Guidance for Good Project Governance

Behind every successful project is an effective governance process. On smaller projects, this governance may be primarily driven by the efforts of the project sponsor and project manager, but on larger, more complex projects you may need to have multiple governance teams and processes to properly guide and support the project.

For those of you who have not experienced the pain of managing a project that is lacking appropriate governance, here are just a few of the issues which might be encountered:

• Inability to secure the committed allocation of required financial and people resources to deliver the project scope on time
• Inability to get those issues, actions and risks addressed which have been escalated beyond the authority level of the project team
• Protracted delays, excessive effort and staff frustration in getting key decisions made or, even worse, wasted effort and schedule impacts resulting from reversed or modified decisions
• Lack of buy-in from key stakeholders
• Insufficient visibility of the project’s importance at executive levels to secure sustained funding and perceived priority

If poor governance can be the cause of such lethal project impacts, wouldn’t you expect to see significant emphasis placed on this critical step?

Reviewing the track sessions for four conferences being held this year across Canada, I was only able to locate one session which specifically referenced governance in its title – while it is likely that a few more also related to subject, having attended a few of the track sessions in the Toronto conference, my experience was that this was not one of the most commonly referenced topics. This is not a criticism of that particular conference – having attended multiple project management conferences across North America over the past fifteen years, I can’t recall one where governance was a focal topic.

Furthermore, over the course of the project management capability improvement work I’ve done with companies, I’ve found that those which include a mandatory “Proposed Governance Structure” section within their project plan templates have usually done so because of lessons they have learned through the school of hard (project) knocks.

It would be impossible to provide a comprehensive guide for defining the right governance structure and process which will meet the needs of all projects as, just as with any other project management practices, these need to be tailored to the specific needs of each project and the culture of the organization in which they are being implemented.

Here are some tips to get you started:

1. While project complexity as a whole drives the need for greater governance, the following specific factors should be evaluated to assess the extent of governance required:
   1. Degree of organization impact – the bigger the change to the organization, the more robust the governance required
   2. Number of key, influential stakeholders who have or are likely to have significantly differing agendas – the greater the likelihood of divergence of opinion on project direction and decisions, the more effort will need to be spent on governance
2. If multiple governance bodies are being considered, make sure that there is a clear definition of the jurisdictional boundaries of each. Without this, you run the risk of getting a frustrated or disengaged sponsor who sees their decisions being overturned or questioned frequently. This also applies to standing governance committees within your organization – your proposed governance structures need to align with those as well.
3. If you are considering a multi-sponsor model for projects where no single sponsor is capable of or will be perceived to be providing a balanced level of governance, remember that with two or more sponsors, you will need to budget some of your time to facilitating their transition through Tuckman’s standard team development phases. You will also need to budget for the additional effort and costs of having multiple executives directly engaged with your project. Finally, you should prepare yourself for the likelihood of conflict and churn across your team resulting from individual sponsors making decisions without fully consulting their co-sponsors.
4. Establish clear terms of reference for each governance body detailing the types and level of activities each is responsible for as well as the overall mandate of the group. This process should start with how these bodies are named as an advisory group may be perceived to serve a very different purpose from a steering committee.
5. Balance the desired project benefits against the administrative costs, effort & potential delays of having an overly onerous governance process. The more gates that a particular decision or action has to pass, the greater the project costs and potential for delays. After a leadership team has experienced issues of inadequate governance on one project, their tendency may be to overcompensate on the next.

The outcome will usually not improve, and governance practices will oscillate from minimal to excessive.

Establishing the right governance structure and process is like the tale of Goldilocks – missing the mark could be “un-bearable”!

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