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Every company that is looking to increase the number of projects that are completed on time and within budget will be faced with one important question; should our projects be facilitated through a centralized PMO (Program Management Organization) team? Or would we be better off having a decentralized set of Project Managers working closely within the business units that are performing the work?

The answer to this question is not as straightforward as you might think. In most cases, it depends on the organization structure, values, and goals to choose the right option or to find a middle ground that incorporates aspects of both systems. Sandalwood has worked with clients to implement both centralized and decentralized project management teams. When considering the options, here are a few of the key questions you will want to answer on your path to making this major decision.

What is the size of your organization?

Large organizations tend to have a more centralized project management structure when compared to small organizations. Centralized project management teams often require more overhead support, and the benefit might not outweigh the cost for a small organization. However, a small organization may choose to form a centralized structure if the projects are large and complex or if the organization is experiencing chronic project delivery problems.

 Does your company prioritize implementing standards for project execution?

Having a centralized project management structure allows for there to be greater consistency in how your projects are executed. One group of Project Managers that work closely with each other are better able to coordinate the creation of standards of project work. A strong set of standard processes and templates allows PMs to focus on the unique aspects of their projects – which is where projects most often fail.

One downside to this approach is that key process requirements for a business unit may be overlooked, which would have become apparent through a decentralized structure focusing on PM support in the business functions.

Does your company have numerous volatile projects that require resource shifting?

Fast paced companies with many projects ongoing at one time would benefit from having a centralized project management structure. A central group of project managers who collaborate with each other can quickly respond to the need to reallocate resources for immediate customer-driven project needs.

On the other hand, if your company’s projects are more stable and changes are not regularly driven by short term customer requests, having a decentralized structure can provide the ability for the Project Manager to become an expert in the domain of their specific business unit. They will be more in-tune with the unit’s needs but might be less understanding of needs coming from other parts of the organization.

What are the project reporting requirements within your organization?

If your organization requires regular project reports to upper management, having a centralized project management structure supports an efficient and well-aligned reporting cadence.   Decentralized project management is most effective when reporting to leaders within the specific business unit where the project work is being done.

These questions are just a sampling of those that your company will need to consider when determining which type of project management is the best fit for you. Sandalwood’s team of experienced Project Managers have helped clients of all shapes and sizes determine and implement project management solutions. If you want to take the next step toward consistent project success, contact Sandalwood today.

For more information on Program and Project Management services at Sandalwood, check out https://sandalwood.com/project-management/