Project Governance: What it Is & How to Implement
Rule the World: Project governance helps make sure you have effective accountability, standardization, and risk management, which ultimately reduces the likelihood of project failure.
Standardization Saves Sanity: With proper governance procedures in place, you can maintain consistency and coherence on your projects, and teams will adhere to standardized processes.
Embrace Software Tools: Project management software tools can help you set and manage processes, build accountability, and increase standardization.
Project governance isn’t just about setting rules. Without this important process in place, you’ll run into issues like a lack of accountability, standardization, and risk management—all of which put your project at risk for failure.
In this article, I’ll discuss the importance of project governance, its components, best practices for making sure your efforts are effective, and how project management software tools can help you implement it successfully.
What Is Project Governance?
Project governance is a framework that outlines how projects are managed and executed throughout your organization. It makes sure that all projects are in alignment with your company’s strategic goals, and provides policies and processes that act as guardrails to keep your projects on track.
Why Is Project Governance Important?
Project governance is important because it helps make sure your projects are aligned with your company’s goals. It provides the necessary structure and principles that guide effective project execution, helps deliver the intended value, and reduces risks.
Governance fulfills these critical functions.
- Guides your processes, policies, and structures
- Defines how projects are managed and controlled
- Provides mechanisms for oversight and control
- Sets criteria for the decision-making process
- Helps you make decisions that are in the best interest of your project and company
- Establishes clear lines of accountability and responsibility
- Defines who has the authority to make decisions
3 Pillars of Project Governance
Project governance has three key pillars: structure, people, and information.
- Structure: This pillar provides a well-defined governance framework along with processes and policies that establish a hierarchy of roles and responsibilities, define decision-making authority, and set up a system of checks and balances. It also creates a clear roadmap for project execution and helps everyone understand their roles to minimize confusion and improve team productivity.
- People: This pillar defines who is involved in projects and what their role is (e.g. the project owner, consulted stakeholders, decision-makers, etc.) so you can identify the right people and place them in roles that align with their skills and expertise. Governance might also set out policies for ongoing training and development to keep people up to date with best practices and emerging project management trends.
- Information: This pillar helps make sure you have the right data and information about your project, and that it’s accurate and timely. The information pillar also involves setting up systems for data collection, reporting, and analysis. You’ll use this information to make informed decisions, track progress, evaluate performance, and identify potential issues before they become problems. Information also improves transparency and trust among stakeholders.
Project Governance Components
These governance framework components and elements help guide project execution, delegation of work, team conduct, and accountability, as well as align outcomes with your company’s goals.
Governance Models
Governance models define the structure and hierarchy of your project. These are examples of models you might choose depending on your company’s size, complexity, and specific needs.
- Centralized: This model uses individual authority or a team to make key decisions and enforce policies.
- Decentralized: In this model, your project team or functional unit can manage the project with limited additional oversight.
- Hybrid: The hybrid model combines a centralized and decentralized approach, typically using centralized policies and decentralized execution.
Accountability and Responsibilities
This component involves providing clarity on roles and responsibilities and defining who is accountable for which work. It helps you make effective and timely decisions with a higher degree of accountability.
For example, your team members are responsible for completing project tasks and deliverables, while stakeholders are responsible for providing input and feedback to make sure the project meets their needs and expectations.
Stakeholder Engagement and Communication
This component involves keeping stakeholders informed and engaged throughout your project’s lifecycle. This includes setting up communication channels for things like progress reports and feedback.
For example, you might set up a standard cadence, status reports, and other communication to keep stakeholders informed and engaged. This helps you manage stakeholder expectations, address concerns promptly, and increase trust.
Meetings and Reporting
This component helps you monitor project progress and keep your projects on track. It involves establishing timelines for regular meetings, defining the agendas, recording minutes, tracking action items, identifying potential issues early, and taking corrective actions promptly.
Risk and Issue Management
This component involves identifying, assessing, and mitigating risks and issues. You’ll develop a standard process for risk management planning, risk identification, assessment, mitigation, and monitoring. This helps address potential problems before they impact your project's success.
You’ll outline clear, practical risk management strategies that cover how issues will be identified, assessed, and resolved. This also involves setting up a process for documenting and tracking issues, and then addressing them promptly.
Assurance
This component involves defining mechanisms for oversight and control like internal project audits, peer reviews, and external assessments. Quality assurance is important because it helps you determine whether project deliverables meet the required specified standards and expectations.
Set up processes for conducting regular quality assessments, quality planning, quality assurance (QA), quality control (QC), and continuous improvement.
Project Management Control Process
This component involves setting up processes for monitoring and controlling project execution. You’ll set up a cadence for tracking your project's progress against the project plan; measuring performance against key milestones, deliverables, and budget; and providing updates to stakeholders.
You’ll also want to establish which metrics and key performance indicators (KPIs) you’ll use, set up monitoring systems, and establish mechanisms for corrective actions to keep your projects on track and deliver the expected outcomes.
Who’s Involved in Project Governance?
Here are the key roles involved in project governance.
Sponsors
A project sponsor (typically a senior executive) provides the overall vision and direction for your project. They align the project with strategic company goals so it delivers the planned value.
Sponsors also approve the necessary resources, support the project team, are accountable for the project's success, and engage with key stakeholders to manage their expectations.
Project Manager
As the project manager, you’re responsible for the work and providing guidance throughout the project life cycle, including planning, executing, and closing the project. You make sure the project stays on track, manage risks and issues, and deliver the expected outcomes.
You also communicate with stakeholders, provide regular updates, address concerns promptly, and make sure your project is executed following the governance framework.
Steering Committee
The steering committee is a group of senior executives and stakeholders who provide oversight and guidance on the project. The committee makes high-level decisions, resolves issues, and keeps the project aligned with company goals.
They also meet regularly to review project progress, address any concerns, and provide your project team with the necessary resources.
Project Management Office (PMO)
The project management office (PMO) establishes and maintains the governance framework and provides you with support and guidance to make sure projects are executed following the governance framework.
The PMO also monitors project progress, provides regular updates to senior management, and follows project management and governance best practices.
Benefits of Project Governance
Here are the key benefits of implementing project governance.
- Alignment with organizational goals: Project governance helps you make sure your projects are aligned with company goals, carry out project execution in a way that matches your org’s standards, and prioritize projects that offer the most value and allocate resources efficiently and effectively.
- Effective risk management: Project risks can lead to project failure. Governance helps you proactively and systematically identify, assess, and mitigate risks so you can address issues before they threaten your project.
- Improved stakeholder engagement: Project governance helps you keep all stakeholders informed and engaged throughout your project’s lifecycle. With the right input from them, you can meet the project objectives and deliver the expected value. It also helps you manage expectations and address concerns promptly.
- Increased transparency and accountability: Project governance establishes clear lines of accountability and responsibility so decisions are made in a timely and effective manner. This minimizes confusion, increases trust among stakeholders, and increases the likelihood of project success.
Common Challenges and How to Overcome Them
Here are some common project governance challenges and how to overcome them:
- Resistance to change: If you encounter resistance to change, involve team members and stakeholders in the governance process and provide them with the necessary training and support. Communicate the benefits and address any concerns promptly to gain buy-in.
- Unrealistic stakeholder expectations: If you’re finding that your stakeholders’ expectations are not realistic, set up communication channels, regular meetings, and feedback mechanisms. Keep them informed and engaged throughout your project’s life cycle to counter any unrealistic expectations and address concerns promptly.
- Resource constraints: If your project resources are limited, make sure you’re conducting sufficient planning and resource management and prioritizing projects that offer the most value for the resources required. Regularly identify, monitor, and report potential constraints early and take corrective actions promptly.
How to Implement Project Governance
Here’s how to implement project governance at your organization.
1. Develop a Governance Team
Build a governance team that can provide an overall strategic direction and oversight and approve your project scope, budget, and timelines. This team should include a steering committee, project sponsor, you as the project manager, the PMO (if that department exists), and key stakeholders.
2. Establish a Clear Governance Framework
Define the roles, responsibilities, and decision-making authority within your project team. Specify who is accountable for what, and make sure there’s clarity, and avoid ambiguities.
You might need to set up different frameworks for different project types. Make sure each framework aligns with your company’s broader strategic objectives and project goals to provide coherence and clear direction.
3. Develop Team Processes and Procedures
Standardize your governance procedures to maintain consistency and make sure all stakeholders, especially your team members, are on the same page. Use established project methodologies like PRINCE2 or PMBOK as a reference to create your processes.
Regularly review and update these processes to adapt to any changes to your workflows, organizational goals, or priorities. How well your team follows these processes will impact key areas such as risk management, issue resolution, decision-making, and project performance.
4. Establish Communication Channels
Communication is key to getting buy-in on governance. Establish a communication plan that identifies key channels for disseminating governance policies, procedures, and frameworks, so information flows seamlessly among all stakeholders.
This includes setting up regular meetings, progress reports, and feedback mechanisms. Transparency is critical; make sure that everyone is kept informed about any changes in governance.
Tools for Project Governance
Effective project governance requires the right tools. Here are some types of tools that you can use to increase visibility and meet intended project goals.
- Project management software: This software helps you plan, execute, and monitor your projects with features for task management, resource allocation, progress tracking, and reporting.
- Governance, risk, and compliance tools: GRC tools help you identify, assess, and mitigate risks with features such as risk assessment, risk mitigation planning, and risk monitoring. They can also help you comply with regulations specific to your industry.
Project Governance Best Practices
Here are some best practices to keep in mind as you’re implementing project governance.
- Make sure your governance framework is clear: Be clear when you develop your governance framework by defining roles and responsibilities, and set up a communication plan that identifies key channels. Engage with stakeholders frequently and clearly to keep them informed and address concerns promptly. Regularly monitor and report potential issues and take corrective actions.
- Conduct ongoing training and development: Provide training and development to team members to make sure they have the necessary skills and knowledge to comply with governance policies and processes. This helps keep everyone updated with changes and best practices.
- Leverage the right tools: Using project management, project governance, or risk management software decreases manual work, improves overall efficiency, and increases everyone’s ability to adhere to governance rules.
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