Establishing a Project Management Office Within the Strategy Function: Best Practices

Abstract bridge from strategy to execution

The Outthinker Strategy Network is a global peer group of heads of strategy at $1B+ companies who are determined to move their organizations to the next level. Members engage in curated learning, practical conversations, and networking opportunities to be more successful in performing their roles, solving their top challenges, and keeping their organizations ahead of the pace of disruption.

It’s not uncommon for the link between strategic planning and execution to present significant challenges. Organizations fail to execute their strategy for many reasons, including lack of alignment, inability to track progress, and missing measurements. The translation of strategy to execution can be even more difficult when it comes to cross-functional initiatives without a defined owner.  

For many large companies, developing a project management office (PMO) within the corporate strategy team can help to bridge the gap between strategy and execution. The strategy office is well positioned to take on the challenge. Chief strategy officers (CSOs) and their teams are adept at framing contexts and problems, influencing decision-making and implementation, allocating resources, and aligning strategy to action. 

“For many large companies, developing a project management office (PMO) within the corporate strategy team can help to bridge the gap between strategy and execution.”

During a recent Outthinker Strategy Network summit, one CSO member brought up the challenge of setting up a global PMO within his strategy team. He asked our network of strategy leaders for their recommendations and lessons learned. Below are the best practices shared by the group, based on their extensive experiences across sectors. 

Best Practices for Setting Up a Global PMO within a Strategy Team:

1. Integrate strategy and transformation teams
2. Pull in business unit leaders
3. Include regional representation
4. Own KPI setting and resource allocation
5. Rebrand for enhanced perception and acceptance
6. Communicate to prevent blame

Integrating Strategy and Transformation Teams

One member, from the financial services industry, shared his experience of dividing the strategy development and execution responsibility between two teams, Strategy and Business Transformation. The Strategy team concentrated on traditional strategy formulation, while the Business Transformation team took charge of PMO execution. The division allowed for effectively cross-training talent and aligning between teams, ensuring that both formulation and execution teams worked cohesively toward the organization’s overarching goals.  

Empowering Leadership in Global PMOs

The impact of global PMOs significantly increased when leadership roles were assigned to respected senior business line leaders. Dedicating credible and fully committed leaders to oversee the PMOs ensures that initiatives are executed with a higher degree of perceived relevance and alignment with strategic objectives. This practice highlights the importance of leadership commitment in the success of global PMOs. 

“We found the most success when we pulled well-respected, senior business line leaders to run the global PMO.”

Including Regional Representation

Addressing the challenge of global strategy implementation, one member (formerly CSO of a multinational CPG company) emphasized including representatives from each region within the PMO to ensure regional strategies are tied to global objectives. These regional teams should be led by the strategy department, enhancing the balance between global strategy and local execution. 

“We had six regions and needed someone from each region. The central leader was always from the strategy team.”

Project management board of sticky notes

Setting KPIs and Aligning Resource Allocation

One CSO established a PMO to take charge of key discussions about resource allocation, and the regular review of results and returns. Actively involving strategy team members with business line executives accountable for the transformation ensures the incentives are aligned and that the resources required are analyzed, discussed, and allocated to keep strategic initiatives focused and on track.

“I recommend the strategy office take responsibility for setting all the KPIs and facilitating the discussions on resource allocation. Send people out into the field to gather insights and enforce execution. Your incentives should be aligned as a collective. If one area wins, the entire organization wins.”

Rebranding for Enhanced Perception and Acceptance

Strategists often harbor negative connotations toward project management. One innovative solution was to rebrand the PMO as a “Strategy Enablement Team.” This not only improves perception internally on the team but also realigns the team’s mandate toward facilitating strategic success, leading to broader acceptance and collaboration across the organization. 

Communicating to Prevent Blame

A common challenge for PMOs is being blamed for a lack of progress. To mitigate this, best practices include maintaining open communication with key stakeholders, developing service level agreements with internal customers, and adhering to clear parameters. This helps to manage expectations and clarify responsibilities. 

Final Thoughts

The responsibilities of a PMO fit naturally under the remit of the strategy office. Strategy teams are equipped to balance priorities, allocate resources, set KPIs, and measure progress. They are highly skilled at building cross-functional relationships throughout the organization and leading without direct authority. The successful establishment of a PMO within the strategy function requires thoughtful integration of leadership, strategic alignment, and clear communication. By following these best practices shared by Outthinker Networks CSOs, strategy leaders can enhance their organization’s ability to translate strategic visions into tangible outcomes. 

Authors

Claudio Garcia
Claudio GarciaPresident - Outthinker Networks
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Cori Dombroski
Cori DombroskiContent Director - Outthinker Networks
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