PROJECT MANAGEMENT OFFICES AS ADAPTIVE PLANNING GOVERNANCE SYSTEMS: A RISK-DRIVEN CAPABILITY TRANSFORMATION MODEL

Abstract

Project Management Offices (PMOs) are widely adopted to support coordination and governance in project-based organisations, yet their performance impact remains inconsistent, particularly within urban infrastructure and construction planning organisations, where multi-project coordination and regulatory complexity are most pronounced. Existing studies typically examine PMO capability, risk, or transformation in isolation and often assume linear relationships with performance. This study reframes PMOs as adaptive governance systems and examines how Capability (C), Risk Activation (R), Adjustment (A), and Performance (P) interact to shape organisational outcomes. Using survey data from 243 practitioners and structural equation modelling, the study shows that PMO capability conditions governance stability but does not directly suppress risk or guarantee performance. Risk does not directly impair performance; instead, it functions as an activation signal that triggers organisational adjustment. PMO transformation emerges as the primary stabilisation mechanism, mediating the effects of both capability and risk on performance. By conceptualising performance as an emergent system outcome, this study advances PMO research beyond maturity and role-based explanations and offers a mechanism-based account of governance behaviour under disturbance. The findings are particularly relevant to the governance of large-scale urban development projects, where capability transformation determines whether coordinated delivery is sustained under planning and regulatory disturbance.