Governance of project management

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EuroProjex rodneyturner@europrojex.co.uk© jrt/gpbo/jul08
EuroProjex
The Governance of Project Management
PMI Beirut 29th May 2014
Prof Rodney Turner
Managing Consultant, EuroProjex
Editor-in Chief, International Journal of Project Management
SKEMA Business School
Definitions
The project-oriented organization
The project
The context
Linking corporate strategy to project strategy

2
Corporate governance
Corporate governance involves a set of
relationships between a company's management,
its Board (or management team), its shareholders
and other stakeholders.
Corporate governance provides the structure
through which the objectives of the company are
set, and the means of attaining those objectives
and monitoring performance are determined.
OECD
Governance
Governance defines
the objectives of the organization
the means of obtaining those objectives
the means of monitoring performance
Governance defines the relationship between
shareholders
the board
management
other stakeholders

3
Three levels of governance of projects
Board
Context
Projects
APM’s Special Interest Group
Project Governance is the overlap between projects
and corporate governance
www.mylara.com/gopm or www.apm.org.uk
Corporate
Governance
GoPM
Projects
Programmes &
Portfolios

4
Project governance
Governing the context in
which projects are done
programs and
portfolios
delivery capability
Governing individual
projects
Four project governance paradigms
Flexible
economist
(maximize value
for sponsor)
Conformist
(minimize
costs)
Agile
pragmatist
(follow the
process)
Governance orientation
Shareholder Stakeholder
Versatile
artist
(balance
requirements)
Control
focus
Outcome
Behaviour

5
Definitions
The context
Purpose of governance of projects
Portfolio efficiency and effectiveness
Sponsorship effectiveness and efficiency
Project management effectiveness and
efficiency
Disclosure and reporting

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Good governance results in ……
Link to strategy
Senior management support
Engagement with stakeholders
Organizational capability
Contact with suppliers
Value for money (focus on value not price)
Breakdown to manageable steps
11 principles of the governance of
projects
Board has overall responsibility for governance
of projects
Objectives, What, Doing the Right Projects
Coherent and supportive relationship between
business strategy and project portfolio
Business case supported by relevant and
realistic information

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projects
Means, How, Doing Projects Right
Roles, responsibilities and performance criteria
clearly defined
Disciplined arrangements, supported by appropriate
methods and controls applied throughout life-cycle
Responsible managers have sufficient representation,
authority, competence and resources to make
decisions
Stakeholders engaged at an appropriate level and in
a manner that fosters trust
projects
Monitoring Progress
All projects have approved plan with stage gates.
Decisions made at stage gates clearly recorded and
communicated.
Board decide when independent scrutiny of projects
required and implement such scrutiny
Clearly defined criteria for reporting project status and
escalating risks and issues
Organization fosters a culture of improvement and
frank disclosure

8
Three levels of process and stage-gate
reviews
Portfolio
Design
Portfolio
Implementation
Portfolio
Maintenance
Portfolio
Review
Lessons learned
Define
Programme
Execute
Programme
Close
Programme
0 0
Business
case
Feasibiliy Design Execution Closure
1 2 3 4 5
0
Definitions
The project
The context

9
A project is ……
A temporary organization
to which resources are assigned
to do work
to deliver beneficial change
Results-based view
Exploitation
Implementation
Resources Project Outputs
Outcomes
Goals
Benefit
Improved
performance
Operation

10
Project governance
Project governance involves a set of relationships
between a project’s management, its parent
organization, its client and other stakeholders.
Project governance provides the structure
through which the objectives of the project are
set, and the means of attaining those objectives
and monitoring performance are determined.
Governance of projects
Governance defines
the objectives of the project
the means of obtaining those objectives
the means of monitoring performance
Governance defines the relationship between
owner
sponsor, steering committee
project manager, team leaders
other stakeholders

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Governance of projects
Define objectives
do the right projects
Define the means
do projects right
Monitor performance
do projects right first time, every time
Business
Change Mgr
Governance roles
Sponsor
Owner
Project
Manager
Steward
Delivered
Outcome
Client
Need
Delivered
Output
Required
Process
Desired
Output
Desired
Outcome
Define
Objectives
Define
Means
Monitor
Progress

12
Benefits definition and delivery
Goal
Value
Proble
m 1
Proble
m 2
Proble
m 3
New
Asset
Capability
1
Capability
3
Capability
2
Benefits Definition - SponsorCapability Definition
Steward
Capability Delivery
Project Manager
Benefits Delivery – Owner/
or Business Change Manager
The Project Manager’s responsibility ends here
Step1
3
Step1
1
Step1
2
Step2
1
Step2
3
Step2
2
Program Director
Project Executive
(Sponsor)
Senior UserSenior supplier
Project Board
Program management
Project management
Project Manager
Sponsoring Group
Program
Manager
Senior business
management
Business Change
Manager
Program
Office
Deliver capability Embed changeControl program
Portfolio
Manager
Board
Owner
PRINCE2 and MSP
Portfolio management
Program management

13
Definitions
The project
The context
Corporate strategy to project strategy
Portfolio
Strategy
Portfolio
Objectives
Corporate
Strategy
Context
Program
Strategy
Program
Objectives
Project
Strategy
Project
Objectives
Work area
Strategy
Work area
Objectives
Team
Strategy
Team
Objectives
Individual
ObjectivesProject strategy

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Programs and portfolios
A program is a set of projects sharing a
common objective
A portfolio is a set of projects or programs
sharing common resources
The investment portfolio is the sum total of
an organization’s investment activity
Investment portfolio
Portfolio of
medium
projects
Portfolio of
small
projects
Large
program D
Large
program C
Large
project B
Large
project B
Investment
portfolio

15
Steps of portfolio management
Step 1: Awareness of ongoing projects through a
project data-base
Step 2: Awareness of the status of all projects through
a project reporting system
Step 3: Projects are prioritized and selected through
transparent procedures
Step 4: Resource needs for all projects are planned
and assigned centrally
Step 5: Business benefits of projects are evaluated
post completion for continuous improvement
Project traffic light report
Project 1 100 3
Project 2 200 3
Project 3 300 4
Project 4 900 1
Project 5 450 3
Project 6 600 2
Project 7 750 4
Project 8 800 3
Project Name Budget Cost Time Risk Benefit Status
As planned Problems Crisis

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Prioritizing projects
Available resources Projects in rank order
These you can do
These you can do if higher
priority than ongoing projects
These you can’t do
Resource
requirement &
progress
Agreed
results
Long-term
demands
Resource
availability
Work
packages
Objectives &
Time/Resource
window
People
scheduling
to maximise
efficient usage
Capacity
planning
to achieve
development
objectives
Time
scheduling
to deliver
project
objectives
(unitary)
Project
Managers
Portfolio
Directors
Resource
Managers

17
reviews
Portfolio
Design
Portfolio
Implementation
Portfolio
Maintenance
Portfolio
Review
Lessons learned
Define
Programme
Execute
Programme
Close
Programme
0 0
Business
case
1 2 3 4 5
0
Program Director
Project Executive
(Sponsor)
Senior UserSenior supplier
Project Board
Program management
Project management
Project Manager
Sponsoring Group
Program
Manager
Senior business
management
Business Change
Manager
Program
Office
Deliver capability Embed changeControl program
Portfolio
Manager
Board
Owner
PRINCE2 and MSP
Program management

18
Three positions of PMO
Company
Projects
DeptDept BDept A
Strategic
PMO
Portfolio
Office
Large
Project
Large
Program
Project
Office
Program
Office
Permanent
Structures
Temporary
Structures
What are organizations competent in?
Project Management processes
project life-cycle
concept, feasibility, design, execution, commissioning
project management life-cycle
plan, organize, implement, control
project functions
scope, time, cost, quality, risk
Delivering individual projects successfully
Technology, engineering and craft skills

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Definitions
The project
The context
Strategic drift
Time
Cumulative
change
Environmental change
Incremental change
Flux
Demise
Project
Project

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Strategic Management
Position
Choices Action
Capability
ExpectationContext
Operational
Level
Corporate
Level
Business
Level
Organizing
Enabling
Managing
Change
Unrealized
Strategy
Deliberate and emergent strategies
Emergent
Strategies

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Corporate strategy to project strategy
Portfolio
Strategy
Portfolio
Objectives
Corporate
Strategy
Context
Program
Strategy
Program
Objectives
Project
Strategy
Project
Objectives
Work area
Strategy
Work area
Objectives
Team
Strategy
Team
Objectives
Individual
ObjectivesProject strategy
reviews
Portfolio
Design
Portfolio
Implementation
Portfolio
Maintenance
Portfolio
Review
Lessons learned
Define
Programme
Execute
Programme
Close
Programme
0 0
Business
case
1 2 3 4 5
0

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Project strategy
Context
Organizational strategy
Project requirements
Business case
Success criteria
Success factors
Project model
plan
organization
tools
Evolution of the business case
Programme
Brief
Project
business caseProject
business case
Aggregation
Sets scope
and objectives
Blueprint
Risks
Benefits
Resources
Plans
Inform
Monitoring
and review
Alignment
Check
Programme
business case
Drivers for
change
Programme
mandate

23
Project success
Success criteria
dependent variables by which we judge project
success
Success factors
independent variables which influence the
achievement of the success factors
Results based view
Exploitation
Implementation
Resources Project Outputs
Outcomes
Goals
Benefit
Improved
performance
Operation

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Measures of success
Measure Stakeholder Timescale
Shareholder value Shareholders End+years
Profitable Board End+years
Happy sponsor Board End+years
Happy consumers Consumers End+months
Easy to operate Users End+months
Easy to sell Marketing End+months
Time, cost, quality All End
Happy project team Project team End
Profitable for contractor Project team End
Multiple views, multiple stakeholders,
multiple time-frames (Turner, 2009)
Stakeholders
Investor
Consumer
Operators
Sponsor
Manager/team
Senior supplier
Suppliers
Public
Output - end
Efficiency
Price, time
Features
Documentation
Training
Efficiency
Risk, safety
Efficiency
Experience
Efficiency
Profit
Profit
Client satisfaction
Environment
Outcome - +months
Profit
Reputation
Price
Benefit
Operability
ARM
Relationships
Investor loyalty
Reputation
Repeat business
Reputation
Repeat business
Reputation
Repeat business
Environment
Social cost/benefit
Impact - +years
Whole life value
Learning
Advantage
Development
Operability, ARM
Learning
New projects
Learning
New projects
Learning
New projects
Learning
New projects
Learning
Environment
Social cost/benefit

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Project success factors
– Pinto and Slevin (1988)
1. Project mission
Top management support
Schedule/plans
Client consultation
Project team
Technical tasks
Client acceptance
Monitoring and feedback
Communication
Troubleshooting
agree clear goals and objectives
political support
good clear plans
communicate with stakeholders
gather a competent team
technical competence
sell product to final users
timely, comprehensive control
timely data to key players
can handle unexpected problems
ICT project success factors
- Standish Group (2006)
1. User involvement
2. Executive support
3. Clear business objectives
4. Scope optimization (lean)
5. Agile processes (iterative)
6. Project management expertise
7. Financial management
8. Skilled resources
9. Formal methodology
10. Tools

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Context
political
economic
social
environment
legal
Sponsorship
benefit
finance
value
schedule
urgency
Attitudes
commitment
motivation
support
right 1st time
shared vision
Definition
objectives
scope
technology
design
resourcing
People
leadership
management
teamwork
influence
IR
Systems
planning
control
reporting
quality
risk
Organization
roles
resources
type
contract
strategy
Project Drivers
Seven forces of project management
External to Organization
Pressures Resistance
Internal to Organisation
Feedback
Project-
results
Project Results
Appreciation
client
Appreciation
projectpersonell
Appreciation
users
Appreciation
indirect parties
Appreciation
contract partners
Leadership &
Team
Project-
management
Project Organization
Policy &
Strategy
Environment
Resources
Contracting
Project excellence model
Westerveld

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That’s All Folks
rodneyturner@europrojex.co.uk
rodney.turner@skema.edu

Governance of project management

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