PENRITH CITY COUNCIL'S INNOVATIVE APPROACH TO A PMO

PROJECT IN THE SPOTLIGHT

PENRITH CITY COUNCIL’S INNOVATIVE APPROACH TO A PMO

PENRITH CITY COUNCIL IN NSW IS ONE OF A HANDFUL OF AUSTRALIAN COUNCILS TO ESTABLISH A SPECIALIST PROPERTY DEVELOPMENT DEPARTMENT. ‘PROJECT LIFECYCLE’ WAS ESSENTIAL FOR DELIVERY OF THE COUNCIL’S STRATEGIC OBJECTIVES, SAYS PROPERTY DEVELOPMENT MANAGER, NATHAN RITCHIE.

The project management office (PMO) known as ‘Project Lifecycle’ was developed for the department to build new commercial and industrial developments to revitalise Penrith City, as well as diversify the council’s commercial revenue stream to deliver greater community benefit.

Establishing a tailored system of management for a unique department was a challenge, which resulted in many valuable insights and learnings, but also a triumph as it has now become an award winning PMO.

LEVERAGING AN OPPORTUNITY

A once in a generation change is underway to transform Penrith into a world-class city that is well connected by public transport, with plenty of choices for recreation activities and employment opportunities close to home.

The council’s unique position of owning a significant amount of land in the city centre meant we could lead a lot of this growth for our city. To drive this transformation, we took an innovative approach through our internal property development department. While operating separately to the council, the department was tasked with using the strategic property portfolio to deliver innovative solutions for each site that would deliver a community benefit and financial return. It was decided that revenue generated was invested into service delivery and renewal projects across the city, boosting the council’s own revenue source and helping meet financial sustainability targets set by the Office of Local Government.

The council is leading major revitalisation projects such as developing new A-grade commercial office buildings, an industrial employment hub, residential land development, heritage refurbishments, retail and more.

ESTABLISHING THE PMO

As a unique department we needed to look beyond the council’s current systems of management to create a tailored solution and approach to achieving our strategic objectives. This journey began with a business process improvement project, which developed a whole-of-department approach to operational efficiencies across strategy, finance, project management, and people and culture.

As a result, the Project Lifecycle (the name of the PMO) was created to increase the department’s operational efficiency and improve the council’s commercial revenue to deliver greater community benefit.

The PMO aligns with the council’s seven strategic objectives by providing a framework for consistency and rigour in decision making, highlighting both efficient project delivery and financial return.

The PMO was underpinned by a department specific People Plan, which ensured team members were supported to grow within the project management framework. It engaged them along the journey, training and upskilling where necessary, to implement the new way of working. While not traditionally part of a PMO, the People Plan was essential because it recognised that introducing a new way of working is only as good as the team championing it.

A team workshop for the People Plan (Source: Penrith City Council)

How it works

The PMO was implemented using an initial ‘three-gate process’, focusing on high-level strategy, identification, and then investment, including:

• An opportunity analysis: determines the potential of an idea to deliver a financial return, create sustainable assets and contribute non-financial benefits.

• The high-level business case: focuses on delivery options, financial implications, extent and nature of the non-financial benefit and any assumptions or dependencies for project success.

• The final detailed business case: focuses on efficiently delivering the tactical elements of the project in terms of time, people and cost.

Ongoing review is built into the PMO along with a further twogate process, which includes a project implementing phase and project close-out review. These processes focus around the ‘lessons learned’ register, where ideas are documented for real-time process improvement that can be implemented immediately or incorporated into future projects.

Overcoming challenges

Before the PMO, the department had a limited ability to measure data and results to analyse the success of our projects. It was clear that the team needed a PMO to capture analytics in a quantifiable way.

To resolve this challenge, the team defined our strategic planning objectives for the property function by establishing a clear set of strategic outcomes. We also developed an overarching property strategy to drive our planning framework and aspirations.

With an agreed vision for the future, led by key personnel champions of the PMO, the team embarked on a targeted business process improvement project, stimulating new thinking around how to adapt to changing expectations, the emergence of new technologies and our competition.

As a result, the department introduced Smartsheet, a project management platform to establish time and resource parameters for project tasks and manage human resources more accurately. Promapp was also implemented to develop and map procedures to support task implementation while working remotely. The team achieved enormous improvements using both systems, which allowed us to track the number of tasks, time, and resources to compare projects in real-time.

SUCCESS AND LEARNINGS

The department has commenced five projects since the PMO was introduced, creating a pipeline worth $245 million. Despite the PMO being relatively young, it has already demonstrated enormous success through continuous improvement.

Our first project under the PMO is the development of a multistorey car park with commercial office space and a green façade, named Soper Place. Learnings from the initial phases of this project have been applied to subsequent projects, including the proposed development of a commercial building at 131 Henry Street. The lessons learned from the Soper Place design process resulted in a three-month reduction (or 175% improvement) in the same process for 131 Henry Street.

An artist’s impression of Soper Place (source: Penrith City Council)

An artist’s impression of 131 Henry Street (source: Penrith City Council)

During the Open Space Urban Reinvestment Project, the team conducted extensive community consultation to gather feedback on potential upgrades to Erskine Park. Improvements to the consultation process were also identified which led to the development of a stakeholder engagement procedure to identify external stakeholders and quantify their respective influence. The lessons learnt from this project led to the improvement of the council’s organisationwide stakeholder and community engagement framework, realising a benefit on a much bigger scale.

The PMO also allows the department to consider the community benefit of our projects beyond an income stream to support the council’s objectives of being a world-class liveable city.

Penrith City Council’s Property Department Project Lifecycle PMO won the AIPM 2021 Project Management Achievement Award (PMAA) in NSW in the PMO category. This was due to the positive results it has achieved for the department which has led to benefits for the council and the Penrith community.

KEY TAKEAWAYS

Through this process we gained valuable insights into establishing a department PMO including the importance of:

1. Establishing a People Plan to ensure the PMO is implemented by the right people with the right skills. We involved the department’s staff in the development of the PMO and the definition of the vision and values to give staff ownership of the new direction.

2. Conducting frequent project reviews and refine processes in line with key learnings, to improve projects and processes in real-time.

Author: Nathan Ritchie is the Property Development Manager at Penrith City Council and has over 18 years’ experience as a planner, urban designer and development manager in the property industry. He has a Master of Business Administration from the University of Western Australia, a Master of Science, Environmental Science from Murdoch University and numerous qualifications in leadership, real estate and business management.