The Role of Project Governance Is Poorly Understood - by Business and Project People Alike
That lack of understanding can lead to the project governance role being interpreted too narrowly - leading to a significant reduction in the value realized.
Project Governance fulfils Two Roles
When we establish a project, we want it to deliver value.
Desired business outcome, which describe what the project is intending to achieve and what the future business-as-usual looks like when everything is working "just right" in the documents and the pro-agreed subset of Project Outcomes - which define what our project is intending to achieve and what the future business-as-usual looks like when everything is working "just right".
The project's measures of success are limited to the successful delivery and achievement of these agreed project outcomes - regardless of the long-term cost or value to the business.
The organization however, needs not only to continue functioning effectively during the life of the project, but also to adopt and absorb the project’s outcomes and consequent changes so it can realise the business outcomes and benefits expected.
The Project Governance team - aka Steering Committee - therefore has two roles:
- It represents the organization at the operational level - ensuring the organization’s needs are met by the project. It therefore needs to keep the project team focused on delivering the agreed project outcomes.
- It also represents the executive leadership team - in maximising the return on the investment. It therefore needs to question the spending of every dollar and chase down the realization of every benefit, during the life of the project and after the project team has finished and been disbanded.
And two perspectives...
To fulfil its two roles, the Steering Committee must have two perspectives:
- On the direction, focus and progress of the project itself, and;
- On the organization’s readiness, willingness and ability to adopt, use and maximize the outcomes and realize their value.
Too often, Steering Committees focus only the project, resulting in the project "delivering" but with business value being lost. Sadly, according to the project success measurement statistics, this happens 95% of the time!
The key question Steering Committee members should ask themselves is:
“How can we (the organization) direct, control and leverage this project investment to realize the maximum benefits in the business and for the business?”
The implications
The project team must deliver their agreed outcomes, so that the benefits dependent on these outcomes can be to be realized. Depending on the nature and timing of these benefits, these may also be delivered by the project team.1
Because some of the identified project benefits are outside the project team’s ambit to deliver, there needs to be an active ‘bridge’ between the project and the organization.
This is what the Steering Committee does. This then makes clear what Steering Committee's role and purpose is - and what it is not. They are there to define and then realise the benefits and value for the Project. (What they are not there to do is micromanage the Project Manager and the project schedule).
In Conclusion
The Steering Committee must ensure the project's outcomes benefits and value are delivered well (at an optimized cost) so that the organization can then continue the journey to deliver the overarching business outcomes, benefits and value.
Simply put, the project team’s focus is on delivering its agreed project outcomes, benefits and value and the Steering Committee's focus is on delivering the remainder - the overall business outcomes, benefits and associated value.
Explore the topic of Project Governance further with TOP's simple-to-read book.
