How you imagine yourself as a project manager Successfull Project Management in the Business Service sector IT Portfolio and Program Management- Interview with an expert “The Dominance of IT in Corporate Project Portfolios – A Discussion with Miklós Gondolovics, Head of IT Project Office at Richter Gedeon”

The Dynamic Evolution of the IT Sector in Corporate Project Portfolios

It’s probably no surprise that the IT sector is currently one of the most dynamically developing areas in corporate project portfolios. Today, information technology is becoming increasingly important and significant in many places. Companies now rely more on IT systems and digital tools than they did a few years ago. In this article, we’ll provide a brief overview of how the IT sector can perform in a large multinational, international company. If you’re curious about what has happened in this area over the past few years, how IT can currently work with other sectors within a company, or what experts envision for the future, it’s definitely worth reading this post or listening to the latest episode of the PMO Club podcast, where Zoltán Sándor, CEO of Profexec Services, interviews Miklós Gondolovics, head of the IT Project Office at Richter Gedeon, about this topic.

EXPERIENCES FROM RECENT YEARS

Over the past 6-7 years, the role of IT in companies and projects has gradually increased. The most dynamic growth occurred in 2022 and 2023, and now this area is almost unavoidable. At Richter, software solutions are most needed in the investment program, and in building engineering and technology.

Five years ago, the international pharmaceutical company operated in isolated silos, but this system has been restructured during its development.

A WELL-FUNCTIONING SYSTEM

At the Richter Gedeon IT Project Office, the established practice is to act as a service provider within the company’s network. The initiative always comes from Richter and is then channeled to IT. Who becomes the main driver of a given project depends on many factors. Typically, the company handles the preparation, and IT takes over the driver role during implementation.

Interestingly, they think in terms of an eight-year corporate strategy, which has four pillars. This strategy significantly impacts IT, as tasks related to these pillars are ranked in their system and prioritized accordingly. This ranking rarely changes. Instead, the portfolio composition can shift, with projects potentially being added or removed, even those not mentioned during the annual planning. In such cases, a swap solution is implemented, considering current capacities.

THE CURRENT STATE OF IT PROJECT MANAGEMENT

The role of IT project management has also changed in recent years. Four years ago, the pharmaceutical company operated in a dual mode, but now IT project managers (PMs) work more on the business side, as there is generally no project management there. This change naturally required PMs to adapt to the new area’s specifics to be accepted on the business side. However, the qualities needed for this role have not changed. These remain essential soft skills, good communication abilities, high-level English proficiency, and flexible handling of cultural differences.

When a manager is involved in a project varies by company. At Richter, PMs are brought in from the tender phase, leading the process and even participating in evaluating offers. This approach has many advantages. Once the project starts, the manager knows exactly who they will work with and what budget they will have, resulting in better-developed risk management than if the PM were involved later.

Finally, it’s essential to highlight what generally distinguishes an IT project manager from a non-IT project manager. It’s beneficial to understand networks and system development, but these are not the main criteria. The most important is to understand organizational operations and fit into them. A good IT project manager is not rigid, is flexible, quickly adapts to different situations, and is persistent since it takes at least a year for a new PM to start a project. It’s a highly diverse and complex role, but once a manager understands the processes, they will be a successful IT project manager.

RESOURCE MANAGEMENT AND SPONSORS

In projects, IT resources are not the bottleneck, as this has been properly scaled over the years. The first step is to estimate the necessary resources from the business side at the project’s start, requiring sponsor approval. The project manager’s task is to control these resources. If any problems arise, an escalation process begins, and the project’s deadline may be postponed.

The head of the Richter IT Project Office has also observed positive changes in resource management, with fewer projects launched in recent years, avoiding capacity issues.

IT projects generally have high-level sponsorship. Typically, there are multiple sponsors from different areas, and projects usually align with their strategies. The standard is to have both IT and business sponsors for a project, but there are more complex compositions, making communication between parties crucial.

WHAT THE FUTURE MAY BRING

The role of the IT sector is likely to continue growing at the same pace in the coming years. For most companies, a clear goal for 2024 is to introduce and use AI and robotic operations. At Richter, they are already examining how these new technologies can be utilized in various areas, with some processes already automated in their systems.

Artifical Intelligence in Project Management – Real life examples from an industry expert

It’s likely everyone agrees that the biggest hype today surrounds artificial intelligence (AI). It’s not just making waves in the workplace, but also increasingly permeating our daily lives. Naturally, AI can already be utilized in project management, though trust in this new technology is still developing. In the latest episode of the PMO podcast, Zoltán Sándor, CEO of Profexec Services, talks with Billal Ben-Redouane, who has extensive experience in global IT business operations and infrastructures, and profound expertise in analysis, planning, and executing initiatives in complex environments.

Billal shares a wealth of practical advice during the episode, which we now elaborate on in detail in the following post.

ARE AI SOFTWARES REALLY USEFUL IN PROJECT MANAGEMENT?

The first and perhaps most important question is whether AI truly aids in work. Anyone who has delved into this topic has likely encountered numerous tools, software, or even chatbots. With hundreds of options available, it’s easy to get lost. However, those who find the 2-3 truly useful tools can automate up to 30% of their work with AI.

But let’s get to the point and examine how these tools assist in project management.

Based on current experiences, there are very few areas where AI is not useful. It’s important to think of AI as a tool; it won’t solve problems or make decisions for you. Instead, it acts as an assistant throughout tasks. It can take over burdensome tasks like filling out documents, writing meeting minutes, automating email content, or creating presentations. Nowadays, even larger companies can benefit from using AI software. For example, Collaborations encompasses collaboration tools. Its core idea is combining a large language model with various spreadsheet or presentation software. Such a tool can filter out the essential data from a 30-40 page presentation. If we’re searching for something in a larger document, this tool can quickly find and highlight the relevant parts and even create a new presentation from them.

In summary, AI tools are currently well-suited for focusing and data analysis in project management.

At this point, a legitimate question arises: can AI take our jobs? Those who have worked with AI know that while it is artificial, it’s far from truly intelligent. Therefore, it cannot replace the human element in processes. However, it must be emphasized that project managers who do not keep pace and learn to use these tools may find themselves at a disadvantage in the job market.

HOW TO CHOOSE THE BEST?

As mentioned earlier, with hundreds of software available, it’s challenging to single out one. This is why PMI developed a new chatbot specifically to assist in project management. The simplest way to describe it is as a ChatGPT that has learned the entire PMI knowledge base. PMI Infinity is familiar with historical data, proprietary documentation, and the history of project management, enabling it to provide specific answers. This software is completely free for PMI members.

Before using PMI Infinity, we recommend consulting the organization’s guide on prompting, which details the instructions and questions project managers should give to the software to get the appropriate answers.

In a corporate environment, it’s a significant challenge to use secure and reliable software that, for instance, does not share our data with third parties. Nowadays, all serious programs have solutions for this, such as Microsoft systems, which are entirely closed. If we still have doubts, we should always thoroughly research the tool and continuously monitor updates, as these software are constantly evolving.

THE FUTURE OF ARTIFICIAL INTELLIGENCE IN PROJECT MANAGEMENT

Based on current experiences, the use of AI will naturally become a regular part of our work. In project management, AI is already playing an increasingly active and significant role, mostly in the form of software. In the future, it will likely take over repetitive tasks, which is good news as it will allow project managers to focus on what currently receives little attention: communication. Using AI tools can reduce the time spent on administration, allowing PMs to spend more time with the team and create a more enjoyable work environment.

GETTING STARTED

And now, here are the three most important points to take the first steps:

1. Prompting: Fortunately, many useful courses are available on this topic. Start with these!
2. Appropriate Software: Select the two or three programs you will learn thoroughly and use in the future.
3. Stay Open-Minded: While it sounds simple, it is extremely important. Besides learning to use the tools, you’ll need an external advisor for further development, such as through training.

EVERYTHING YOU WANTED TO KNOW ABOUT PROMPTING

The courses mentioned above mainly focus on how to ask good questions and identify less appropriate ones. Here are a few tips for formulating effective prompts:

• Encourage the model to ask follow-up questions.
• One question is not a question.
• Always provide as much detail as possible.
• Use examples.
• Be very patient.
• Consider having the process reviewed at the end.
• Use a very specific persona or perspective.
• Write as if you are conversing with a person.

For those who want to delve deeper into the topic, the PMI website offers numerous additional guides and courses, all of which are completely free.

Assessing the Maturity of the PMO System – Here’s How!

In the latest episode of the PMO Club Podcast, Zoltán Sándor, the CEO of Profexec Services and the host of the show, discusses with his guest the importance for every company to understand the level of project culture within their organization. The question is whether they are aware of this and if they know how to assess and develop it based on the results.

The guest for this episode was Kálmán Kovács, a long-time member of the Profexec team responsible for the PMO and Consulting division within the company. Kálmán holds a degree in finance and has nearly 30 years of experience working in multinational financial (banking and investment services) environments, as well as five years in the Hungarian SME sector. He has gained 23 years of experience as a member of executive teams in various organizations, leading finance and back-office operations, organizing institutions, managing organizational development areas, and overseeing project and portfolio management. Zoltán asked Kálmán how to assess the maturity of the PMO within a company and why it is important.

STARTING FROM THE BASICS

Firstly, it is essential to clarify what a PMO (Project Management Office) is and its role within a company. A PMO is an organizational unit responsible for project management and development, encompassing the project management culture within an organization. It is a key tool for implementing strategy. The appropriate system is one where the strategy is translated into projects, which are then integrated into a portfolio. The PMO is responsible for this, providing the framework and managing the projects.

There can be other frameworks and different PMOs. Essentially, project-based thinking started in the IT sector, where there was a significant need for structured requests from the business side. From there, the PMO evolved to higher levels, supporting the entire system at an enterprise level. Large companies typically use this toolkit and organizational unit. For SMEs, it requires additional investment, which they generally do not apply, although it would be beneficial.

Based on methodology, three types of PMOs can be distinguished:

1. Supportive PMO: Establishes rules, mentors project managers, and provides guidelines.
2. Controlling PMO: Has authority and influence to enforce compliance among project managers.
3. Directive PMO: Allocates human and financial resources, directly managing projects.

STRUCTURING THE ASSESSMENT

Kálmán has long worked in consultancy roles and realized there wasn’t an appropriate, objective tool to compare PMO systems. Assessing PMO maturity involves examining three dimensions: strategic, operational, and tactical services. Here’s what you need to know about these dimensions:

• Strategic: Involves top management responsible for strategy execution and monitoring, often encompassing portfolio management.
• Tactical: Provides services to specific roles, such as business analysts, including training and development programs processed by project leaders.
• Operational: Directly targets project managers, focusing on specific, actionable items.

CURRENT STATE AND INSIGHTS

According to Kálmán, building and developing a project management culture is challenging everywhere. However, it is important to note that Hungarian PMO systems have proven to be quite advanced internationally.

Benchmarking and gap analysis are useful to see how organizations compare to more developed counterparts, which is not a problem, as each organization focuses on its unique developments. The most common issue is that project managers often lack the necessary authority to execute projects effectively. The aforementioned questionnaire addresses these issues, examining authorization levels, participation in financial planning, resource management, competencies, training, mentoring, project leader support, and regulatory systems.

OVERCOMING CHALLENGES

The biggest challenge and obstacle to development is usually if top management does not provide enough space. Therefore, project managers should first win over the leadership before proceeding to other departments.

Typically, these assessments are conducted in large companies, primarily within IT departments. The assessment can be further developed upon request, as it currently focuses mainly on PMO project and portfolio management. However, it can delve into more detailed aspects of project management, such as human resource management, where there is growing demand for development and analysis.

CONCLUSION

Overall, assessing and developing project management culture within organizations is crucial, and understanding the current state and areas for improvement can lead to more effective project execution and strategic alignment.

Prioritization and resource management at an advanced level – Talked with the project portfolio experts of E.ON

Fortunately, even at the national level, we see many good examples of high-level portfolio management, including several proven, well-functioning methods for proper prioritization and resource management. The guests of the new episode of the PMO Club podcast have been working in this field for a long time, and this time they share their views on the future of this sector, their experiences from recent years, and we can also gain insight into the current challenges. Zoltán Sándor, Managing Director of Profexec Services, interviewed Alice Sándor, Head of Portfolio Management at E.ON Hungária, and János László, Head of Portfolio and Data Management at E.ON Hungária. Listen to the episode if you’re curious about the opinions of these seasoned experts on this area, or read the post below, which is a brief summary of the new episode.

THEN AND NOW

About eight years ago, the organization decided to create a portfolio management framework based on lean-agile principles, deviating from the classic PMO operation. At that time, they had to face the fact that projects would not be purely waterfall-based; there would be many changes in the project environment to which they needed to adapt. This was a significant challenge then, but today it has become natural for them to plan only one year ahead, and not necessarily beyond that. This is a fundamentally different way of operating compared to the past. Additionally, huge projects have also come into play, and managing them at the portfolio level has been a major challenge. János’s team had to adapt the most to these.

In recent years, there has been a significant transformation in the energy market, which also led to a restructuring within E.ON a year ago. Part of the data management activities was assigned to the team dealing with project portfolio management at the E.ON group level, thus expanding János’s scope of work and turning the portfolio management department into a specialized area.

The E.ON project portfolio management team has already developed a mature and well-functioning operation. Alice, the head of the department, oversees a portfolio consisting of IT-related business projects and purely business projects. The department is responsible for assembling and planning the portfolio of IT-related business projects. Every project has both a business and an IT aspect, with the stronger line varying by project. Currently, there is one large common portfolio. Another interesting aspect is that this team belongs to the holding organization within the company, so they have so-called decentralized counterparts in several areas with whom they work on projects related to the respective segment. The team in question is currently responsible for ensuring the framework and continuously developing it, and they work with many colleagues from different areas (e.g., project managers, resource managers, middle and senior managers).

E.ON switched to an agile approach to portfolio management years ago. Projects are planned and executed in so-called portfolio cycles, currently lasting 4 months/third of a year. The entire organization has not become agile; rather, the mindset has shifted, and projects are run with this approach. So, agility within the company is not radical; it is slowly seeping into every area, but there are already quite a few employees who are experts in this way of thinking. The whole point is that the portfolio is replanned every four months. Of course, this does not mean that projects last four months. This instead provides flexibility in starting new projects and reviewing the importance of various topics. Naturally, there is a main strategy, but it is monitored on an annual basis.

In the future, their goal is to further integrate and promote agile topics within the organization. They plan to achieve this with small groups, which are likely to yield quick results. Additionally, there are plans to improve and fine-tune the mechanism.

HOW THEY PRIORITIZE NOW

A unique system has developed at E.ON, where essentially anyone can follow the projects. They do not prioritize according to the classic hierarchy. They have set up upper and middle management committees. According to the experts, one of the biggest advantages of this unique system is transparency, as everyone can see and contribute to the process, resulting in much less opposition than usual.

Of course, they do not claim that this operation is perfect. There are still some who disagree or question the final priorities. But based on Alice and János’s experiences, this is still a better way. Decisions about what will happen in the coming months are not made in a closed room. Moreover, internal tensions and dilemmas are also entirely open, and they share this with external parties as well.

As mentioned earlier, the committees meet every four months to determine priorities and evaluate new and ongoing projects through a scoring system.

For new projects, the criteria may include:

• What value does the project create?
• Is it innovative?
• Does it bring a new solution?
• Does the project increase revenue?
• Is this investment worthwhile for the company?

For ongoing projects, they examine the status and whether the promises have been kept. The middle managers conducting the evaluations score themselves, summarize project scores, and based on this, place the projects in the portfolio.

The committees are very diverse, with members coming from all relevant areas. During the senior management validation, it is also important that everyone can only intervene at one point. The key is that consensus must be reached through discussion every time. It is also crucial that these events are personal, which has been challenging recently due to COVID, so the team has switched to a hybrid solution for portfolio planning events (2 or 3 days). Their goal is to ensure as much space as possible for personal connections.

One might wonder if four months is too long, as it could take this long for a new project to start. In this system, this time flies by quickly, and even the preparation phase is dense with many activities. E.ON has already established this as a well-functioning prioritization system, having initially had quarterly planning cycles, which proved ineffective.

RESOURCE MANAGEMENT

Once the priority list is completed, project managers are asked to plan the resources. At E.ON, specific resource needs are assigned to task packages. This process typically takes 2-3 weeks, and project experts and relevant managers figure out exactly who they want to involve in the project and with what capacity. János’s team, together with IT, operates a system in which resource planning takes place, followed by resource demand reconciliation at the portfolio-level event.

If a colleague’s resource demand is too high, priority will naturally guide the allocation. The plan, as already explained, is detailed for four months (one cycle), but this can change if, for example, a resource drops out, or it becomes apparent during the process that additional colleagues need to be involved to ensure successful implementation.

 

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PMO Klub XII. Episode – Demand management: The bridge between IT and Business

For modern companies, efficiently managing and prioritizing business needs is crucial for successful project portfolio management. Demand management is a framework that helps organizations collect, prioritize, and facilitate the planning of business requirements. In this blog post, we will explain in detail how demand management works, its benefits, and challenges, as well as provide practical tips for its effective application.

If you’re interested in exploring the topic further, we highly recommend the latest episode of the PMO Club podcast, in which Balázs Federi, the IT Portfolio Manager at Red Bull, shares his extensive experience in the field. Balázs has a broad background in IT Governance, IT Service Management, IT Project, and Portfolio Management, and was involved in the implementation of demand management at Red Bull.

 

LET’S START FROM THE BEGINNING
To delve deeper into the topic, it’s important to clarify at the outset what demand management actually is. The IT world realized in the last 10-15 years that something was needed to approach the business side, and that’s when this field emerged. It is an essential part of the project portfolio management framework, occurring at the very beginning of every process, and serves as one of the main elements of business interaction, supporting the work of business partner colleagues. Its goal is to collect, prioritize, and approve business requirements in a structured way. It’s like a funnel that allows companies to shape the process according to their needs. After collecting and grouping the business requirements, the next step is prioritization, which facilitates project planning.

You might not realize how helpful it can be! Multinational companies often have multiple business areas that IT can approach in different ways, which may not be efficient. Demand management helps with prioritization, decision-making, and collecting business needs within a unified framework, thus avoiding misunderstandings. Its structure allows for assessing what resources are needed based on incoming demands. Additionally, it guides aligning business needs with the company’s strategy.

FRAMEWORK
A typical demand management framework consists of three significant steps plus an additional one:

1. **Collecting business requirements**

It’s important not to think in solutions immediately but focus first on a deeper understanding of the needs. IT business partners should participate in brainstorming to determine when an idea is mature enough for demand management and provide guidance on what key points need to be discussed with the business side.

2. **Elaborating on requirements**

Various stakeholders, such as business analysts, architects, and senior experts, collaborate to expand the requirements. After gaining a precise understanding of the needs, the teams begin to explore the options available on the market, not relying solely on internal experiences but considering external sources as well.

3. **Approval and prioritization**

During prioritization, different models can be used to rank the needs. Values are assigned, and a ranking is formed based on these. A line must be drawn to determine what can stay in the project, as not everything will fit. This is an objective system, so it’s necessary to seek input from decision-makers and experts on the established ranking, and it’s worth regularly redoing the prioritization. Financial and human resources must also be considered here.

+1. **Handover to implementation** – During the handover, it’s crucial that all information and decisions are properly documented; this helps avoid problems in later phases.

This framework provides an objective view to the business and helps resolve conflicts. However, it’s essential to emphasize that the process needs to be flexible and as simple as possible. It’s not necessary to confine colleagues within this system.

 

LESSONS AND EXPERIENCES
1. It is essential to have frequent discussions with representatives from different areas during the process to help everyone reach a common understanding.
2. Clear directions from senior management are important, and these should be aligned.
3. One must confidently know what is expected of demand management.
4. No one in the system should expect such a level of detailed information that is not currently available; this needs to be clarified thoroughly.
5. Demand management can only succeed if there is a good relationship between IT and the business in the company culture.
6. The development of AI presents new challenges and legal questions, which may involve many non-IT stakeholders in the future of demand management. Be prepared for this!
7. Innovation and market research are also gaining ground, and they will certainly play a role in demand management.

Overall, this structured approach allows the different stakeholders to better understand each other’s needs and expectations, ultimately leading to project success, while also strengthening communication and collaboration between organizations.

 

You can listen to the episode here:
Spotify
Here 

Apple Podcast 

Here

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ERP implementation: an IT initiative or a corporate project?

Introducing an ERP system is one of the most significant milestones in a company’s lifecycle. While it can lead to major successes and improvements in quality, careful preparation and planning are essential for effective operation. The implementation of SAP and other ERP systems is not merely a technological project but also a strategic challenge.

What happens when a large enterprise integrates its entire business processes into a new system? How does the work unfold when it affects every department, involves huge budgets, and is critical to the company’s future? In the latest episode of the PMO Club podcast, Dr. Balázs Holenda—who has been leading Deloitte’s SAP advisory division and project management competency center for five years—addresses these pressing questions.

WHY ARE ERP SYSTEMS IMPORTANT?

As companies grow, there always comes a point when a consolidated, unified system becomes necessary to operate processes efficiently. At this point, it is crucial for management to choose the right system.

An ERP system eventually integrates into every part of a company. From logistics to financial accounting to HR, no area remains untouched during the process.

WHAT MAKES A GOOD PROJECT MANAGER?

A recurring question is whether a project manager needs to be a subject matter expert or if project management skills alone are sufficient. The answer is not black and white. While a good project manager doesn’t necessarily need deep technical expertise, understanding the logic of the product or service is essential for leading a project successfully.

A common professional path is transitioning from an expert role to project management, often because of the search for new challenges. This shift can be ideal, as leaders with relevant experience are often seen as more credible.

What is indispensable, however, is strong communication skills. Project managers must maintain connections with stakeholders and team members alike.

WHAT MOTIVATIONAL ROLE DOES THE PROJECT MANAGER HAVE?

One of the biggest challenges within companies is maintaining the work capacity and motivation of project management teams. Team turnover can endanger project quality and delivery. For this reason, the role of the project manager is crucial.

The phenomenon known as a “death march” describes projects doomed from the start due to unrealistic deadlines and scale. Project managers, however, must carry on, leading to 12+ hour workdays, dissatisfaction, and often deadline extensions.

It is essential for leadership to create realistic working conditions. Excessive overtime and high stress often lead to burnout or resignations within project teams. After intense work periods, allowing team members to recharge is also critical. This profession requires flexibility and complex thinking.

THE MAIN CHALLENGES OF PROJECT MANAGEMENT

Regardless of company size, project management faces three primary challenges (and potential pitfalls):

1. Underestimating Complexity – During the planning phase, it is vital to set achievable, realistic goals. This can be difficult as leadership ambitions often clash with feasibility. Unrealistic objectives, deadlines, or budgets early on can lead to massive problems later. Finding reasonable compromises at the start is essential.
2. Lack of Change Management – Leadership often tries to save money in this area, which is a critical mistake. Informing and involving employees in changes pays off multiple times over. When hundreds or thousands of interdependent employees lack proper communication, it can jeopardize project success.
3. Lack of Sponsorship or Improper Involvement – If team-level and individual motivations diverge, project success is threatened. It’s vital to clarify goals with sponsors at the outset to ensure smooth collaboration.

Another emerging consideration is how IT-driven a project should be. Ideally, leadership should first define business needs, which are then translated into IT requirements. In recent years, strong IT involvement sometimes overshadowed business goals. However, the ultimate purpose of these projects is to support the company’s daily operations and business interests. The focus must therefore be on defining business requirements at the outset.

WHICH METHODOLOGY SHOULD BE USED?

Agile methodologies have infiltrated almost all areas in recent years, including SAP projects, but they have not achieved widespread success due to their complexity. In these cases, the traditional waterfall method tends to be more effective. In many cases, hybrid approaches—incorporating elements of agile methodology—are also used.

General rule: Agile approaches are worth considering when there is already a long-term, trust-based partnership with a client. Agile methodologies require a paradigm shift. Goals and deadlines are less defined at the project’s start, and processes can evolve over time, making mutual trust critical.

TYPES OF ERP SYSTEM IMPLEMENTATIONS

The need for an ERP system can emerge at different times, resulting in three main implementation approaches:

• Greenfield Approach
  The company grows organically and implements an integrated ERP system for the first time. The reason often stems from a lack of fast access to critical information needed for daily operations.
• Bluefield Approach (Brownfield Plus)
  This involves a detailed planning process, including impact studies. Preparation projects preceding the implementation phase can sometimes take years.
• Brownfield Approach
  An existing system is already in place, but the company transitions to another or newer version.

BIGGEST CHALLENGES AND THE FUTURE OF ERP SYSTEMS

One of the greatest leadership challenges is that ¾ of projects exceed their original plans, and meeting initial deadlines is rare. When delays are anticipated, project managers instinctively bring in more resources to stay on track. However, as Frederick Brooks famously stated in project management: “Adding more people late to a project only worsens the situation.” New team members require knowledge transfer, demanding even more time and creating temporary chaos.

This phenomenon can only be avoided during the project’s planning phase. Detailed planning, realistic schedules, and well-defined project goals are essential. Saving a failing project at the last minute is extremely difficult—even for the most experienced project managers.

FINAL THOUGHTS

Overall, ERP systems significantly support leadership and are expected to become indispensable in the future. The next decade will be the era of transitions, offering companies the opportunity to redefine their operations. Innovations like SAP S/4HANA and artificial intelligence are driving fundamental changes, which will significantly reshape project management roles and responsibilities.

You can listen to the episode in Hungarian:

Spotify: link

Apple Podcast: link

YouTube: link

Establishing a PMO: Insights and challenges from a business transformation

Building a PMO from the Ground Up: Lessons Learned from a Corporate Transformation

Where does the PMO journey begin?

When a company decides to establish a professional Project Management Office (PMO), it embarks on a complex project in its own right. At Praktiker, this journey began in January 2024 under the leadership of Anita Horváth (Boni). The initial challenge was clear: the organization had no formal project management framework in place.

Key recommendations for the early stages of PMO setup:

• Conduct an audit: Identify stakeholders, existing project structures, resources, and competencies.

• Apply a 30-60-90 day roadmap: Focus on mapping the current state, conducting stakeholder interviews, and delivering the first quick wins.

• Assess how different units define “project”: This helps create a common language across the organization.

In this first phase, the goal is not intervention, but observant understanding and building trust.

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Designing the structure and securing organizational buy-in

Following the initial assessment, a unified project management framework was developed. This was based on a simplified version of the PMI methodology, including a tailored set of templates, forms, and a governance structure.

One of the greatest challenges was gaining acceptance of the new processes across various business units. Changes like transforming the meeting culture, introducing agendas and memos, and creating transparent task and responsibility structures all aimed to enhance transparency and efficiency.

The rollout of the methodology was gradual. Internal training, mini-workshops, and individual mentoring supported the teams’ development. Company-wide training sessions also ensured that all departments became familiar with the new operating model.

One of the most visible improvements was the increased efficiency of meetings. Standardized agendas, consistent memos, and a culture of feedback led to rapid progress — not only in project management, but in overall organizational communication.

A successful PMO framework is more than a collection of documents — it sets behavioral expectations. At Praktiker, the PMI methodology was implemented in a hybrid, practical form with targeted templates and a simplified governance model.

Strategic advice for introducing the structure:

• Avoid overly complex approaches — aim for gradual implementation.

• Standardize every project lifecycle phase: initiation, planning, execution, closure.

• Encourage feedback — templates are starting points, not rigid rules.

Key elements in transforming meeting culture:

• Every meeting should have a pre-defined agenda.

• Ensure clear ownership and deadlines for all action items.

• Document outcomes in a structured memo and share with all relevant parties.

Change acceptance is best supported by consistent role modelling and integration into daily operations.

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Leadership support and the role of stakeholder management

Leadership backing was a key success factor. The PMO reported directly to the CEO, ensuring independence and cross-functional alignment across the executive team.

Regular Strategic Board meetings provided visibility of the project portfolio and enabled swift decision-making. Customized communication of expectations and frequent sponsor meetings further promoted transparency.

Practical stakeholder management tools:

• Regular stakeholder interviews at all levels (executive, middle, and operational management)

• Introduction of expectation-based communication channels

• Creation of two-way feedback forums

• Use of prioritization maps and stakeholder matrices

Such openness and feedback mechanisms made it easier to drive change acceptance and reduced organizational resistance.

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Challenges and risks along the way

One of the biggest challenges in building the PMO was the need to simultaneously validate the new leader, the operational model, and the very legitimacy of the new organization. This called for intensive communication and support efforts during the early stages.

Employee turnover posed another risk. Several colleagues left during the change period, complicating the stabilization process that had just begun.

Key measures to address these challenges:

• Regular one-on-one meetings with team members

• Thematic knowledge-sharing workshops to strengthen critical competencies

• Soft skill development (e.g. communication, conflict management)

• Transparent KPI tracking and soft feedback systems

A key takeaway: when introducing a new organization, personal competencies and change management capabilities are as vital as professional expertise. Boosting acceptance and engagement also required targeted development of the project managers themselves.

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Results and future outlook

By August, the PMO had reached its first stable state. Project managers were working independently and consistently, with templates and processes embedded in daily operations.

The year-end review made it possible to compare the current state with the past — and both objective and subjective indicators confirmed the PMO’s success. Future plans focus on solidifying stability, developing talent pipelines, and integrating AI tools.

Potential AI applications:

• Automated generation of meeting agendas and memos

• Creation and population of project documentation and templates

• Analysis of project data for decision support

• Predictive resource planning and capacity optimization

This experience highlights that setting up a PMO is not just a professional exercise — it is an organizational and human one. Transparent operations, stakeholder-oriented communication, and continuous measurability provide the solid foundation needed to build a successful PMO.