NEU ENERGY NEU ENERGY RESOURCESRESOURCES

PMO PROPOSAL PMO PROPOSAL

March 29March 29thth, 2010, 2010

Lingling Yang, Rustem Bozkurt, Zeki TanrikuluLingling Yang, Rustem Bozkurt, Zeki Tanrikulu

Dan Zheng, Ge Zheng, James BlackburnDan Zheng, Ge Zheng, James Blackburn

Why do we need a PMO?Why do we need a PMO?

Our company has a large quantity of Our company has a large quantity of project proposals. We donproject proposals. We don’’t have the t have the resources to complete all of them. A resources to complete all of them. A

group needs to be established to group needs to be established to help prioritize the projects, aligning help prioritize the projects, aligning

them with our company goals.them with our company goals.

This will allow the executives better This will allow the executives better control of project flow. control of project flow.

What type of PMO?What type of PMO?

Our company has operated for many Our company has operated for many years without a PMO. To slowly make years without a PMO. To slowly make changes and offer assistance we will changes and offer assistance we will

introduce a introduce a Supportive Type PMO

This should help make the transition This should help make the transition more subtle.more subtle.

Should attract less opposition to Should attract less opposition to change. change.

Should support the existing projects. Should support the existing projects.

What will it achieve? What will it achieve?

A PMO brings value to the company. A PMO brings value to the company.

Helps prioritize projects and guide Helps prioritize projects and guide their progress. their progress.

Standardizes the project process and Standardizes the project process and improves project flow. improves project flow.

Helps assigns staffing appropriately.Helps assigns staffing appropriately.

Reports back to key stakeholders, Reports back to key stakeholders, keeping the sponsors informed. keeping the sponsors informed.

Critical Success FactorsCritical Success Factors Executive and project support across the Executive and project support across the

organizationorganization Project management training and skills Project management training and skills

development at every level of the development at every level of the organizationorganization

Quality marketing of the PMO, its tools, and Quality marketing of the PMO, its tools, and supportsupport

Acquisition/development of quality products Acquisition/development of quality products to support project excellence. to support project excellence.

Effective training Effective training Executive ownership of the portfolioExecutive ownership of the portfolio

Critical Success FactorsCritical Success Factors

How to contribute to the organizationHow to contribute to the organization’’s s goals? goals?

Efficiently Help Projects Through Efficiently Help Projects Through Completion Completion - Making the most of our investors money. Making the most of our investors money.

Good Business Practice Good Business Practice -Helps the company compete effectively with their competition. Helps the company compete effectively with their competition.

Ensures High Standards of Project Ensures High Standards of Project Groups Groups - Maintaining oversight of their Safety & Environmental commitment. Maintaining oversight of their Safety & Environmental commitment.

Influence scheduling and decision making Influence scheduling and decision making across all projectsacross all projects

Influence changes to resource allocation and Influence changes to resource allocation and project priority changesproject priority changes

report to an executive with responsibility for report to an executive with responsibility for both the supply and market side of the both the supply and market side of the organizationorganization

SCOPESCOPE

What will PMO do?What will PMO do?

Service:Service:

a.a.Identify minimum data requirements for project Identify minimum data requirements for project scheduling scheduling

b.b.Develop and document best practices, in an Develop and document best practices, in an easily accessible web-based tool.easily accessible web-based tool.

c.c.Gather, report and analyze initial project portfolio Gather, report and analyze initial project portfolio datadata

d.d.Delivery a library of easily accessible user guides Delivery a library of easily accessible user guides for project managers, resource managers, team for project managers, resource managers, team members sponsors and executivesmembers sponsors and executives

e.e.Implement necessary Implement necessary training/education/development processtraining/education/development process

Scope in organization:Scope in organization:

The scope of PMO is provide support to the The scope of PMO is provide support to the existing project groups. This is to include training existing project groups. This is to include training and access to specialists. Forms and documents to and access to specialists. Forms and documents to standardize our paperwork and record keeping. standardize our paperwork and record keeping. The necessary technology allowing us to organize The necessary technology allowing us to organize our information and give access to project groups. our information and give access to project groups. The PMO is also to provide staffing support to the The PMO is also to provide staffing support to the projects groups. projects groups.

Three Measurement SystemsThree Measurement Systems

PMOPMO

Project Teams and Associated Project Teams and Associated ResourcesResources

ExecutivesExecutives

How will we measure success? How will we measure success?

Use key ratios Use key ratios - Tracking the number of days spent on each stage of a project. Tracking the number of days spent on each stage of a project. - Keeping a history of key milestones for each project. Keeping a history of key milestones for each project.

Weekly status reportsWeekly status reports-To show progress on the project & critical pathTo show progress on the project & critical path

Senior management monthly reviewsSenior management monthly reviews- Understanding lessons learned from other projects. Understanding lessons learned from other projects. - The PMO will provide accurate information for the executives The PMO will provide accurate information for the executives review. review.

Understanding inherent value of the Understanding inherent value of the projectproject- Meeting the companyMeeting the company’’s goals and understanding why this is s goals and understanding why this is important.important.

Implementation Implementation

PMO will set Guidelines for Project GroupsPMO will set Guidelines for Project Groups

Create a Standard set of PMO ToolsCreate a Standard set of PMO Tools

Provide information to Project Groups on Provide information to Project Groups on what the PMO offers. what the PMO offers.

StaffingStaffing

Commonly the PMO should include:Commonly the PMO should include:

PMO executivePMO executive Project portfolio managerProject portfolio manager Project management mentorProject management mentor Project management tool mentorProject management tool mentor Help desk specialistsHelp desk specialists Resource portfolio managerResource portfolio manager Methodology specialistMethodology specialist Project management trainerProject management trainer Data administratorData administrator

AlignmentAlignment

Welcome packet for PMO participantsWelcome packet for PMO participants Training materials for PMsTraining materials for PMs Weekly communications to participantsWeekly communications to participants One on one project mentoringOne on one project mentoring Reports given to executives at critical Reports given to executives at critical

junctures. junctures. Regular meeting with participantsRegular meeting with participants

TransitionTransition

Baseline Changes will be DocumentedBaseline Changes will be Documented

Each existing project group will submit a Each existing project group will submit a brief report to the PMO describing the brief report to the PMO describing the project, status and resource usage.project, status and resource usage.

All new projects will be directed to the All new projects will be directed to the PMOPMO

Currently the company has no PMO and very little Currently the company has no PMO and very little project group structure. In order to transition to a project group structure. In order to transition to a PMO structure the following things will be done:PMO structure the following things will be done:

Name/Nature of Communication

From To Content Provided By Frequency Format Used

Delivery Media

Urgent Issues Project Manager PMO

Project Sponsor Project ManagersAny Stakeholder

As needed Any VerbalE-mailMemos

Issues Updates/Resolutions

Executive Sponsor

PMO Manager, PMO GM

Executive Sponsor As needed Verbal,E-mailMemos

Status Report PMO Manager PMO GM PMO ManagerProject Managers

Monthly Report Form E-mailShared Storage

Special Presentation or Meetings for Updating

Executives

PMO Manager Executive Team Program Manager Program Director

As needed TBD based on requirements

Meeting

Issue Items Status / Updates / Resolution

Project Managers

PMO Manager Project Managers, Project Team Members

(1) Weekly (via the Project Status Report)(2) As needed

(1) Project Status Report

form

(1) E-mail

Change Requests Project Managers

PMO Manager Project Managers As needed Standard Change

Request form

E-mail

Project Status Report Program Manager

PMO Manager PMO Manager, Project Managers

Weekly Standard Status Report

Form

New Issues/Action Items Stakeholders Project Manager Stakeholders Bi-Weekly Discussions during bi-

weekly stakeholders

meeting

Issues/Action Items section of meeting

minutes

Urgent Information Impacting Team and

External (I/S) Stakeholders

Program GM Team & External Stakeholders

PMO Manager, PMO GM, Project Managers

As needed TBD E-Mail/Voice Mail, as appropriate

Communications Plan Communications Plan ** In order for a project to be successful, there needs to be ** In order for a project to be successful, there needs to be

constant, effective communication between everyone.constant, effective communication between everyone.

Risk ManagementRisk Management

For each project a risk management form needs to For each project a risk management form needs to be completed by the project group. be completed by the project group.

This form includes the following items: This form includes the following items:

- The description of the risk - The description of the risk

- The type of risk- The type of risk

- The scale of impact ranked 1-10. - The scale of impact ranked 1-10.

- The response to limit or eliminate the risk - The response to limit or eliminate the risk

Change Control Change Control

11stst –– Individual project teams will review changes and make Individual project teams will review changes and make any recommendations. any recommendations.

22ndnd –– The PMO Implementation Manager will review the project The PMO Implementation Manager will review the project teamteam’’s decision and submit to the PMO.s decision and submit to the PMO.

33rdrd –– The PMO will ensure the change falls within the The PMO will ensure the change falls within the companycompany’’s standards including all documentation. s standards including all documentation.

44thth –– The PMO will submit the final change request to the The PMO will submit the final change request to the Executive board for approval. Executive board for approval.

Procurement Plan Procurement Plan

Up to $10,000 Up to $10,000 –– Project Team is Authorized to make Purchases Project Team is Authorized to make Purchases

$10,000 - $50,000 $10,000 - $50,000 –– Project Manager is to Approve any Project Manager is to Approve any PurchasesPurchases

Above $50,000 Above $50,000 –– The PMO is to Create a Request for Executive The PMO is to Create a Request for Executive ApprovalApproval

Cost / Benefit AnalysisCost / Benefit Analysis

Each project must be reviewed at completion to determine the Each project must be reviewed at completion to determine the savings based upon project efficiency and risk management. savings based upon project efficiency and risk management.

Ex. Ex. Code

Base Headcount Avg Cost

Total Cost per Project

Pm 2 140.00$ 5,600.00$ Ed 4 40.00$ 800.00$ Ee 2 50.00$ 1,750.00$ Me 2 40.00$ 640.00$ Mr 1 37.00$ 555.00$ Me 4 55.00$ 880.00$ Md 2 45.00$ 810.00$ Qe 1 60.00$ 1,440.00$ Se 2 50.00$ 500.00$ Ra 1 30.00$ 300.00$ Swe 1 55.00$ 2,200.00$ St 2 35.00$ 1,400.00$ Se 1 45.00$ 1,350.00$ Tw 1 22.00$ 660.00$

Total Employees : 26 Total Savings per Project: 18,885.00$

Average for 10 Projects per Cycle: 188,850.00$

Technical writer 30.00

System Tester 40.00 System Engineer 30.00

Requirements 10.00 Software engineer 40.00

Quality Engineer 24.00 Safety Engineer 10.00

Mechanical 16.00 Mechanical 18.00

Manufacturing 16.00 Marketing 15.00

Electrical Designer 20.00 Electrical Engineer 35.00

NEU Energy Resources

Resource by typeAvg Hours Saved

per ProjectProject Manager 40.00

Timeline for Establishing Timeline for Establishing PMOPMO

Executive Approval: Executive Approval: Within two monthsWithin two months

Establish PMO Charter: Establish PMO Charter: Within four monthsWithin four months

Assign Staff to PMO:Assign Staff to PMO: Within six monthsWithin six months

Create set of Standards:Create set of Standards: Within nine monthsWithin nine months

Implement PMO for all New Projects: Implement PMO for all New Projects: Within One year Within One year

Duration Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

Executive Approval: 2 Months

Establish PMO Charter: 2 Months

Assign Staff to PMO: 4 Months

Create Set of Standards: 3 Months

Implement PMO for all New Projects: 1 Year

Timeline for Establishing PMO