UPI Study › Courses › Project Management › Free lessons › Lesson 1.3 Free with a free account
Structure and Functions of a Project Management Office
Project Management · Chapter 1: Foundations and Framework of Project ManagementSection 1.3 · lesson 3 of 7314 min · free with a free account
Free preview
Create a free account to keep watching
It takes a minute and costs nothing. Your free account unlocks all of Chapter 1 and 3 more lessons of Project Management.
Lesson complete
Earn the 3 college credits for Project Management
Enrolling adds a quiz after each lesson, the graded work and the official transcript. Recommended for credit by NCCRS.
Next lesson: Business Value and Strategic Benefits of Project Management →← Core Skills and Competencies for Effective Project ManagersNext lesson: Business Value and Strategic Benefits of Project Management →
In this lesson
How organizational structure and the PMO shape project authority.
- Compare functional, matrix and projectized structures by project manager authority
- Distinguish weak, balanced and strong matrix organizations
- Describe supportive, controlling and directive PMOs and the functions a PMO performs
- Evaluate a PMO using value measures and its common failure modes
Free study notes
Get this lesson's notes by email
The key points and 4 practice questions with answers, in your inbox. One email, free.
One email. Unsubscribe in one click.
Transcript
Everything said in the video, section by section (1,806 words). Read along, or search it.
Opening Question
Two Bosses, One Thursday Deadline
On Tuesday, Imani, a systems analyst, is asked to finish a data conversion by Thursday. The same afternoon, her own department head asks her to fix a payroll fault, also by Thursday. Both requests are legitimate, and she can't meet both. Whose priority wins? That isn't a question about personalities. It's a question of structure: who controls the people, the money, and the decisions.
Key Terms
Structures and Reporting Lines
An organizational structure is the pattern of departments, reporting lines and decision rights, through which an organization divides and coordinates its work. A reporting line is the chain from an employee up through successive managers. It decides whose instructions they follow, and who evaluates them. Projects are awkward for most structures, because a project is temporary, and cuts across permanent departments. So whether a project manager can simply assign a developer, or must negotiate for the developer's time, is a structural fact, not a personal one. Three common structures, functional, matrix and projectized, each answer it differently.
Functional Structure
Departments Own the Work
A functional structure groups people into departments by the kind of work they do, such as design, production or purchasing. Each department head controls its staff, budget and priorities, and every employee has one reporting line, up through the department. A project runs inside the departments. Design might own a new product line, and borrow hours from production and purchasing. The project manager is often a coordinator: someone who tracks tasks and reminds departments, but can't direct work, approve spending or release staff. Team members' first loyalty goes to the manager who controls their careers. So project tasks compete with routine work, and often lose. The strengths are deep expertise and clear careers. The weakness is that nobody below the executives owns the whole result.
Matrix Structure
Weak, Balanced and Strong Matrices
A matrix structure keeps people in their departments, but also assigns them to projects. Departments run down the page, and projects run across it. That grid gives the structure its name. So each team member answers to two managers: the functional manager, who owns their discipline, and the project manager, who owns the project work. Matrices come in three variants, depending on where authority sits. In a weak matrix, functional managers keep most of it, and the project manager is close to a coordinator, often part-time. In a balanced matrix, authority is shared. The project manager runs the plan, but the functional manager still controls who is assigned. In a strong matrix, a full-time project manager holds most of the authority and much of the budget. Departments stay the home of expertise.
Common Problem
The Dual Reporting Clash
Every variant carries the dual reporting problem, and that's exactly Imani's Thursday. A matrix works when the two managers settle the clash themselves, through an agreed priority rule, or an escalation path to a shared senior manager. It works badly when the clash is left to the team member, who has the least authority of anyone involved.
Projectized Structure
Organizing Around Projects Full-Time
A projectized structure builds the organization around its projects. Team members work on one project full-time, and report to its project manager, who controls the budget and the staffing. A construction firm with its own site team for each building often works this way. Here the project manager has the most authority of the three. Decisions are quick, loyalty runs to the project, and communication lines are short. The cost is idle resources: people who are paid but unassigned, when one project ends before the next begins. And duplication: self-contained teams solve the same problem from scratch, and people may not know where they belong when a project ends.
Comparison
Authority, Budget and Reporting Side by Side
Put the three side by side, and a pattern appears. Project manager authority: little in functional, from low to high across the matrix variants, and high in projectized. Budget control: the functional manager or the sponsor, then split, then the project manager. Reporting lines: one, then two, then one again. No structure is simply best. Authority gained on the right is paid for in idle staff, and depth on the left is paid for in authority. Most real organizations are hybrids, so judge where control sits for a particular project, not for the whole company.
Quick Check
Identifying a Telecom Firm Structure
Quick check. At a telecom firm, each project leader works on projects all week, and signs off most project spending. The engineers on loan are still reviewed by engineering. Which structure is this? Pause, and decide. Strong matrix. The engineers keep two reporting lines, so it's a matrix. And a full-time manager holding most of the budget makes it strong. It isn't projectized, because the engineers don't move to the project, or report only to its manager.
Definition
What a PMO Does for Governance
Structures leave a coordination gap, and organizations often fill it with a project management office, or PMO. A PMO is a management unit that standardizes the governance of projects, and shares resources, methods, tools and techniques across them. Governance means the rules, roles and review points by which an organization decides which work proceeds, who may approve changes, and how progress is checked. Without it, each project manager may invent a plan format and a status report, and executives can't compare one project with another. A PMO is a small, permanent group whose job is project practice itself. It isn't a project, because it isn't temporary.
PMO Types
Supportive, Controlling and Directive PMOs
PMOs differ by how much control they hold, and three types sit along one scale. A supportive PMO consults. It offers templates, advice and lessons from earlier projects, and managers may use them or not. A controlling PMO requires compliance. It sets standards, like a required plan format or mandatory status reports, and checks them. Managers still run their projects. A directive PMO manages the projects. The project managers belong to it, and it assigns them, directs their work, and answers for results. Each step to the right asks project managers to give up more independence. It isn't a ladder every PMO must climb. A few experienced managers may need only support. A history of failed projects may call for control from day one.
Worked Example
Seven PMO Functions at a County Agency
Whatever its type, a PMO performs some mix of seven functions. Picture a county services agency. Standards: no project spends money until a sponsor signs a one-page purpose statement. Methodology: a published four-stage approach. Templates: a library with a plan outline, a risk log and a status form. Training: a quarterly workshop for new project managers. Governance: running the review points where leaders decide whether a project continues. Reporting: one monthly dashboard of every active project. And resource pooling: three business analysts sit in the PMO, and are lent to projects for set periods. A supportive PMO offers all this as optional help. A controlling PMO requires it. A directive PMO does it, as part of running the projects.
Fit
PMO Authority Is Borrowed
A PMO's authority is borrowed from the structure around it. It can only require what existing managers will give up. In a functional or weak matrix organization, a supportive PMO fits easily, but reaches only those who choose it. A controlling one must persuade the department heads. In a balanced matrix, a controlling PMO often has room, because project managers already hold part of the authority. In a strong matrix or projectized firm, managers may resist a controlling PMO as a duplicate layer. A directive PMO that employs them formalizes what exists. And a directive PMO over a functional organization, without a strong executive sponsor, stalls at the first dispute. How much control belongs in the center is contested. Central control lets leaders compare projects, and spot overloaded people. Distributed control keeps decisions with the people closest to the work. The answer depends on the work, and on how much autonomy an organization will trade.
Value Measures
Judging Whether a PMO Is Worth It
A PMO costs salaries and effort, so how do you judge whether it's worth having? With value measures: quantities an organization chooses to track, to judge whether a unit delivers what it was created for. Each uses one formula: the items that met the condition, divided by the items that could have, times one hundred. In one quarter, 28 of 40 active projects use the standard template. That's 70 percent. 45 of 60 required status reports arrived on time: 75 percent. And 9 of 12 closed projects met all their success criteria: also 75 percent. Read them with care. Template use says nothing about how well templates were filled in. And with only twelve projects, one miss moves the rate by more than eight points. Track several measures over time, and never treat one number as a verdict.
Failure Modes
Four Ways PMOs Fail
PMOs fail in four recognizable ways. Bureaucracy without value: forms, approvals and meetings that cost more than they return. Nobody can name a decision a report changed. No executive sponsor: no senior leader backs the PMO or settles disputes, so a controlling PMO shrinks to a supportive one. Standards nobody uses: templates designed without managers' input, harder than their own, or never enforced. A low template-use rate is the signal. Unclear authority: nobody knows what the PMO may require or refuse, so each dispute goes to whoever pushes hardest.
Quick Check
A PMO Without Backing
Quick check. A new controlling PMO, in a functional company, asks every team for a weekly status report. Department heads tell their staff to ignore it. When the PMO escalates, the chief executive says, work it out yourselves. Which failure mode is this? Pause, and decide. No executive sponsor. The requirement has no senior leader behind it, so department heads can ignore it at no cost. Bureaucracy is tempting, but nothing says the reports cost more than they return. The PMO simply has no backing.
Case Study
A Narrow Controlling PMO for Hospitals
Here's how one director chose. Dana runs operations for a network of four hospitals and a dozen clinics. In one year, four overlapping projects shared the same technicians and electricians, and three missed their dates. Each department head put routine work first, and nobody saw the overlap until a deadline passed. The network is a weak matrix. A supportive PMO would be easy to set up, but it wouldn't make anyone share staff calendars, the real cause. A directive PMO would fix the cause, but department heads would never hand over their staff and budgets. So Dana chose a controlling PMO with a narrow scope: one shared staffing register, one monthly report, and optional templates. She made the chief executive its sponsor, because a requirement that heads could ignore would fail the first time it was inconvenient. The trade-off: the PMO exposes conflicts, but doesn't resolve them. Limited authority the organization will grant beats broad authority it would refuse.
Key Takeaways
Structure Sets Authority
To recap. Structure sets a project manager's authority: little in functional, shared in a matrix, and high in projectized. A matrix gives people two managers, so the managers must settle clashes, not the team member. A PMO fills the coordination gap. Supportive, controlling and directive PMOs differ in how much control they hold. Its authority is borrowed from the structure and its sponsor. Judge it with several measures, and watch for the four failure modes.
About Project Management at UPI Study
Project Management (Business 230) is a self-paced online course of 73 video lessons in 12 chapters, from starting and defining a project to planning, budgets, scheduling tools, proposals, contracts, execution, monitoring, closure, teams and certification. It carries a NCCRS credit recommendation for 3 semester credits.
Every lesson transcript is free on pages like this one, and the videos are free with a free UPI Study account. Enrolling adds a practice quiz after each lesson, the graded work and final exam that earn the credit, lifetime access, and an official transcript on completion. UPI Study has helped over 130,000 students with college credits. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.
Enroll now → Course details Download the syllabus All Business courses Every course with PRO →
Why take it here
Why students take Project Management with UPI Study
Where the credit goes
Universities that work with NCCRS
Project Management carries a NCCRS credit recommendation. These universities work with NCCRS; some are UPI Study's signed partners. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.
Thomas Edison State UniversitySigned partner
University of the PeopleSigned partner
Charter Oak State CollegeSigned partner
Strayer UniversitySigned partner
Columbia Southern UniversitySigned partner
Indiana TechSigned partner
Penn StateWorks with NCCRS
Southern New Hampshire UniversityWorks with NCCRS
SUNYWorks with NCCRS
+many more cooperating universitiesFind my college →Find my college → Not listed? Ask Athena in the corner of this page, or book a 15-minute call.
FAQ
Questions students ask us
About Structure and Functions of a Project Management Office
What is the difference between a weak, balanced and strong matrix?
What are the three types of project management office?
What are the pros and cons of a projectized organization?
Why do project management offices fail?
About the Project Management course
How many college credits is Project Management?
How much does Project Management cost and what is included?
Which universities accept UPI Study credits?
How long does Project Management take?
How are the exams done?
How do my credits reach my college?
Ready for the full course? Earn 3 credits in Project Management.
73 video lessons, a quiz after each one, and the graded work that earns the credit. Recommended for credit by NCCRS.
3 credits · NCCRSEnroll →