from Project base to product base organization
Article two in a three-part series
By By Waffa Karkukly, PhD and Ian Laliberte, MBA
In the first article of this series, we focused on the need for PMOs to become digital to stay valuable for their organization and continue to improve and adopt industry trends; and to be more equipped to support their organizations’ digital transformations. We explored the PMOs landscape today and what is expected of them to do and not do to transition to digital and how the internal readiness and external readiness preparation play an essential role in ensuring success in digitalize themselves, and be ready for their organizations’ digital shift. In this second article, we will explore what it means to be a product based and differentiate the areas of focus for a product based vs. a project-based organization. We will step through the required elements for a successful transformation and explain the details for each of these elements. Further, leverage a specific organization transformation to share the challenges and benefits from a product-based model, and explore what changes the new model will make to ensure success, and what are the expected outcomes and measures. Finally, the success of the new model relies on the orchestration of the various functions namely the EPMOs/PMOs and explain the reason they need to be re-invented, as well as the for a new oversight function to be setup to support the product-based organization in the digital landscape.
Key Words: DPMO, DMO, Journey, Platform, Product-based, Project-based, Agile.
Nearly two-thirds of CEOs and senior business executives already have a digital business transformation initiative underway at their organization. Some 90% of corporate leaders view digital business initiatives as a top priority, but 83% are not making any meaningful progress (5).
Organization differentiate themselves based on their business model, PMO is a business model that some organizations created to seek differentiation in the way they deliver products and services, or in the way they optimize on their strategic investments while maintaining the lights on for their operation. The main problem that many organizations face today in the digital transformation is the operating model which impacts the PMO regardless of the PMO digital to gain the anticipated benefits.
In Deloitte’s most recent industry 4.0 reports, 48% of executives indicated that introducing new business models was one of the top five topics discussed most frequently within their organization, yet only half of those leaders consider themselves ready for new business model. The business model has become the basis of competitive differentiation in creating, delivering, and capturing value in the digital realm (2). According to the 2019 Gartner CIO Survey, enterprises are changing their business models and requesting help from the IT function to do so. Forty-nine percent of the organizations surveyed reveal they experienced business model change, with 13% reporting they have already changed and 36% in the process of changing (5).
One of the most popular models that are on the rise is the product-based organization. Businesses are making a model shift in becoming a product focus organization rather than a project focus organization for many reasons; one of the primary reasons is the digital disruption and what it means in delivery expectations. What does it mean to be a product-based organization?
How to cite this article: Karkukly, W. and Laliberte, I. (2019). The Digital PMO: Shifting Organizations from Project base to product base organization, PM World Journal, Vol. VIII, Issue IX, October. Available online at https://pmworldlibrary.net/wp-content/uploads/2019/10/pmwj86-Oct2019-Karkukly-Laliberte-the-digital-pmo-part2.pdf