Effective governance

Effective Governance
of Change
Martin Samphire and Andy Murray
14th January 2013
#APMGovernance
@APMGovernance
www.apm.org.uk/group/apm-governance-specific-interest-group

APM Presenters

Martin Samphire Andy Murray
MAPM MAPM, PPM RC
MIOD MIOD, C.Dir
Chairman of APM Governance SIG APM Governance SIG Committee Member
APM Portfiolio Mgmt SIG Committee Member Contributor – PRINCE2, P3M3, APMBoK
Owner and MD – 3pmxl Ltd Director – Outperform UK Ltd
Sectors – FS, police, defence, energy Sectors – IT, Transport, Local Government
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Webinar Objectives
 To provide a practical overview of
applying simple governance principles
to improve decision-making
effectiveness and efficiency for project
management in your organisation.

Webinar Etiquette
 By default we will mute all participants when the presenters
are speaking. Please use the chat to get the facilitator‟s
attention if you are having any issues.
 Please use the chat to ask questions or to make comments
throughout the presentation. The facilitator will summarise
these for the presenters.
 If the presenters want to ask the group a question, you will
all be un-muted. To avoid talking over other participants, the
presenter will invite specific participants to speak.
 There will be a short Q&A session at the end
 For further discussions we will be using #APMGovernance

Webinar Content
 APM Governance SIG Introduction
 What is Governance of Project
Management
 Effective Governance of Change
 Summary & Questions

APM mission

Working collaboratively, create new standards and
knowledge and enhance their application amongst
individuals and organisations, such that all projects
succeed.

6

Governance SIG objectives
 Be the UK focus
 Advance understanding
 Contribute to good practice
 Influence national and international standard making
authorities
 Influence those operationally responsible
 Develop ambassadors and exemplars of excellence

….in the governance of project management (change)
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Governance SIG activities
 Engagement – CxO level and APM
members
 Governance Benchmarking Group
 Conferences and Seminars
 Publications
 Development (of Governance material)
 Influence of and contribution to standards

GovSIG – Publications to date

Co-Directing Change Sponsoring Change Directing Change
2007 2009 2nd edition 2011

Free to APM members at www.apm.org.uk/memberdownloads
9

Corporate Governance definitions

OECD IOD Independent
Corporate governance A governance framework Commission on Good
involves a set of Governance in Public
should ensure that
relationships between a Services
corporate boards
company’s effectively monitor The function of
management, its board, its governance is to ensure
shareholders and other managerial performance
stakeholders. and achieve an equitable that an organisation or
return for shareholders – partnership fulfils its
Corporate governance also overall purpose, achieves
reinforcing the values of
provides the structure
fairness, transparency, acc its intended outcomes for
through which the
objectives of the company ountability and citizens and service users,
are set, and the means of responsibility. and operates in an
attaining those objectives effective, efficient and
and monitoring ethical manner.
performance are
determined.

PM Governance definitions
Project Project Management Governance – APM
Governance - ISO
21500
The governance of project management
Governance is the concerns those areas of corporate governance
framework by which
that are specifically related to project activities.
an organization is
directed and Effective governance of project management
controlled. Project ensures that an organization’s project portfolio is
governance includes aligned to the organization’s objectives, is
but is not limited to
those areas of delivered efficiently, and is sustainable.
organizational Governance of project management also
governance that are supports the means by which the board and
specifically related to
other major project stakeholders exchange
project activities.
timely, relevant and reliable information.

Change in context
Vision Portfolio Management
“Doing the right
Mission projects”

Strategy &
Objectives
Programme & Project
Operational Portfolio Mgmt – Management
Planning & Mgmt Definition &
“Doing the projects
Monitoring
right”
Operational Mgmt Programme and Project
of on-going operations Mgmt of authorised
(BAU) P&Ps

Organisational and External Resources delivering tasks
13

Factors in project failures (OGC)

1. Lack of a clear link between the project and the organisation‟s key
strategic priorities, including agreed measures of success.
2. Lack of clear senior management and ministerial ownership and
leadership
3. Lack of effective engagement with Stakeholders
4. Lack of skills and proven approach to project management and risk
management.
5. Lack of understanding of and contact with the supply industry at senior
levels within the organisation.
6. Evaluation of proposals driven by initial price rather than long-term
value for money (especially securing the delivery of business benefits).
7. Too little attention to breaking development and implementation into
manageable steps.
8. Inadequate resources and skill to deliver the total delivery portfolio.

Examples of poor governance

15

Consistent failures: need for a new focus

 Heavy investment in change
delivery framework, tools and
skills (PM focus)
 Success rate for projects not
improved
 Need new “medicine”
 Could that be more focus on
Exec / Directors / Sponsor
roles?
 Successful Governance
leading to more successful
Delivery?

Directing Change from APM

• Portfolio direction
• Sponsorship
• PM Capability
• Disclosure and
reporting 18

APM Governance principles
1. The board has overall responsibility for governance of project
management.
2. The organisation differentiates between the projects and non-project
based activities
3. The roles, responsibilities and performance criteria for the governance
of project management are clearly defined.
4. Disciplined governance arrangements, supported by appropriate
methods, resources and controls, are applied throughout the project
lifecycle.
5. Every project has a sponsor.
6. There is a demonstrably coherent relationship between the overall
business strategy and the project portfolio.
7. All projects have an approved plan containing authorisation points at
which the business case is reviewed and approved. Decisions made at
authorisation points are recorded and communicated.

APM Governance principles
8. Members of delegated authorisation bodies have sufficient representation,
competence, authority and resources to enable them to make appropriate
decisions.
9. The project business case is supported by relevant and realistic information
that provides a reliable basis for making authorisation decisions.
10. The board or its delegated agents decide when independent scrutiny of
projects and project management systems is required, and implement such
scrutiny accordingly.
11. There are clearly defined criteria for reporting project status and for the
escalation of risks and issues to the levels required by the organisation.
12. The organisation fosters a culture of frank internal disclosure of project
information.
13. Project stakeholders are engaged at a level that is commensurate with their
importance to the organisation and in a manner that fosters trust
14. Projects are closed when they are no longer justified as part of the
organisation‟s portfolio

1. The board has overall responsibility for governance of project management.
2. The organisation differentiates between the projects and non-project based activities
3. The roles, responsibilities and performance criteria for the governance of project management are
clearly defined.
4. Disciplined governance arrangements, supported by appropriate methods, resources and controls,
are applied throughout the project lifecycle.
5. Every project has a sponsor.
6. There is a demonstrably coherent relationship between the overall business strategy and the project
portfolio.
7. All projects have an approved plan containing authorisation points at which the business case is
reviewed and approved. Decisions made at authorisation points are recorded and communicated.
8. Members of delegated authorisation bodies have sufficient representation, competence, authority
and resources to enable them to make appropriate decisions.
9. The project business case is supported by relevant and realistic information that provides a reliable
basis for making authorisation decisions.
10. The board or its delegated agents decide when independent scrutiny of projects and project
management systems is required, and implement such scrutiny accordingly.
11. There are clearly defined criteria for reporting project status and for the escalation of risks and issues
to the levels required by the organisation.
12. The organisation fosters a culture of frank internal disclosure of project information.
13. Project stakeholders are engaged at a level that is commensurate with their importance to the
organisation and in a manner that fosters trust
14. Projects are closed when they are no longer justified as part of the organisation‟s portfolio

Number 1 principle organisations
struggle with – poll result
14. Stopping Projects

13. Stakeholders engagement and trust

12. Culture of frank internal disclosure

11. Reporting project status

10. independent scrutiny

9. Project business case

8. Competence, authority and resources of decision-makers

7.Authorisation points

6. Portfolio alignment

5.Project sponsorship

4. Project lifecycle control

3.Governance responsibilities clearly defined.

2.projects and non-project differentiation

1.Board responsibility

0 5 10 15 20 25 30 35

Governance of project
management involves…
 Engaging with stakeholders to ensure change supports
organisational objectives (alignment)
 Defining where what type of change decisions can be most
effectively made (golden thread of delegation)
 Defining when critical change decisions need to be made
and those involved in making them (decision gates)
 Ensuring transparency of change decisions/actions and
communicating their outcome (reporting)
 Ensuring appropriate resources are in place (competence)
 Corroborating through independent review (assurance)

In practice….
Alignment Delegation Competence Decision Reporting Assurance
(objectives) (authority) Gates

Shareholders

Company Board

Programme
Board (+SRO)

Programme
Manager

Project Board

Project Manager

Governance isn‟t just what the project
board does!
CEO Board NED
Stakeholders
Directors
Risk
Partners
Portfolio Mgrs
Mgrs Sponsors

Programme Functional
Mgrs Mgrs

Assurance Project Suppliers
Mgrs Mgrs

They all need to be competent in their change role

Project Governance and GoPM
Project/Programme Level Organisational Level
Project board regularly chaired by a sponsor Individuals stay in sponsor role throughout each
project lifecycle
Governance structure for a project defined Sponsors are accredited and accountable
Progress reporting for a project is accurate and Projects report against a common template.
timely Exception reports available at executive level
There is a coherent project plan Projects are prioritised in line with strategic
objectives
Project stakeholders are involved in the The board directs the change agenda
direction of a project
There is an integrated assurance and approvals The board has oversight of the gate review
plan for a project programme – individual executives are
intimately involved in reviews
The project management team is competent All project players are trained, assessed against
and fully resourced a competency framework, accredited?
Capacity is balanced against demand
26

Improving governance of change
 Do a governance audit
– Use the „Directing Change‟ principles
– Understand your governance metrics
(time taken to make decisions, recycling rates for decision
requests, number of layers between requestor and decision-
maker, number of poor decisions, cost of poor decisions)
– Benchmark your metrics
 Target to improve both effectiveness and efficiency
 Treat governance as a system starting at the top and flowing
down (how are board decisions made and accounted for?)
 Integrate Governance of Change with Corporate Governance (it
is not an add on)
 Drive competence and performance at all layers and all
elements

Example Analysis
Frequency

Our Best Case

Our Worst Case
Industry Benchmark

Our Average

40% 10%
months
2.5 3 5.5 12

Unplanned waste

planned
waste
Project delays
Embedded cost of “standing army”
Breeds wrong behaviours – programmes hang on to resources / approval
sought too early / work is carried out at risk / programmes seek authority in Programmes risk losing resources
bigger tranches

The above covers the cost of conformance, but the cost of non-conformance is also
significant, e.g. Costs associated with rescuing contracts awarded before scope fixity

Webinar Content
 APM Governance SIG Introduction
 What is Governance of Project
Management
 Effective Governance
 Summary & Questions

Benefits of adopting a formal
approach
 Assurance that robust governance requirements are applied
across the projects managed in their organisation
 Optimise their portfolio of projects
 Avoid many of the common failures in project and
programme performance
 Improve relationships with staff, customers and suppliers
 Minimise risks to the organisation arising from projects
 Maximise the benefits to be realised from projects
 Assure the continued development of the organisation

Thank You

The Governance SIG is always seeking new members.
See the SIG pages on APM website for details.

www.apm.org.uk/group/apm-governance-specific-interest-group

Any questions?

Questions Asked during webinar
 I like the message but how do project manager level staff achieve what has been suggested
 So what else could we be doing to make the connections with senior leaders whose focus tends to major on strategic issues?
 For me I always place such matters in the risk log and highlight to snr mgr's. BUT oftern they are ignored. This is beyond stageholder mgr's
 How do we ensure that lessons are learned from governance failures in major projects and programmes? I was heavily involved with the Galileo
satellite navigation project for ESA/EU and have many insights into what went wrong but have found difficulty in finding anybody in the UK
Government with an interest in understanding this from a governance (as opposed to political) point of view?
 Is there a tool kit which could be supplied to sponsors/senior management etc
 Surley there must be a balance for a project and over-governance becomes a bigger problem??
 Politically, effective governance can put a magnifying glass over other dis-functional parts of an organisation and can be as unwelcome as the impact
of poor governcance!
 Who would normally do the independant review?
 Corporate PMO perhaps doing independent review
 How do you encourage investment in governance, i.e. skills & resources?
 Can you expand on how to benchmark the metrics or did you mean baseline metrics
 Tip : Anyone who is part of an organisation with an internal audit function should find they can be very helpful in addressing governance of project
management issues. They should have seen examples of any significant governance failings.
 There was a benchmark for best case - 3months, but was is the average industry benchmark for decision making?
 Have all corporate member organisations been invited to take part in benchmark studies?
 you said there are different functions of PMO, do you have anything on main principles of PMO dept.
 Going back to a previous slide share what is meant by the term 'accredited' Sponsor.?
 What do you think the interdependencies are between project governance and programme governance (when considering strategy, delivery,
objectives etc)
 My Question: Benefits Management delivery plays a key role in a succesfull outcome to the corporate road map. But this is outside the scope of a
project and in the hands of the stakeholders. How do we ensure once a product has been delivered into organisation this is achieved successfully?
 Going back a few slides, can you expand on how to benchmark the metrics or did you mean baseline the metrics
 Good sponsors are key to project success, what tips do you have for sponsor engagement and how can a PM influence this?
 In an organisation where there are a number of different federated business units with different cultures (some running agile projects other taking a
more waterfall approach) but where there are also central functions ñ IT, Finance etc how can you align an approach to governance?

For follow-up contact

Martin Samphire Andy Murray
msamphire@3pmxl.com andy.murray@outperform.co.uk
+44 7798 700314 +44 7776 301602

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Effective governance

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