Project governance – determining and directing the organisation’s resources to achieve the optimum value from its investments – has proved to be the single most important factor in delivering organisational change successfully.
The purpose of good governance development is to provide a structured approach to decision making that is robust and repeatable.
History and research has shown that there are four fundamental principles that need to be properly implemented for good project governance.
Ensure a single point of accountability for the success of the project: It is not enough to nominate someone to be accountable – the right person must be made accountable, and must have sufficient authority to make the decisions necessary and come from the correct area within the organisation be held accountable.
Project ownership independent of asset ownership other stakeholder group: Making the project owner or asset owner the sponsor, though superficially attractive, has shown to lead to wasteful scope inclusions and failure to achieve alternative stakeholder requirements.
Ensure separation of stakeholder management and project decision making activities: The decision making effectiveness of a committee is inversely proportional to its size. Not only can large committees fail to make timely decisions, those it does make are often ill considered because of the particular group dynamics at play.
Ensure separation of project governance and organisational governance structures: Project governance structures are established precisely because it is recognised that organisation structures do not provide the necessary framework to deliver a project.
The governance structures and remits are analysed in terms of decisions made and needing to be made, the information flows available for decision making, and the level of involvement. ‘Touching’ roles are closely scrutinised to ensure clarity of role and responsibilities is maintained, and that decisions are made at the appropriate level.
Meetings are analysed using a variety of techniques with the results being used to formalise structures and roles.
Issues, decisions and actions are tracked through the governance process to demonstrate timeliness and effectiveness.
Two common starting points are when the organisation is faced with a difficult downsizing exercise for its project portfolio and the governance structures in place find it difficult to find an acceptable resolution to the question of ‘Which projects’?
The other is when there has been a significant project failure and the cause is difficult to determine, but it may be due to a failure in the governance process.
Our approach to business case studies would typically involve the use of the following tools and models: