The Business Governance Dimension
Governance teams can, more by default than action, ensure their projects under-perform.
Projects do not exist in a vacuum but within the business context. The closer the business-project nexus, the better the project performance and result.
Who runs the business? Not the project manager, but the Governance Team.
The Governance Team needs to take action to ensure their project’s success. How? Please read on.
Resources
A project manager can deliver a project. Even then, he or she is dependent on the cooperation of the business to make the right staff available for the project at the right time and for the right duration. The Project Manager does not run the business and so cannot compel the business staff’s involvement and cooperation.
So, one critical governance role is to ensure the business cooperates with, supports and resources the project to the level required.
Obviously, if the wrong people are made available, or the right staff are only available at the wrong time (e.g. late) or for too short a period, then the quality and timeliness of the project will diminish and, usually, the cost will increase. This loss of value is often invisible but is still there.
Results
A project manager cannot deliver the business results. A project is not an end in itself, it is a means to an end. The end is when one or more business outcomes or results are delivered that the project has enabled and supported. These outcomes and results are created in the business (not in the project). They are dependent on the readiness, willingness and ability of the business staff to take on the project-driven outcomes and use them to deliver the final business results.
If the business staff are not ready, willing or able to adopt the changes, despite training courses and communications, et al, the net end effect will be diminished business results and value.
So, a second critical governance role is to ensure the business is ready, willing and able to absorb and use the outputs of the project.
The Need for Effective Project Governance
If we just limit the governance role to these two dimensions — ensuring cooperation and support for the project and the readiness, willingness and ability to use the project outputs — you can understand the impact of poor project governance.
The project can deliver an A1+ result, but the end business result can still be a disaster if the business dimensions are not addressed and managed. And these are areas the Project Manager cannot control.
In theory, the business will automatically respond appropriately to project requests for resources, assistance, cooperation and acceptance of the results. But in practice other pressures get in the way and cause problems.
Business managers need to be asked, advised and sometimes directed to cooperate with and participate in the project. These managers usually report to or are peers of the ‘governance team’ — the Sponsor and Steering Committee.
It is up to the governance team to ensure the business is fully involved and is able to extract the maximum value from the project and its outputs—always remembering the project’s value is realized in the business, not in the project!
It is also good to remember that the purpose of a “steering” committee is to “steer” the project successfully into the business! (It is less the purpose of this committee to “steer” the project — that’s the project manager’s job.)
So, the challenge to business executives is simple.
For projects to be successful (in business terms), they need active and effective project governance to ensure the business dimensions are addressed. Inactive or ineffective project governance dooms projects.
Why hasn’t this been a major problem before? Because of the confusion of terms and measures.
Projects learned to take their internal performance measurements — on time, on budget, to quality/specification — as the project measures of success. Nice for them, but of limited use to the business.
Business learned to not expect significant (or at least beneficial) change from projects (regardless of what was in the business case) but to blame poor project delivery for poor outcomes and performance (i.e. it’s the project manager’s fault).
In Conclusion
With the improvement in project management skills, projects are being delivered closer to their original specifications. This has highlighted the root cause of the problem — the lack of business involvement, readiness and governance. These failings result in over 50% of project value routinely being destroyed.
So, when the governance team performs, it has a direct and material impact on the business value of the project. And when it doesn’t perform, the results decline significantly.
All executives and managers need to understand their direct impact on their project’s results. Then they can take their governance roles seriously
The first step to be effective is to understand your role
