PLEASE – What is Project Governance Really About?

Introduction

We often hear or read the term Project Governance.  It seems straightforward enough – no doubt referring to the rules under which projects are conceived and executed.  Here’s the problem, the more you encounter the term the less consistency there seems in its application.  If you consider the project as a corporate investment with both a project lifecycle inside an investment lifecycle, there is a lot ‘going on.’    

Questions Come to Mind…

What is the scope of project governance?  Are things like PMI’s PMBOK a subset or superset of it?  Is it a role & responsibility matrix?  Does project governance extend through the entire lifecycle?  How are programs and portfolios involved, if at all?  I decided to explore the concept of ‘project governance’ and nail it down.  I thought it would be a routine examination - not exactly.

Sampling of ‘Project Governance’ Definitions

In reality, there is no agreed on, generally accepted definition for “project governance” as there is for a project or for project management.  With no governing body to provide oversight, individuals are left to develop their own understanding of what project governance means, or infer a meaning based on what context ‘Project Governance’ is used.  

Like all intrepid explorers faced with a challenging question, I googled it.  Here are two examples of the many I found:  

1. Project Governance refers to the set of policies, regulations, functions, processes, procedures and responsibilities that define the establishment, management and control of projects, programs and portfolios. – Association for Project Management

This seems to specify that project governance defines the entire people and process management framework surrounding projects, programs and portfolios – across their lifecycles.  It therefore seems reasonable to conclude that complete coverage would be provided by PMI’s Project Management Body of Knowledge, and Standards for Program and Portfolio Management.  It turns out that assumption isn’t far off.

2. …role of governance on a project: setting direction, making decisions and overseeing direction. – ProjectManager.com

PMI’s The Standard for Portfolio Management states that –

“The term governance is increasingly used in the field of portfolio, program, and project management, but the term and what it represents is frequently confused with notions associated with management.”

Here we have a definition that simply states what project governance should do – with no mention of its nature.  Since project governance is not project management – setting direction, overseeing direction and making decisions imply something above the project manager.  Hold that thought…

Combining the two definitions tells us this – project governance is a set of policies that allow Sr. Management to set and oversee project direction as well as decision making across project, programs and portfolios.    

Definition and Discussion

From the PMI Conference Paper “Project governance - reviewing the past, envisioning the future—“ we’re provided the following definition:

“Project governance is the bridging mechanism between corporate governance and project management.  As a result, project governance ensures that the board of directors and senior management are able to share and exercise ultimate accountability, transparency, and disclosure on material matters of the enterprise investments made via projects, programs, and portfolios.”

Before We Proceed – Corporate Governance

Project governance is a bridge between Corporate Governance and Project Management.  Without getting into another major definition, let's briefly describe Corporate Governance as –

"...the transparent set of methods in which senior management monitors and controls its company and is held responsible to the board, shareholders and finally – all company stakeholders." 

What Does This Mean?

It means that project governance is the framework in which information is provided to management regarding investments of the project type.  This is provided in such a way that management is capable of setting direction, making decisions and overseeing direction on the company’s projects, just as they do with all other company operations.

In addition to this power, the definition clearly lays out that senior management is accountable, transparent, and able to disclose the ‘why and wherefore’ of the decision process.  And this is required for programs and portfolios as well.

Why Programs and Portfolios too?

In the project/program/portfolio paradigm, projects are the atoms that comprise all else – so wouldn’t coverage of projects as in ‘project’ governance be satisfactory?  Not really.  

The complete picture of all project activity requires that its program and portfolio parents are included in the definition as well.  Decisions made at these levels will impact any given project and may not be as apparent as required for project governance.  For project governance to work as intended, the program and portfolio pertinent lifecycle information must be in scope.

What Project Governance is NOT

Project Governance is not the PMBOK, nor is it a specific process framework, SDLC, Agile or execution methodology.  Nor is it a program or portfolio management arrangement.

Project Governance Spelled Out

Project governance will impact your project, program and portfolio management framework by detailing the information requirements and organization, information flows, timing and frequency of information and the associated roles & responsibilities in action within the framework in order to meet the governance objectives of:

• Setting Direction

• Making Decisions

• Overseeing Direction

It specifies that Sr. Management’s actions and attendant information must be:

• Transparent

• Accountable

• Available for detailed disclosure

PMI has released a composite ‘practice’ guide for governance – “Governance of Portfolios, Programs, and Projects:  A Practice Guide.”  It’s here you’ll find detailed information regarding everything project governance plus what is needed to implement governance frameworks.  I would consider this a must have reference for any serious project practitioner.  

Conclusion

Hopefully, you’ll walk away from this article with the understanding that project governance specifies the conduct of project activities such that the organization’s governing body is provided with the timely information so that it is informed and able to make decisions.  

… The accepted definition and associated conventions of project governance have arrived.  The challenge will be how individual organizations introduce, standardize and mature it into and along with the breadth of their project, program, and portfolio systems.  

To some degree, all organizations are practicing project governance – either because they feel it is a sound practice or because their industry or the law mandates it.  The accepted definition and associated conventions of project governance have arrived.  The challenge will be how individual organizations introduce, standardize and mature it into the breadth of their project, program, and portfolio systems.