Sign public and private sector

PMOs in the Public and Private Sector

Project management offices have many uses across different organisations. How they work and what they achieve are different depending on the setting requiring a PMO.

One contrasting setting you’ll find PMOs in is the public and private sectors. There will be lots of characteristics that PMO in either setting share, and plenty more where the office will be rather different in feel and focus.

We’re going to be looking at:

  • The overall purpose of a PMO in both the public and private sectors
  • Where the intrinsic differences are between both PMOs
  • What public sectors PMOs can learn from privately run company PMOs

Enabling you to design the right PMO for your organisation, no matter the organisation type.

What does a PMO do in the public and private sectors?

The overall goal of a PMO is to get an organisation’s project delivered successfully. What a successful delivery looks like will vary not just by sector, but by project type, stakeholders, end users, and other factors.

A PMO is there to bring in processes for project managers to adhere to. It can also work to assess and select which projects get initiated and manage the resources of project across an organisation.

It’s important that a PMO has KPIs to that the manager knows what is expected of the office. Laying out targets and which parts of the organisation visions and values must be focussed on will hone in on what tasks need to be done. The tasks between private and public sector PMOs might be similar, but their outcomes and strategic focus are very different.

What’s the difference between a private sector and a public sector PMO?

As much as the actions of a PMO will be similar across both sectors, there is a lot that is different. This is mainly in terms of the external factors that affect either PMO.

Here’s a guide to some of the key elements that differ between a public and private sector PMO:

  • Stakeholders – private sector PMO stakeholders are generally the C-suite and the project’s clients; they are very easy to identify. A public sector PMO has a range of stakeholders such as tax-payers, voters, and end users – there may be a lot of crossover but it’s not definite.
  • Market position – in the private sector, the PMO needs to ensure projects keep the business competitive. A public sector PMO hold a dominant market position and has little competition to factor into decisions.
  • Responsiveness – a private sector PMO has markets to consider, any changes in the market could require adjustments to projects. In a PMO in the public sector, changes can happen rapidly due to political and macroeconomic conditions.
  • Funding – money comes from inward investment from the owners or directors of a company in the private sector and must be managed with the profit motive in mind. Funding comes from public coffers and is generally set with extras in reserve when a public sector project starts.

With differences will come a different focus for the PMO. Whilst a private sector PMO needs to be understanding returns on investment and long-term business strategy, one on the public sector should be focussing on the value added for end users.

What lessons can a public sector PMO learn from the private sector?

In a privately run business, a PMO will look at the bottom line and work to deliver projects on time, on budget, and that produce what the customer or client is looking for. This needs to be done with the strategic aims of the business in mind, working towards growth and profitability.

Whilst growth and profitability aren’t an issue for the public sector, it’s important for stakeholder trust that projects are delivered on time and on budget. Using new and innovative project management styles such as Scrum or Kanban bring energy and dynamism into projects.

A challenge within the public sector is how to link performance with reward. By using the monitoring software that’s common in private sector PMOs, performance is easier to be measured in the public sector. When staff have clear goals to meet, projects will deliver more efficiently.

The take home

Whilst there are clear differences between PMOs in the public and private sector, there are overarching ideas that can apply to both. Lessons can be learned in business around efficiency as well as people and resource management. Making projects more dynamic and with a focus on the strategic aims of the government department is a clear lesson to be learned. Introducing measurable KPIs will also make a public sector office more motivated.