PMOs Will Make or Break Your Business in the AI Era

Introduction

Project Management Offices (PMOs) are often surrounded by mystery and a lack of understanding. Academics and thought leaders come up with a myriad of fancy abbreviations such as EPMO, VMO, XMO, PM CoE, Transformation Office, etc, but let's zoom out and cut through the noise. In this article, I use the term PMO in its most generic form – the organisational unit responsible for project-based work in a company and the home of the project methodology and the project managers.  

Companies are made up of four things: Processes, Projects, Disasters and Environment.  

• Processes are the lifeblood of a business. They are repetitive and have to be stable, predictable and controlled. The core business processes, which are the revenue generators, are crucial to understand when evaluating a business. This knowledge empowers you to ask the right questions about their execution and stability.  
• Projects are the adaptive mechanism of a business. Projects are unique and introduce novelty. They develop future value-generating capability if managed correctly. The questions to ask are: Is there a project methodology (Standard project lifecycle, Project Management Tool, Roles & Responsibilities, Governance)?  
• Disasters are disruptive and unpredictable. As you operate your process and deliver your project-based work, disasters can cause disruptions. Although we cannot predict the exact timing of the occurrence, we can assure you that a disaster will inevitably take place over time. This understanding should prompt you to proactively build resilience into your processes and projects to minimise disruption.   
• The environment is the context around these elements. It could be your industry, company or country. The environment has a unique impact on these elements, and we must strive for an optimal fit within the mix. I always try to answer questions such as What is the fit with the environment? Do you have a generic project management methodology, or is it tailored to the unique requirements of the business? I look for evidence of customisation in relation to the industry.  

Every company represents a mix of these four elements in varying proportions. Traditionally, companies are heavier on processes, with people working on processes making up 80% and those working on projects making up 20%. One of the key changes that we will observe in the coming years is the gradual increase in the proportion of project-based work in the organisation. This shift will be driven primarily by technological advancements and their associated ripple effects. Project management will also change. Time will be the most essential success factor, and that will skew the traditional balanced project triangle. Speed will beat Cost, Scope, and Quality.   

So what will happen when the proportion of projects increases? The demand for project-based work will also increase due to its growing importance. I see three major trends:  

Increase in Agility

In an environment of shrinking timelines and constantly changing scope due to fast market changes, the project management approach has to incorporate superb agility mechanisms and strong resilience. Hybrid and custom-made project management methodologies tailored to the specific needs of the business will be the way to success.   

Generative AI and Agentic Impact 

Intelligence used to be the primary competitive advantage. Companies like McKinsey and Bain used to charge millions of dollars to offer essentially intellect-as-a-service. Now you can get that for 20 dollars a month. Being clever is not going to be sufficient to win. The rapid growth in agentic technology, which is essentially process automation with a brain, makes the workforce redundant as a competitive advantage as well. AI tools also impact the project management profession by speeding up some traditionally labour-intensive processes.   

Shift from focus on Deliverables to longer-term Benefits and Value

Benefits and Value were terms used traditionally in the realms of Programme Management and Portfolio Management. Deliverables have always been more attractive because they were tangible and easier to deliver. We don't do projects for the deliverables, but for the benefits and long-term Value. You do not buy a car to have a car and a key (Deliverables); instead, you buy the vehicle to enhance your mobility and, in some instances, your reputation.  

The future of work will be project-based as organisations shift from stable and predictable processes to constantly adapting and evolving project-based models. Continuous change management, learning, and unlearning will be the new normal. Classic competitive advantages, such as intellect, access to workforce, and access to technology, will no longer be sufficient to thrive. The company's ability to execute complex adaptive efforts through project portfolio management quickly will separate businesses that succeed from those that fail.