The role of the Project Management Office (PMO) has been to define and maintain standards for projects – an important business function for most organizations. In the software development world, the PMO has made significant headway over the years in standardizing processes to ensure projects are executed successfully. While the PMO has been vital in streamlining organizations, its focus has been on progress and utilization rather than on business value.
As the software development industry matures and competition becomes greater for most organizations, there is a need to focus on more than just efficiency and effectiveness, we must also be driving business value from each software development initiative. A Software Value Management Office (SVMO) does just that – it optimizes processes to maximize value flow and ensures the organization is maintaining a competitive advantage and satisfying customer needs.
The PMO for software development is typically focused on planning, implementing, monitoring, and controlling projects. It often serves as the “bad guy” informing management about missed deadlines and keeping the staff on task, ensuring they are following the standard processes as they were defined. These are extremely important and necessary functions. So, I am certainly not saying that they should be eliminated but I am saying that it’s necessary to focus on more than what has historically been done. I believe the PMO needs to be transformed into more of a strategic partner within the organization, focusing on optimizing process to maximize value flow and measure value rather than just standardizing process to improve efficiency and measure compliance and, consequently, being repositioned as a Software Value Management Office (SVMO).
The Value of the SVMO
For software development organizations that use the waterfall methodology, the PMO helps to keep active projects on track. By transforming the PMO to an SVMO model, there would be a greater focus to help drive value. Organizations practicing Agile methodologies tend not to have PMOs. In this case, I believe an SVMO should be created to help encourage the business units to collaborate with the IT teams on assigning value to features and epics and making that value visible to both groups in order to maximize value flow.
The mission of the SVMO would be to make software value visible to all stakeholders and to increase end-to-end software value flow to both internal and/or external customers.
The SVMO would consist of a small, but permanent staff of individuals that would coordinate projects, act as gatekeepers and maintain continuity of the function. These individuals need to be value champions – always focused on the big picture: “what value will the project or feature or functionality provide the customer?” These value champions need to understand the business needs, as well as the technology capabilities. They would be positioned between the business unit and IT departments to ensure all stakeholders clearly understand the end goals of each project and keep the team focused on those economic and business value goals.
Measuring the SVMO’s Success
Like with any business function, to measure success you need to measure against the mission. For the SVMO, it is no different. The SVMO needs to be evaluated on how it is making software value visible. This can be done by assessing four key areas: portfolio, value stream, product/program, and team (the four levels used in the SAFe model), while also considering whether the appropriate information is available and if decisions are being made based on that data. More details on how to leverage these metrics to determine the success of the SVMO can be found in my recent white paper on “The Software Value Management Office (SVMO)”.
SVMO = Strategic Partner
Software is no longer a luxury, but a necessity to run organizations efficiently, provide high-level customer service, deliver top-quality products and services, and to stay ahead of the competition. However, software development efforts can be very costly for an organization. An SVMO can provide the needed guidance to maximize and measure the business value of its software initiatives by ensuring all stakeholders are visualizing the economic and business value throughout the software development process, and to ensure the business unit and IT teams are successfully collaborating on value streams for each project. In turn, the SVMO will become a strategic partner within the organization that actively drives value to the customer and to the organization’s bottom line.
He became president, CEO and majority owner of Premios Group (formerly DCG Software Value) in 2006 and previously held numerous senior executive positions in Fortune 500 companies, including: Fidelity National Information Services (NYSE: FIS), Sanchez Computer Associates (NASDAQ: SCAI) and MasterCard International (NASDAQ: MA).
Latest posts by Mike Harris
- Transforming the PMO into an SVMO to Drive Software Value - July 5, 2017