The Impact of Project Management Office on NGO

The focus of the literature review will be to determine whether the establishment of a PMO is an important consideration for NGO as illustrated by the three initial research objectives. The final objective will be answered in an inductive process.94 articles were considered by following keyword based on the concept of “project management office NGO” ”project management office PBO” and ”project management office types”, read and selectively downloaded with only four of those (Bennis and Thomas 2002, Golini and Landoni 2014, Brière et al. 2015, Hassan et al. 2017) that detailed with content on NGOs operations under in project management unit. Unfortunately, none of the articles had a particular focus on PMOs implementation within these institutions. Additional 45 articles were selected by search backwards utilizing a snowball technique by focusing on the list of citation from the article by Aubry and Hobbs (2007) who were handling a critical project, thereby sharing insights about the evolution of PMO strategies. Furthermore, various books published under general introduction on project management offices were considered (Rad and Levin 2002, Letavec 2006, Tjahjana et al. 2009, Taylor 2011, Ortner and Stur 2015, Taylor and Mead 2015, Nir 2016). Moreover, the use of indicative literature review will generally follow work along the along the concepts in the research questions shown in introductory chapter. However, the use of 139 articles was not achievable due to the limits imposed by the research paper’s word count.

Definition and Typologies of Project Management Offices

(Models and frameworks relevant to the establishment of a PMO)

The Project Management Institute (PMI) defines a PMO in their seminal publication ”Project Management Body of Knowledge” as ”A management structure that standardises the project-related governance processes and facilitates the sharing of resources, methodologies, tools, and techniques.” (PMI 2013, p. 31). The PMI identified three common types: Supportive (providing a consultative role), Controlling (providing support and requiring compliance) and Directive (direct management of the projects).

The term PMO is not standardised, however, as Taylor and Ortner and Stur in their research found (Taylor 2011, Ortner and Stur 2015) multiple definations of the term, among others. The PMO, Portfolio Management Office or even Project Office. This notion is supported by Monteiro et al. who identified 47 PMO models. As some shared identical names, the authors reduced the twelve different typologies down to 25 differing model names (Monteiro et al. 2016, p. 1091) as can be seen in

These different denominations led Casey and Peck to posit that a PMO is ”Something that’s going to fix our project management mess” (Casey and Peck 2001) while Aubry and Hobbs argued that ”… discussions on this topic tend to be characterised by a diversity of opinion and confusion” (Aubry and Hobbs 2010, p. 2). In their research into 502 PMOs, the most significant empirical study on this topic yet, the authors identified eight typologies using four classes of descriptive variables (Aubry and Hobbs 2010, p. 52). Expanding on this research, Müller, Glückler and Aubry investigated organisations utilising concurrent PMOs having various functions and characteristics (Müller et al. 2013, p. 59) where three roles were identified: Serving, Controlling and Partnering. It is evident from the literature reviewed that the effort to define the role of PMO is highly complex ongoing. In summary, this case study will use the definition most commonly provided by PMI and others (Rad and Levin 2002, Hobbs and Aubry 2009, Tjahjana et al. 2009, Aubry et al. 2010, Ortner and Stur 2015, Taylor and Mead 2015): Supportive, Controlling and Directive.

Project-Based Organisations (PBOs) and its relation to PMOs

NGO would describe itself as a project-based organisation (PBO), with its currently nine research projects funded by external sponsors mostly for one or two years, as defined by Pemsel and Wiewiora, declaring that PBOs are ”organisations in which the majority of products or services are produced through projects […]” (Pemsel and Wiewiora 2013, p. 31). This argument is supported by Thiry and Deguire who reason that PBOs can be organised company-wide but that they can as well utilised within subsidiaries or departments (Thiry and Deguire 2007, p. 650).

Aubry state that in ”project-oriented organisations, the management of multiple, concurrent projects tend to form networks of diffuse authority and diversified coordination mechanisms“ (2015, p. 19). This problem is intensified in PBOs if knowledge is ineffectively or not shared across projects (Swan et al. 2010), primarily if they operate mostly autonomous (Pemsel and Wiewiora 2013). This situation is exacerbated once (temporary) project teams – projects do per definition have a start and an end (PMI 2013) – are disbanded, culminating in the loss of knowledge, established project processes and collaboration between project and management (Thiry and Deguire 2007, Sokhanvar et al. 2014).

The organisational design of NGO – such as the line-management – should be considered (Thiry and Deguire 2007, Monteiro et al. 2016) since most of the PMO’s follow a matrix configuration. The organisational structure is constantly changing with PMOs being reconfigured triggered by changes in the leadership systems (Hobbs et al. 2008, Nir 2016). This concept is endorsed by Aubry and Lavoie-Temblay stating ”Organizational project management differs from the organisational level in that it covers the entire organisation, including all its operations and projects” (2017, p. 3). Further promoted by Artto et al. who asserts that PMOs to ”have a key role in the management of innovation projects” (2011, p. 412and Thiry and Deguire 2007, p. 651). Thus, the constant growth in the use of programme/portfolio management and the emergence of PMOs has prompted organisation to move towards the use of project-based organisational structures [31,33,5].

The project-based frameworks provide temporal systems for organisations to improve its performance on various projects (Thiry 2007, p. 4). The PBOs conducts activities for the projects by providing functional approaches to improve the quality of the deliverables (Miterev 2017, p. 4). The PBOs helps to reduce the bureaucracy and hierarchy that slows the pace of activities such as decision making within an organization, as the outcome of the project is assessed based on the deliverables and not the positions held by various stakeholders or other politics related to the work (Clarke, T., 2004, p. 8). The PBOs which are also referred to as a multi-firm consortia are effective in executing most of its activities in the form of a project. The effectiveness of PBOs depends on the synergy between organisational programs, project, and management of the portfolio so that the stakeholders could receive tangible value for their investment into the firm. The stakeholders only focus on value creation which helps organisations to be vision-oriented as part of corporate governance and providing a purpose for the organisations (Crawford 2001, p. 16). Thus, when projects in a firm are geared towards an integrated vision, these will result in effective management of the programs that meet the desired goal.

Additionally, the emerging trend on value creation makes the PBOs focus more on the effectiveness of the organisation and not the financial investment (Thiry 2008, p. 14). The process displays a wider scope of success in the creation of value through innovativeness, and empowerment among other factors necessary for effective project management. The PBOs helps the organisations to focus on sustainability over the short-term results embedded in the project activities and ultimately focusing on the connection between the results and the expected benefits to be accrued. Furthermore, the better integration of the PBOS can only be accomplished by utilising a proper governance approach which can be achieved by various considerations. ”First, the vertical integration of the project across the project portfolios to be linked to the corporate strategy. The second consideration is horizontal integration of the projects across the life-cycle of the product starting with business strategy formulation to the delivery of the desired benefits. Finally, the PBOs to utilise an integrative project governance frameworks to facilitate the creation and delivery of value (Thiry and Deguire 2007, p. 651)”. During the vertical and horizontal integration in an organisation, corporate strategies could be used to focus both medium and long-term of the organisational future. The business world relies on business strategies to enable them to deal with uncertainties.

Similarly, the PBOs considers their programs as a business unit hence, the use of an integrated project management approach is effective as compared to the product delivery project management approach. Moreover, in firms where the focus is on a single project or multi-project management where resource allocation and data collection are the core of operation, the manager will be expected to consider the role of product delivery mainly. However, an effectively integrated PBO there will be a link between the project, its activities, and corporate strategies meant to create and achieve value

Staff stakeholder views and practices related to project management introduction

According to Artto et al. (2011) PMOs should be at the core of innovation while Hobbs et al. asserts that organisational change is a process that depends on the PMO (2008, p. 550). Aubry and Hobbs (2010, p. 6), states that PMO stakeholders are ”individuals and groups who have a substantial interest in the projects management within an organisation…” Ortner and Stur (2015) summarise them as Governance Boards/Executive Boards, internal or external customers, project managers, business unit managers, functional line members, etc. For these reasons, Santos and Varajao (2015) indicates that introduction of a PMO as part of organisational frameworks of an organisation, should be accomplished with handled carefully to prevent the loss of motivation and distrust while pursuing change within the organisational. Tjahjana et al. state ”Introducing a new approach to an organisation requires buy-in from all stakeholders…” (2009, p. 196). According to Taylor (2011) an executive sponsorship and alignment to the corporate goals – as articulated by the executive board, are the basic foundations of for a reliable PMO. Thus, it is critical to consider an early preparation for every phase accompanied by a clear communication as revealed by Tjahjana et al. He further indicated that ”managers need to have a good understanding of the culture, policies and processes” and ”the communicator must be trustworthy and credible” (2009, p. 64). The different stakeholders in the PMO have different expectation and contributions towards the projects and programs handled by the organisation (Lacruz, and Cunha 2018, p.220). Thus, they all expect to see their views considered and producing the desired results. For instance, the donors expect to see value for their investment and managers expect to see results as promised by the project implementers. However, there are various barrier to effective project management (Alexandrova, Stankova, and Gelemenov 2015, p. 25). For example, the lack of clarity in the project implementation may affect the allocation of a resource which leads to wastage of donors resources. The lack of clarity limits the ability to see the risks, and other uncertainties which compromise the ability to make decisions that will achieve the projects set deliverables (Callistus and Clinton 2016, p. 391). Such a situation leads to another barrier which is limited donor support and donor retention hence the lack of finances to execute the projects.

Additionally, the resistance to change among employees limits the progress towards better efficiency within the organisations (AlNasseri 2015, p. 14). The change of technology is essential to be considered by the organisation to improve not only the pace of performing tasks but also the quality of results. Moreover, the use of information which is not evidence-based may affect the decision-making process which may affect the entire project.

Can a PMO lead to improved value, project efficiency and acquisition rate of new?

”What we forget is that the ultimate goal of every PMO is specific and simple: to create value” (Nir 2016, p. 12). The same notion was promoted by various authors in the articles by Hurt and Thomas (cited in Van Der Linde and Steyn 2016, p. 152) who exhibited ”benefits that include cost savings, increased revenue, reduced rework, improved competitiveness, attainment of strategic objectives, strategic alignment, more effective use of human resources, improved general use of resources, and better project decision-making” while Kutsch et al. argued that ”sustainable PMOs are ‘driven’ by a value perspective” (Kutsch et al. 2015, p. 115). Unfortunately, this idea has not been supported by other researchers. For instance, Unger et al. suggests that ”despite increasing research efforts, solid empirical evidence for the positive impact of multi-project PMOs on performance is still lacking” (2012, p. 610) a similar position promoted by Van der Linde and Steyn revealing that the return on investment (ROI) “generally does not contribute directly to the bottom line of an organisation” (2016, p. 152). In even stronger terms Bredillet et al. are pointing towards a study by Stanleigh who found that in the domain of Information Systems ”75% of PMOs were shut down within three years because they could not demonstrate their value (Stanleigh, 2006 and Bredillet et al. 2017, p. 3). Most of the NGOs rely on projects linked to their mission to achieve their goal (Diallo and Thuillier 2004, p. 22). However (Golini, Kalchschmidt, and Landoni, 2015, p.656) indicated that when organisations have a project management office, its performance improves tremendously. The project management office ensures that the NGOs can effectively allocate their minimal resources to the projects which will yield the highest value to the investors. Glaeser revealed that NGOs financing is a ”donation market” when both private and public individual offer their resources for various projects that organisations pitch through public notices (2002, p.15). Thus, in most cases the funds tend to be smaller than demanded by the NGOs; hence the need for professional management of the resources and the use of a PMO have been considered a reliable idea. This office also, seek for sources for the resources to help cover the deficits in their financial plans which ultimately facilitate the productivity of the organisation. The productivity is reflected by the ability of the organisation to finance and accomplish the programs. The activity of fundraising is an essential activity for the sustainability of any NGO a role that is played only by the PMO (Keating and Thrandardottir 2017, p. 136). Thus, for s sustainable competitive advantage of the NGOs considers the PMO are a critical unit at the core of its operation as shown by Cooke-Davies and Arzymanow (2003, p.475). The organisations with this office are efficient in their search, allocation, and monitoring of resources which helps them to deliver the value they promise to their stakeholders.

Furthermore, Lacruz indicated that the PMO helps the organisation to coordinate and centralise projects and programs by formulating policies among other leadership initiatives to steer towards meeting the set goals (2015, p. 520). The office drives the organisation towards the desired results by helping the managers in decision making to improve their efficiency in various activities. Hence, the office ensures that the project management efforts are transferred for use in the organisational environment as shown by Monteiro, Santos, and Varajão (2016, p. 1087). The process of monitoring and governing the projects through it life-cycles and making decisions about the effective methodologies to be utilised by project team are stationed at the PMO as revealed by Pinto, Cota, and Levin (2010, p. 14). The organisation which have this office are considered to be mature in their programs which confirm their impact on the society they are serving and probably the amount of resource they target and potentially control. The PMO is classified into three major categories depending on the roles it plays within the organisation in pursuit of the goal and objectives. The first PMO is referred to as individual project office where the individual projects are designed. The second PMO is the departmental project office where various individual projects are managed as aligned on a single vision. The final PMO is the strategic project office which is involved in greater organisational integration while performing portfolio analysis and making organisational decisions as shown by Van der Linde and Steyn, (2016, p. 156).

Additionally, to achieve these PMO distinct functions different forms of management designs are needs to provide tailored skills towards particular activities. Thus, according to (Monteiro et al. (2016, p. 1089), there are various PMO designs where the first is a corporate office where the senior management takes charge. The divisional PMO is hosted by the management division, while the sectoral office is located within management, and finally, the departmental office found within a department. These divisions and designs help to streamline the activities in the project management process to deliver the promised value to the stakeholders. The PMO is considered the centre of excellence for organisations as it enhances the accountability of the project implementers during the various phases of the product lifecycle. Moreover, the managers are obligated to report to the PMO to assess their performance and improve their efficiency in executing the subsequent phases of a project.

Additionally, the ROI (Return on Investments) is a critical measure to establish the performance of an organisation. The ROI as a metric helps organisations to evaluate the current workplace procedures and make adjustments to achieve the desired goals (Botchkarev, Andru, and Chiong, 2011, p. 6). There are various variables used to determine the ROI with an organisation such as social media metrics and donor retention among others. Pressure has been mounting on NGOs to include their donors in reporting their performance as a business entity. For instance, a 2010 Canadian annual report for donor on the non-profit organisations indicated that corporate donors are interested in understanding the value of their contributions to NGOs they offer their funds (The Canadian Institute of Chartered Accountants. 2011, p. 6). The donors consider this aspect a way of accountability and value for their investment. Hence, these organisations need to find a way of assessing their performance and reporting to their financiers to secure their further support in their organisational programs (Anderson and Jessen, 2003, p. 460). This is the aspect of ROI which could contribute to the donor retention. The reports act as a motivation for the donors and prompt for performance and accountability for the organisations a situation that helps the NGOs to remain afloat in its business activities. However, the donors expect to see higher returns for their investment which encourages them to extend their funding (Kerzner 2003, p. 17). The social ROI is considered a useful metric for evaluating the impact of an NGO on the society and show its success in its programs. The social ROI refers to the profits that will be generated following donor investment (Varua and Stenberg 2009, p. 19). Thus, the higher the social ROI, the higher the chances of securing new donors and retaining the previous ones which are an aspect of donor retention. However, the NGOs are not in the business of creating tangible wealth for the investors but to serve the society in ways that the donors anticipate. For instance, the NGOs build shelters, offer clean water to communities, and prevent diseases all to the benefit of the society but with a focus on the organisational and donor goal in the project (Golini, Kalchschmidt, and Landoni 2015, p. 17). The donors who support the fight against human rights violations would finance programs by organisations such as Amnesty International. The reporting of successful occurrences motivates the donors to finance further. The donors see the success of the organisation as their own, so they keep supporting the projects of respective organisations.

Project Governance

Project governance refers to the frameworks within organisations used for management and decision making on the project activities (Ahola, Ruuska, Artto, and Kujala 2014, p. 1325). Project management performs some of the PMO functions such as the accountability and being responsible towards the project. The project governance provides the organisation with the required internal control while reassuring the investor/donors/stakeholder that their money will accrue the promised value (Garland 2009, p. 14). Moreover, the stakeholders and government among other parties that invest in projects are increasingly demanding for governance as part of achieving the desired efficiency. The governance occurs at the portfolio, projects, and programs which are expected to be compliant to the performance indicators. The project governance offers various benefits such as optimising the investment, motivating the staff through effective communication, and control of common triggers of project failure in an organisation by proper planning and management. Thus, project governance helps to improve certainty and minimise the risks which arise from the changes occurring during project execution to maximise the desired benefits.

Furthermore, the project team are encouraged to be disciplined, organised, and effective while executing the project through its various phases (Bekker and Steyn 2008, p. 1327). There are various features in a project that could be used to identify whether the governance has been applied or not. For instance, project governance has displayed the process of recording and communicating the decisions made at the points of approval (Müller and Lecoeuvre 2014, p. 1350). The project governance provides for the clear definition of roles and responsibilities and criteria of performance for each phase of the project execution. Furthermore, the project governance is displayed by the coherent and supportive integration between the project and the business strategy or the organisational vision. Also, through project governance, the board can call for independent scrutiny of individual projects to enhance the level of accountability and the quality of deliverables (Joslin and Müller 2016, 627). The project governance plays a critical role in deciding about the business cases, as it includes the stakeholders in the process to the level that reflects the importance to the organisation which is also a way of promoting trust. For instance, the donors are included in the process of making budgetary decisions while the implementers are involved in the design and evaluation of the projects (Biesenthal and Wilden 2014, p. 1293). The situation enables the organisation to deploy qualified individuals to the activities of the projects. The outcome is finishing the projects within the set time and the predetermined budget (Bekker and Steyn 2009, p. 218). The major causes of failure of projects are linked to the insufficient management of the project especially the project governance. The managers and executives of the organization are majorly linked to this problem based on the decision making tree (Magee 1964, p. 4). The project governance deal with the problem by allocating different task for all members or the organisation, while ensuring that they are complementary to facilitate the collaboration and improve efficiency (Müller and Lecoeuvre 2014, p. 1355). Moreover, the project governance shows the reporting patterns but reduces the bureaucracy of such structures to improve the process of making decisions and implementing them.

Recommendations on Leadership and Staff Preparation Issues

Project management is an activity that depends on the contribution of all staff at their respectful level and professionalism. The NGOs operations depend on the donor support to finance their programs which require the staff to be pragmatic in executing their roles with utmost competency. Thus, they are required to be prepared with leadership skills to handle activities such as project governance to enable the organisation to meet its set goal and objectives. Hence, the need for training in leadership skills that will encourage the staff to be independent and proactive at the workplace is needed. For instance, by equipping the staff with transformational leadership techniques, they will realise their role is to become situational leaders and learn from the environment and make the needed decision to streamline the project activities (Chou, Lin, Chang, and Chuang 2013, p. 18).

Furthermore, professional development which could be conducted at the workplace or outside using relevant institutions such as training colleges could be used to improve the competency of the employee to take leadership roles and prepare for the activities at the core of the organisation (Wesarat, Sharif, and Majid 2013, p.81). For instance, mentorship programs help the staff to become prepared for leadership through the transfer of knowledge and skills from skilled to novice staff.

Moreover, the organisations could prepare succession plans earlier before they are needed to enable the staff to prepare themselves for upcoming positions (Hao and Yazdanifard 2015, p. 11). The recognition of improved performance at the workplace such as through rewards and other incentives will encourage the staff to improve the performance by intrinsic motivation which is needed to nurture leadership skills and preparing the staff to take up high responsibilities. Additionally, performing skills gap analysis for the staff will enable the organization to equip its employees appropriate to facilitate their performance.

The gap in literature

Despite the effectiveness of the identified literature in answering the research question, various limitations or gaps were identified. For instance, there were minimal sources that focused on the role of the donors in the establishment of the PMO. Moreover, no article indicated how the established PMO could be evaluated in terms of its impact on meeting the organizational goal. There was no scientific framework that had been proven to be effective in performing the same task. Moreover, there were minimal up-to-date project governance articles which forced the researcher to refer from sources within the past decade. The situation might affect the quality of founding especially when making conclusions about experiences in the current business world. Most sources revealed how the ROI metrics could be used to show the impact of project on the donor support. However, a few articles focused on NGOs activities especially those that revealed the situation in the non-for-profit institutions.

Conclusion

Thus, the research could conclude that an exploratory case study is essential considering that various sources that were used to answer the research questions were incomplete as revealed in the literature review is obvious. Furthermore, the inadequate availability of governance-related research focused on the NGOs (Unger et al. 2012) as well as the lack of the value or return on investment for the PMO at an NGO are prominent indicators of the gap in the literature. Moreover, the inadequate involvement of the donors in the evaluation process has been expressed by literature. The inclusion of donors in the evaluation processes for the impact of the projects have been indicated but the exact framework to accomplish this activity have not been revealed. The only tools available are those that help the project implementers to perform this role and report the findings to the other stakeholders. The process may prompt the program manager among other organisational staff responsible for implementing, monitoring and evaluation but it would be appropriate if the donors had their specific tools or frameworks to perform the same task.

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