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The Project Management Toolbox - Part 4: Good governance

The Project Management Toolbox - Part 4: Good governance

Governance bodies that are set up well can have a significant impact on the smooth running of projects and programmes of work. Here, we talk about the key ingredients to ensure that your governance arrangements are most effective and add value.

In the last issue of Unspun, we focused our Project Management Toolbox on building and maintaining stakeholder engagement. This time we’re turning our attention to project and programme governance.

When it comes to projects and programmes, good governance is essentially about encouraging and supporting the decisions that lead to success. This is easier said than done. As Theodore Roosevelt put it, “In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing”. So it’s not surprising that some governance bodies suffer from struggling to make decisions and lessons learned reports are riddled with observations that governance could have better served, steered or controlled the project or programme.

To help, we highlight some of the key pitfalls to avoid and offer some tips to ensure that your governance arrangements are set up to help your projects and programmes succeed.

Lay strong foundations

To establish effective and value-adding governance arrangements, you first need to be clear on the purpose of each governance body – what it’s here to do. Some governance groups are established to mitigate risk; others to control investment. Some aim to ensure that the solutions delivered by change are fit for purpose; others that the desired benefits are achieved. Whatever the purpose of a governance body, it is important to be clear on this upfront and to communicate it unambiguously and widely. Why is this so critical? Because a clear agreed purpose lays a strong foundation for good governance.

Most governance bodies are set up to make decisions. Sometimes it is appropriate for these decisions to be made by committee, but this is notoriously difficult even in the most aligned of stakeholder groups. It might be better to appoint the Chair as the decision-making authority, with the other attendees providing counsel, input and support as required. This approach is likely to make decision-making quicker and easier.

Once you’ve clarified the purpose and decision-making process, it’s worth writing clear and simple terms of reference which can be agreed at the inaugural meeting. When setting the terms of reference for the group consider how the governance body fits within the overall governance regime of the organisation, the division, the portfolio or the programme. Don’t waste time and effort considering things that have been decided elsewhere. To avoid multiple governance groups attempting to independently make the same decisions, make sure you are clear on the role and purpose of each of these bodies and challenge whether there is a need for a new committee before setting one up.

Summary points:

  • Use a clear agreed purpose as the foundation for the governance arrangements.
  • Consider delegating decision-making authority to the Chair.
  • Agree a simple one-page terms of reference at the first meeting.
  • Communicate the purpose of the group consistently and widely to avoid confusion.
  • Appoint someone who can act as the link between multiple governance groups to ensure consistency of information and decisions.

Invite the right people to the party

Arguably, choosing the right people to make decisions will have the most direct influence on whether the governance body is a finely-tuned decision-making machine or a toothless talking shop. Choose the Chair or sponsor who has the most to gain from the governance body being successful in achieving its purpose but take care not to appoint someone who is too senior and simply cannot spare the time required.

Once you have your Chair, it’s time to make the difficult choice of who to regularly invite to the meetings. The temptation is to openly invite representation from every stakeholder group who could conceivably be impacted by or remotely interested in the project or programme. From the relatively simple task of planning a time that everyone can make to actually getting a cast of thousands to agree on a decision - the more people involved, the harder it becomes. To avoid this unnecessary drag on success, select attendees with care to strike the right balance between covering the necessary bases while keeping the group focused, effective and manageable. A good tactic here is to focus on who has the content knowledge, who will be affected by the changes and who will enjoy the benefits of the project or programme.

Summary points:

  • Choose a Chair or sponsor who has sufficient authority to make decisions and can commit the time required.
  • Choose your governance team wisely. If possible, cover the bases with six to eight empowered individuals, to avoid overcrowding and enable quick and effective decision-making.
  • Get a good balance of personal styles and perspectives so that there is a healthy level of challenge from the governance group.

Maximise the value of your investment in governance

One thing that good governance and bad governance have in common is that neither come for free. The participation of senior stakeholders in governance meetings often comes at a significant opportunity cost. Time spent preparing for steering group or programme board meetings adds to the cost of a project or programme. As such, governance is an investment and, like any other, you need to take steps to maximise the value of that investment.

Effective governance bodies use reliable information to make sound decisions at the right time. Even when chaired by a sponsor or other accountable executive, project and programme managers are frequently charged to plan the agenda and prepare the materials for discussion. As such, they are the ones who, sometimes unwittingly, hold the key to how valuable and useful the interactions with governance bodies will be.

Summary points:

  • Treat governance as an investment.
  • Manage the participation of people and the flow of information to maximise value.

Present focused information

Projects and programmes are typically data rich, especially when they are supported by an eager PMO function busily capturing information and producing reports. The temptation can be to force-feed too much of this data to the governance groups in an attempt to make them as well-informed as possible. This approach rarely helps the governance body to make decisions. So when deciding on what to include in the pack for the governance meeting, consider the agreed purpose of the governance body. Keep the information focused on enabling the decisions that must be made and keep it as simple, clear and uncomplicated as possible. Get to know your audience in order to tailor what you present to them. Talking through project cost analysis in minute detail to a room full of strategists and creative types will, for example, rapidly result in a fidgety, disengaged and possibly even frustrated audience.

Summary points:

  • To avoid wasting time, tailor the information presented to governance bodies according to the purpose, the decisions to be made and the style of the audience.
  • Don’t confuse governance with communication. Keep governance meetings focused on making decisions and consider alternative channels for one-way status updates.
  • Tailor your materials and the way you present them to the audience.

Strike the right balance

Executives who ask for help to turnaround a failing project or programme often state that they lose confidence in its management because they do not trust what they are hearing in the board meetings. This loss of trust can be caused by presenting the board with a rosy picture of progress when, in fact, the project or programme is actually really struggling to make headway. It is human nature to be positive and optimism bias is just as much a threat to accurate status reporting and sound decision-making as it is to realistic project estimating and planning. That said, the opposite end of the spectrum is not a healthy place to be, either. Some governance bodies become so closely entwined with the day-to-day management of a project or programme thanks to the hair-trigger escalation of all issues and risks, however big or small, as soon as they surface. The trick is to strike the right balance by being open and clear with all attendees on whether they would appreciate early notification of issues and risks or whether they would rather just focus on interventions and escalations that they are required to decide upon or execute.

Summary points:

  • Be conscious of the pitfalls of both optimism bias and raising the alarm too early as both can be damaging to the success of your project or programme.
  • Agree the balance stakeholders want to strike between gaining early visibility of risks and issues and only being told when there is a problem that requires escalation.

Be prepared to change as required

Businesses these days rarely stand still and nor should the good governance of your project or programme. Whether driven by a significant change or simply by things not quite working as well as you’d hoped, do not be afraid to make changes to the governance arrangements that will help to improve the chances of your project or programme succeeding. Such changes could include the Chair, attendees, agenda, meeting frequency, meeting duration, purpose and terms of reference.

And finally, as soon as a governance body has served its purpose and ceases to add value, stop it in a controlled and constructive way that allows for it to be restarted if needed. That way, you’ll free up valuable resources for other investments and tasks.

Summary points:

  • Change aspects of the governance as and when required.
  • Bring it to an end when it has served its purpose.
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