1. PMO Series: Developing Leaders? Look to Your PMO Presented By: Art Drake Vice President – AIG Global Operations & Systems Director At Large – Enterprise Management Association – International PMI© San Francisco Bay Area Chapter, October 20, 2010

2. 2 Agenda  Background  Opening Perspective  Leadership Defined  Leadership Trends  Why The PMO?  Competency vs. Maturity  Operations Maturity  Strategic Design  What’s Next?

3. 3 Background  Pre-2008  No consistent PM skills model across AIG  Defined the AIG Project Lifecycle (had 35 variations)  No consistent adoption of a PMO model; Improved ‘project’ governance mandated  Global AIG PMO established; monthly project portfolio reporting implemented  2008  Defined and implemented PMOs across in Corporate and in all Business Units  Varying levels maturity; defined a roadmap for each PMO and measured progress  PM/PMO maturity model and approach designed; central PM & PMO training  2009 – “Run for the hills!”  2010  “Operations Professionalism”  Global PMO redesigned into the Global VMO  Strategic Design and Target Operating Models; disciplined process management  Clear directive to “get ready”

4. 4 I Say “leader.” You say? Visionary Charismatic Tough Mentor Annoying Energetic Trusted Multi-tasker Crazy Fun Pioneer Innovative Radical Thought Leader Integrity Creative Command Entrepreneur Organizer Relationship Builder Respected

5. 5 To Name A Few Abraham Lincoln Jack Welch Ronald Reagan Mahatma Gandhi Vince Lombardi Winston Churchill

6. 6 Another Perspective (or Perception?)

7. 7 Words To Live By “If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” John Quincy Adams. “Leadership and learning are indispensable to each other.” John Fitzgerald Kennedy “Nothing so conclusively proves a man's ability to lead others as what he does from day to day to lead himself.” Thomas J. Watson, Sr. “Management is doing things right; leadership is doing the right things.” Peter F. Drucker

8. 8 Leadership Defined*  Vision – a clear, vivid picture of where to go, as well as a firm grasp on what success looks like  Openness - being able to listen, accept new ways of doing things that someone else thought of; building trust *As described in HR World  Integrity – integration of outward actions and inner values; builds trust  Creatively - the ability to think differently, to get outside of the box that constrains solutions  Dedication - spending whatever time or energy is necessary to accomplish the task at hand  Fairness - dealing with others consistently and justly  Magnanimity – ensures that credit for successes is spread as widely as possible throughout the company  Assertiveness - the ability to clearly state what one expects so that there will be no misunderstandings  Sense of Humor – ability to relieve tension and defuse hostility; more importantly, use humor to energize followers  Humility - is not self-effacing but rather tries to elevate everyone

9. 9 An Industry Perspective (CCL)  Trend 1: The Rise of Complex Challenges  Trend 2: The Innovation Revolution  Trend 3: The Art of Virtual Leadership  Trend 4: Collaboration Nation  Trend 5: The World of Interruption 10 Leadership Trends

10. 10  Trend 6: Authenticity Is the Next Celebrity  Trend 7 & 8: The Fallout From The Baby Boom And Filling The Leadership Void An Industry Perspective (CCL) 10 Leadership Trends, cont’d  Trend 9: Leadership For Longevity  Trend 10: What’s Next?

11. 11 The PMO Executive Council Perspective (1/2)

12. 12 The PMO Executive Council Perspective (2/2)

13. 13 A PMO Peer Group Perspective

14. 14 Competency vs. Maturity  Build on basic organizing and planning skills  Develop broader perspective; managing across projects  Build relationships and trust to take on more responsibility  Provide leadership in the ‘project’ space  Learn to manage change  “Trusted Advisor” Leadership

15. 15 Time Maturity A Balancing Act Individual Capability Organizational Maturity The organization cannot mature until individual capability reaches required level The individual cannot exert total capability since organization cannot adjust Sub-optimized Organization Optimized Organization The organization and individual are advancing/growing in maturity at a similar rate/speed Individual Capability Organization Maturity Levels 1 02 3 4 Knowledge used to sustain performance Knowledge used to advance performance Time Maturity

16. 16 Building Competency – One Approach

17. 17 Competency Model Structure  Knowledge Domains  Main categories that group related/complimentary subjects  Knowledge domains align with personnel development (e.g., organization)  Subject Areas  Represent the specific project/program/portfolio management functional and learning activities (e.g., risk management)  Proficiency Level  Establish a metric to evaluate the key learning and performance outcomes expected within the subject area  Learning Levels  Training content and structure to address competency maturity: foundational (what I need to know), operational (applying what I know) and transformational (expanding what I know to improve)  Training Focus  Alignment of training to the project, program, and portfolio level of functions (i.e., establish how risk management is performed at the varying levels)

18. 18 Knowledge Domains  Organization  The activities and skills necessary to plan, scope, structure and resource a project effort  Maturity within this domain is evidenced by the expanded activities and skills required to coordinate projects as a program.  Governance  The activities and skills necessary to ensure alignment between strategy and execution  Effective oversight of the organized work to ensure expected project outcomes are achieved within stated constraints/controls  Leadership  Demonstrated and recognized skills to organize, motivate and mentor project teams  Ability to manage change and stakeholder expectations to ensure the successful outcome of a project, program or portfolio  Individual  Personal initiative to learn and develop an understanding of the business and to grow professional skills; learning agility.

19. 19 Subject Areas  Knowledge Domains  Subject Areas  Organization  Project/Program Planning  Resource Management  Project Estimating  Project Scheduling  Project Budgeting  Procurement Management  Governance  Strategic Alignment  Risk Management  Scope Management  Execution Management  Project Accounting  Quality Management  Leadership  Relationship Management  Change Management  Team Development  Mentoring  Business Acumen  Individual  Communication  Facilitation / Negotiation  Decision Analysis  Learning & Growth  Personal Leadership

20. 20 Model Structure Knowledge Domain:Governance Subject Area:Risk Management ProjectProgramPortfolioOperational Fundamental: Operational: Transformational: Advanced:  Framework consistent across domains and perspective (individual vs. organization)  Methodologies, Tools, Training align to the individuals growth plan  Corresponding organizational view to determine gaps

21. 21 Start With A Basics PM Knowledge The industry knowledge and formal education in project management practices (expertise) PM Performance The individuals past project management performance (experience) Personal Aptitude The individuals personal behaviors and characteristics (qualities) Competency is generally recognized as a set of characteristics that encompass knowledge, skills, attitudes, behaviors and other personal traits that can be learned, improved and measured. 1 1Crawford, Lynn, “A Global Approach To Project management Competence (1997).

22. 22 Organizational Competencies Communications & Reporting The PMO provides regular and consistent communications to all of its constituents; Data-driven scorecards are used by all levels of management to monitor project performance Portfolio Oversight & Governance The PMO exerts control and governance over the entire project portfolio from an enterprise perspective; Facilitating key portfolio decisions (alignment / investment) Operational Controls & Tools The PMO promotes and enforces the use of standardized processes and supporting tools to ensure consistency At the PMO level, competency is centered around the PMO’s organizational collective ability to drive performance and attain an expected level

23. 23 Organizational Capability Organizational Performance The VMO ensures that portfolio outcomes are realized in the business and monitors current initiatives to ensure delivery of benefits Strategic Planning & Alignment The VMO actively facilitates the strategic planning sessions, capturing strategic priorities, ensure alignment, and establishing the portfolio design Driving Change The VMO provides direction and support to key initiatives to ensure change management is used and that change ‘capability’ is retained in the business At the VMO level, competency is focused on the overall organizational change capability.

24. 24 Operational Maturity Project Management Operations Management Operations Leadership Current Operational Performance Process Improvement Process Reengineering Operations Optimization Competency LevelsProcess Maturity Levels Project Management Skills Operations Management Skills Operations Leadership Skills Transitioning from projects (change) to operations (performance)

25. 25 The Path To Leadership Development  Use Strategic Design TM to transform the organization  Understand the current operations while planning for the future  Actively engaged in the change  Encourage and mentor  Remain behind; Achieve target performance levels Transformation Plan

26. 26 Strategic Design  Baseline the current ‘operational’ state  Envision the future and create the strategy  Design a future Target Operating Model (TOM)  Define the program of work to transition to the TOM  ‘Implement’ the program of work – All 14 Dimensions  Remain behind to achieve target performance levels

27. 27 What’s Next?  First round of organizational assessments planned for 2011 – establish a baseline  Develop the Strategic Design capability by EOY 2010  Integrate project/program performance to personal performance process by EOY 2011  Integrate program outcomes to Sponsor performance process by EOY 2011

28. 28 Biography Art Drake is currently a Vice President in the Global Operations & Systems Organization, specifically, the Value Management Office at AIG. In this role, Art is responsible for the development of organizational competencies in the areas of portfolio, program and project management across AIG. In his current role, Art has developed several models for measuring the performance of programs and portfolios, leading to improved training and mentoring for program and project managers. Prior to coming to AIG, Mr. Drake was the Director of the Program Management Office and Business Analysis & Strategy Group for EmblemHealth of New York. Art is currently one of the Founding Directors of the Enterprise Management Association – International (EMA-I). EMA-I is focused on advancing change management competencies for teams and organizations. Art is also the former Executive Chair of the Program Management Office Specific Interest Group (PMO SIG), a PMI © component.