State of the Consulting Industry: All Firms Are NOT The Same                    

I had two very interesting calls this morning: They are the impetus of this article; one was with a potential client in the banking and financial industry and the other was with a LinkedIn colleague looking to join the management consulting industry.  Both conversations landed on the same topic—the state of the consulting industry right now.

I wont hide that the consulting industry, while still very sizeable, is facing challenges that have led to cooler (some would even say “colder”) reception from some corners of the business community. In many regards, the cold shoulder is understood and warranted.  BUT—not all firms are the same.  I can only speak for myself: PM Principle was created to be different, to deliver different, and to earn different.   Here’s a breakdown of the current state of the management consulting industry.  I want to specifically focus on the impact of the large firms and the trickle-down effect it’s having on the overall industry.  THIS ARTICLE IS NOT MEANT TO BE CRITICAL—IT’S JUST STRAIGHTFORWARD, GRIPPING, AND AS TRUTHFUL AS POSSIBLE.

1.         Reasons for Potential Disenchantment with Large Consulting Firms:

·      One-size-fits-all solutions: Clients are feeling that larger firms are overusing their ‘standardized approaches’ over custom solutions.    [Vault, Consulting: Industry Outlook].

·      High fees and perceived lack of ROI: The cost of engaging big-name consultants ARE significant, and some businesses are questioning the return on investment. (Especially when the solutions aren’t highly customized and recent graduates lacking the real experience necessary to truly be consultants are deployed [IBISWorld, Management Consulting in the US].

·      Focus on “blockbuster” projects: There’s a perception that MBB firms prioritize large, pricey, splashy projects over smaller engagements that could benefit mid-sized businesses [NMS Consulting, Management Consulting Industry Trends in 2023].

·      Brand Cache:  Many of the larger firms simply have a strong brand recognition.  With the poor ROI, the overpricing, and inexperienced staff, clients are feeling disenchanted.

2.        Impact on Smaller Firms:

While these trends might lead some companies away from the bigger players, it can be a double-edged sword for smaller consultancies.  They are mistakenly lumped in with their larger cohorts.  PM Principle, for example, was founded over 10 years ago after witnessing these practices from the inside out.  We were born to be different—THE ALTERNATIVE TO THE BIG FIRMS.  We create only tailored, custom solutions; our consultants have 20 years of real tangible business and senior experience (as opposed to just Ivy League school name—though we have that too); and we are less about blockbuster projects or even our company branding.  We promote our consultants, our employees, and their successes; in essence, we consider ourselves a holding tank for superior brain power.  I won’t lie, though PM Principle IS different and has made great impacts with that difference—we are still caught in the wave created by the larger firms.

It’s important to note that the industry is still growing:

·      The global management consulting market is expected to reach $343.5 billion by 2025 [NMS Consulting, Management Consulting Industry Trends in 2023].

·      The US market specifically is estimated at $368.5 billion in 2024, with a strong projected growth rate [IBISWorld, Management Consulting in the US].

There is still the need for consulting—that “outsider looking in” perspective is still powerful and is still very much needed in, and by, the business world.  For smaller firms:

·      Potential for increased demand: As businesses seek more specific solutions and potentially lower fees, smaller, more agile firms could see a rise in demand.

·      Pressure to compete on value: Smaller firms will need to clearly demonstrate their expertise and cost-effectiveness to stand out from the crowd.

Overall, the management consulting industry is adapting to a changing business landscape. While large firms face some criticism, the industry as a whole is still experiencing growth. Smaller consultancies have an opportunity to capitalize on the potential shift in client needs, but they’ll need to focus on demonstrating their value proposition.

Sources:

Vault, Consulting: Industry Outlook [Vault, Consulting: Industry Outlook]

IBISWorld, Management Consulting in the US [IBISWorld, Management Consulting in the US]

NMS Consulting, Management Consulting Industry Trends in 2023 [NMS Consulting, Management Consulting Industry Trends in 2023]

The six (6) the top ethical considerations surrounding Generative AI in the business world

Artificial Intelligence: The Game-Changer in Modern Business

March 7, 2024

In the rapidly evolving landscape of technology, artificial intelligence (AI) emerges as a revolutionary force, fundamentally changing how businesses operate, innovate, and engage with their customers. The transformative power of AI extends across every sector, offering unprecedented opportunities for growth, efficiency, and competitive advantage. Yet, AI remains shrouded in complexity and uncertainty for many business leaders. This article seeks to demystify AI, offering a comprehensive understanding of its capabilities, benefits, challenges, and practical applications in the business world. By embracing AI, businesses can unlock new frontiers of possibility, enhancing their operations and setting new benchmarks in customer satisfaction and innovation.

First, let’s really try to define AI:  Artificial intelligence encompasses technologies that enable machines to mimic human intelligence processes, including learning, reasoning, and self-correction. At its core, AI can be classified into three types: narrow (or weak) AI, designed for specific tasks; general AI, which can understand and learn any intellectual task that a human being can; and superintelligent AI, which surpasses human intelligence. Key subsets of AI include machine learning (ML), where algorithms improve through experience, and deep learning, a type of ML based on neural networks with multiple layers.

Now for the business world: AI IS reshaping industries by offering smarter solutions to age-old problems. From retail and healthcare to finance and manufacturing, AI’s adoption is widespread, driving efficiency, innovation, and improved decision-making. Businesses leverage AI for various applications, such as customer service bots, predictive maintenance, fraud detection, and personalized marketing strategies, demonstrating AI’s versatility and impact.  These adopters are gaining a significant competitive advantage.  Imagine that you and your competitor have a similar product;  they sell for $98, and you sell for $96.  If it costs them less to make their product, THEY have a higher profit margin, and that wiggle room means they can easily deal with your lower price point—they just have to drop their price slightly, and now they are directly competing.

AI’s adoption is rapidly expanding across all sectors, transforming traditional business models and processes. For example, we recently used AI in retail to enhance customer experience through personalization and recommendations.  A client also asked us to use AI for smarter inventory management. In healthcare and Pharma, we use it to improve patient care with predictive analytics and diagnostic tools. Our number-crunchers in finance benefit from AI in fraud detection and automated customer service, while in manufacturing and “make,” there are significant advancements in Industry 4.0, predictive maintenance, and supply chain optimization—smart manufacturing in the factory of the future. These examples underscore AI’s versatile applications, driving operational efficiencies and innovation. Reducing costs, increasing margins, and creating a new competitive playing field.

AI spans several varying capabilities and technologies, each offering unique benefits:

·      Natural Language Processing (NLP): Enables machines to understand and interpret human language, facilitating interactions between computers and humans. Applications include chatbots and sentiment analysis.

·      Computer Vision: Empowers machines to process and interpret visual information from the world, applied in facial recognition systems and even autonomous vehicles.

·      Predictive Analytics: Uses historical data to predict future outcomes, aiding decision-making processes across finance, marketing, and beyond.

Now think of how these tools can make you smarter, your manufacturing line better or more accurate, or even your finance process more precise or indicative.  Imagine how your industry, your world, your way of doing business, or even the way you communicate, connect with, or service your customers can or has changed.

Consulting Unveiled: The Rise, The Fall, and The Resurgence

September 12, 2023

In the consulting industry, where I’ve carved out my business, I find myself grappling with a recent sense of disillusionment. I’ve set up media alerts to keep a finger on the pulse of the industry—today’s brought nothing but a cascade of grim headlines. Slalom Consulting axed 900 positions; McKinsey “reshuffled” this year too, affecting around 1400 individuals; and the list extends: EY, KPMG, and Deloitte all laying off hundreds of people. This barrage of bad news forces me to ask: what the hell is going on in the consulting world? Why the sudden onslaught of layoffs? Why the plummeting reputations to the consulting giants?  Basically, WTF is going on?

Let’s cut to the chase. Consulting, at its core, is a straightforward deal: “I have the knowledge you need, and I’m ready to sell it to you.  Lets make a deal.”  It’s a simple exchange of business secrets, tax strategies, marketing insights, or tech wizardry. But then the internet burst onto the scene (thanks Al Gore), spilling all the giant’s secrets left and right, forcing them to rethink their product.   “Fine,” said the consulting world, we will add services to the mix.  So the consulting world scrambled and added services to their once “secret sauce.”

Now, what crafts a powerhouse consultant? How did the likes of Bain, McKinsey, and Deloitte rise to dominate the industry? It boils down to a potent mix of tactical and strategic knowledge, a blend that created behemoths in various sectors, each holding a unique edge in specific domains.

But the real catalyst behind the industry’s meteoric rise was the market, a landscape that echoed the mantra, “Leave no stone unturned, leave no customer on the table.” Globalization was the game-changer: opening doors to untapped markets and unprecedented profits. Yet, it also ushered in a complex, dynamic competitive landscape, where information overload became the norm, and navigating the corporate ship through hostile waters became a high-stakes game.

But here we are, witnessing the giants stumble, failing to adapt to shifting sands, clinging to outdated strategies that no longer resonate with the evolving demands. They opted for a shortcut, recruiting fresh faces from top universities, offering them a crash course in consulting, and sending them out, ill-prepared, into the field. This strategy, aimed at boosting profit margins, has backfired spectacularly, diluting the expertise pool and fostering a breeding ground for dissatisfaction among clients.

So, where to from here? The answer is glaringly obvious: listen to the market, the customers, the industry.  As a consultant, that is what I would advise.

In my firm, we’re doing just that. Leveraging the rich reservoir of experience that my partners and I bring to the table, we’re committed to delivering strategies that empower our clients to function autonomously if that is what their end goal is. Our approach is grounded in humility, steering clear of grandiose profit margins to prioritize purposeful and effective outcomes that foster our and our client’s satisfaction and happiness.

We’re here to shake things up, to bring back the sharp, incisive consulting that the industry was once renowned for, driven by expertise, integrity, and a genuine desire to see our clients succeed. It’s high time the consulting world got back its edge, and we’re here to lead the charge.

The Secretes of the Metaverse

July 3, 2023

In the last few days—months—the term “metaverse” has become a buzzword for virtually everyone in every industry, sparking intrigue and excitement…and concern. However, in all these fancy articles, with great graphics and head-turning headline pics, no one bothered to clearly explain what the metaverse was or why and what I needed to know. Here, I am going to try to do just that: unveiled the secrets of the metaverse.

In simple terms, the metaverse is a virtual reality space—but a mixed space where users can interact with a computer-generated environment and other individuals in real time.  It mixes VR and AR—Virtual Reality and Augmented Reality and the Internet.

For those of us who are curious, and I am, the term comes from a 1992 book, “Snow Crash” where the author, Neal Stephenson, portrayed a virtual reality where users could virtually engage with the expanses of the digital universe. He thought he was writing fiction.

The metaverse is real…but like all things, it runs on something—something fuels the metaverse—and that something, is data. Every action, interaction, and transaction within this virtual universe generates vast amounts of data. From user preferences and behavior to purchasing habits and social connections, the metaverse thrives on data. But what opportunities does this bring for business, for the everyday consumer, for everyone?

1.    Hyper Customer Connection: Businesses will have deeper insights into customer preferences enabling in-depth personalization. Businesses will be expected, by their customers, to deliver a highly customized, tailored, individualized customer experience.

2.    Precision Targeting: Businesses will know their customer better—and will now be able to market to their customers better. Imagine the optimized marketing capabilities! Imagine the precision targeting capabilities!

3.    Innovation and Development: Data gathered from the metaverse can help businesses identify trends, analyze feedback, and gain valuable insights about products, usage, preferences, and more. By using this data, companies can make better decisions about product development, leading to more successful and market-aligned offerings.

4.    Communications: imagine a new type of Teams, or Zoom, or FaceTime…imagine a new virtual workspace or workplace. Imagine how that could change sales or education, or just the daily call to your loved ones. Just imagine…

Here is something else that we have to keep in mind when talking about the metaverse—Yes, it is real, but it is still very much evolving—and like all things—will always be evolving. So many tech and consulting companies (and I know quite a few) are hesitant to define and describe the metaverse simply because they genuinely do not fully understand it. After all—it is complex and the possibilities are endless. It’s understandable. As a result, the “metaverse” often takes different forms in different contexts, making it difficult to pinpoint a universally accepted definition. Despite all this, the business, social, education, communication, and the “everything else” possibilities are endless: seamless digital experience, collaborative workspaces and workplaces, new revenue streams, new social engagement, and new possibilities.

PS: there is a way to ready your organization for the metaverse. Let’s see if you can guess what it is.

Customer Success!

Customer Success isn’t just about keeping clients happy (although that’s definitely part of it!). It’s a strategic approach that fuels incredible business results.

Here are 6 insights I’ve gleaned from industry experts that will transform your customer success strategy:

1. Proactive is Profitable: Don’t wait for issues to arise. Anticipate needs and
proactively guide customers to maximize value. (Reduced churn, increased
product adoption)
2. Metrics that Matter: Track the right data! Measure success beyond vanity
metrics and focus on customer health & engagement. (Improved customer
lifetime value, data-driven decision-making)
3. Content is King (and Queen): Empower customers with self-service
resources & personalized content. A knowledge base is your secret
weapon! (Reduced support tickets, faster onboarding)
4. The Power of Community: Foster connections between customers. User
groups and forums create a loyal ecosystem and valuable feedback loop.
(Increased brand advocacy, valuable customer insights)
5. Listen to Learn: Actively gather customer feedback through surveys &
calls. It’s the roadmap to continuous improvement. (Enhanced product
development, happier customers)
6. Celebrate Success Stories: Showcase customer wins! Testimonials and
case studies are powerful magnets for new business. (Increased brand
trust, attracts high-quality leads)

By prioritizing these elements, you’ll cultivate a thriving customer base that fuels sustainable growth.

Let’s Clear the Air About Diversity!

Let’s clear the air about Diversity. I’ve been reading some interesting articles and I’ve noticed some interesting questions from my clients too.

Diversity in the Workplace: It’s Not Just a Buzzword (Let’s Get Real)

Hold up. Before you scroll past this thinking “diversity, yawn,” hear me out.
Diversity isn’t just a feel-good hashtag or a mandatory HR training session.
It’s the secret weapon you (and your company) might be missing.

Diversity Debunked: What it is and What it Ain’t
Let’s clear the air. Diversity goes way beyond a confetti cannon of skin
tones at a company picnic. It’s the beautiful tapestry woven from a variety
of backgrounds, experiences, and perspectives. We’re talking race,
ethnicity, gender, sexual orientation, age, socioeconomic background, and
even that quirky neurodiverse co-worker who can code like nobody’s
business (you know the one!).

Now, diversity isn’t just about hiring a random assortment of people. It’s
about creating an inclusive environment where everyone feels valued,
respected, and empowered to bring their A-game. Think of it like a high-
performing orchestra: you need violins, cellos, flutes, and maybe even a
funky kazoo solo (diversity!) to create a masterpiece (results!).

So, Does Your Workplace Really Value Diversity?
Here’s the honest truth: sometimes our own unconscious biases can create
a diversity mirage. We might think we’re champions of inclusion, but
unconscious assumptions can hold us back.

Here’s a reality check:
1. Challenge your network: Does your lunch table look like a United Nations
meeting, or a high school reunion photo?
2. Listen to the whispers: Are certain promotions met with raised
eyebrows, or is genuine merit celebrated?
3. Microaggression meter: Do casual jokes or comments make certain
colleagues feel out of place?

If you answered “yikes” to any of these, it’s time to get real.

The Power of “And”
Diversity isn’t about sacrificing competence for a quota. It’s about
embracing the “and.” WE CAN have a brilliant team and represent the
beautiful diversity of the world we live in. Studies by the Society for
Industrial and Organizational Psychology [Society for Industrial and
Organizational Psychology, 2023] show that diverse teams outperform
homogenous ones in creativity, problem-solving, and overall decision-
making.

The Takeaway
Diversity is a journey, not a destination. It’s about challenging assumptions,
creating a space for open dialogue, and celebrating the unique strengths
each person brings to the table. So, ditch the box-ticking mentality and
embrace the power of “and.”

Let’s get real about diversity. What are your thoughts? Share your experiences in the comments! I would love to know your thoughts!

Shine a Light on Those Who Support You!

Shine a light on those who support you!

I want you to meet someone special: This is my mother. She’s the most amazing person I know.

And this is me on graduation day—Thursday, May 23rd, Harvard Yard. I want to tell you about the person who’s been behind me, beside me, and even in front of me, guiding the way my whole life.

A few things about my mother: She was born in Zambia, Africa. Married in England. Formally uneducated, yet she’s still the smartest person I know. She’s worked hard her whole life: in dry cleaning, pressing clothes; in a bakery; and even as a maid. My mother has worked very hard, all her life.

My father, who unfortunately passed away 11 years ago, worked just as hard: two jobs most of his life. Together, they made less than $40,000 a year. With that, they raised three sons (fed five mouths), built a home, clothed us, fed us, and made sure we were immensely loved. My parents did all this without any government benefits or assistance—just their own hard work and ethics. We were well fed, very happy, healthy, and most importantly, they made sure we were very well-educated both in culture, ethics, and school. Hence, on my graduation day from Harvard as I earn my third master’s, I’m not going to tell you about how hard it was for me, or the tireless nights I spent studying, or anything I have sacrificed—I’m going to shine a light on the person who taught me how to work hard and the value of it, the person who instilled in me the strength to study long hours, and the ones who sacrificed with me and for me—my amazingly strong, smart, and loving parents.

There are characters in all our lives without whom our story just doesn’t work. They are usually in the background working their magic and being the main characters of their own stories and struggles. We all have those people or peoples (plural, when we’re really lucky and have more than one champion). AND—we know who they are. It’s time to share out spotlight—at least temporarily. In our lives, we are, and should always be, the main character, but to recognize those who propel us and support us, those who hold us up, those without whom our story would not be complete, IS a necessary part of the novel. It lets the readers, and those very important characters, know that they are important.

So today, I introduce you to an amazing woman: a person who may not have the formal education we may have but is brilliant nonetheless; a person whose never had a corner office but strategizes and leads standing up; a person with a humble income and an equally humble heart. Today, among the many things my mother has accomplished in her life, she is now the mother of a Harvard Graduate; and that Graduate is speechlessly proud of her.

Shine a light on those who support you.

 
 
In today’s highly competitive and fast-moving business environment, can you afford not to have an in-house strategic capability—one that is not only capable to defining where and how you should move forward, but also has the ability to get you there?
 

About ten years ago I launched PM Principle.  I was inspired to bridge one very unique and wide gap:  the chasm that exists between strategy and execution.  I was witnessing a trend in the market where the business world was retaining large, well known, and very reputable consulting firms—the giants of management consulting (of course, at astronomical prices, but who ever got fired for hiring one of these guys?) Their sole purpose in doing so:  get help building winning strategies and approaches aimed at solving the business’s very unique, very real challenges or problems.  What I saw was an output of great strategic documents and presentations printed on dual branded-letter head and, of course, on glossy stock paper with a color scheme exactly matching the corporate standard—the pictures and graphics were great too—the graphs—impressive—everything was going up!  How could you, namely your boss, not be immensely impressed?  However, I felt that there was something missing…a key ingredient—something huge—something that could almost make the millions that were spent on producing those glossy deliverables and graphs—well, worthless.  Then I heard it (and heard it again, and again):  “How the hell do we make this all happen.  It’s a lot.  Looks great on paper, but how do we make it all happen and how do we get there?  How do we make it a reality? Oh, and without the usual head aches and pain that are typical of our organization.”

As an outsider looking in…the answer was obvious:  the strategy was created to not be executable, at least not by the business itself.  The business is not positioned where it has the internal maturity to run and execute these strategies on its own—not without outside help, of course.  But why not?  “We have a PMO…kinda.  Can’t we just task them to deal with the execution part?”

Ahhhh…the PMO.  Remember the PMO craze a few years back?  There were the Gartner reports, the Standish reports, PMI articles—all saying the same thing: business losing millions due to project failure.  Projects are over budget, didn’t come in on-time, or are simply canceled and never come to fruition.  Little has changed.  However, if these same projects are now strategically important, imperative to your business’s viability or to your ability to sell or compete… to your business maintaining its competitive position in the market…can you afford a 50/50 chance of success? Or the project coming in much later than was expected?  With today’s increasingly competitive business environment, can a business of any size at any stage afford to gamble with or even lose millions of dollars?  Can you afford to lose valuable market time to your competitors?  This is exactly the ‘not so unique’ drama that most businesses facing with those glossy, multi-million-dollar strategies—do you take the gamble on its successful execution and attempt to go it alone or do you dish-out millions more for their help.

There is a solution—you didn’t hire that big firm just to come-up the fancy presentation—that’s just silly.  No.  Another one is coming:  this time a proposal.  And guess what—there is nothing wrong with that.  That large consulting firm that created your strategy knows that in the current state of your business’s maturity or with all that you have going on, you may not be capable of carrying these strategies forward and they know they just showed you how important these strategies are to your profits, your market, your very survival.  In the consulting world, we focus on ‘core competencies’—”do what you do best”.  You, in your business, are great at creating the technology, the fashion, the retail capabilities, the robotics, or manufacturing automation whatever it is that is the center of your business’s value proposition; that’s what your clients and customers expect you to be an expert in.  “You don’t need to be an expert in strategic execution; that’s an expertise that you hire someone for—us, management consultant’s; that’s out core competencies—not yours.  You do what you do well and hire us to do what we do well.”  (See how easy that sounds.  It’s almost poetic; Business 101).

However, times have changed.  Technology and innovation are moving faster.  Your competitive advantage, your market, your industry is, therefore, changing just as fast.  That means that you need to be increasingly adaptive and adoptive of those changes; and since these changes are coming more often, that may mean that you need to consider having these strategic capabilities in house—at least in a rudimentary form.  Why?  Simple:  because your competitors do and that may make them faster, more responsive, more agile—and, therefore, may give them a significant competitive advantage.  You not being as agile and responsive to these changes and opportunities could mean you losing traction in the market—with your customers.  As such, your survival means that you must evolve your internal capabilities to secure and respond to these rapid changes as, and when, the occur.  An EPMO (Enterprise Program Management Office) will help you do just that.  As oppose to the traditional role of a PMO which is simply tactical, gate keepers of process, if you will, an EPMO is designed to partner with executive leadership to help them define and then execute these strategies.  Basically it helps ensure that your organization is doing the right projects, strategically, while also making sure that those projects are done well, efficiently, and effectively.  For those organizations with an existing PMO—the opportunity to evolve and merge the tactical execution arm into something with the strategic capabilities of an EPMO is readily simple; and for those organizations without a PMO to evolve or merge—it means building an EPMO capability from the ground up—both arms, strategic and tactical.  Sounds daunting, but still very much achievable. 

From time to time, your organization may still need external help for larger strategic changes or endeavors or maybe even staff augmentation or recruiting assistance, but the ability to build a strong strategic and execution capability in-house are well within the grasp of any organization and the time to pursue these capabilities has never been so important yet so available.   All it takes is partnering with an organization whose sole purpose is to help your organization evolve and become more strategically self-sustainable and capable. 

It’s time to evolve and PM Principle is here to help you do just that!

Here are a few tips and lessons I’ve learned along the way.

The need is real.  Very real!  It’s important that your organization is in full alignment and support of the adoption of an EPMO—and that may mean you building a case to illustrate the benefits and value an EPMO can bring.  Business cases, charters, proposals, etc. are all powerful tools that I have personally employed in the past to rally support and speed needed to build an EPMO.  Look internally and find the process and mechanisms that fits your organization and culture the best.  Here are a few facts that might help in your challenge to change minds.

Imagine the positive impact an EPMO could have for your business or organization.  It could not only help to save millions, but it could help to ensure and secure your competitive advantage in the market, help bring your products and service to your customers fasters, increase sales, profits, etc.  the advantages of being able to control, secure, and successfully deploy your organization’s strategy is boundless. 

Now that you know the very real and bleak reality, understand that there is an escape—a way to change and mature your organization in one that has more control over its strategy and more success in its strategic execution.  An EPMO is designed to partner with the leadership your organization and help them to articulate and define their strategic goals and direction.  Additionally, the tactical capabilities of an EPMO come into play by guiding the creation and then management of an executable plan to bring that strategy into reality. 

Here are just a few of the benefits you should expect from deploying a mature EPMO.

With current strategic failure rates as high as 90% organizations stand to garner significant savings and reap numerous other tangible advantages through the implementation of an EPMO.  The increasing speed with which business and technology are changing is making both an internal strategic capability and an execution capability a necessity for today’s modern business.

Just imagine how much project and strategic failure is currently costing you—now imagine possibilities, potential, and impact securing those savings could have for your organization.

Here is where you may need the help of a consulting firm such as PM Principle.  A firm specializing in building an EPMO capability and committed toward developing the processes and procedures needed to make your organization strategically self-sufficient—both with the ability to develop its own strategy and decisively realize it.  Your efforts to regain or build a your strategic and tactical capabilities will allow your firm a greater chance of being able to keep pace with today’s new rapidly changing business landscape. Utilizing the assistance of a firm such as PM Principle will help to ensure a faster and smoother injection of these competencies throughout your organization and, thus, gain a quicker realization of the multiple benefits that stem from an EPMO.

Here is what you should keep in mind during the transition:

CHANGE, CHANGE, CHANGE!

This is as much a people change as it is a change in process or procedure.  Human and Behavioral Change Management techniques and practice are extremely important to the process and should not be discounted.  Change Management practices will help to ensure that your organization not only has the Enterprise-wide support and buy-in of the development of an EPMO but will help to move the culture into alignment with and support of the strategy across all level, at every stage, and throughout the Enterprise.  It has been said time and time again that ‘people are a company’s greatest asset.’  This is even more true when talking about strategy:  a well-oiled machine, with all its parts moving toward the same goal can be a powerful force in any company’s pursuit of continual success.

PROCESS:

The process of making your company more strategically self-sufficient will involve and evolve the entire Enterprise.  Begin by understanding your current state.  In some cases, depending on the culture of your organization, you will begin by conducting a maturity assessment.  This should help in the process of defining and setting a baseline from which to improve.  Gage factors such as project management performance, enterprise-wide strategic knowledge, governance and steering committee practices, documentation, status reporting, etc.  Sounds simple, but don’t be fooled.  The high failure rates we mentioned above—well, they’re that high for a reason.  By knowing your current state, you are one step closer in your root cause analysis.

TECHNOLOGY: 

Have the right tools!  One of the main values that an EPMO can bring to executive level management, investors, and/ or shareholder is the ability to clearly illustrate how the organization if evolving and where its investments are being concentrated.  Find or build a good tool that will enable portfolio management and alignment.  I have seen great success with vendor provided PPM SaaS tools as well as home-grown solutions in SharePoint.   This knowledge repository will become the organization’s primary mechanism in to other strategic activities and reporting—financial; shareholder, board, and investor reports; audits; etc.  Having a good and reliable tool is integral to these processes.

PM Principle is committed in being your trusted partner in your strategic journey.  With increased global competitiveness in virtually every industry, market, and segment, we have dedicated in our efforts to toward assisting our clients gain the capabilities they need to ensure their success, growth, and profitability.   We provide uniquely tailored solutions to large, global, Fortune 500 Companies and medium sized firms.  Furthermore, we are uniquely positioned to support the growth efforts of small start-ups, not-for-profits, and government organizations.  Our strong belief that a sound, executable strategy is the foundation for market success, has allowed us to serve a host of diverse clients ranging from the beauty, cosmetics, and fashion industry to the advanced automation, robotics, and technology industries. 

There are many benefits a PMO and and ePMO can bring.  

A Project Management Office (PMO) is a crucial component for organizations aiming to enhance their project execution and align initiatives with strategic objectives. The establishment of a PMO can bring substantial value by increasing project accuracy, optimizing resource allocation, and enhancing decision-making processes.

1. Enhanced Decision-Making and Strategic Alignment:
One of the most significant advantages of a PMO is its ability to gather, analyze, and disseminate project data, which empowers key decision-makers with real-time, reliable information. This data-driven approach helps organizations prioritize projects that offer the most strategic value, minimizing the likelihood of pursuing non-essential initiatives. By acting as a central hub for project data, the PMO ensures that projects align with the broader strategic goals of the organization, thereby increasing the chances of successful outcomes (PMO365, 2023).

2. Standardization and Improved Project Control:
A PMO plays a pivotal role in developing and enforcing standardized processes across an organization. This standardization is critical for improving project management expertise and ensuring uniformity in project execution. By establishing clear methodologies, templates, and best practices, a PMO helps maintain consistent project quality and control, which leads to better management of timelines, budgets, and resources. Moreover, the structured oversight provided by a PMO can significantly reduce risks associated with project delivery, ensuring that projects are completed on time and within scope (Cora Systems, 2023).

3. Resource Optimization and Cost Efficiency:
Effective resource management is another area where a PMO adds value. By overseeing resource allocation and identifying any shortfalls, the PMO ensures that projects have the necessary personnel and tools to succeed. This not only improves project efficiency but also contributes to cost savings by reducing the need for last-minute changes or resource reallocations. Additionally, a PMO can assist in forecasting future resource needs, allowing the organization to plan proactively and avoid potential bottlenecks (BestOutcome, 2023).

4. Facilitating Organizational Communication and Collaboration:
The PMO serves as a communication nexus within an organization, fostering collaboration between different departments and teams. By improving communication channels, the PMO helps break down silos, enabling more cohesive and coordinated project efforts. This enhanced collaboration is essential for optimizing the use of organizational resources and ensuring that all parts of the organization are aligned with the overall strategic vision (Cora Systems, 2023).

5. Long-Term Strategic Impact:
For organizations that integrate a PMO at an enterprise level (EPMO), the benefits extend beyond individual projects to the organization’s overall strategic capabilities. An EPMO ensures that all projects and portfolios are in line with corporate goals, providing a direct link between project execution and strategic outcomes. This connection not only improves project success rates but also strengthens the organization’s ability to achieve its long-term objectives (PMI, 2023).

In conclusion, the value of a PMO lies in its ability to streamline project execution, ensure alignment with strategic goals, and optimize resources—all of which contribute to higher project success rates and improved organizational performance. As companies continue to navigate increasingly complex project landscapes, the role of the PMO becomes even more critical in driving sustainable success.

I have set up PMO’s and ePMO’s for a number of different companies:  Estee Lauder Companies, Inc., New York and Company, Festo, and many more.  It IS necessary to effectively and efficiently run a dynamic business.  From my experience, here are a few tips on setting up a strong PMO.

How to Best Set Up and Establish a PMO
Establishing a Project Management Office (PMO) is a critical step for organizations looking to improve project efficiency, align projects with strategic goals, and maximize resource utilization. Here is a detailed approach to setting up and establishing a successful PMO.

1. Define the PMO’s Purpose and Scope Before diving into the specifics, it’s essential to define what you want the PMO to achieve. The purpose and scope should align with the organization’s overall strategy and should be clearly documented. This could range from standardizing project management practices across the company to providing a governance structure for large, complex projects. Start by articulating the PMO’s mission in a way that resonates with organizational goals, which will guide all future decisions related to the PMO (PMO Squad, 2023).

2. Assess Organizational Needs and Resources Understanding the current state of project management within the organization is crucial. Conduct a thorough assessment to identify existing gaps, resources available, and the specific needs the PMO will address. This will help in tailoring the PMO to effectively support the organization’s projects and ensure that the right resources and processes are in place from the start (Planforge, 2023).

3. Develop a Governance Structure A robust governance structure is vital for the PMO to function effectively. This includes defining roles and responsibilities, decision-making processes, and establishing the authority of the PMO within the organization. The governance structure should ensure that the PMO has the necessary backing from senior management and can enforce standardized processes across all projects (PMO Squad, 2023).

4. Create and Implement Standardized Processes The backbone of any successful PMO is the standardized processes it implements. Develop and document templates, methodologies, and tools that project managers can use consistently across all projects. This might include creating a project management framework, defining key performance indicators (KPIs), and ensuring that all projects adhere to these standards. These processes not only improve efficiency but also provide a clear framework for monitoring and reporting on project progress (Planforge, 2023).

5. Focus on Quick Wins To build momentum and demonstrate the value of the PMO, focus on achieving some quick wins early on. This could involve successfully executing a few high-priority projects that deliver visible results. Quick wins help build trust with stakeholders and establish the PMO as a valuable asset to the organization (Planforge, 2023).

6. Communicate and Engage Stakeholders Effective communication is critical to the success of the PMO. Establish a clear communication plan that ensures all stakeholders are kept informed about the PMO’s activities, achievements, and challenges. Regular updates, transparent reporting, and active engagement with both project teams and executive leadership help to maintain support for the PMO (PMO Squad, 2023).

7. Continuously Evaluate and Improve A PMO should never be static; it needs to evolve with the organization. Continuously evaluate the performance of the PMO using predefined KPIs, and seek feedback from stakeholders to identify areas for improvement. This iterative process of evaluation and optimization will ensure that the PMO remains aligned with the organization’s changing needs and continues to deliver value (Planforge, 2023).

8. Ensure Long-Term Sustainability For a PMO to succeed in the long term, it must be integrated into the company’s culture and strategy. This involves not just aligning the PMO with strategic objectives but also fostering a culture of continuous improvement and adaptability. As the organization grows, the PMO should be flexible enough to scale and adapt its processes to meet new challenges and opportunities (Planforge, 2023).

By following these steps, organizations can establish a PMO that not only meets immediate project management needs but also provides a strong foundation for long-term strategic success. The key is to start with a clear purpose, build momentum with quick wins, and continuously refine processes to align with the organization’s goals.

References:

Cora Systems. (2023). “7 Benefits of a PMO / Project Management Office.” Retrieved from Cora Systems
PMO365. (2023). “The Top 10 Benefits of having a PMO.” Retrieved from PMO365
PMI. (2023). “Which PMO Is Right for Your Organization?” Retrieved from PMI
BestOutcome. (2023). “How To Set UP An Effective PMO Office In 2023 (Step-by-Step).” Retrieved from BestOutcome