What is a Strategy Realization Office (SRO) and how is it different from a Project Management Office (PMO)?
In this article Project Management advisor and lecturer, John McGrath examines five areas of difference between PMO and SRO areas of focus. While a Strategy Realization Office and a Project Management Office are very similar in their approach, in that they are both adding value to the organization, there are subtle differences between the focus of a PMO and an SRO.
The PMO tends to be focused on business justification, but the SRO tends to be focused on strategic alignment.
Business justification is where we’re looking at the project in isolation in terms of how it adds value. But when we look at it from a strategic alignment point of view, which is what the SRO is focused on, we are looking at the project in terms of how it adds value within the overall organizational structure. Both are very important, but both also have a slightly different focus.
Cost management versus return on investment.
PMO’s tend to be very focused on cost management. They’re essentially tracking the plan cost versus the actual cost and the variance in between and the associated risk that goes with that variance. However, the SRO tends to be more focused on return on investment. It is looking at not just the cost of the project, but how the project delivers a long-term investment to the organization.
The PMO tends to be deliverable focused or milestone focused.
The PMO looks at projects in terms of the defined deliverables and if we are meeting them on time and on budget whereby the SRO is more focused on value creation. It’s asking the bigger question in terms of not just are we hitting the defined deliverables or milestones, but what value does this project create for the organization?
Pipeline Efficiency and expansion (and pipeline rationalization and reduction).
The PMO tends to be looking at maximizing the efficiency of a project program portfolio pipeline. It’s looking at ensuring that all of your resources are working as efficiently as possible. However, the SRO is more focused on pipeline rationalization and reduction. The SRO recognizes that more projects do not mean more benefits. In fact, it’s often the opposite. By the SRO focusing on reducing the number of projects in the pipeline, focusing on the higher value projects, they actually deliver more benefits by fewer projects. A very significant difference between the PMO and the SRO.
The fifth and final difference is that the PMO tends to focus on project completion. When will the project be completed? However, the SRO tends to be more focused on project selection. At the strategic planning stage, the SRO is asking the question “which project should we be selecting in terms of meeting our strategic objectives?”.
In conclusion, a PMO and an SRO both add value to an organization. But the PMO is more focused on delivering projects, whereby the SRO is more focused on delivering your organizational strategy – i.e., are the projects we’re focused on strategically aligned?
Is the SRO right your you?
Now that we’ve answered “What is a Strategy Realization Office” you may decide that it is a structure better suited to your organization. Learn more about the benefits by downloading our free guide “How to Move from PMO to SRO”.