Over the last 12 months, we’ve heard both our clients and the Harvard Business Review ask about how to bridge the gap between the organisational strategic vision and day-to-day operations. A Transformation Management Office (TMO) enables organisations to manage multiple program and project management initiatives against one common goal. It’s more than a PMO with a fancy name – it’s about bringing strategy to life.
What is a TMO?
A Transformation Management Office (TMO) is typically an enterprise function responsible for driving complex initiatives on both operational structures and the strategy of the organisation. It is a critical link between the executive vision and the work of the enterprise. Some companies call this function a Strategic Implementation Office, while Gartner refers to this as a Strategy Realisation Office. Regardless of the name, one element that sets a TMO apart from most PMOs is that the C-suite proactively supports the TMO’s mandate to transform the organisation which ensures it has the highest priority when implementing and affecting change.
We’ve recently helped a media and telecommunications client set up a dedicated TMO. This organisation was undertaking multiple, complex initiatives across the organization – from cost-cutting to technology transformation – but none were aligned to the global strategy. We talked to the client leadership about bringing all these programmes under the same banner with the aim to transform the company into a digital-first and customer-centric organization. Bringing our experience of the client, Portfolio and EPMOs, and Programme Management offices together, we jointly designed the Transformation Management Office or TMO. The TMO was focused on providing transformation leadership to the executive, executing the strategy and selecting and monitoring initiatives that deliver the strategy. The TMO was also able to communicate both to the executives and to the business about the transformation and provide a centre of excellence in program management expertise.
Where do you start?
As we talked to our client about what a TMO was, we clarified three principles:
- A TMO’s scope is bigger than a normal PMO – and is constructed differently. A dedicated TMO Director interacts with the Transformation or Company Steering Board on a regular basis, and serves as a direct link to company senior executives to enable the TMO to be effective in managing this change. The TMO Director is a transformation leader that is able to champion the change and what benefits it would bring to the organisation.
- A TMO defines what it stands for. We needed to articulate the key outcomes that the board was looking to drive. In a normal PMO, you might begin with a Project Charter whereas in a TMO, we started with a Leadership Alignment workshop. Having agreed to the outcomes, we mapped all the programmes on the horizon to the dependencies with the Programme and Portfolio Management functions. At this point, we could start to define the roles, responsibilities and boundaries of the TMO and how it would interact with other parts of the organization.
- A TMO whilst transitory in purpose will need to be part of corporate memory. Change is a constant for organisations, with success hinging on their ability to transform and adapt with the ever-changing market. Having a dedicated team to enable the business to execute its current strategy, as well as respond to emerging market transformation trends, is becoming increasingly important. The TMO will close down as the transformation programme reaches its conclusion, but the model of a TMO and how to establish them will be something organisations will have to learn to do repeatedly in order to cope with this constant change.
What does good look like?
What were the key learnings from our experience with this media organisation? Don’t underestimate the level of senior team engagement required for the right conversations – we found we needed both C-level Business and Technology leads to act as sponsors. An effective TMO requires people with both traditional PMO skills and more strategically-minded people who were passionate about aligning the organisation to the vision.
The most effective TMOs will also have a feedback and continuous improvement loop – the portfolio of initiatives are continuously monitored and adjusted to maximise their value. Too many times, we’ve seen projects delivered on time, on budget and to scope but fail to land because they are irrelevant to the organisational vision and the strategy.
But it’s not just about strategy. An effective transformation office will reinforce the transformation culture ensuring a joined-up communications and change approach. Transformation requires large amounts of change management, coordination of complex stakeholders, and more importantly people committed to make it happen with the right skills.
So, why should you consider a TMO in your organization?
As the recent Gartner report showed around the Strategy Realisation Office, a TMO can be more successful than a traditional PMO in addressing the organisational priorities as its scope is enterprise-wide. The TMO can transform organisations, executives, and PMO leaders, by cascading strategic plans from corporate strategy to business unit strategy to portfolio, program, and project strategy and creating a clear roadmap connecting disparate parts of the organisation into a unified system for executing strategy through projects. The TMO is the bridge between strategy and execution - connecting the aspirations of many transformation programs and the reality of how this can be delivered.