In most CIO organizations, there is a Program Management Office (PMO) whose significance is well-known to everyone. Successful PMOs are not just limited to establishing the standards and methodology of project management but also participate in strategic project management, either passively as a facilitator or actively as the owner of the project portfolio. This means that PMO would monitor and report on active projects and follow up on the project management until its completion. It will also influence the top management for strategic decisions on what projects to continue with or cancel.
The Program Management Institute (PMI) is a professional association organization for project management based in the United States. The Community of Practice (CoP) at the PMI describes the PMO as a strategic driver for organizational excellence that makes efforts for enhancement of practices such as execution management, organizational governance, and strategic change leadership.
The degree of control and influence that Program Management Offices (PMOs) have on projects depends on the type of PMO structure within the organization. The level of empowerment of PMO ranges from just a supportive and consulting role, only compliance and control role, to the highest level of even granting the full project management control.
Well, projects are important, but Operational Service Management is no less important, so why not Service Management Office?
SMO: Goals and objectives
A Service Management Office (SMO) defines and maintains the standards for service management within the organization. The primary goal of an SMO is to achieve benefits from standardizing and following service management policies, processes, and methods. The service management principles, practices, and processes of an SMO are generally based on a certain industry-standard methodology.
SMO owns process management that is a holistic management approach focused on aligning all the aspects of service wants and needs of clients. It promotes IT service effectiveness and efficiency while striving for innovation, flexibility, and integration with technology. Process management aims to improve processes on a continuous basis. It operates a Continual Service Improvement Process (CSIP). SMO enables organizations to be more efficient, more effective, and capable of a change than a functionally focused, traditional, hierarchical process management approach.
SMO control models
There are three types of SMOs in organizations, varying in the degree of control and influence they have on operations within the organization. The effectiveness and the degree of integration depend upon the type of SMO.
SMO Control Model
An advisory SMO is like a quality organization. The advisory SMO generally provides guidance and advice in terms of on-demand expertise, templates, best practices, access to information, and expertise in industry benchmarking. Operations are carried out in a loosely controlled manner, where additional control is deemed unnecessary. The service management office reports on what is going on but does not try to influence it. The SMO staff gathers data about SLAs and KPIs, summarizes it for executives without making any decisions or enforcing any standards. They just circulate the report to all the stakeholders. This is the scenario of a traditional line organization where activities and jobs are recognized by position and reporting structure. Process-defined workflow activities are executed by the teams and roles in the control of the execution team. It is like watching traffic chaos and reporting the status of traffic—where it is flowing and where there is a traffic jam.
The SMO here integrates the measurement and reporting of the services. However, value is there in this kind of integration as well. Although it looks easy and mechanical, this type of SMO implementation is not as easy as it seems. One of the biggest challenges is obtaining authentic and consistent data across all the towers in a timely manner without a common data source.
Control tower SMO
Control tower SMO is a central governance office for all the service management processes. This model requires other tower managers to comply with certain methodologies, tools, and templates, bringing uniformity and quality in services.
Control tower SMO does not only provide support, but it also requires that the support be used. The requirements might include adopting specific methodologies, templates, forms, conformance to governance, and process policies established by SMO. SMO also does regular reviews and compliance audits. Control tower SMO requires sufficient executive support to stand behind the standardized processes and tools implemented by the SMO. In this scenario, the process manager monitors and measures the process performance and compliance and escalates this to a line manager who is still in charge. SMO does tactical process management, where processes are prescribed by the process manager and managed by reports.
Control Tower SMO enables a higher degree of service integration by reducing the incompatibility of processes and methods between different towers. It is like monitoring and regulating traffic.
This is more difficult to implement but not impossible if there is a buy-in and mandate from the executive management. For instance, during the implementation of a standard change management process across multiple divisions in a new ITSM tool in an IT organization, the project was estimated for nine to ten months, but it took about eighteen months. The real work took off after eight months when the CIO commanded/instructed all the stakeholders to cooperate.
Another risk in control towers SMO is that it tends to add so-called best practices that are viewed as bureaucratic and are not adding value by performing towers. Like any bureaucracy, it justifies each expansion with the urgent need for more regulation. Compliance by other managers decreases as they see little benefit. It is important to understand where to add control and where not to.
This type of SMO goes beyond control and actually ‘takes over’ some of the cross-functional process operation roles and provides the experience and resources to manage the lifecycle of a service transaction. For example, the critical incident management process comes under the purview of a critical incident manager or major incident manager (in some organizations, the term situation manager is used for the same purpose.). The role of critical incident manager/situation manager/major incident manager can directly be played by directive SMO.
The process manager monitors the process performance and compliance and informs, directs, or corrects the staff. The influence of the process manager is recognized and accepted by operational towers. The process manager influences the allocation of staff for process-related activities and workload. There is a full process direction—all the teams are organized to execute the process.
Directive SMO brings in the highest degree of service integration not only by design and implementation of standardized processes and tools but also by operational authority for process execution. In our view, this is a complete service integration.
The benefits of directive SMO are standardization and centralization that bring in real and complete service integration, but these are rare cases. This is often (and wrongly) viewed as a dilution in the value of other towers. With SIAM taking the front place in the IT outsourcing world, we should expect these scenarios more often.
Typical charter of SMO
This charter is applicable for directive SMO and can be scaled down for other types of SMO with a corresponding reduction in the degree of integration. The principal charter of an SMO is to orchestrate, facilitate, and even conduct collaboration among multiple service providers, thus ensuring collaboration and delivery of integrated services. This charter will invariably require a unified process, and tools and institutionalization of unified processes and tools would become an extended charter.
Unification of processes and tools is one of the cornerstones of service integration. However, unification does not imply a single set of tools. It means the ability to trace a service transaction from start to finish. It can be the integration of multiple tools and processes of multiple service providers.
After the unification of processes and tools, SMO will orchestrate the operation to meet the intent of the unified service management processes and would be responsible for keeping them unified all the time through maintenance and support ownerships.