, but it is one that should be examined to determine whether the vendor/contractor project manager works solely with the project manager, or whether the vendor/contractor participants are integrated with the project team.

The prescribed protocols for this project relationship are very similar to those indicated for the customer project team, only now with reversed roles. Here the project manager can determine the level of vendor/contractor integration, the preferred approach to technical leadership and project team resource management, and the point of contact for vendor/contractor deliverables.

The PMO should prescribe conditions and standards for alignment, but the project manager will need to make the final decision regarding the integration of any vendor/contractor work plan with the primary project work plan. The conditions that normally warrant full integration of project work plans are associated with technical activities where vendor/contractor participants work side by side with primary project team members, serving as technical leads, technical experts, or technical assistants. In other project situations, the vendor/contractor may have responsibility for one or more deliverables that it prepares independent of any participation with the primary project team. That condition probably just requires that a single line item be included in the project work plan to represent the vendor/contractor effort relative to other project activities. Of course, the project manager or a designee on the project team must actively manage that work plan line item.

Regulatory Agent Project Team Alignment

The introduction of a regulatory agent as an extended participant on the project team may initially seem awkward. However, the purpose of identifying the extended project team in the first place is to ensure that the project manager is able to account for and manage all prominent project activities, with appropriate alignment of key participants. In some project management environments, a regulatory agent can be a prominent participant at critical junctures in the project management life cycle.

A regulatory agent is often thought of as an external government representative. However, as described in the next subsection on other project stakeholders, the regulatory agent role could originate within the relevant organization or as an external representative. Usually, a regulatory agent is introduced into the project at points of product development or delivery. The decision to formally recognize regulatory agents as extended members of the project team will be determined by the protocol required and by mutual agreement between the regulatory agent and the project manager.

The points of protocol for regulatory agents may be preestablished by the regulatory agency by the nature of its oversight role and the type of project. The PMO should thoroughly understand these protocols for all regulatory agents and convey associated requirements to project managers and project team members.

It is wise to include regulatory agent activities associated with the project as elements of the project work plan, as would be done for any other key project participant. This enables the regulatory agent to identify preferred points of activity and, if necessary, to coordinate adjustments as a matter of protocol or convenience. Equally important, the participation of a regulatory agent on the project work plan serves as guidance and a reminder to the project manager and project team members about the need for timely completion of project activities.

Other Stakeholder Project Team Alignment

The alignment of extended project team participants is a factor for PMO consideration based on relevant organizational culture and business needs. The PMO and others within the project management environment benefit by specifying and recognizing the standard composition of an active project team within the relevant organization. In that regard, this PMO function model does distinguish between members of the active project team, including primary and extended members, and other project stakeholders. Per reference to the listings in the following section, the PMO can add or exclude any project stakeholder roles as active participants on the project team.

Develop Stakeholder Participation

Who are the project stakeholders in your project management environment? This is determined by the PMO as it attempts to optimize communication among project participants and to maximize the benefits of stakeholder participation. This section recommends the identification of project stakeholders and describes the role that each can perform relative to project management activities and project performance. The following subsections describe six primary categories of project stakeholders.

Internal Project Team Stakeholders

This stakeholder category represents those project participants that are directly involved in conducting and managing the project effort. This group is responsible for producing required project deliverables and for achieving specified project objectives. In some project management environments, the project team can also be augmented by full- or part-time participation of PMO staff members. The following subsections describe the various stakeholders in this category.

Program Manager

This individual is responsible for oversight of multiple projects, usually a collection of projects that are interrelated by similar business interests, technical solutions, or customer base. This position usually serves as the reporting official of the project when it exists in the project management environment, and therefore it bears the responsibility for project success. Related position titles include "manager of project managers," "program director," and "project director."

Project Manager

This individual is responsible for conducting project management activities through all phases of the project management life cycle, managing project resource utilization and performance, and fulfilling project deliverables and objectives. Related position titles include "project leader," "project coordinator," and "project administrator."

Project Team Member

This individual is responsible for planning and performing work to accomplish project deliverables and to complete selected project management activities, as delegated by the project manager. This position reports to the project manager, either directly or through another project team member serving in an interim management or technical leadership position. The project team can comprise a variety of technical and managerial roles. Some of the more common roles include:

Assistant project manager
Technical leader
Technical staff member
Technical specialist
Professional staff member
Task leader/supervisor
Craft specialist/laborer

In some project management environments, the project team may be augmented by full-time or part-time participation of PMO staff members.

Internal Oversight Stakeholders

This stakeholder category represents those project participants that provide senior level direction and decisions to guide project management toward the achievement of business interests and objectives. The following subsections describe prominent stakeholders in this category.

Project Executive (Sponsor)

This individual is the senior manager responsible for project performance, with the power to authorize project selection, continuation, and termination and project funding. In some organizations, these responsibilities are deferred to a committee of executives or senior managers. However, this role still retains responsibility for the alignment of projects with strategic business objectives, as can be performed using an effective project port-folio management system. A related title for this position is "project sponsor." This role can also be fulfilled by the executive head of a business unit or, in some smaller organizations, by the CEO.

PMO Director

This individual is the head of the project management office having responsibility for establishing and conducting project management oversight, control, and support across all projects in the relevant organization, and thereby for each project at hand. The PMO director advises and collaborates with the project executive and other executives and senior management teams regarding overall project management capability as well as individual and collective project activities and status. Program and project managers may report to or otherwise be aligned with the PMO director, per the organizational structure established for the project management environment. Related position titles include: "PMO manager," "chief project officer" (CPO), "chief technical officer" (CTO), and "vice president for projects."

Executive Control Board

The executive control board is the group of executives or senior managers within the relevant organization that deliberates and decides on the capability instituted in the project management environment; determines project selection, continuation, termination, and funding (when deferred by the project executive or by business mandate); and thereby has vested interest in individual project performance. Related titles for this board include: "project management oversight committee," "project control board," and "executive management team."

Technical Advisory Boards

Technical advisory boards are groups, usually having some executive level representation, that convene to deliberate and decide technical processes and practices applied in the project management environment and in association with technical elements of project performance. Such boards could have special technical purposes, and there could be a board aligned with each major technical discipline within the relevant organization. These groups would collaborate decisions and activities with the PMO to achieve integration with project management processes and practices and thereby would have a vested interest in technical aspects of real-time project performance. A variety of groups by different titles can be established to represent technical discipline interests, including the following few examples:

Product development control board
Technical process control board
Configuration management team
Engineering design committee
Scientific analysis committee
Test and acceptance procedures committee
Construction management board
Manufacturing process control board
Technical achievement advisory council

Internal-Support Stakeholders

This stakeholder category represents those project participants within the relevant organization that serve as adjunct or part-time project team members. Their particular business, technical, or project management skill and expertise may warrant concurrent short-term assignments on several small to medium projects, or they could be assigned as full-time project team members on longer projects. The following subsections describe stakeholders in this category.

PMO Staff Member

This stakeholder group reports to the PMO director to establish and implement PMO functionality, develop project management capability in the relevant organization, and support project managers and project teams to achieve fulfillment of project deliverables and accomplishment of project objectives. Support is provided relative to the established functional capability of the PMO. See the PMO "career development" function (Chapter 11) for a full list of PMO staff positions.

Project Resource Manager

This is the individual to whom personnel who are competent to perform business, technical, and project management activities as members of a project team are assigned. This stakeholder is responsible for collaborating with the PMO and project managers to fulfill requirements for qualified project resources according to commitments made. In turn, project resource managers should solicit and incorporate project manager evaluations of project team member performance into performance reports for each assigned individual. Related titles for this position will vary by organization and industry.

Business Unit Managers

These stakeholders are the individuals who head the business units or departments in the relevant organization, including their designees who routinely provide business support to project managers and the PMO. Because of their interest in business outcomes on each project, they are viable project stakeholders. On larger projects, they could assign individuals with particular business expertise as members of the project team on a full- or part-time basis. Some examples of business unit support stakeholders include:

New product expert
Human resources manager
Business development manager
Legal adviser/counselor
Procurement/contracts manager

Customer Stakeholders

This stakeholder category represents those project participants that have responsibility for ensuring that project outcomes fulfill the intended business purpose or need of the customer's organization. These stakeholders are members of the customer's organization. The specified stakeholders in this category are not always active participants on every project. However, at least one of them is normally identified as a primary point of contact for each project effort. Stakeholders in this category are described in the following subsections.

Customer Executive

This stakeholder is the senior manager in the customer environment who authorized project selection and funding and who holds strategic level responsibility for project success. Although not always visible in the customer's project management environment, this stakeholder is undoubtedly present and working behind the scenes. This is also the point of contact for executive level discussions, if needed.

Customer Project Manager

This stakeholder is responsible for providing project oversight and control on behalf of the customer's interests and perspectives for project success. This individual, along with relevant customer project team members, will normally be involved in developing technical requirement and specifications, participating in the preparation and approval of project plans, and tracking project progress through acceptance of project deliverables. When present, this customer stakeholder serves as a point of contact and coordinates and collaborates directly with the project manage to ensure project success.

Customer Project Team Member

These stakeholders are responsible for performing technical, business, and project management activities on customer-initiated projects that may be performed in conjunction with the project at hand. In some cases, joint project management plans are prepared, and customer project team members join the primary project teams in task efforts. In other cases, customer project team members represent the customer project manager to establish an oversight presence. On many projects in different industries, there is no customer project team in the project management environment.

Customer End Users

These stakeholders are responsible for implementing the project's technical solution in the customer's business environment. They may act in lieu of or in deference to the customer project team to test, approve, and accept project deliverables.

Customer Business Manager

This stakeholder is the default customer representative and point of contact for project efforts. This role normally has responsibility for initiating the project request, managing the associated project contract or agreement, and receiving and approving project deliverables. This role is the one usually encountered on a majority of customer projects across industries, and it is used in lieu of a customer project manager and project team on projects where deliverables do not require intense technical oversight, scrutiny, and test and acceptance activities.

Vendor/Contractor Stakeholders

This stakeholder category represents those project participants who have responsibility for ensuring that project outcomes fulfill the offering of the vendor/contractor. These stakeholders are members of the vendor/contractor organization. The specified stakeholders in this category are not always active participants on every project. However, when vendors and contractors are involved in the project, at least one of them is normally identified as a primary point of contact for each project effort. Stakeholders in this category are described in the following subsections.

Vendor/Contractor Executive

This stakeholder is the senior manager in the vendor/contractor organization who holds business responsibility for the offering. It is this individual who normally warrants quality of products and performance as well as the fulfillment of any associated contract or agreement. This stakeholder is also the point of contact for executive level discussions, if needed.

Vendor/Contractor Project Manager

This stakeholder is responsible for leading the vendor/contractor project team in conducting assigned project tasks and in achieving the prescribed technical solution to fulfill the vendor/contractor's offer. When present, this stakeholder serves as the vendor/contractor point of contact and coordinates and collaborates directly with the project manager to ensure successful completion of the vendor/contractor effort.

Vendor/Contractor Project Team Members

These stakeholders have responsibility for performing technical, business, and project management activities on assigned projects. In some cases, joint project management plans are prepared, and the vendor/contractor project team members join the primary project teams in task efforts. In other cases, vendor/contractor project team members work independently to accomplish assigned project tasks. A vendor/contractor project team may or may not be established for each vendor/contractor offering.

Vendor/Contractor Business Manager

This stakeholder is the default vendor/contractor representative and point of contact for project efforts. This role is also prevalent when there is a particular product or service acquired, in lieu of technical development work associated with the project effort. It is the position usually encountered in business interactions with a vendor/contractor organization.

Other Project Stakeholders

This stakeholder category represents those project participants that have primary interests in fulfillment of all or part of the project objectives. These stakeholders can be associated with the relevant organization or be introduced from an external organization. The stakeholders in this category are not always active participants on every project. The nature of each project will determine the need for their participation. Stakeholders in this category can include:

Regulatory Agents

These stakeholders normally perform inspections or examinations within the project management environment to ascertain quality or compliance. This includes regulatory agents from business units within the relevant organization who primarily address product- and service-quality issues. It also can include external representatives who focus on compliance issues such as those from industry or technical standards organizations or government regulatory agencies.

Business Partners

These stakeholders have interests in recouping investments associated with project efforts. They are not normally visible in the project management environment, but they may be encountered through integrated activities with the business environment.

Industry Partners

These stakeholders have interests in achieving technical and technology solutions that advance industry standards, enlarge markets, or promote associated professional disciplines. They could be visible in the project management environment when one or more projects are involved in developing or implementing a solution of interest to the partnership. In general, industry partners may be business partners, but business partners are not inherently industry partners.

Executive Management Team

These stakeholders represent the highest level of executive management in the relevant organization. This stakeholder category includes the CEO, CIO, CFO, etc. It would be rare for these stakeholders to be visible in the project management environment, unless the enterprise is a small business. Therefore, this stakeholder group normally defers oversight responsibilities to the PMO or project executive (sponsor). The absence of visibility, however, does not mean lack of interest. These stakeholders undoubtedly will have some measure of regard and support for project contributions to business, and thereby they have an interest in the business results achieved within the project management environment.