determinants of pmo and its impact on success of strategic initiatives

1

DETERMINANTS OF PMO AND ITS IMPACT ON SUCCESS OF

STRATEGIC INITIATIVES

INDEPENDENT STUDIES - 1

ZILL -E- HUMA

1467156

MS-PM

SUPERVISOR

SIR FAROOQ RASHID

2

ABSTRACT

Project Management is getting more difficult when there are multiple overlapping projects with

limited resources, resulting in need empowered PMO to enhance governance controls in order to

achieve success of Strategic Initiatives. With these rapid changes in technology and

globalization, Organizations are experiencing continuous evolution to stay in business which

ultimately leads to projects to meet targets. Old Management ideology and Operations

Management frameworks can’t address these challenges because it keeps changes on daily basis.

In order to respond to these changes effectively and efficiently project management frameworks

are there to facilitate. That is the reason, organizations are now establishing PMO to meet these

challenges and achieve business initiatives success. However establishing just PMO without

skilled team and TOP management support is not enough solution to problems. PMO should be

compromised of team with skilled and well versed in project management resources, which

understand and have capacity to adopt modern project management best practices and

framework. Furthermore it should have TOP management support to operate in such a way that it

adds value. The focus of current study is how PMO can help organizations to achieve business

initiatives success. My focus will be on basic needs of empowered PMO i.e. Organization

Culture, TOP management support and skilled team. Although there are other needs of PMO

which are required for fully functional PMO but my research will only be focused on these

needs. If PMO is empowered then it can definitely help organization in all aspects. In this

research how empowered PMO can help organizations to achieved targets and ultimately lead to

success of business initiatives. Six hypotheses were developed to check the Impact of

independent variable and mediator on dependent variables. Results shows that the organizational

culture, skilled PMO leaders and top management support has a strong impact in achievement of

strategic Initiative success and PMO plays mediating role. Although modern project management

frameworks are being adopted in developed countries and they are getting benefit out of it. But

in developing countries, companies are still not in race. So the circumstances in developed

countries and developing countries are different. My research will explore the developing

countries prospect and I am conducting this research in Pakistan, which will also identify the gap

b/w theory and reality in developing countries.

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Acknowledgement

First of all, thanks ALLAH ALMIGHTY for his mercy and guidance in giving me full strength

to complete this Report. Many thank to my colleague M. Faheem and Sir Farooq Rashid my

supervisors for their guidance, support and advice at every step.

I am especially grateful to my family for always supporting me. In particular, I am grateful to my

father and mother.

I wish to extend my sincere gratitude to the people who supported me and provide the necessary

encouragement to see the research to the end.

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Contents

CHAPTER 1 ................................................................................................................................... 6

INTRODUCTION .......................................................................................................................... 6

1.1 Background ........................................................................................................................... 6

1.2. Gap Analysis ........................................................................................................................ 7

1.3. Problem Statement ............................................................................................................... 8

1.4 Objectives of Study ............................................................................................................... 8

1.5 Significance of Study ............................................................................................................ 9

1.6 Research Questions: .............................................................................................................. 9

1.7. Delimitations of study: ......................................................................................................... 9

CHAPTER – 2 .............................................................................................................................. 10

LITERATURE REVIEW ............................................................................................................. 10

CHAPTER – 3 .............................................................................................................................. 28

THEORETICAL FRAMEWORK AND HYPOTHESIS ............................................................. 28

3.1. Theoretical Framework ...................................................................................................... 28

3.1.1. Variables 28

3.2. Theoretical Framework .................................................................................................... 28

3.3. MODEL 29

CHAPTER -4 ................................................................................................................................ 31

RESEARCH METHODOLOGY.................................................................................................. 31

4.1. Sample Selection ................................................................................................................ 31

4.2. Population Frame ............................................................................................................... 31

4.3. Sampling Technique ........................................................................................................... 31

4.4. Type of Study ..................................................................................................................... 31

4.5. Data Collection Strategy .................................................................................................... 32

4.6. Data Analysis ..................................................................................................................... 32

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4.7. Statistical Techniques ......................................................................................................... 32

4.8. Software 32

4.9. Reliability 33

CHAPTER-5 ................................................................................................................................. 34

ANALYSIS AND RESULTS ....................................................................................................... 34

5.1 Descriptive Analysis ........................................................................................................... 34

5.2. Correlation Analysis ........................................................................................................... 35

5.3. Regression .......................................................................................................................... 37

5.3.1. ANOVA ANALYSIS ......................................................................................................... 38

5.3.2. Coefficients 38

5.3.3. Collinearity Diagnostics...................................................................................................... 40

5.3.4. Mediation Test................................................................................................................. 41

5.4. Discussion .......................................................................................................................... 54

5.5. Conclusion:......................................................................................................................... 55

5.6. Limitation of Study ............................................................................................................ 56

5.7. Future Direction ................................................................................................................. 57

6. References 58

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CHAPTER 1

INTRODUCTION

1.1 Background

As organization started to identify that their business initiatives are effectively achieved through

projects so the importance of Project Management as a significant competency come into sight.

By realizing its importance, organizational project office has been established which is also

known as PMO developed to maintain organizational project management competency stated in

1990 and continue as area of interest for both researchers and practitioners . ( Hill,2004;

Crawford,200; Aubry & Hobbs, 2007).

The Project Management Institute (PMI) has reveal its interest in the emerging functional group

(the release of OPM3 in 2003). From the organizational point of view using project management

office is valuable to the organization (Lullen & Sylvia,1999 ).

Many organizations reveal their interest in establishing Project Management Office in order to

support and manage different project related to Information system/ Information technology.

PMO is an organizational entity with full time personnel that provide wide range of functions

from project designing , administrative, training, consulting, technical, and maintain project

events to select strategically and beginning of projects to align project with organizational

visions and objectives (Kerzner, 2009; Project Management Institute, (PMI), 2008).

A well built PMO focus on two main area of improvement to the organization. It helps

organization in opt right project to deliver and also helps organization to deliver the project

appropriately. Project management success is not only to get the outcome on schedule and within

budget it should also sync with organizational strategy otherwise it’s of not use it is just wasting

resources, money. (Greg Wood).

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Organizations must strike the right strategic response— and they must do it quickly. PMO

represent for organization .It guides the project safely (minimizing the risk) and quickly to their

destination.

Strategic initiatives is a way through which organizational vision is translated into practice. It’s a

collection of finite duration discretionary projects and programs, outside of organization day to

day activity that are established to help organization to achieve its target performance.

PMO should not only focus on scope, budget and schedule, it should also consider how to deliver

the project and service within time and satisfaction of customer is most important.

PMO has evolved as a concept and it is very significant body and it has been evolved in early

days in US Air Cops; later, the US Air force used PMO to help in examining and controlling

development of aircraft projects during World War 2 and Cold War times (Benson, 1997).

Currently, PMO has well established concept in organization but to attain PMO success is hard.

75% of PMOs in Information Systems and Technology domain closed within 3 years of

formation. Presently there is no defined standard or model to identify the structure, steps, or

outline of PMO formation exist. (Desouza & Evaristo, 2006; Dai & wells, 2004; Hill, 2004;

Aubry & Hobbs, 2007; Thomas & Hurt, 2009; Kerzner, 2003; Martin et al, 2007).

1.2. Gap Analysis

PMI has issued several papers aimed at elevating the discussion of role PMO in enabling

successful implementation of strategic initiatives, however those research papers covers the

organizations based in well developed countries. The circumstances culture & maturity is much

different among organizations based in Developed and developing countries. So most of

discussions/research is totally based on ideal conditions and real time problems and differences

are still not explored with respect to developing countries.

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1.3. Problem Statement

The motivation of this study is PMO in Pakistan does not has the value what it actually deserves

and projects in Pakistan usually fail due to wrong choice of project manager, unsupportive top

management and cultural issues that are basically needs of PMO in any organization that

empowered PMO to achieve the strategic/business initiative of organization by prioritization of

the projects, proper working on business plan or feasibility, on time and within budget

completion of projects, proper documentation and training guidance, provide right piece of

information to right people and by aligning project goals with organization strategic goal.

So in this research we are going to study that how the needs of PMO (Organizational Culture,

Skilled PMO leaders and Top Management Support will impact, help and empowered PMO in

achievement of strategic initiatives. What challenges PMO has to face in organization and how

when these needs empower PMO then PMO plays a mediating role in achievement of strategic

goals of an organization. Focus of our study will be also on these differences and problems, to

address real concerns pertaining to organizations based in Pakistan.

1.4 Objectives of Study

The research objectives are:

1. To measure the impact of PMO in achievement of strategic targets/goals

2. To identify the challenges being faced by PMO in organization.

3. To study the tools & techniques of PMO which ensure prioritizations of projects and

perfect use of organizations assets in projects.

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1.5 Significance of Study

Focus of study is to identify the factors which may help PMO to achieve strategic initiatives or

goals. PMO is not just responsible to delivers the projects well on time and within budget, PMO

is also responsible to deliver the projects when it’s required and manage the priorities of different

projects. Companies fail to achieve strategic targets, one of main reason is implementation.

“Implementation is more important than strategy formulation”, (Prof L.Hrebiniak). However

Effective PMO can help organizations to achieve their strategic targets and goals. In this study

we will explore those factors and their impact.

1.6 Research Questions:

1. What are the factors which help PMO to achieve strategic targets/goal?

2. What are needs of PMO to ensure implementation of strategic initiatives?

1.7. Delimitations of study:

Due to time constraints, study will complete in almost 04 months. Demographically, it will only

cover project based organizations in twin cities Rawalpindi/ Islamabad.

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CHAPTER – 2

LITERATURE REVIEW

Two things are very certain for many organizations today: greater uncertainty and accelerated

rapidity of change. With increase globalization the scope of competition and Digitization

accelerated the pace of business.

A too speedy economy hasty growth in rising market and slowing growth in developed markets

means that companies perform in extremely multifaceted world. In this situation the skill to

develop and execute the strategic initiatives and changes gear rapidly is becoming a key

differentiator.

As many senior executives know and they dedicate their important consideration and center of

attention is in developing those strategic initiatives and many companies still effectively

executing those initiatives but the issue is shortcoming on leadership that is mostly linked with

unproductive commitment.

Many senior executives have difficulty in acquiring information they require when they have that

information in order to make necessary adjustment and course correction in today business are

significant to make certain that large strategic initiatives will bring up their aim.

Project management especially at organizational level is growing trend of contribution of

projects to make strategic goal realization. Project management is basically requiring continuous

change and its main focus is to deliver timely results on regular basis. So according to Field and

Keller in 1998 organizations that drive projects is growing on basis that effective change of

execution is a basis of competitive advantage.

Project Management is becoming so important that there is need to combine it with company

remuneration system, and company gratitude of project management that is necessary to

maximize performance. There is need of environment that is supportive or culture in which

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project staff and project operate effectively. If it does not so there is chances even best qualified

and highly motivated employees will become ineffective and disheartened if organization don’t

provide facilitative infrastructure environment to deliver project successfully (Turner &

Kernzner, 2003).

Project management office has evolved with focus of people, process, tools and technology

where by projects efforts are controlled supported and monitored within organization. Many

organizations pursuing purposely growth of project ability have done by taking in account all

important actions related to management of project under PMO direction.

According to research of Gartner Group in North America 40 percent of organizations have

executed some of PMO to professionalize management of project (Light & Breg, 2000).

PMO is becoming more important in business hierarchy and taking on new assignment and

accountability for sustaining project management and vigorously support business strategic

planning and execution (Kerzner, 2003).

Many organizations nowadays realize with ongoing challenge there is need of greater PMO

discipline. For many organizations it’s completely utilization of undertaking administration

capacity forms, and administration structure by actualizing undertaking project management

office.

PMO is basically to help both project manager and the relevant organizations to not only apply

the up to date project management practices but also to become adapted and incorporate business

interest into organization’s project performance efforts.

In past Individual capacities in undertaking administration have been fortify and developed

through a blend of improvements in venture administration procedure and systems, the execution

of preparing projects, and robotized instruments that utilization propelled outline ideas and

innovation. As of now numerous associations consequently execute hierarchical substance

Project Administration Office (PMO) to accomplish venture administration oversight, control,

support furthermore, arrangement .(Gerard.M.Hill, 2004).

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There are generally five stages of PMO that shows progression and advance functions that helps

PMO to meet up project management needs and help to achieve the strategic objective of

organizations. (Gerard M.Hill, 2004).

PROJECT OFFICE PMO is a unit of project management, as a space for undertaking

supervisor who is reliable deliver project successfully. It’s basically function is to implement and

shows excellence in project by implementing practices and principles in each project. Only

single project manager has an authority to control the activities and action of project. It does not

has any program level authority .The function of project office is to implement only those

policies or guidance that is assigned by the high authority.

The BASIC PMO deals with multiple projects and controls multiple project performance; it’s

also called program office that is domain for program manager. The function of basic PMO is

basically establishing standards that how project management will be conducted in organization.

What methodology, tools &techniques process would be implemented, helps in evaluating the

project progress, , train project teams and analyze performance of project manager, train project

teams and make sure that organization objectives has been achieved.

The STANDARD PMO is a hub of complete PMO capability. It supports to boost up both

individual and project performance. It deals or controls multiple projects and project managers. It

basically function is to execute venture administration center business competency and enhances

competency of task administration and enhance its maturity. It basically act as a interface

between project environment and business environment and provide policies, guidance to

perform project and also provide methodologies, practices for success of project provide tools for

project reporting to senior executive to get their support it also involve in activities like training

, resource assignment evaluation and qualification.

The Advanced PMO is basically to integrate project management in to business objective.

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It develops practices that are executed in both project and business. It perform the function of

developing budget if not prepared before in order to develop and execute practices of project

management and integrate business activities. Develop process and practices that is utilized in

both business and project management. Provide practices and procedures and senior management

dedicate their skills and knowledge to implement such function like audits of projects, mentoring

service and if project will get fail how to recover it. They run and supervise project results in

terms of business presentation.

The Center of Excellence is a separated unit in organization and responsible to operate project

management. There is supervisory in charge of center of excellence and he will report to top

management in an organization. It performs functions like providing power and direction to

operations of project management. Supervise subordinate PMO usefulness where pertinent

association has built other PMO operations with respect to its global, national, or other extended

topographical business center. Build customer and vendor relationship, develop both awareness

and representation of project management and stakeholder across business unit and represent the

business enthusiasm of association in task administration environment..

The trend to implement PMO is spreading so fast because it provide structure that needed to both

standardize project management practices and assist project management portfolio and also

determine methodologies for repeatable processes and complete more task within time and

budget with fewer resources (Megan Santosus,2003).

The main reasons to establish PMO is improving project success rate and to implement standard

practices. PMO is basically strategic entity that is in employment at corporate level means it set

project standard across the enterprise and it must be supported by top management (Megan

Santosus, 2003).

PMO provide guidance/direction to project managers in business unit. Establish and implement

consistent and standardized processes. Conduct trainings programs and manage centralized

office from where project managers are loaned out to work on projects. Direct employees about

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best practices. Maintain project management tools and develop a staff of program managers who

can manage multiple projects and allocate resources (Curtis Cook, 2003).

PMO is basically to deliver projects with more consistency and efficiency. PMO depends on

three metrics to determine its effectiveness: the cost estimate accuracy, the schedule estimate

accuracy and satisfaction of project stakeholders (Jim Smith, 2002).

PMO take the responsibility of resource allocation that improves the employee productivity.

Having oversight to all personnel and projects PMO can assign the best to prioritize projects and

that keep them focused on the projects (Darrel Raynor, 2002).

Multitasking does not work on different project. Productivity reduces every time when employee

switched from one task to another. PMO eliminate this multiple assignment and boost

productivity by ensuring that priority projects should get more attention by allocating majority of

resources to highest priority projects. (Ferrarell, 2003).

PMO responsibilities widely range from project management best practices to conduct formal

portfolio management reviews. PMO track and coordinate both projects and services. PMO does

not need road map to follow or benchmark or metric against which to measure. Effective PMO

harvest improvement over time and constantly force the department to improve performance.

(Diaz, 2003).

PMO helps in delivering projects within time and budget, reduced failed projects, improve

project productivity and increase saving of cost. PMO value reduced when PMO in an

organization not complete and deliver projects within defined objectives ranges from time,

budget and deliverables. One of the main reasons is not communicating results of PMO to top

management (PMI’s Pulse of Profession Survey, PMI, 2012).

PMO has also faced many challenges like lack of defined project management methodology. If

well defined methodology and standard not implemented within PMO then it’s a major

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contributor to the failure of PMO because it results in inconsistency in managing and controlling

projects.

If not properly tracking project resources working hours that would be a challenge for PMO

specially in matrix project organization because it results in not properly identify true capacity of

resources working on projects that results in failure in meeting project estimated schedule and

cost.

There is need of constant support of top management to empower PMO to make decision. The

executive support should exhibit at initiation phased and throughout lifecycle. Resource

contention is also a great challenge for PMO. Project prioritization is also a great challenge for

PMO if not prioritize then it leads to not delivering of projects as planned because it handle

different projects simultaneously.

PMO should implement processes that are flexible especially at the initiation of PMO

implementation. It’s very necessary to adapt change and adopt project management processes

and absorb any resistance of new PMO it results proper alignment and collaboration among

organizations team and functions.

Organizational culture consists of values, beliefs, behavior of the people and experiences to

create the organization that define how the organization does work. Organizational culture is so

crucial if anything doesn’t fit in specific culture that will get rejected. It is need of organization

to develop PMO but in different size and different function (Gibson & Donnelly, 1994).

For Organization Project Management is very important because it deals with many project in

parallel specially project with scare resources. PMO in organization is a great challenge because

every organization is of different nature so organization should be careful about its needs

regarding project management and PMO. The project management organization should be

design according to organization nature, type and size. The culture affects everything in the

organization very considerably and is a very complex reality to understand and analyze (Hayal

Senyurt, 2010).

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Strategic initiatives are key actions programs which concentrate on achieving specific objectives

and eliminating the gap between actual performances and planned one. It provide guidance to

review all current projects and sort out the expected impact and spotlight the important project

that have measurable and immediate change impact on achieving organizational mission.

PMO supports strategic initiatives with project evaluation, prioritization and selection and align

projects with business strategies. For organization to be successful by implementing PMO it’s

necessary that share values and belief aligns with technical and social aspect of project

management to achieve organizational business objective. PMO success is linked with four

dimensions that is organizational structure, measurement system, project management skills &

competencies and management practices that represent organizational culture. Organizational

value create link between structure, system, organizational members and processes in

implementation of project management methods (Kendra & Taplin, 2004).

Many organizational culture show resistance in accepting PMO because they value their

discipline rather than managerial knowledge but PMO helps them in their understanding that it

would be benefit for standardized operation, for decision making, better resource allocation, fast

access of important information; reduce need of restructuring, give effective and efficient

operations, few meeting that is valuable and reduce high time consumption of executives and

helps in prioritize of task (Kerzner, 2003).

Projects usually fails because of objective is not properly clear, inappropriate project schedule,

troubleshooting, communication is ineffective, non availability of required resources, not clear

goal of participants and absence of top management support, teams focus on technical problems

rather than customer satisfaction (Young, 2000; Andersen et al., 2004; White, 2006; The

Standish Group in Young & Jordan, 2008).

Another major factor in failure of projects in as number of projects increase then there is need to

have more employees so there will be rise in relationship and contacts. The association of

stakeholders actually represents trouble to regular work and therefore its results in short

tempering and functional managers have an aversion to such projects. So there is need to defined

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proper roles, responsibilities, competencies and relationship between stakeholders if it’s not so

then it would lead into more conflicts and less efficiency of project execution. (Aljaz Stare,2011)

Projects often fail because of many cultural factors. The most important the plans of projects

made in hurry without any proper risk management .there is low level of project managers

authority, low level of line managers support and project teams are not suitable these

components could be subsume inside of task hierarchical society which structures some portion

of corporate society (Aljaz Stare, 2011).

Organizational culture has an impact on project management office e.g. organizational strategy,

structure, culture, system, behavioral patterns and organizational processes determine the internal

environment that is necessary for success of project management office (Brown, 2008;

Andersen et al, 2009).

A literature study reveals that’s three types of organizational culture impacts the success of

PMO. Corporate culture with an indirect influence. Constant employee participation, how to

adapt to changing environment, long term directions, clear mission , How ambiguity is being

responded by decision makers, uncertainty and complexity Management style of people,

flexibility, process and system support, people philosophy, competency of people, performance

management, communication, cross functional integration. Optimistic working environment,

leadership, technical focus and customer satisfaction, empowered working style, hierarchy has a

vast impact on PMO(Moore, 2002; Fong & Kwok, 2009; Belassi et al,2007 Kuo & Kuo, 2010;

Shore, 2008; Aroson & Lechler, 2009; Brown ,2008; Morrison et al, 2008 ).

Project Organizational Culture has a direct influence like top management support and their

attitudes, prioritization of projects, project staffing, organization policies, rules, procedures,

roles, departmental support in track of project goal, employee commitment to that objectives,

task arranging, how function is assessed and how assets would be doled out and managed,

project team performance and how directors assess and see the consequences of ventures has a

great impact on success of PMO. (Pinto, 2010; Cleland, 1999; Young & Jordan, 2008, Doll,

1985; Kearns, 2007; Kerzner, 2009; Tinnirello, 2011; Andersen et al, 2009)

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According to Kernzer, 2011 & Cleland in 1999 The project team subculture has a straight

influence like effective communications, trust and team work and cooperation, not feeling

reluctant in sharing problems and ideas among team members , team social activities, calling

colleagues by their epithets or first names and convention level inside of group.

According to Cleland, 1999 and Skarabot, 1998 Project culture is most important factor in

successful project implementation and its part of organizational culture .it’s basically attitude to

project within business. Project should be operating within a business environment not in

isolation because it's essential prerequisite of great task administration. The way of life

influences venture administration, vital arranging and execution and everything else.

According to Pinto in 2010 organizational culture can also affect project management office in

four ways. How department interact and support each other to achieve goals, employee

commitment level to achieve the goal with strategic goal, project planning how work is estimated

and resources are assigned and how project manager evaluate the team performance and

outcome of project.

Another important factor that empowers PMO to achieve strategic objective is top and senior

management support. The top management support absence is a great challenge for project

management. CEO and other senior management should dedicate their time to evaluate plan,

assist project management problems, and follow up results.

Mostly top management control access of project manager to resources that are under the

supervision of functional manger. Support level provided by functional manager is determine by

the level of strengthen gave by top administration. Most important issue in any organization for

PMO is availability of resources it is not a big issue if it is part of functional department because

the functional manger himself is project manager but in case of matrix organization it needs

positional power and negotiating skills within organization to have adequate resources. Full top

management support is very necessary for PMO to facilitate and implement strategies successful.

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Relationship between task administration and senior administration is imperative. A civilized

relationship includes these factors; project managers should be empowered to make decision and

it’s only done through decentralization, project managers should be given authority to present

recommendation and alternatives to sponsor while maintaining a hands off rather than just

problems. There should be a policy that calls for a periodic briefings and meaningful executives’

status report has been formulated. (Kerzner, 2011).

Project manager and senior manager should build up a commonly pleasing venture culture and

working relationship that is based on trust, teamwork, cooperation and communications.

Everyone tries to propel the cost of others, the utilitarian supervisor adds to its own way of life

and venture administrator ought to manage the work as per that culture (Kerzner & Saladis,

2009).

Project managers and senior managers both are responsible for successful completions of

projects in order to achieve organizational strategy. Project managers must negotiate with senior

manager for achievement of deliverable; senior manager should trust their employees and

empower employees to make decision. If something went wrong then project manager must help

senior manger to develop some alternative plan.

Responsibility of project manager is to deliver the outcome of project and project is complex

endeavor so project manager needs some support from some other mangers in organization. The

senior management involvement can help project management to successfully achieve the

project (Benser & Hobbs, 2008; lester, 1998; Zwikael & Globerson, 2004 Whittaker, 1999;

Johnson et al, 2001).

Most of the executives considered organizational issue are more important than technical so

organizational involvement is important for project success. With introduction of maturity model

top management support is most important factor. The model examine that rather than project

management exercise project is an organizational effort like top management support is highly

weighted the tools project manager decides to use in projects.(Doherty & King, 2001; Benser &

Hobbs, 2008; Paulk et al, 1995; Project Management Institute- PMI, 2003).

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PMO is basically established to better the performance of project management and lessen those

projects that unsuccessful in fulfilling customer demands, projects that are over budget and ahead

schedule those results in delaying of projects. Skilled PMO leaders are another very important

factor that boosts PMO to achieve the organization strategic objective.

According to PMI, PMO which is also known as program management office, project

management center of excellence has allotted many different obligations identified with

concentrated and direct those undertakings which are under its zone.

PMO leader skills are very important factor in empowering PMO to successfully completion of

projects in order to achieve strategy of organization. It is very critical to select project managers

who have technical and administrative skills to terminate the projects successfully and it is also

very important during implementation stage.

PMO consist of staff who has blend of expertise like managerial, training, administrative,

consulting and technical services related to projects and organization. PMO is basically

established because there was necessary to better the project management essentials like

performance results; lesson learned and project manager’s support.

Project mangers competence and commitment is very important because it is not only impact

project performance but also involve in client satisfaction and acceptance of projects. The

objective of PMO is basically to improve project management effectiveness by acquiring

knowledge from previous failure and success and give support and enhance service for not only

projects but also for supporting units and other management levels (Dai &Wells, 2004).

According to Kerzner, 2004; Walker & Christenson, 2005, PMO is very important it helps to

identify the opportunities of continuous improvement because it contains project management

practices, standards, lesson learned. In addition to PMO is a knowledge network which develops,

make and disperse thoughts. PMO incorporates best practices, devices and procedures, ideas

from past experience and make them open for succeeding task groups.

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Senior mangers play the role of intermediaries in linking project managers to assist cross project

learning. They play a vital role in facilitating cross project knowledge transfers because they are

involved for the large programs serving as conduit. They review the projects frequently and

review some other projects and share information on to other teams. PMO leaders is basically

specific type of intermediaries who overview multiple projects and assist learning from one

project to the other (Scarbrough & Swan, 2003).

The most important activity in cross project learning is practicising those experiences when the

project got completed. This is known as lesson learned which is also known as after action

review or post project review. The project members then discuss what went good and what went

wrong and then document and store it in database with objective of improving future project

performance for future project team. (Kotnour & Vergopia, 2005; Zedtwitz, 2002).

Organization consists of multiple communities of practices in which knowledge seen entrenched

within and across the group so PMO leaders play a very important role within collection of

practices from and through which knowledge and past experiences negotiated and shard

(Wenger, 1998).

The significant project management skills sets needed for successful completion of projects to

achieve strategic initiatives are specialized venture administration abilities, initiative aptitudes,

and business and key ,administration abilities. Numerous associations discovered that it’s most

noteworthy trouble in discovering assets with adequate specialized task administration aptitudes.

Almost every organization believed that key and business administration abilities and specialized

aptitude can be taught through trainings but they require the resources with good leadership

skills. (Project Management Institution (PMI), 2013).

Project management performance increased by training and career development, recruiting, and

hiring skill PMO leaders but the important is its efficiency and effectiveness should closely

aligned to organizational strategy. If it is aligned with organizational strategy then it has clear

impact on project success meeting the organizational goals and business initiatives and creates

the competitive advantage to sustain and growth of an organization.

22

Organization with Skilled PMO leaders efficiency aligned with its strategy has an average

success rate of 72 percent while organization with not effectively aligned with organizational

strategy has an average project success of 58 percent this 14 percent difference equal to risking

50 percent of loss (Project Management Institution, (PMI), 2013).

Most of the PMOs directly report to senior management, the primary objective to establish PMO

is to improve project team performance so PMO leaders is examined as straddling no less than

three groups of works on including upper administration, task group what's more, PMO

association (Wells, 2004).

PMO leaders performance is highly influenced by uniqueness of activities, the more standard

activity the project will have it will be more easy for PMO leaders to plan, schedule and monitor

their projects.

The PMO leader’s primary responsibility is to ensure timely delivery of project, within assigned

budget and meet and satisfy customer expectations. Many PMO leaders require project team in

order to classify the lessons learned when work has been completed. Continuous improvement in

performance to achieve the organizational strategic objective is important aspect of PMO

leader’s responsibility.

PMO leaders have a responsibility to check whether the project management practices have been

implemented across the organization or not. They develop growth and learning for project

managers, PMO maintain by project managers who are experienced and skilled. They have

proper tools for training and helpful setting to do their best.

PMO leaders smooth the progress of cross project learning by developing processes that can be

utilized by multiple projects, carry out lesson learned and information sharing session between

venture chiefs, task group and other administration. PMO leaders also assist cross project

learning by conducting training of team members and make certain people with required

capabilities are employees on upcoming projects.

23

PMO pioneers create procedures, structures and frameworks that settle in learning crosswise

over venture groups inside of associations and help them to achieve the organizational

objectives. Organizational routine has been utilized by multiple projects that help organization to

produce and transfer lesson learn from past experience that helps project teams to use that

learning for similar future projects.

From literature organizational routine is mean by which aggregate know how from past

encounters can be embedded into day by day routine work of each authoritative individuals

(Becke 2005; Becker, Lazaric, Winter & Nelson, 2005; Brensen et al, 2005; Feldman &

Pentland, 2003; Szulanski &Jensen, 2004). So organizational routine not only helps in learning

from past experiences but also helps in improving project templates, methodologies that would

be utilized by upcoming project teams.

Project prioritization is very necessary and critical that helps PMO to choose the high priority

projects over low priority projects in order to achieve the organizational strategic initiatives.

Prioritization of projects will increase organization likelihood of success. It helps the PMO to

rank projects that are important on basis of criteria. It helps PMO to see which projects are more

important to see t first and which if any could be discontinued or put on hold.

Organization should be focus on high critical projects, it will generate high revenue. In order to

gain the greatest return the organization should effectively prioritize and manage projects. To

prioritize projects organization use many methods like ABC method in which A is assigned to

high priority project B is to slightly lower priority and C is for lowest priority projects. Some use

5 or 10 method for project prioritization but the most effective method to prioritize project is

effort and impact.

In this technique first u have to check whether the effort is easy or hard then sort out project is

going to have low or high impact on organization or you can say what company gain as a result

of successful termination to the project. Usually the easy to do project has high priority and has

more impact than projects with difficult to do and has low impact in achieving organization

mission.

24

Once the project has been prioritized now it’s time to manage these projects. Many commercial

software’s programs are available to facilitate in managing any project. Mostly are based on

Gantt chart in which activities are listed, has established time line and assigned resources.

Apart from managing projects it is important to update the status of progress regularly. The

updates would be done by person who is assigned to that work it’s basically referred to that

person who is responsible for updating the whole project plan because it creates the ownership of

each task and its key element of successful completion of task.

PMO prioritize project on different criteria and weight it based on strategic direction,

organizational goals, available resources etc. Projects are then prioritize and scored on those

criteria. Once project get prioritize and priorities are reviewed and discussed, PMO then evaluate

the result to decide funding and resource allocation for high priority projects then decide when

and how resources would be assigned to low priority projects in future when more resources will

be available.

The criteria on which the project would be prioritized could be required services or projects, like

project required to meet regulatory mandates or legal compliances. On vital arrangement like

what exactly degree the project is adjusted to our association general techniques and worth to

client the amount of quality the result of this undertaking convey to our customer. Organizational

benefit of project including revenue, profit, cost and improvement. Complexity of projects like

required expertise, cross cultural communication, innovative content, virtual team work etc.

project risk that would damage organization reputation and contract management which include

expected changes and claims towards us and others.

Project prioritization is necessary for organization which has clear strategy but if organization

change its strategy then there is need to change prioritization criteria accordingly .So there is no

need to change the priorities of those projects which are already in implementation phase that

could cause disturbance. However it is necessary to communicate strategy changes that involve

changes of project prioritization to all members of an organization. Then affected teams and

25

members have an understanding of changes and its consequences. It would be best practice to

involve organization staff into strategy development.

Strategic initiatives is not business as usual it requires few critical projects to improve

organization to deliver its mission. It begins with collecting complete list of projects. All are

important regarding projects including its budget, benefits, risk and owners of project managers

must be collected. Once it gets completed now it’s time to review it. Now each project must be

plotted against organizational strategic objective. Add mark for each strategic objective that

project will have positive impact.

Strategic initiatives are about doing right things while routine operation and low impacts projects

is about doing things right that thing would depict for long term strategic position of

organization. Strategic initiatives are to help entire organization to get focus on more important

and critical work rather than get distracted by low priority projects.

The most important tool that is used with strategic initiative is milestone helps to determine

when major task is going to start when it going to be completed. The owner of this would be

responsible for ensuring major milestone is completed on schedule and on budget and also keep

top management up to date on progress.

There is no need to update top management about minor milestone, they should be updated about

major milestone if they are over budget or ahead schedule or require more resources.

The Gantt chart is very useful in communicating the top management about milestone planning,

delivery, completion. Strategic initiative is a tool for translating vision into results.

The alignment of PMO to the organizational goal is key to drive strategy implementation. PMO

is very important for organization portfolio of projects and strategic initiatives. It is mindful for

undertaking and program conveyance administration and brought together inside of association.

Hence PMO is working in defining its value within organization and determine its role within

organization (Project Management Institution (PMI), 2012).

26

PMO has play very important role in clearly defining of organizational mission. Goals and

mission not only clear by project teams but also by the other department in the organization. It

helps in developing project schedule plan that is developing detailed plan of required phase of

usage process.

PMO has also solved personnel issue including recruitment, selection and training of necessary

personnel for project team and it helps in the documentation of necessary standards,

methodologies, policies and practices that can be applied for same nature of projects to prevent

reinventing of wheel.

If an organization is running multiple, cross functional projects then it needs PMO because it

helps in continuous improvement culture, continual progress review towards completion and

improved ROI, repeatable project delivery and process and less reinventing the wheel,

management and up-skilling resources, had senior management support and direction, provide

consistent project management and guidance (methods, systems, processes, tools, metrics

etc),manage resources accurately across the projects, managed priorities according to timelines,

budget, resource information and what if analysis and estimates accurately based on firm’s

history and lesson learned.

There are a variety of types of PMO structure exist and they perform variety of task and achieve

organizational strategy differently. Some PMO are easy to line up with strategy of organization,

but most important of it is the obligation of PMO inside of association and whether it is

measured dynamic in achieving association achievement. Another essential component is senior

director’s state of mind and PMO approach to chief executives and members of board who

present a greater opportunity to align PMOs to organization strategies.

The PMO greatest appliance is run past arrangement with key activities; they are enjoying

creating and executing authoritative system. PMO when aligned with organizational strategic

objective than it will have more potential to generate business value to organizational activities

(Project Management Initiative (PMI), 2013).

27

According to PMI if the projects are align to organization goal it is really very helpful in rising

the business value. PMO which are involved in alignment of projects to strategic objective of an

organization it is almost twice as liable to be high performing PMO to those once in a while

included. High performing PMOs implement strategy more effectively.

Most effective organization not only well aware about project, program and portfolio

management but also give PMO credibility, management authority, top administration support

also, apparatuses inside operational business structure. It is essential that top administration

ought to comprehend PMO and most ideal approach to utilize it and bolster it.

PMO should have direction, governance and support, and skilled staff personnel if it wants to

generate society that grasps venture administration and to create business worth to association.

Successful PMO play a very important part in strategy formulation. The imminent they get

enable them to prioritize strategic initiatives and eventually increase the chances for successful

implementation.

28

CHAPTER – 3

THEORETICAL FRAMEWORK AND HYPOTHESIS

3.1. Theoretical Framework

3.1.1. Variables

3.1.1.1. Independent variables

Organizational culture, Skilled PMO leaders and Top management support are

independent variable.

3.1.1.2. Dependent Variable

Success of Strategic Initiatives is dependent variable.

3.1.1.3. Mediating variable

Empower PMO is Mediating Variable.

3.2. Theoretical Framework

Organizational Culture

Empowered

PMO

Success of Strategic

Initiatives

29

3.3. MODEL

Hοa = Organizational Culture does not affect success of Strategic Initiatives.

H1a = Organizational Culture affects success of Strategic Initiatives.

Hοb = Empowered PMO does not play Mediating role between Organizational Culture and

success of Strategic Initiatives.

Skilled PMO leaders


Initiatives

Empower

PMO

Skilled PMO leaders


Initiatives

Empower

PMO

30

H1b = Empowered PMO plays Mediating role between Organizational Culture and success of

Strategic Initiatives.

Hοc = Skilled PMO leaders does not affect success of Strategic Initiatives.

H1c = Skilled PMO leaders affects success of Strategic Initiatives.

Hοd = Empowered PMO does not play Mediating role between Skilled PMO leaders and


H1d = Empowered PMO plays Mediating role between Skilled PMO leaders and success of

Strategic Initiatives.

Hοe = Top Management Support does not affect success of Strategic Initiatives.

H1e Top Management Support affects success of Strategic Initiatives.

Hοf = Empowered PMO does not play Mediating role between Top Management Support and


H1f = Empowered PMO plays Mediating role between Top Management Support and success

of Strategic Initiatives.

31

CHAPTER -4

RESEARCH METHODOLOGY

4.1. Sample Selection

The sample size for this study is one hundred and twenty five respondents. I have calculated the

sample size through SS calculator it was around 96 that I should get the data from 96

respondents but I have collected 125 responses from respondents who are working in project

base organization. The key subjects for this sample are program managers, project managers and

project team working in different project based organization in twin cities Rawalpindi/Islamabad.

4.2. Population Frame

Population frame will be different Project based companies in Rawalpindi Islamabad.

4.3. Sampling Technique

Population size of this study was not very large as PMO exist very rare and it is very difficult to

find out too many project managers, program managers and portfolio managers in organization

because they are few in numbers that’s why we used non-probability convenience sampling

technique to draw sample from population.

4.4. Type of Study

This research is explanatory and casual in nature and hypothesis testing will use to explore how

the needs of PMO empowered PMO in achieving the strategic success of organization.

32

4.5. Data Collection Strategy

The data is collected by using questionnaires, theses questionnaires were specifically being

distributed among different project based companies in Rawalpindi and Islamabad. The items of

the questionnaires were reliable question of top management support is adapted from research

study of (Steven & Debora, 1998) “ Perceived Organizational Support” and question of

organizational culture is adopted from the study of (Abram Carmeli, 2003) “The relationship

between organizational culture and withdrawal intentions and behaviors” and questions PMO

adopted from study of (Young W.Lee, 2006) “ The effects of PMO on IT Projects” questions of

remaining two variables are self constructed.

4.6. Data Analysis

The feedback of respondents will be quantitatively analyzed. Different numbers were

specifically assigned to the options on nominal scale and also to the options on five point Likert

scale .After assigning the numerical values, they were specifically added to the statistical tool for

management sciences software (SPSS) and analyze by using different statistical tool.

4.7. Statistical Techniques

Different statistical techniques is used in this study like regression analysis, correlation analysis

etc.

4.8. Software

For Analysis of data SPSS (Statistical Package for Social Sciences) will be use

33

4.9. Reliability

The reliability of questionnaires was checked through reliability coefficient Cronbach’s Alpha

that measures the precision and accuracy of the instrument. For 8 items of organizational culture,

6 items of op management support, 9 items of skilled PMO leaders, 10 items of empower PMO

and 9 items of strategic initiatives, values of Cronbach’s Alpha are .691, .739, .652, .765 and

.800 which are shown in Table 1. If the value of Cronbach’s Alpha will be .65 then instruments

used in research are reliable. So all the values are more than 0.65 which shows that items of the

questions are reliable.

TABLE – 1

Internal reliability of the Study

Variables Cronbach’s Alpha Items

Organizational Culture 0.691 8

Skilled PMO leaders 0.739 9

Top management support .652 6

PMO .765 10

Strategic Initiative Success .800 9

34

CHAPTER-5

ANALYSIS AND RESULTS

For this study the targeted population was Project Managers, Program Manager, Project Team

and Portfolio Managers working in project based organizations... SPSS (Statistical Package for

Social Sciences) is used to investigate the results and techniques used were regression,

correlation etc. Strategic initiative success was treated as dependent variable where as

Organizational culture, Skilled PMO leaders and Top management support treated as

independent variable and empower PMO used as mediating variable.

All questions for dependent, independent and mediating variable were assessed on 5-point Likert

scale from “Strongly Disagree “to “Strongly Agree” and 125 responses were collected to study

all the variables.

5.1 Descriptive Analysis

Table - 2

Descriptive Statistics

N Minimum Maximu

m

Mean Std.

Deviation

Skewness Kurtosis

Statistic Statistic Statistic Statistic Std.

Error

Statistic Statistic Std.

Error

Statistic Std.

Error

oc_idx 125 3.38 5.00 4.0320 .03055 .34155 .363 .217 .509 .430

sl_idx 125 3.22 5.00 3.9902 .02771 .30981 .609 .217 .922 .430

tms_idx 125 2.33 4.67 3.8493 .03254 .36381 -.541 .217 2.243 .430

pmo_idx 125 3.00 5.00 4.0120 .03297 .36865 .387 .217 .243 .430

busini_idx 125 3.11 5.00 4.0924 .02724 .30453 .570 .217 2.213 .430

Valid N

(listwise) 125

35

Table – 2 provides the descriptive statistics of studied values. It shows six different types of

values i.e. (total number of responses), maximum and minimum values, mean, standard

deviations, skewness and kurtosis.

As we measured our instrument on 5-point Likert scale from “Strongly Disagree” to “Strongly

Agree”. Mean values for all variables are equal to four or close to four it means that shows most

of values have degree of agreement in our data set and deviation is also very low.

Skewness is used to check the symmetry in the distribution. Positive values shows that

distribution is right tailed and right side is heavier whereas negative values shows that

distribution is left tailed and left side of distribution is heavier. In our skewness value of all four

variables i.e. strategic initiative success, organizational culture, skilled PMO leaders and

empower PMO is positive its means the distribution values of all the variables are rightly tailed

while value of top management support is negative it means it is the distribution value of this is

left tailed.

Kurtosis is basically to measure the tallness of probability distribution of the variables.

Distribution with kurtosis less than 3 is playtykurtic. Distribution with equal to 3 is leptokurtic

and distribution with excess than 3 is excess kurtosis.

By applying Jarque Berra test we have analyzed the data of all variables are normal. As its value

is greater than 2 then it means the data of all variables are normal.

5.2. Correlation Analysis

Table – 3

Pearson correlation of variables

Correlations

oc_idx sl_idx tms_idx pmo_idx busini_idx

oc_idx Pearson Correlation 1 .404** .361** .407** .568**

Sig. (2-tailed) .000 .000 .000 .000

36

N 125 125 125 125 125

sl_idx

Pearson Correlation .404** 1 .241** .505** .423**

Sig. (2-tailed) .000 .007 .000 .000

N 125 125 125 125 125

tms_idx

Pearson Correlation .361** .241** 1 .345** .390**

Sig. (2-tailed) .000 .007 .000 .000

N 125 125 125 125 125

pmo_idx

Pearson Correlation .407** .505** .345** 1 .363**

Sig. (2-tailed) .000 .000 .000 .000

N 125 125 125 125 125

busini_idx

Pearson Correlation .568** .423** .390** .363** 1

Sig. (2-tailed) .000 .000 .000 .000

N 125 125 125 125 125

**. Correlation is significant at the 0.01 level (2-tailed).

When we want to check the association between two variables then we use the Pearson

correlation. Its values vary from -1 to +1, -1 shows the perfect negative correlations between two

variables, 0 shows no correlation between two variables and +1 shows the perfect positive

correlation between two variables.

Table – 3 shows the Pearson correlation between our dependent variable strategic Initiative

success and our independent and mediating variable i.e. organizational culture, skilled PMO

leaders, top management support and empower PMO and it is tested on 0.01 level of

significance.

Correlation between strategic initiative success and organizational culture is significant

(P < 0.01) whereas the value of R is 0.568 which shows that there is positive correlation between

both variable the organizational culture has positive impact of strategic initiative success.

Similarly the correlation between empower PMO and organizational culture is significant

(P< 0.01) whereas the value of R is 0.407 which shows that there is positive correlation between

two variables means the organizational culture has positive impact/ influence on the empowered

PMO.

37

Correlation between strategic initiative success and skilled PMO leaders is significant (P < 0.01)

whereas the value of R is .423 which shows that there is positive correlation between two

variables means the skilled PMO leaders has positive impact of strategic initiative success.

Similarly the correlation between empowered PMO and skilled PMO leaders is significant

(P < 0.01) where as the value of R is 0.505 which shows that there is positive correlation

between two variables means the skilled PMO leaders has positive impact/ influence on

empower PMO.

Correlation between strategic initiative success and top management support is significant

(P < 0.01) whereas the value of R is 0.390 which means there is positive correlation between

two variables shows that top management support has positive impact on strategic initiative

success.

Similarly the correlation between empower PMO and top management support is also significant

(P < 0.01 ) whereas the value of R is 0.345 which shows that there is a positive correlation

between both variables means the top management support has positive impact/influence on

empower PMO.

Correlation between strategic initiative success and empower PMO is significant ( P < 0.01 )

whereas the value of R is 0.363 which shows that there is correlation between both variables

means PMO has positive impact on success of strategic initiative.

5.3. Regression

Table – 4

Model Summaryb

Model R R Square Adjusted R

Square

Std. Error of the

Estimate

Durbin-Watson

1 .631a .398 .383 .23916 1.988

a. Predictors: (Constant), tms_idx, sl_idx, oc_idx

38

b. Dependent Variable: busini_idx

Adjust R square should be less than R square it shows the closure look of variation. According to

model summary independent variable (organizational culture, skilled PMO leaders and top

management support) accounting 38.3% variation in Dependent variable (strategic initiative

success).

5.3.1. ANOVA ANALYSIS

Table – 5

ANOVAa

Model Sum of Squares df Mean Square F Sig.

1

Regression 4.579 3 1.526 26.684 .000b

Residual 6.921 121 .057

Total 11.500 124

a. Dependent Variable: busini_idx

b. Predictors: (Constant), tms_idx, sl_idx, oc_idx

According to regression theory the residual sum of square is always less than regression sum of

square but in our case the residual sum of square is greater than regression which means the data

is scattered and we cannot draw the regression line easily. According to table 7 the regression

sum of square is less than residual sum of square (4.579 < 6.921) which means data is scattered

and we cannot draw regression line easily.

As sig value is also less than 0.05 which means null hypothesis is rejected and independent

variables affect dependent variable. According to table – 7 the sig value is 0.000 which means

claim got accepted that independent variables organizational culture, skilled PMO leaders and

top management support affect the dependent variable i.e. strategic initiative success.

5.3.2. Coefficients

Table – 6

39

Coefficientsa

Model Unstandardized Coefficients Standardized

Coefficients

t Sig. Collinearity Statistics

B Std. Error Beta Tolerance VIF

1

(Constant) 1.168 .342 3.420 .001

oc_idx .370 .072 .415 5.136 .000 .763 1.311

sl_idx .206 .076 .210 2.708 .008 .826 1.210

tms_idx .158 .064 .189 2.487 .014 .859 1.164


In table – 6 we have two streams unstandardized beta coefficient and standardized beta

coefficient. If variables are measured on different scale then we will use standardized beta but if

variables are measured on same scale then we will use unstandardized beta. In our case We will

use unstandardized beta because its measured on the same scale.

Beta value determines the rate of change. If beta value is positive then there will be positive

relationship between independent and dependent variables. If beta value is negative then there

will be negative relation between independent and dependent variables. In this case all beta

variables are positive it means there is positive relation between our dependent variable and

independent variables.

Therefore we will conclude that there is positive relationship between organizational culture and

strategic initiative success means organizational culture positively impact strategic initiative

success. And 37% change in strategic initiative success is due to organizational culture.

There is positive relationship between skilled PMO leaders and strategic initiative success that

means skilled PMO leaders positively impact strategic initiative success.20% change in strategic

initiative success is due to skilled PMO leaders.

There is positive relationship between top management support and strategic initiative success

that means top management support positively impact strategic initiative success and 15%

change in strategic initiative success is due to top management support.

40

T value shows the relative importance of the independent variables means which independent

variable is more important for dependent variable. It will be checked by higher value. In this case

the T value of organizational culture is higher than other two variables top management support

and skilled PMO leaders that is 5.136 that means organizational culture is more important for

strategic initiative success.

As sig value for organizational culture is 0.000 that is less than 0.05 (0.000 < 0.05) which means

there is positive relationship between organizational culture and strategic initiative success and

organizational culture positively impact strategic initiative success.

As sig value for skilled PMO leaders is 0.008 that is less than 0.05 (0.008 < 0.05) which means

there is positive relationship between skilled PMO leaders and strategic initiative success and

skilled PMO leaders positively impact strategic initiative success.

As sig value for top management support is 0.014 that is less than 0.05 (0.014 < 0.05) which

means there is positive relationship between top management support and strategic initiative

success and top management support positively impact strategic initiative success. Table – 8 also

shows multicollinearity statistics. If the tolerance value is less than 0.20 or 0.10 it will indicate

multicollinearity problem (Brien & Robert, 2007). In above table the tolerance value of all the

independent variables are 0.763, 0.826 and 0.859 that means there is no problem of

multicollinearity and it shows that tolerance level is good and moderate. The VIF value 5 or 10

above indicates that multicollinearity problem (Brien & Robert, 2007). In above table VIF

values of all the independent variables is less than 5 or 10 that is 1.311, 1.210 and 1.164 which

shows that VIF level is good and there is no multicollinearity problem.

5.3.3. Collinearity Diagnostics

Table – 7

Collinearity Diagnosticsa

Model Dimension Eigenvalue Condition Index Variance Proportions

41

(Constant) oc_idx sl_idx tms_idx

1

1 3.987 1.000 .00 .00 .00 .00

2 .006 25.811 .02 .04 .18 .89

3 .004 31.691 .08 .95 .26 .02

4 .003 37.742 .90 .01 .56 .09


If Eigen value is near to zero it means there is less variation. In above table the value of all

independent variables is close to zero which means there is little variance in these variables that

is good.

5.3.4. Mediation Test

First we will run regression analysis for organizational culture and strategic initiative success and

Empowered PMO as mediator. In this model the mediation is checked through four steps, the

path a, b and c is estimated by multiple regression. In first step the organizational culture variable

is correlated with dependent variable strategic initiative success.

a b

c

Table – 8

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .568a .323 .317 .25167 1.949

a. Predictors: (Constant), oc_idx


Organizational

culture

Empowered

PMO

Strategic initiative

success

42

ANOVAa


1

Regression 3.709 1 3.709 58.554 .000b

Residual 7.791 123 .063

Total 11.500 124


b. Predictors: (Constant), oc_idx

Coefficientsa


Coefficients



1 (Constant) 2.051 .268 7.660 .000

oc_idx .506 .066 .568 7.652 .000 1.000 1.000


In above table the significant value is less than 0.05 that is 0.000 (0.000 < 0.05) that means the

null hypothesis got rejected as its value is less than 0.05 means there is mediation.

In second step the independent variable organizational culture is correlated with mediator

empower PMO. Simple regression is conducting where organizational culture is predicting

mediator empower PMO to test path a.

Table – 9

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .407a .166 .159 .33813 1.917

a. Predictors: (Constant), oc_idx

43

b. Dependent Variable: pmo_idx

ANOVAa


1

Regression 2.789 1 2.789 24.396 .000b

Residual 14.063 123 .114

Total 16.852 124

a. Dependent Variable: pmo_idx

b. Predictors: (Constant), oc_idx

Coefficientsa


Coefficients



1 (Constant) 2.242 .360 6.231 .000

oc_idx .439 .089 .407 4.939 .000 1.000 1.000




In third step we conduct simple regression analysis with mediator empowered PMO predicting

the dependent variable strategic initiative success to test the significance of path b

Table – 10

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .363a .132 .125 .28494 2.007

a. Predictors: (Constant), pmo_idx


ANOVAa

44


1

Regression 1.513 1 1.513 18.641 .000b

Residual 9.986 123 .081

Total 11.500 124


b. Predictors: (Constant), pmo_idx

Coefficientsa


Coefficients



1 (Constant) 2.890 .280 10.335 .000

pmo_idx .300 .069 .363 4.318 .000 1.000 1.000




In the fourth and final step we conduct the multiple regression analysis with the mediator

empower PMO and independent variable predicting dependent variable strategic initiative

success

Table – 11

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .586a .343 .333 .24880 1.945

a. Predictors: (Constant), oc_idx, pmo_idx


ANOVAa

45


1

Regression 3.948 2 1.974 31.890 .000b

Residual 7.552 122 .062

Total 11.500 124


b. Predictors: (Constant), oc_idx, pmo_idx

Coefficientsa


Coefficients



1

(Constant) 1.759 .304 5.792 .000

pmo_idx .130 .066 .158 1.966 .052 .834 1.198

oc_idx .449 .072 .504 6.271 .000 .834 1.198


This results shows that there is partial mediation but according to Sobel test when we calculate

the path a and b and by putting value of Beta and Standard error in formula we get the value i.e.

3.672 which is more than 2 and according to Michael E Sobel if the value is more than 2 it shows

that there is a mediation.

Now we are going to run regression analysis for skilled PMO leaders and strategic initiative

success and empowered PMO as mediating variable. In first step the skilled PMO leader’s

variable is correlated with dependent variable strategic initiative success.

a b

c

Skilled PMO

leaders

Empowered

PMO

Strategic initiatives

success

46

Table – 12

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .423a .179 .173 .27702 2.036

a. Predictors: (Constant), sl_idx


ANOVAa


1

Regression 2.061 1 2.061 26.855 .000b

Residual 9.439 123 .077

Total 11.500 124


b. Predictors: (Constant), sl_idx

Coefficientsa


Coefficients



1 (Constant) 2.432 .321 7.568 .000

sl_idx .416 .080 .423 5.182 .000 1.000 1.000




In second step the independent variable skilled PMO leaders is correlated with mediator

empower PMO. Simple regression is conducting where skilled PMO leaders is predicting


47

Table – 13

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .505a .255 .249 .31954 1.850

a. Predictors: (Constant), sl_idx


ANOVAa


1

Regression 4.293 1 4.293 42.045 .000b

Residual 12.559 123 .102

Total 16.852 124


b. Predictors: (Constant), sl_idx

Coefficientsa


Coefficients



1 (Constant) 1.616 .371 4.358 .000

sl_idx .601 .093 .505 6.484 .000 1.000 1.000




In third step we conduct simple regression analysis with mediator empowered PMO predicting

the dependent variable strategic initiative success to test the significance of path b.

48

Table – 14

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .363a .132 .125 .28494 2.007



ANOVAa


1

Regression 1.513 1 1.513 18.641 .000b

Residual 9.986 123 .081

Total 11.500 124



Coefficientsa


Coefficients



1 (Constant) 2.890 .280 10.335 .000

pmo_idx .300 .069 .363 4.318 .000 1.000 1.000





empower PMO and independent variable predicting dependent variable strategic initiative

success

49

Table – 15

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .457a .209 .196 .27305 2.047

a. Predictors: (Constant), sl_idx, pmo_idx


ANOVAa


1

Regression 2.404 2 1.202 16.122 .000b

Residual 9.096 122 .075

Total 11.500 124


b. Predictors: (Constant), sl_idx, pmo_idx

Coefficientsa


Coefficients



1

(Constant) 2.165 .340 6.361 .000

pmo_idx .165 .077 .200 2.145 .034 .745 1.342

sl_idx .317 .092 .322 3.456 .001 .745 1.342


This results shows that there is mediation and according to Sobel test when we calculate the path

a and b and by putting value of Beta and Standard error in formula we get the value i.e. 3.607

which is more than 2 and according to Michael E Sobel if the value is more than 2 it shows that

there is a mediation.

50

Now we are going to run regression analysis for top management support and strategic initiative

success and empowered PMO as a mediating variable. In first step the top management support

variable is correlated with dependent variable strategic initiative success.

a b

c

Table – 16

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .390a .152 .145 .28161 1.920

a. Predictors: (Constant), tms_idx


ANOVAa


1

Regression 1.745 1 1.745 22.009 .000b

Residual 9.754 123 .079

Total 11.500 124


b. Predictors: (Constant), tms_idx

Coefficientsa


Coefficients



Top management

support

Empowered

PMO

Strategic Initiative

success

51

1 (Constant) 2.837 .269 10.557 .000

tms_idx .326 .070 .390 4.691 .000 1.000 1.000




In second step the independent variable top management support is correlated with mediator

empower PMO. Simple regression is conducting where top management support is predicting


Table – 17

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .345a .119 .112 .34738 1.802

a. Predictors: (Constant), tms_idx


ANOVAa


1

Regression 2.009 1 2.009 16.651 .000b

Residual 14.843 123 .121

Total 16.852 124


b. Predictors: (Constant), tms_idx

Coefficientsa


Coefficients



52

1 (Constant) 2.665 .332 8.039 .000

tms_idx .350 .086 .345 4.081 .000 1.000 1.000




In third step we conduct simple regression analysis with mediator empowers PMO predicting the

dependent variable strategic initiative success to test the significance of path b.

Table – 18

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .363a .132 .125 .28494 2.007



ANOVAa


1

Regression 1.513 1 1.513 18.641 .000b

Residual 9.986 123 .081

Total 11.500 124



Coefficientsa


Coefficients



1 (Constant) 2.890 .280 10.335 .000

pmo_idx .300 .069 .363 4.318 .000 1.000 1.000


53




empowered PMO and independent variable predicting dependent variable strategic initiative

success.

Table – 19

Model Summaryb


Square

Std. Error of the

Estimate

Durbin-Watson

1 .459a .211 .198 .27272 1.965

a. Predictors: (Constant), tms_idx, pmo_idx


ANOVAa


1

Regression 2.426 2 1.213 16.306 .000b

Residual 9.074 122 .074

Total 11.500 124


b. Predictors: (Constant), tms_idx, pmo_idx

Coefficientsa


Coefficients



1

(Constant) 2.267 .321 7.051 .000

pmo_idx .214 .071 .259 3.024 .003 .881 1.135

tms_idx .251 .072 .300 3.502 .001 .881 1.135


54

This results shows that there is mediation and according to Sobel test when we calculate the path

a and b and by putting value of Beta and Standard error we get the value i.e. 2.971 which is more

than 2 and according to Michael E Sobel if the value is more than 2 it shows that there is a

mediation.

5.4. Discussion

The research study found that the needs of PMO (organizational culture, top management

support and skilled PMO leaders) has a positive impact on strategic initiative success they

empowered PMO to achieve the strategic initiative of organizations and PMO plays a mediationg

role between them.

They showed that:

Our first hypothesis was organizational culture affects strategic initiative success. Through our

results we conclude that organizational culture positively affects the strategic initiatives success.

Our results support the hypothesis this is also supported by study done by (Aljaz Stare, 2011).

Our second hypothesis was empowered PMO plays a mediating role between organizational

culture and strategic initiative success. In order to check this we have applied the theory of

(Barren & Kenny, 1986) in which mediation is test through four steps and we have also checked

the mediation through Sobel test it supports our hypothesis that empowered PMO plays

mediating role between organizational culture and strategic initiative success. This is new thing

in literature and has not done before.

Our third hypothesis was skilled PMO leader’s affects strategic initiative success. Through our

results we conclude that skilled PMO leaders positively affect the strategic initiatives success.

Our results support the hypothesis this is also supported by study done by (Thomas Blomquist &

Ralf Muller, 2006).

Our fourth hypothesis was empowered PMO plays a mediating role between skilled PMO

leaders and strategic initiative success. Similarly we have applied the theory of (Barren &

55

Kenny, 1986) in which mediation is test through four steps and we have also checked the

mediation through Sobel test it supports our hypothesis that empowered PMO plays mediating

role between skilled PMO leaders and strategic initiative success. This is new thing in literature

and has not done before.

Our fifth hypothesis was top management support affects strategic initiative success. Through

our results we conclude that top management support positively affects the strategic initiatives

success. Our results support the hypothesis this is also supported by study done by (Ofer

Zwikael, 2008).

Our sixth hypothesis was empower PMO plays a mediating role between top management

support and strategic initiative success. Similarly we have applied the theory of (Barren &

Kenny, 1986) in which mediation is test through four steps and we have also checked the

mediation through sobel test it supports our hypothesis that empowered PMO plays mediating

role between top management support and strategic initiative success. This is new thing in

literature and has not done before.

The results of statistical analysis shows that all the six hypothesis are acceptable and that three

independent variables (organizational culture, skilled PMO leaders and top management support)

have positive impact on dependent variable strategic initiative success. And PMO plays

mediating role between them.

The study also found that organizational culture, skilled PMO leaders and top management

support are very necessary and basic needs in any organization to empower PMO which helps to

achieve the strategic goal of an organization in Pakistan project environment as well.

5.5. Conclusion:

Based on research and survey being conducted that, Empowered PMO can drive business

initiatives to success, if PMO got skilled resource and TOP Management Support. Establishing

PMO in an organization is not just a solution to problem. It can only add value when it can

56

understand business needs and well versed team of Program/Project Managers. It’s very

important that PMO should be directly reported to TOP Management, because this will help

them to get TOP Management support and involvement in Strategic decision making. If PMO is

empowered then it can help organization to achieve business initiatives success with proper

prioritization at every stage. Prioritization of projects is very important throughout the life cycle,

because every organization got resource limitations and other projects as well. So it’s very

important project get prioritized on the basis of KPIs, goals and objectives. These are also the

parameter to evaluate the Business initiatives. Once project are getting prioritized then focus and

resources will be well managed to achieve business initiatives success. This can be only possible

if a PMO team is well versed and skilled and then got Management Support as well. Because any

BIG decision making require TOP Management support. Organization cultures also play pivotal

role because it’s not just PMO who is responsible to achieved targets but it requires organization

wide support, collaboration and responsibility sharing.

Hence PMO should be established in organizations, which should have skilled team of

Portfolio/Program/Project Managers. PMO should always be directly reported to TOP

management so that they may have their support and plays vital role and act as Strategic

Alliance. This will help organization to get their business initiatives well evaluated before

execution and Resources are well managed. This will ultimately lead to success of Business

Initiatives.

5.6. Limitation of Study

This research was conducted with the sample selected from project based organization. Due to

time constraint the data collected from the respondents of Rawalpindi and Islamabad only.

Sixteen weeks for writing to complete the results affects the quality of research. Data collection

was also a serious issue because majority of respondent occupied by heir project work and

response from experience and executive seemed to b e low because of their non availability and

enough spare time. It was also difficult and time challenging to collect data from the respondent

physically so data was also collected via online that was slow and time consuming.

57

5.7. Future Direction

During the research, I have visited a lot of companies in twin cities and was much disappointed

that they are only very few companies which got well established PMO organization. Whole

world is moving ahead and adopting Project Management Practices to stay in competition. There

a lot of challenges involved, few of them are resource limitations, aggressive deadlines to deliver

project, QoS and consistency to be on TOP. PMO can easily overcome these challenges but its

being observed companies are not much aware of value PMO can add up. My recommendation

will be, someone should work on these reasons which cause organization to don’t consider PMO.

Such factors should be identified and then solutions to those problems should be addressed.

58

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determinants of pmo and its impact on success of strategic initiatives

Education