Is this the year of the Transformation Management Office (TMO)?

As organisations welcome agile into their core, will traditional PMOs continue to govern transformations?

Competitive market forces are driving demand for faster transformation projects with more value at a lower cost than we have seen before. Organisations appear to have an almost ravenous appetite for new innovative products and services as they try to secure market share, grow customer relevance and build customer loyalty. This appetite manifests into another Agile team joining the fray every few weeks.

“traditional PMOs are driven by administration and compliance, while transformation programs focus on value”

One of the key benefits of Agile is its focus on customer-driven features. There is no pre-set, locked in stone build – the new features and functions are created as you go to meet the evolving competitive market and customer trends. This helps ensure customer relevance and engagement, and hopefully loyalty.

With limited defined outcomes and an evolving scope, traditional portfolio management appears poorly matched for the new methodologies delivering transformation initiatives. It is the round peg in the square hole story – traditional PMOs are driven by on administration and compliance, while transformation programs focus on value.

While most acknowledge the disconnect, there is still resistance in organisations to introduce a Transformation Management Office (TMO). Instead, they continue to invest in their PMO functions to extend capability and capacity to support the delivery of their change programs and projects.

Further investment is being made to refine portfolio management practices by building new bottom-up processes that align project deliverables to the organisational strategy. This is a hybrid approach – integrating value and new digital-orientated metrics that being applied far beyond the constraints of the marketing department, into traditional PMOs.

The more transformation-centric enterprises are adding a dedicated TMO to their arsenal.

…this disruption doesn’t sit well with traditional PMOs

TMOs are charged with ideation for creating and realising value. With a fast-paced operating rhythm, it owns the decision on which transformation initiatives are adopted, the decision to achieve the desired value in the most efficient and cost-effective way, and provides the governance needed to ensure all investment is aligned to the organisational transformation objectives.

TMOs orchestrate the complex and challenging change that is needed to realise the full value of transformation programs. Founded on administration and compliance, this disruption doesn’t sit well with traditional PMOs, resulting in them potentially hindering the value realisation opportunities that transformation programs bring.

As rapid iteration delivery methodologies continue to entrench themselves into the very core of organisations, Executive teams have a choice. They can continue hammering their round pegs, or they provide the foundation their transformations need to succeed.