Leading the PMO in a Lean Pioneering Organization

By Dave Cornelius, DM, MBA, PMP, PMI-ACP

BillieJo Johnson is director of the Program & Project Management Office for Toyota Financial Services (TFS).  In 1977, she accepted a role at Toyota and is a member of Toyota Diversity—Business Partnering Groups.  BillieJo is responsible for TFS Project & Program Management Office (PgMO) activities, which include strategy development, portfolio, program, and project management.  The PgMO is responsible for defining, monitoring, and ensuring adherence to PgMO processes, procedures, project management discipline, guidelines, and policy. 

 Over the past decade, the project management world began embracing lean and agile practices.  I wanted to explore how a PMO operates within an environment focused on eliminating waste and maximizing efficiency.  BillieJo shares her experience leading the PMO in an environment focused on Kaizen principles in my exclusive Q&A below.

BillieJo, can you identify a few professional or personal strengths that give you a competitive advantage?

I believe I have an innate ability to connect well with others and be a trusted source for transparent interaction.  People feel comfortable approaching me for advice.  They also know that I am receptive to honest feedback about how to do things better.

My training and knowledge in organizational change management (OCM) allow me to influence change in the organization.  Communication also is critical because I often convey to TFS members the objectives, portfolio performance, and reason for change in the PMO.  My project management expertise provides the tactical skills for effective management.  I am a member of the Toyota innovation team, and that role allows me to think of new ways for continual improvements in the PMO.  One of my visions for the PMO is to support process changes that alter the approach to delivering value to the organization.

Toyota is known for practicing Lean principles and the “Toyota Way.”  How has that culture directed the project management practice of the PMO?

The philosophy and practice of the “Toyota Way” help the PMO remember that we have to remain vigilant and not comfortable with the status quo.  We see a time for change—continual improvement dictates change.  It is time to deliver faster and not put as much rigor on projects without sacrificing quality and introducing risks.  Kaizen principles keep us thinking about continual improvement in our processes and projects.  We have to look at the problem, decompose it into achievable activities, and ensure that the solution or counter measure is traceable to the problem.

Is agile project management and Scrum part of your culture?  What is your perspective about these project management practices?

We have applied some concepts that are agile and have used Scrum in some cases.  We have developers collocated in a room adjusting functionalities based on feedback from customers on certain projects.  However, the agile practice is not rolled out to the entire organization.  I am currently evaluating different agile delivery practices and methods that fit TFS culture.  Our business partners want incremental value along the way and will not wait six months for delivered functionality.

I do not know if the organization is ready for agile across the board, or if everyone understands the implications of agile to our business operations.  But I know we will start educating the organization about the value and benefits of the different agile methods.  We must make smart decisions and apply agile to certain types of projects where we can see the value.  The PMO will use the OCM methods to help TFS management understand the agile value and best use, as well as where it cannot be applied.

What are some of the challenges faced by the PMO today?

My specific challenge is helping the business leadership understand the value of a PMO.  The business is saying we want faster delivery, more autonomy, and independence to manage work.  One of the executives describes the PMO as “placing needed order around the work”.  We have experienced projects executed without the PMO, and the results were not good.  Our executive support makes the PMO strong and they believe in the concept of “rules, schools, and tools” for project management.  My challenge is to always remind the business that our executives believe that project management and the PMO are necessary.

As a leader, how have you positioned the PMO value proposition to the organization?

Our PMO has grown from managing small IT projects to true portfolio, program, and business value management.  We have positioned portfolio and program managers to support our project portfolio and programs with the appropriate controls for success.  In the past, we would manage projects just to technical implementation, but the value of the project is not achieved until a future date.  My message to our internal customers is that the PMO will support the post implementation value determination with our business value management process.

The maturity level of the PMO has provided performance transparency to communicate project health and earned value management, process standardization, project audit, and process controls to validate quality.  We are creating centers of excellence for requirements and quality assurance in the PMO.  I continue to evangelize the PMO value to our business partners by describing how projects are managed to deliver quality and the desired value to the business.

The evolution of the PMO is to service business projects outside of the technology groups.  As Toyota continues to create innovative ways of doing business, the result is an initiative with a defined start and end—a project.  The business partners are reaching out to the PMO requesting project management support.

Should the PMO have profit and loss (P&L) accountability in the organization?

Our projects are responsible for delivering value.  Our projects have associated business cases that show a return on investment (ROI).  The PMO performs a value capture analysis to determine if projects are able to deliver the ROI value impacting the bottom line.  The PMO has accountability for the project and is responsible for governance to ensure that the project delivers ROI value.  However, there is an opportunity for the PMO to do more in business value management by developing appropriate key performance indicators.  I envision the PMO maturing to support the business with projects that have promised ROI value six-months or greater through value capture analysis and business value management.