6 signs it’s time to improve your Project Management Office (PMO) approach
By Gilles Ourvoie, France Partner at Global PMI Partners
At Global PMI Partners, we are often requested on merger and acquisition (M&A) or carve-out projects that have already been started but are not delivering as anticipated. Often, the call for support comes from a senior manager with a global understanding of the issues at stake, but does not fully understand how to fix them. In many cases, some internal messages or adjustments have already been tried without success, causing the project timeline to become chaotic and extended.
To avoid such situations, it’s useful to identify early acquisition integration risks in your project management office (PMO) approach. This will support concrete and timely decisions. We have identified six signs that indicate it’s time to improve your PMO approach.
Six signs your PMO approach needs to be improved:
#1 You don’t hear about the integration project
An acquisition integration is a significant project. For the managers involved in it, the integration process should normally be a top-of-the-list discussion topic in informal gatherings as well as in more formal project-related meetings. This may help you get a sense on the degree of engagement in the integration:
- If the managers don’t raise specific integration issues in the first 15 minutes – it’s time to be on the alert. Integrations are complex and usually require a lot of energy and coordination.
- If it’s not perceived by your managers as a top priority, they may be underestimating the job or consider it an individual effort. In both cases, the project may become at risk.
- Lack of communication between managers is both a cause and consequence for the failure of an integration project. Delays in planning, conflicts between task forces, desynchronization of efforts, inconsistencies in decisions, all this may be connected to poor communication between managers.
If you don’t hear about the integration, ask yourself why. It’s critical for the Programme Management Office (PMO).
#2 The integration manager is exhausted and disillusioned
Being an integration manager is a highly exposed position. It requires a huge capacity to get correct, relevant and on-time information, process it appropriately, make fair and swift decisions, and ensure the implementation is well-executed. This role also depends on working collectively. An integration project is always a collective process, at team and executive level.
- If the integration manager feels isolated, he will try his best to compensate with hard work to get the analysis and committees in order.
- You’ll see more and more analytics and figures in meetings, as opposed to action plans and quick synthesis.
- Over-information will appear as a way to mask the lack of change and decisions.
- The integration manager will begin to feel exhausted. Without strong corporate support, disillusionment can develop.
- If the integration manager begins showing these characteristics, it’s time to react. Support may be needed or position changed. In most cases that we have been called for, there is a systemic problem, not an individual one. The entire PMO architecture and operating model has to be re-designed – which we’ve found can be done quickly.
#3 The steering committee is disengaged
Group executives are always struggling with tight time constraints and prioritization of their own efforts. At this level, an integration project may be poorly impacted by individual time allocations. The entire PMO may need to be redesigned if:
- The Integration Steering Committee role starts to be a second-priority at the executive level.
- Absenteeism becomes acceptable and/or delegation is given to managers with no decision-power.
- Mobilization decreases, decisions are delayed, reporting becomes perceived as theoretical and administrative – all while the integration manager becomes more and more disillusioned.
Redesigning the PMO architecture also includes the list of integration task forces, agendas, roles of the executives, or roles of the Integration Manager. Perhaps the executives have not voted for the project, do not care about the integration success, or have other priorities. In all situations, the integration approach must be reset with clearly aligned and shared goals and decision capabilities that support the integration manager in full force.
#4 There is no urgency to end the integration project
Strict deadlines do not deliver value per se. In reality, you may have to accommodate plans to take into account day-to-day business constraints, among other factors. This permanent agility is critical for integration success.
Too much focus on time constraints may become a problem. Speed is a factor of success in actually reaching initial deals’ objectives. The desired success of the integration may be in jeopardy if:
- The project is not sufficiently active, demobilizing people and delivering slow results.
- The analytics, implementation, and delivery are not carefully monitored.
- The integration has no self-realization loop to ensure the energy spent maintains momentum and motivates people.
When integration kick-offs are delayed weeks after closing, major deadlines are postponed, and synergies do not come – even if all this is well-justified – there is a risk on the project. Not to mention the future integration projects that are in the pipeline. Clear project termination must be known by all contributors, as well as a clear sequenced set of deliverables. If not sufficiently clarified, your PMO will need to work with all stakeholders and fix the pace.
#5 “Everything is under control”
Managers typically resist micro-management, defining it as too administrative, unproductive, and distractive. We often hear this message when integrations are not well conducted. But we all know that there should be a minimum of control, reporting, and coordination. Full decentralization of powers generate silos, under-productivity, and poor management of interdependencies.
Managing the right mix of delegation and control is key in an integration project. This is why the quality of the reporting process must be cautiously monitored. At a procedural level only, the PMO has the role of monitoring the timely availability of information with the capacity to take decisions and follow-up on plans. In such a role, issues may occur:
- If monitoring does not drill enough into operational details, the integration process may derail fairly quickly.
- If the information is selectively shared, silos will start to appear and conflicts will grow (supply chain integration vs IT integration, HR integration vs marketing integration, and so on).
- If the integration manager is stuck between silos, there will be limited authority and limited executive support.
- If you begin hearing “we know how to deal with it… it’s well underway… nothing to be worried about…”, it’s clear the reporting has no obligation of being transparent.
When executives begin remarking that “everything is under control”, it’s a red flag on how cooperation is working, and how this may endanger the entire project. There is clear risk of being informed too late. Running an integration project requires early communication on the required cooperation among the integration team members. This type of communication will prove to be a key success factor.
#6 “The culture is so different – it’s difficult to align”
During an integration project, silos and coordination problems may take several forms. Often difficulty appears between functions or between the corporate and acquired subsidiary. It may also occur between geographies, especially between distant locations. In that context, we commonly hear about cultural gaps and issues.
Culture is key in cross-border deals and this factor should not be underestimated. But culture is also often used as a way to resist integration or change of control. Typically, we hear: “our markets and cultures are so different”. When culture becomes an issue in an integration program, it may indicate:
- The language used may not be the right fit.
- The headquarters may have to be relocated.
- The employees working in the integration process may have to be trained.
- The acquiring group functions do not fit with the acquisition strategy.
- In some cases, the external constraints or stakeholders may be jeopardizing internal corporate efforts.
In successful organizations, corporate culture acts as a force overcoming national gaps or resistance to organizational change. Médecins sans Frontiéres, or any international scientific program, are examples showing that strong technical culture and vision may overcome educational differences and language barriers. When the word ‘culture’ is used as an issue, it is not because of the national cultures, but because of the integration strategy and process itself. Culture covers a large number of topics that may be acted on – and these points of action should be part of the PMO tactical improvement process, and the definition of work to be achieved in the different task forces.
These 6 signs indicate the need for careful listening and agile PMO fixing.
Companies are being evaluated more and more on how they consider human values and purpose. In our view, integrations must also take this evolution and showcase how the firm can adjust to it. Being cautious to these six signs during an acquisition integration is a very powerful way to communicate on best-practices that will apply later to the entire organization.
Attention to interpersonal communication details, the integration manager mindset, actual executive cooperation, the PMO governance and methods, and overall enthusiasm and pride within the organization are not distractions. They are core indicators of a successful acquisition integration strategy. The more complex the deal, the more improvement may be needed in your PMO approach.
Gilles Ourvoie is a partner at Global PMI Partners, an M&A integration consulting firm that helps mid-market companies around the world bring their operational, technical and cultural differences into alignment. Global PMI Partners has a reputation for delivering exceptional consistency, speed & customized execution on the complex operational, technical and cultural issues that are so critical to M&A success.