How to set up a Governance model for your IT Programs and how to set up and manage a PMO

1. PROGRAM GOVERNANCE STRUCTURE
SETUP & MANAGEMENT
By Saurabh Sardesai
www.starvaluemodel.com
June 2014

2. Objectives
 Establish a Program/Project governance structure within the
organization and ensure stakeholder participation
 Define the program roles, decision making hierarchy,
program execution strategies and best practices
 Describe the protocol for proper flow of relevant information
to all stakeholders
 Establish a project/program review, issue management &
change mgmt mechanism
 Mechanism to identify program compliance and
communications to all stakeholders
 Evaluate various models of program governance and
investigate their suitability for adaption
 Translate business strategy into actual program execution via
a proper governance framework

3. Governance defined
 Governance, for a program or a project, is a
combination of individuals filling executive and
management roles, program oversight functions
organized into structures, and policies that define
management principles and decision making.
 This combination is focused upon providing direction
and oversight, which guide the achievement of the
needed business outcome from the execution of the
program effort, and providing data and feedback,
which measure the ongoing contribution by the
program to needed results within the overall
business strategy and direction.

4. Need/Background
 The organization was facing a huge problem of
managing diverse projects across geographies without
having a formal program structure in place
 Senior management was finding it increasingly difficult
to have an oversight on project execution in absence of
proper governance structure and formal feedback
channels
 There was a clear disconnect between project execution
and business mission or strategy
 There was no overarching body like a Steering
committee to provide oversight to projects
 A need was felt to aggregate all multiple projects data in
a central place and use the information to better
manage the defined outcomes

5. Stakeholders
 Board of Directors and C level executives
 Project sponsors and funding partners
 Internal and external clients of the organization
 Business units within the organization
 Vendor partners of the organization
 Project managers and delivery managers/heads
 Development teams, architects and testers
 Support staff, line managers and consultants
 Product control and management teams
 Other relevant project stakeholders

6. Plan of action
 Initiate consultations with relevant stakeholders to get
their opinion & feedback
 Establish a Program Steering Committee as the
overarching body for program/project execution
 Establish a Program Management Office (PMO)
 Establish a Program Organization model and Project
Organization model
 Define and set up roles for Program Director, Program
Managers, PMO managers and PMO support staff
 Implement mechanisms to provide guidance and direction
regarding policies, governance principles, and decision or
authority specifications.
 Establish a communications network and protocol for
effective program and project communication to internal
and external stakeholders of the organization

7. Steering committee models
 Consensus Model: Executive-level sponsors who must reach
consensus on issues, changes, and adjustments in order to proceed
 Consultative Model: Executives and senior managers who are
stakeholders for some aspect of the defined outcomes. Their role is
to understand issues and needed changes, provide advice and
assessment of potential impact, and make needed adjustments
within their own responsibility area
 Advisory Model: Representatives for the major business segments
who are responsible for outcomes, or portions of outcomes, within
the business strategy and direction. Their role is to monitor program
progress, understand issues raised and adjustments made, assess
potential impact within their own business segments, and carry back
information about committee decisions to their respective business
segments
 For our initiative we recommend the Advisory model as the
organization is large and has many interdependent businesses that
routinely interact with each other

8. Recommended model – Program
Management Office (PMO)
 The Program Management Office (PMO)
provides support along administrative, financial,
process, and staff dimensions associated with
successful program execution.
 The PMO also provides review and tracking of
financial expenditures, generation of required
reports and financial documents, and ensures
compliance with policies and practices.
 The PMO provides & administers policies,
procedures, & practices that provide an
operational framework for program members

9. Sample Program model

10. Sample PMO structure

11. Sample Project structure
within a PMO

12. Benefits of recommended model
 Increases the long term potential of the program
and individual projects
 Continuous linkage to enterprise business
strategy and direction
 Clear and well-understood decision-making
authority
 Effective oversight of & insight into program
progress and direction
 Executive control over program evolution and
outcomes
 Central storage and management of all project
data

13. Measuring Program success
 Delivering the program to the client on time and
within the dates specified in the agreement, taking
into account any amendments or approved change
requests
 Achieving the financial objectives set forth in the
business case, taking into account any amendments
or change controls
 Meeting all expectations related to quality and
fulfilment of program requirements
 Adhering to an established program methodology
measured by a joint governance board
 Achieving overall client satisfaction and repeat
business

14. PMO – Tools of engagement
 Overview and statement of purpose
 Communication plan
 Integrated program schedule
 Program quality plan
 Program risk management plan
 Program issue management plan
 Program change management
 Program monitoring and control
management

15. Elements of good program
governance
 A compelling business case, stating the objects of the
project and specifying the in-scope and out-of-scope
aspects
 A mechanism to assess the compliance of the completed
project to its original objectives
 Identifying all stakeholders with an interest in the project
 A defined method of communication to each stakeholder
 A set of business-level requirements as agreed by all
stakeholders
 An agreed specification for the project deliverables
 The appointment of a project manager
 Clear assignment of project roles and responsibilities

16. Elements of good program
governance….contd.
 A current, published project plan that spans all project
stages from project initiation through development to the
transition to operations.
 A system of accurate upward status- and progress-reporting
including time records.
 A central document repository for the project
 A centrally-held glossary of project terms
 A process for the management and resolution of issues that
arise during the project
 A process for the recording and communication
of risks identified during the project
 A standard for quality review of the key governance
documents and of the project deliverables

17. Program Communications Plan
 Sets up approved methods of communication
 Establishes standard communication procedure
 Frequency and type of updates provided to the
program/project stakeholders
 Provides consistency in information flow
 Removes misinterpretations and doubts
 What information to be sent to whom & when
 Ensures Executive program engagement
 Helps keep everyone on the same page

18. Communication Plan elements
 Documented communication paths for information sharing,
including tools (VOIP, email, video/Web conferencing, etc.)
will be used throughout the program & for projects
 Program and project contact lists based
 Roles and responsibilities matrix for all stakeholders
 A program organization chart to identify high-level
organization, reporting, escalation and accountability for the
program.
 Approval and escalation procedures for decision making
 Recurring Communication Matrix to ensure timely and
effective communication
 Program event management plan that ensures the right
event occurrence reporting about issues, risks, milestones etc

19. Integrated Program Schedule
 Key program tasks
 Key program and/or project milestones
 Duration of the program and projects in it
 Dependencies related to the program
 Assigned responsibilities within the program
 Key deliverables of the program & schedule
 Program tracking and control mechanism
 Actual v/s Expected program metrics
 Measurement and analysis of any deviations

20. Program Quality Plan
 The quality plan defines the expectations of
quality that will be delivered by the program.
 The plan addresses the overall approach that will
be adopted by the program and associated
projects to ensure that quality is delivered
according to stakeholder expectations.
 The quality plan also defines quantitative
measures that are used to validate quality prior
to moving through a quality gate and eventually
prior to implementation.

21. Program Risk Management Plan
 The risk management plan is used to define the tolerance
for risk throughout the program life cycle as well as the
methods for identifying, recording and addressing risk
throughout the program.
 The early and frequent identification of risk in a program is
essential to meeting cost, schedule and quality
expectations.
 Steering committee and program manager to meet on a
monthly basis, or as defined in the communication plan, to
review the identified risks, examine each associated action
plan and define updates that need to be initiated.
 Additionally, the team communicates any newly identified
risks that may impact the program as they surface.

22. Sample program risk
distribution chart
14%
20%
6%
33%
2%
12%
13%
Dependencies
Requirements
Knowledge
Availability
Commitment
Project size
Complexity

23. Program Mgr v/s Project Mgr
Program manager Project manager
Integrates efforts, continuously assesses and refines approaches
and plans, ensures good communication.
Plans, organizes, directs, and
controls the project effort.
Directs managers to achieve defined outcomes aligned with
business strategy.
Manages for on-time delivery of
specific products.
Acts as the implementation arm of the program sponsor(s) and /
or steering committee.
Manages work within the project
plan framework.
Manages managers. Manages technical staff.
As Table above shows, the program manager and project manager roles
are quite different from one another. Whereas project managers
typically focus on delivering a specific component, program managers
typically focus on one or more outcomes that are business strategy
components.

24. Links to Business Strategy
 Throughout program planning and execution,
managers must ensure that the program sustains a
connection to the business strategy.
 This strategy is dynamic, not static. Both internal
and external events affect the enterprise's initiatives,
 So programs need mechanisms that will maintain a
link between the initiative and the business strategy,
and provide for effective data exchange and
necessary adjustments.
 We can divide such mechanisms into two categories:
those active during program mobilization and
planning, and those active during execution.

25. Program Mobilization –
Strategic Review
 IT goals and strategy
 Program capital and expenses budget
 Program benefits definition
 Program outline
 Candidate projects identification
 Program mobilization plan
 Consulting and staffing agreements
 A business strategy review
 Program planning strategy

26. Program execution reviews
 As the program proceeds, the program plan and
schedule should provide for periodic strategy
reviews by the program sponsor(s) and / or
steering committee.
 The schedule for these reviews can be aligned
with the program's phase structure, which cuts
across all of the constituent projects.
 As a phase-end approaches, reviewers can
compare the program's current state and results
against the then-current business strategy, and
propose needed adjustments.

27. Decisions and Authority
 An important aspect of program governance
is assigning specific decision-making
authority to each executive and management
role.
 Program managers can hold special group
work sessions for this purpose and then
create and distribute a matrix for major
decision areas and roles.
 Decision hierarchy structure should be clearly
communicated to all program stakeholders

28. Sample authority matrix

29. Program Issue Management
Plan
 Throughout any program, risks are bound to become
issues needing resolution in accordance with the
strategy defined in the risk management plan.
 In the likely scenario that an issue arises that has not
yet been identified as a risk, the issue management
plan provides strategies and guiding principles for
resolving the issue.
 Recognizing that this theoretical situation is not the
typical situation in the execution of programs and
projects, the same escalation principles identified
through the program organization chart apply in the
escalation of issues.

30. Program Change Management
 Whether due to missed requirements, project
issues or increased scope, a program is bound to
encounter change during the life cycle.
 The program change management plan defines
the authority that the program has to approve
change from an associated project, how said
project requests change the agreed-to plan
 How the program should receive approval on
change requests that are beyond its authority is
also defined in this plan

31. Program monitoring & control
 Event log (includes identified risks, issues,
changes, decisions and action items)
 Project performance information such as key
metrics on realized rate, resource utilization,
ROI, duration, deliverables etc
 Weekly status reports to stakeholders
 Recommendations for intervention and
corrective actions from senior management
 Lessons learnt activities from closed initiatives
 Managing change control requests
 Effectively manage deviations from baseline

32. Conclusion
 Establishing a governance framework is a
significant activity requiring participation
from all the relevant stakeholders
 The key to a program’s success is optimal
utilization of the governance framework,
policies and best practices
 Continuous feedback and communication are
the essential ingredients of a Program
 Program Management is a ‘people’ thing’ and
must be projected that way

33. Thank you