Welcome to Governance of Project Mgt ~

Project Management in Practice

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Amerjit WaliaOrbitus Consulting Ltd

Joan LangleyBMT Hi-Q Sigma Ltd

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Welcome to the Governance SIG

What is Governance of PM? Governance Structure & key roles 13 Principles of Governance (Handout) Project Sponsorship Alignment of Project Portfolio and Business

Strategy Case Studies GovSIG – Work and future activities – Get

involved.

OECD Definition

‘Corporate governance involves a set of relationships between a company’s management, its board, its shareholders and other stakeholders.

Corporate governance also provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined’

Organisation for Economic Co-operation and Development

OECD Principles of Corporate Governance 2004

www.oecd.org

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Why Governance of PM? Governance of portfolios, programmes and projects

is a necessary part of organisational governance; Provides for internal controls; Externally, it reassures stakeholders that their

money being spent is justified; Good governance is increasingly demanded by

shareholders, government and regulators. To comply with external regulations and legislation

(e.g. the UK Corporate Governance Code and Sarbanes-Oxley in the USA).

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Governance of PM ‘.. Governance refers to the set of

policies, functions, processes, procedures and responsibilities that define the establishment, management and control of projects, programmes and portfolios’.

APM BoK 6th Edition

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Not Project Governance!(management framework within which project decisions are made)

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“No such thing as failed projects, only failed governance” Andrew Bragg – CEO APM

Lack of a clear link between the project and the organisation’s key strategic priorities, including agreed measures of success.

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Lack of clear senior management and ministerial ownership and leadership

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Lack of effective engagement with Stakeholders 3.

Lack of skills and proven approach to project management and risk management.

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Lack of understanding of and contact with the supply industry at senior levels within the organisation.

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Evaluation of proposals driven by initial price rather than long-term value for money (especially securing delivery of benefits).

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Too little attention to breaking development and implementation into manageable steps.

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Inadequate resources and skill to deliver the total delivery portfolio.8.

Factors in project failures (OGC)

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Governance Structure APM Bok 6th Edition

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Organisational PM BoardRoles & Responsibilities of OPM

BoardAccountability

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Core Components: Portfolio direction Project sponsorship Project management Capability Disclosure and reporting

Gov PM 13 Principles

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Principle 6: All projects have an approved plan containing authorisation points at which the business case, inclusive of cost, benefits and risk is reviewed. Decisions made at authorisation points are recorded and communicated.

What are the key elements in this statement?How does it apply to P3M?Consider the remaining principles and

discuss what are the challenges for these in your organisation?

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Gov PM Principles 2/..

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“Sponsorship of a project, programme or portfolio is an important senior management

role. The sponsor is accountable for ensuring that the work is governed

effectively and delivers the objectives that meet identified needs.”

APM BOK 6th Ed 2012

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Sponsoring Change: A Guide to the Governance Aspects of Project Sponsorship, APM 2009

What would you expect from the project sponsor?

Attributes of Successful Project Sponsorship

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Project Sponsor effectiveness = best single predicator of project success or failure

Appoint a named Sponsor early in the project lifecycle

Critical success attributes:

1. Support

2. Continuity

3. Alignment

Personal Attributes:

1. Understanding

2. Competence

3. Credibility

4. Commitment

5. Engagement

Case Study 1 Universal Credit Project

Key Challenges of Governance

Further details: http://www.apm.org.uk/blog/if-only-they-d-read-guide#.VD6t6PldXGU

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Key governance issues raised

Programme strategySRO longevityActions from assurance reviews“Overambitious” timescaleEnd state and interim BlueprintsUse of AgileGovernance culture - “fortress mentality”Matching spend to progress

Lessons

No ‘Project Business Case’ – ‘economic case’ No clear Programme Strategy No clear vision to support the business

caseMinisterial imperativeNAO highlights the reactive nature of

the programme and clear governance failures

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Lessons 2/.. No clear understanding of the ‘end state’

the blueprint or ‘architecture’ would provide stakeholders and project teams with a strong vision and focus of direction;

MPA issued warnings of potential failure

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Response Establish a programme definition (common

understanding) of the programme strategy;Agree programme requirements;Agree strategy and vision;Develop a plan for benefits realisation;Conduct a stakeholder management analysis

and develop a relationship management plan;Consider issues for governance in an IT mega

project;

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Case Study 2:

BBC DMI Project Failure

further details:

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http://www.bbc.co.uk/news/entertainment-arts-26963723

BBC DMI Project The BBC was "far too complacent" in its handling of a failed IT

project that cost licence fee payers £98.4m. The Digital Media Initiative (DMI) was intended to move the BBC

away from using and storing video tape. But it was scrapped, with almost no results, after five years of

development. After investigating the demise of the project, the Public Accounts

Committee (PAC) has branded the programme "a complete failure". Chairman Margaret Hodge said the BBC needed to "overhaul" its approach to such projects, to "safeguard licence fee payers' money".

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BBC DMI Project 2/..Where the money went

Contractors - £46.7m IT - £37.2mSiemens costs - £24.9mConsultancy - £8.4mBBC staff - £6.4mOther - £2.3m

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BBC DMI Project Failures After a series of delays, the project was brought in-house, There it

floundered until last May, when the BBC's incoming director general, Tony Hall, admitted it had "wasted a huge amount of licence fee payers' money".

The gross estimate of the amount spent on DMI was £125.9m, although the BBC claims to have recouped £27.5m of that.

The BBC's technology chief, John Linwood, was sacked in July 2013 over the project's demise.

A previous report, by the National Audit Office (NAO), blamed "confusion and a lack of planning" for the failure.

It said that senior executives failed to take control of the project when it ran into trouble and "did not appear to appreciate the extent of the problems until a late stage".

"The BBC was far too complacent about the high risks involved in taking it in-house. No single individual had overall responsibility or accountability for delivering the DMI and achieving the benefits, or took ownership of problems when they arose."

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Looking Ahead GovSIG – 2014/15

Publish update to Co-Directing Change 2nd Edition Develop new guidance on Agile Governance Further collaboration with PwC regarding their

global survey and Directing Change Network Rail Sponsoring model and Benefits

Tracking Investigation of new MOD governance model Collaboration with other APM SIGs – e.g. People Further engagement with NAO, FRC and other

institutions, e.g. CMI, ICS

Directing Change2nd edition 2011

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Co-Directing Change2007 (2nd edition in 2014)

Sponsoring Change2009

Free to APM members at www.apm.org.uk/memberdownloads

GovSIG – Publications to date

Getting Involved with GovSIG

APM GovSIG Blogging Research Committee

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Project Management Governance 13 Principl

Further Reading

• APM Governance of Project Management Specific Interest Group, 2007. Co-directing change: A Guide to the Governance of multi-owned projects. Princes Risborough: Association for Project Management.

• APM Governance of Project Management Specific Interest Group, 2009. Sponsoring Change: A Guide to the Governance aspects of Project Sponsorship. Princes Risborough: Association for Project Management.

• APM Governance of Project Management Specific Interest Group, 2011. Directing Change: A Guide to Governance of Project Management. 2nd ed. Princes Risborough: Association for Project Management.

• Reiss, G. et al., 2006. The Gower Handbook of Programme Management. London: Gower.

• Wernham, Brian (2012) Agile Project Management for Government, Maitland and Strong.

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