Introducing the new and improved PMO, meet the VMO

Introducing the new and improved PMO, meet the VMO

The Project Management Office versus the Value Management Office.

As the Value Management Office (VMO) monitors the overall health of an organization, it also ensures that current project activities stay in alignment with its mission, vision, and strategic initiatives. Perhaps the main benefit of the VMO is its ability to deliver increased profitability, lower costs, better customer satisfaction, and improved workforce morale.

This article will highlight how value management offices differentiate from project management offices. Future articles will focus on the benefits of implementing VMOs in specific industry sectors.

PMO: Status Quo

Most of the time, “business as usual” is not an unacceptable approach for companies in mature or stable industry sectors. Project management offices (PMOs) have been supporting business units for decades. Professional certifications such as the “Project Management Professional” from the Project Management Institute have increased the rigor, sophistication, and proficiency of its practitioners.

The primary function of a project management office is to deliver value by completing projects (as defined by a specific project charter document) on time and within budget. Usually organized as a department within a company, the PMO is responsible for defining and maintaining standards for project management within the organization. The PMO’s value lies in standardizing its activities so that economies of repetition can benefit higher performance project execution.

In this sense, the PMO’s objectives depend on the specific types of projects or companies it supports. However, the main objective of a PMO, regardless of industry sector, is to improve the project success rate (or reduce the project failure rate).

VMO: Raising the PMO Bar

Clearly, PMOs will continue to provide significant organizational value in well-defined applications. PMOs are not in danger of being phased out any time soon as organizations consider establishing new Value Management Offices.

A VMO is different from a typical PMO because it combines elements from project management, IT, performance outcomes, and value-based management. The VMO serves as a center of excellence for determining evidence-based outcome measurements. In a healthcare example, the Value Management Office is designed to facilitate the creation of value-based care models and ultimately improve patient care.  The VMO supports IT governance by evaluating business case investments and projected benefits to link people, processes, and technology.

As a result, the VMO delivers greater benefit than typical project management offices. The VMO is a business function, designed to oversee corporate governance, organizational change, quality, compliance, and process management. The VMO monitors every organizational activity and clearly articulates why it is being done, who it is being done for, what value it provides, and whether it is a necessary business activity.

Comparative Anatomy: PMO | VMO

Business Cycle (duration) Duration of the project Duration of the business activity or business unit
Success Criteria and Measurement Time and cost to complete the defined project scope

Quality of goods or services

Customer satisfaction

Employee satisfaction




Overhead Costs

Management time

Software and IT systems

Specialized personnel

Based on the number of projects

Similar to PMO

Based on number of business units

Reporting Tools

Project charter

Communication plan


Risk log

Issue log

Management dashboards

Management report cards

Financial reports

Return on Investment Tied to successful completion of the project and accurate pre-assessment of project benefits

Increased customer satisfaction

Increased employee satisfaction

Increased revenue

Increased profitability

Lower operational costs

The VMO in Operation

The Value Management Office provides a number of key benefits that can improve business performance on multiple levels. By conducting regular portfolio and project analysis, the Value Management Office is able to monitor the overall health of its corporate operational activities. Regular portfolio monitoring can improve alignment between projects and strategic objectives allowing for more informed management decisions.

Additionally, the Value Management Office can enable accurate cost allocation for projects in planning or monitoring phases. These assessments can help determine how planned and completed projects will impact an organization’s technical systems and identify technical constraints that may inhibit progress towards achieving strategic objectives.

Implementing a VMO requires committed leadership from senior management who believe in the concept and are willing to work with establishing this new organization. The VMO’s scope can grow as other business units come on board. Positive results and innovations are typically rewarded with increased resources and facilities.

After implementing the VMO, it is important to begin measuring performance and report improvements (or note areas that need improvement).  Note that the VMO must collect, categorize, and communicate its progress.

As with any new potential business process improvement opportunity and to increase potential success, it is often advisable to start with a small pilot with active participation and involvement from senior management.

everis Health Consultant

I'm a senior healthcare practice consultant with everis USA. I began my career as a self-starting entrepreneur creating value from ideas, building teams, and amplifying performance and transparency. I optimize productivity, quality and creativity.

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