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Performance Management Systems for Project Management Offices: A Case-

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DOI: 10.1016/j.promfg.2020.01.397

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Procedia Manufacturing 39 (2019) 923–931

25th International Conference on Production Research Manufacturing Innovation:

Cyber Physical Manufacturing
August 9-14, 2019 | Chicago, Illinois (USA)

Performance Management Systems for Project Management

Offices: A Case-Based Study
Rafael Duartea,b *, Fernando Deschampsb,c , Edson Pinheiro de Lima b,d,
André Pepinob , Rene Marcel Guzman Clavijob,
Universidade Positivo, R. Prof. Pedro Viriato Parigot de Souza, 5300, Curitiba - PR, 81280-330, Brazil
a

b
Industrial and Systems Engineering Graduate Program (PPGEPS) – Pontifical Catholic University of Parana (PUCPR), R. Imac. Conceição,
1155, Curitiba - PR, 80215-901, Brazil
c
Department of Mechanical Engineering (DEMEC), Federal University of Parana (UFPR), Av. Cel. Francisco H. dos Santos, 230 - Centro
Politécnico, Bloco IV, Curitiba - PR, 81530-000, Brazil
d
Federal University of Technology – Parana (UTFPR)

Abstract

Project Management Offices (PMOs) are organizational structures in charge of managing and coordinating several simultaneous
projects within companies. Due to the complexity of different projects’ objectives, it’s usual to simplify project indicators and
control them by means of the well-known triple constraint or “iron triangle”: scope, cost and time. This approach does not
account for the organizational strategy, internal and external stakeholders’ interests, nor other specific indicators. The problems
due to the lack of integration caused by this oversimplification are yet amplified in complex project portfolios related to
technology development and deployment, since in this kind of scenario the marketing competition demands new features, at
lower costs, in no time. These points could be addressed by operations management approaches, such as the Performance
Management Systems Design Framework (PMSDF). To identify the viability and relevance in using this method in PMOs, this
work adopts a mixed methods research. Is begins with a Systematic Literature Review to better understand performance
management routine and tools in PMO. It was followed by meetings with two project management consultants, to identify the
best practices, habits and advises, to check the differences between practitioner and academic views. Finally, it was conducted
interviews with the PMO Director of a trucks’ manufacturer and a PMO Manager in an agrarian-cattle-breeding cooperative, to
verify how such companies measure their PMO’s successes. The last step was to adapt the PMSDF to the project management
context, evaluating the PMO operation in a medium-sized software development company and propose the restructuration of its
Performance Management System.

*
Corresponding author. Tel.: +55-41-99925-9889; fax: +55-41-3271-2579.
E-mail address: rafael.duarte@up.edu.br

2351-9789 © 2019 The Authors. Published by Elsevier B.V.

This is an open access article under the CC BY-NC-ND license (https://creativecommons.org/licenses/by-nc-nd/4.0/)
Selection and peer review under the responsibility of ICPR25 International Scientific & Advisory and Organizing committee members

2351-9789 © 2019 The Authors. Published by Elsevier Ltd.

This is an open access article under the CC BY-NC-ND license (https://creativecommons.org/licenses/by-nc-nd/4.0/)
Peer-review under responsibility of the scientific committee of the ICPR25 International Scientific & Advisory and Organizing
committee members
10.1016/j.promfg.2020.01.397
2 Rafael Duarte, et al / Procedia Manufacturing 00 (2019) 000–000
924 Rafael Duarte et al. / Procedia Manufacturing 39 (2019) 923–931

©
© 2019
2019 The Authors. Published
The Authors. by Elsevier
Published by Elsevier B.V.
Ltd.
This
This is
is an
an open
open access
access article
article under
under the
the CC
CC BY-NC-ND license (https://creativecommons.org/licenses/by-nc-nd/4.0/)
BY-NC-ND license (https://creativecommons.org/licenses/by-nc-nd/4.0/)
Selection
Peer-reviewandunder
peer responsibility
review under ofthethe
responsibility of ICPR25
scientific committee International
of the Scientific &Scientific
ICPR25 International Advisory&and Organizing
Advisory committee
and Organizing
members
committee members

Keywords: PMS; PMO; KPI; Operations Strategy; PMSDF

1. Introduction

Organizations must control their operations’ performance to ensure they’re achieving their objectives.
Performance management systems (PMS) supports the managers, providing valuable information and assisting the
decision making. It includes the processes of assessing the outcomes, comparing it against the desired targets,
understanding the reasons of undesired results, if any, and introducing (and monitoring) possible corrective actions
to fix the performance gaps[1].
There are some reference frameworks that guide in the creation of the PMSs. One of the most prevalent is the
Balanced Scorecard (BSC) created by Kaplan and Norton [2], published in 1992, and still a major reference (Fig. 1).
Different from the other approaches until then, that focused mainly in the financial indicators, the BSC introduces
operational and strategic measures. However, it is based on economic conception, resting its foundations on ROI [3],
turning it less suitable to companies whose financial results is not the focus, like public organizations and not-for-
profit, or for roles and tasks in for-profits whose main activity are either not directly linkable with financial results
or this connection is hard to trace, as project management offices [3], [4].

Fig. 1. The Balanced Scorecard [2]

As an option to BSC, it was developed the Performance Management Systems Design Framework (PMSDF)
[5](Fig. 2). Unlike the former, this model is not prescriptive in terms of which group of measures the organization
should focus to determine its success. With a set of recommended steps and flexible parameters that may be changed
according the organization characteristics, it has been used in the evaluation and improvement proposals in the
context of small and midsized business (SMB) strategies [6], urban mobility planning [7] and not-for-profit
organizations (NFP) [8]. In each of those contexts, a new form was created, with terms that could improve the
communication with the people working in the context being evaluated the information (e.g.: in the NFP
 Rafael Duarte et al. / Procedia Manufacturing 39 (2019) 923–931 925
Rafael Duarte, et al / Procedia Manufacturing 00 (2019) 000–000 3

organizations, “benchmark value”, “competitors” and “employee” were exchanged by “reference norm”, “funding
competitor” and “employee/volunteer”; e.g. 2: in the urban mobility context, a list of possible performance
objectives and performance measures was provided).

Company size; Mission, vision PMS deployment schedule;

Competitive and values; Strategic PMS Project Deployment test; PMS
Diagnosis objectives; Audience / and Processes deployment; PMS use; PMS
stakeholders; Business action plan; PMS review.
segment; SWOT analysis.

Facilities; Control policies; Measure reason; Measure

Operation Capacity; Processes and Performance frequency; Measure review
Strategy technologies; New Products; Measures frequency; Measure data
Processes extension. source; Measure sponsor

Processes definition; Processes

Processes description; Processes origin;
Modeling Processes activities; Processes
inputs / outputs.

Fig. 2. Performance Management System Design Framework (PMSDF) [5]

Towards testing the usability of the framework, and the possible contribution it can offer, the authors chose the
Project Management Offices (PMO) departments as a context to evaluate the model. PMOs are organizational unit
that have a number of responsibilities related to the centralized and coordinated management of projects under its
domain [9]. PMOs are complexes structures, and there is no consensus about the expectancies and responsibilities
that they must assume within each company [3]. Since it’s not easy to link the influences of the PMO on the ROI
[3], and its processes are not very standardized, it is a challenge to determine how it contributes to the company to
reach its objectives.
The next section of this article will bring the main concepts related to PMO, obtained by a systematic literature
review (SLR) and complemented by a series of interviews with practitioner, and the PMO Value Ring, a model that
guides through the PMO strategy definition until, with focus on the performance of this department. Finishing the
theoretical part, the PMSDF is presented and analyzed against PMO perspectives. After the theory, we are
discussing the analysis of 2 project management offices, conducted by means of interviews with PMO managers
from 2 companies: a trucks manufacturer and an agrarian-cattle-breeding cooperative.

2. Literature Review

This section will first present the systematic literature review (SLR) that was conducted to explore the current
knowledge about performance measurement systems (PMS) related to project management offices (PMO). Then, it
will be presented the PMO Value Ring model, comparing it with the PMSDF.

2.1. Systematic Literature Review

To discover how the current academic literature deals with PMO performance management, it was conducted a
SLR about this subject. The adopted SLR process (Fig. 3) is based on [10].
Step 1: Problem definition: Lack of guidelines to create performance measurement systems that take in account
the PMOs’ context and particularities;
Step 2: Scoping study: Search in academic journals articles that present performance indicators applied in the
PMO. Peer validate the selected articles;
926 Rafael Duarte et al. / Procedia Manufacturing 39 (2019) 923–931
4 Rafael Duarte, et al / Procedia Manufacturing 00 (2019) 000–000

Problem Lack of guidelines to create Export articles to Mendeley

Data Colection
Definition PMSs that take in account
the PMOs’ particularties

Articles related to articles Remove articles not related

Scoping Study Data Analysis
that present performance to the subject.
indicators applied in PMO Analyse remaining articles.

Base: Scopus; Test queries

Search Strategy
patterns.
Write reports and articles.
Reporting

Exclusion Articles in languages other

Criteria than English

Fig. 3. Systematic Literature Review Process [10].

Step 3: Search strategy: Test different queries to validate the quality of the strings. The query was tested in the
Scopus portal. The final query is below (Fig. 4).

( performance ) AND
(
( pmo W/10 project ) OR
( "Project Management" W/1
( office OR officer )
)
) AND (
kpi OR indicator OR bsc
)

Fig. 4. SLR Query

Step 4: Exclusion criteria: It was decided to remove articles in languages other than English. A total of 110
articles were returned at this point.
Step 5: Data Collection: The articles were imported to a group in the reference manager Mendeley.
Step 6: Data Analysis: The articles were evaluated by title, keywords and abstract. They should be classified as
being related to the research or not. Each article should be evaluated by 2 analysts, and if approved by both, should
be kept for future in deep analysis. From the 110 articles, 24 were considered adherent to the main theme, and had
their full text evaluated by the authors. The current paper will consider the information from this data sample;
Step 7: Reporting: The data analysis, presented on the section 2.2. PMO Performance.

2.2. PMO Performance

The main findings about the performance measures and measurement systems in the analyzed sample of papers
about the subject are described below.
In [11], a Delphi study is conducted to identify the challenges to implement a PMO. Regarding the performance,
it was verified in some panels that hard metrics were less important, and soft metrics were given more importance,
and on another it was declared that ‘The only metrics we have is the feedback from managers about their pain points
today, as compared to the pain points before the PMO implementation’.
The second paper [3], among the one from the SLR sample, is also the one that brings more progress about the
subject, being cited by other articles in the revision. A list of 79 unique indicators was produced and presented.
Using the Competing Values Framework (a model based upon the assumption that many conceptions of
organizational performance coexist in a single organization), the research led to a set of 17 unique criteria grouped
 Rafael Duarte et al. / Procedia Manufacturing 39 (2019) 923–931 927
Rafael Duarte, et al / Procedia Manufacturing 00 (2019) 000–000 5

into three significant dimensions: the structure dimension (paradox between flexibility and control), the focus
dimension (paradox between internal and external), and the dimension of purpose and orientation. A challenge to
measure the performance of PMOs is related to the subjectivity in this task, since the concept of organizational
performance depends on the values of those who are evaluating.
The next article [12] uses the indicator presented in [3] and the MACBETH (Measuring Attractiveness by a
Categorical Based Evaluation Technique) approach, described as a being “a multicriteria decision analysis approach
that requires only qualitative judgements about differences of value to help a decision maker quantify the relative
attractiveness of options” (Fig. 5). Other articles also propose the use of MACBETH to evaluate PMO performances
([12]–[14]).
In the segment of PMO in new product development, [15] analyses PMO functions from the point of view of
performance indicators related to project´s triple constraints. Their results indicate that PMOs are not aiming on
activities as to provide project success on time, cost or scope. That makes sense, since those are the responsibilities
of the project management.
In [16] there is a discussion about the level of application of project management by European Union project
organizers, and how it can be deduced from how much PM is included in common process change management
tools in the form of a single PM methodology.

Fig. 5. Performance evaluation model for PMO

Besides these approaches, from scholar sources, a practitioners’ framework has been chosen and added to the
review. Created based on reference literature [17], [18], the PMO Value Ring [19] describes the step-by-step to
create a PMO structure, with the help of a web based software. It takes into account that the PMOs are not
standardized, and it must be aligned with the company strategy. Its 8 stages have some similarities with the PMSDF,
as listed in the Fig. 6.

PMO Value Ring PMSDF

1 – Defining the PMO Services
1 – Operations Strategy
2 – Balancing the PMO Mix of Services
3 – Stabilizing the PMO Processes 2 – Processes Modeling
4 – Defining the PMO KPIs 3 – PMS Project and Processes
5 – Defining the PMO Headcount and Competences 4 – Processes Modeling
6 – Defining the PMO Maturity evolution plan
7 – Calculating the PMO ROI 5 – Performance Measures
8 – Establishing the PMO Balanced Scorecard

Fig. 6. PMO Value Ring vs. PMSDF

3. PMSDF for PMO

Though PMSDF is not limited to specific use area, nor prescriptive in the choice of performance indicators,
acting as a guide in the evaluation of the analyst, it was verified that when applying it in a new context, the
customization of some variables, questions and premises make the process of evaluation of an existing system or
928 Rafael Duarte et al. / Procedia Manufacturing 39 (2019) 923–931
6 Rafael Duarte, et al / Procedia Manufacturing 00 (2019) 000–000

design of a new one more efficient. For this reason, it was created a new computer fillable form taking in account
the literature review.
Some of the changes are listed below:
 Operation strategy/Performance objectives: replaced the manufacturing performance dimensions by the most
frequent PMO functions [17]
 Processes/Evaluated processes: A drop list with options of the criteria and indicators to select when modeling
the processes.
The interviews were also influenced by the studied context. The high flexibility of the processes, common in
PMO’s, and the lack of quantitative indicators and metrics for several of the operations were a couple of the points
of interests in these meetings.

4. Interviews

In this section the four interviews are reported in brief. They are presented in the chronological order in which
they happened. The interviews were made in a semi structured protocol, following the PMSDF sections, items and
criteria.

4.1. PM Director in an International Trucks manufacturing company

The first interviewee is the Project Management Director of an industrial plant, in a large-sized vehicles
manufacturing company. This company has operations in several countries, and the project management practices
and processes are shared between the sites. He was accompanied by a senior project manager of the company, who
participated on the discussion. The local PMO structure has existed for more than 10 years.
The project management department has an internally developed framework, used by all project management
departments from the company’s sites. with processes well aligned with PMI PMBoK recommendations. Currently
over 70 project managers have PMP certification.
To manage the projects within the department, there are two key performance indicators: GPOT and QDCF.
GPOT stands for “Gates Passed on Time”. Gate is a large list of items that must be addressed at a specific stage.
Each project has several gates during its timeline. The Chief Project Manager (CPM) compilates the projects gates
and presents it in the direction board meeting. The number of projects gates that are approved are informed in the
GPOT measure. The second indicator, QDCF, is short for “Quality, Delivery, Cost, Features”. While the metric for
this indicator is 90% or higher, there is no trade-off’s for quality and features. Only delivery dates and cost are
negotiable. Currently, the Brazilian branch performs outstanding results, being a reference in the group.
Other indicators, like product quality, fault frequency, customer satisfaction, are measured for decision making in
the process, but not for de PMO. These measures are evaluated continuously, classified according to the main
milestones: visibility, concept, solution development, final verification, industrialization and follow-up.
The PMO has a support role to the advanced engineering department. This is where new technologies are
developed to be used in the projects.
For improve the quality of the communication and the share of the knowledge between projects and project
managers, the projects use visual communication, by means of Project Management Canvas, and lessons learned
sharing at the end of each gate.
Weekly, the PMO’s from all the different countries have meeting for share the results. Eventually there is
exchange of employees between the different sites, for a while or as expatriation. This helps to spread good practices
from the reference sites. This knowledge exchange also happens with other product groups with the company, and
even with project teams form other companies from aircraft, automobile and academy fields.
The group still is not sure about how to measure the impact of the project management and the customer
satisfaction, since it usually takes about 4-5 years between the project start and the delivery to the final customer.
Still, customer satisfaction is the main goal of the department, following the company’s vision. It is aligned to the
change from a process-based to a values-based view, that still is happening. For the interviewees, the PMO will have
success when the people know exactly their mission and vision, delivering values to the final customer. That’s a
result of a team strong and well targeted and motivated.
 Rafael Duarte et al. / Procedia Manufacturing 39 (2019) 923–931 929
Rafael Duarte, et al / Procedia Manufacturing 00 (2019) 000–000 7

4.2. PM Consultant I

The second interview was with Mr. O. Zózimo. Mr. Zózimo is project manager for 20 years and is editor and
publisher of Project Management journals for 16 years. With a mixed practitioner and academic experiences in PM
and PMO, his point of view was important to reinforce and challenge some assumptions.
According to him, the “PMO offers an organizational structure to support the project management, in a
methodologic level, providing tools, documents, frameworks and recommendations to the project managers. By
providing training and knowledge, the PM’s feel able to deliver with improve of the agility, delivery level and
quality, not only to the project but also of the portfolio in which these project belong. It must be a facilitator of these
competences and is available for the people that will work in the operation of the project and program”. The PMO
provide support so the people don’t feel helpless. It is also the responsible by bringing innovation to the PM. The
PMO focus on the alignment of the project department with the company’s strategy, while the PM may focus in the
product.
While PM managers focus on timely delivers, in the competence levels, the organization needs that some
competences and skills are provided for them. That’s the point where the PMO acts, creating the infrastructure to the
project and the project ambient. That’s also where the methodology used in the company is chosen, like PMI,
Prince2, Agile or a mixed one. The interviewee pointed out that the methodology design management is a strong
current tendency of PMO’s.
For the PMO performance management, Zózimo indicates the PMO Value Ring is a mature framework with a
mix of qualitative and quantitative approaches. Because PMO’s acts in a strategic level, quantitative indicators are
not always an effective option, so, it’s not a simple process to determine the Return-of-Investment (ROI) of this
department. For the same reason, it’s not recommended to use many low-level processes to standardize the
operation.
About the PMS, he states that the challenge is to select an indicator that can measure how the PMO assists to
deliver the company’s strategy.

4.3. PM Consultant II

The second consultant, Mr. Americo Pinto, is chair of the Board of Directors of the PMO Global Alliance, and
the creator of the Value Ring model [19].
According to him, it’s very important to define what the PMO is measuring about the organization’s performance
(in the projects, programs and portfolios), and what is the own PMO performance characteristics. Usually people
believe that they’re both connected: if the first has a good result, the later will follow. That’s not necessarily true and
depends on how the PMO is set.
Since each PMO must be aligned with the company’s values, it’s not always advised to compare the results
across companies. The results of a construction company’s PMO could be very different of a technology’s one. So,
there is no use in benchmarking their results.
Using the Value Ring, the 6th step is to evaluate the maturity of the process. If the organization decide to do it in a
specific way, it’s acceptable. The point, once again, is to separate, the maturity of the company’s processes to the
PMO’s processes. One of the main approaches of the model is to ensure that the PMO will do what it must do, but
not necessarily creating a series of detailed prescriptive processes. Once the PMO do what it’s expected, it’s correct.
And the model assists the decision of what to do, offering a list of benefits to the stakeholders to choose.

4.4. PM Manager in agrarian-cattle-breeding cooperative

The final interview was with the Ph.D. Odivany Sales, Project Manager Office Manager of a cooperative. The
organization operates in the South and Southeast Regions of Brazil, in 8 market segments, covering several areas of
the food production, like beef, chicken, pork, milk, eggs, seeds, cattle feed, medicine and seeds. Currently, the
company has 3200 employees and 900 cooperative associates.
930 Rafael Duarte et al. / Procedia Manufacturing 39 (2019) 923–931
8 Rafael Duarte, et al / Procedia Manufacturing 00 (2019) 000–000

With four employees, the company PMO addresses projects which investment ranges from R$ 200.000,00 to R$
2.000.000,00 (about US$50,000.00 to US$ 500,000.00). It will work in the selection and initiation flow of these
projects, defining and assessing schedule, risk, costs, controlling the project benefits.
The PMO main indicator is the reach (adherence) of benefits to the expectations. Other indicators, like schedule,
costs, changes and scope only support the mains ones.
The main processes performed by the PMO are listed below:
 New projects selection (performed every 15 days);
 Approved projects control
 Project management
 Organizational changes management
 Project managers capacitation
 Portfolio financial health report (monthly)
 Project control (monthly)
Currently, their main challenge is to set a common language, with standard processes for all business areas.
There are no specific project managers across the business areas, but the ones in the PMO. Continuous
Improvement projects are conducted by the operations area.
Each business unit has its own portfolio, but the main concern is the ratio “promised / achieved”. From the
company’s point of view, the business indicators are more important than the project indicators, because there is no
advantage to have projects performing well if it doesn’t offer value to the business. The project approval flow
ensures a good balance between these perspectives (business and project). Before the creation of the PMO, one year
before, each business unity had its own project structure, not always aligned with the company’s business strategy.
Currently, the corporate strategy defines which areas to prioritize, and the PMO only incorporates this strategy and
performs the projects governance based on these inputs.

5. Conclusions

In this first stage, the PMSDF has been adherent to the theme, raising substantial questions about the specifics of
the PMO.
The SLR brought up significant information about the researched subject. However, it might be needed a new
cycle of literature review, to gather the complementary literature, targeting mainly the authors who were present in
the evaluated material, and the ones cited or how cited these materials.
As the previous researches indicated, PMO is a complex structure, as well as understand how to measure its
performance. The adaptation of different models to this context has the potential to explore new perspectives and
assist in the understanding of the growing area.
The interviews with companies with different sizes, areas and maturity in project management and PMO shows
that the performance management, mainly the adequate selection of quantitative indicators, is still a challenge in the
PMO operations. The interviews with the experts highlight how the company’s strategic planning influences the
PMO management. In the future works, the researchers are going to explorer more deeply this approach.

Acknowledgements

The authors would like to acknowledge Americo Pinto, O. Zózimo, Odivany Sales and the anonymous
interviewee, for the assistance and the experience that you shared along the interviews.

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