Project management governance: How much is enough?

What's the best way to apply governance to project management? CIOs need a light hand, and a deft blend of process focus on increasing project completion rates.

Most large enterprises have some form of IT project management governance, according to a recent survey, but nearly 7 in 10 survey respondents were dissatisfied with how involved those governing bodies were with project and portfolio management (PPM) decisions.

Indeed, 46% of respondents to the project and portfolio management (PPM) and IT governance survey, conducted in May with 304 respondents, wish their PPM governing body was more involved. And a surprising percentage (22%) wish it were actually less involved.

Where's the balance for effective project management governance? Experts suggest that it depends on the size, maturity and complexity of projects within the organization.

 Genworth Financial created a robust governance system in an effort to standardize its project management offices. The 6,000-employee company built its formal PPM and governance model from the ground up when three business units merged into one, changing the business direction and bringing together more than 500 associates and contractors from three complex IT shops.

"There were three separate IT teams, three finance teams and all projects were tracked in different ways," said Joyce Perry, IT solutions leader at Genworth Financial. "It took a long time to gather the information and data, consolidate it all and get one common view."

The reorganization and standardization process required a strong governance model to enforce procedures and maintain unity. "Whenever you are changing the business culture, you need a procedure for this," Perry said. "You need processes in place or else the PPM tool will just sit there with people in all different locations going all different directions."

The financial firm has everything accounted for in its project management governance model: a steering committee, essentially made up of the executive team; a process execution team for coaching, mentoring and supporting project leaders; and teams on the IT and operations sides for technical support.

According to Perry, the system has substantial benefits. "You have a place to go to for assistance, to receive coaching from process and subject matter experts," she said. "And from the IT standpoint, you know you've got a process that is maintained and governed across the board."

Before a project proposal goes before the steering committee for a final decision, the proposal already will have been vetted and given clear ROI estimates, a business objective and other important criteria important.

But even with governance and formal PPM in place, many organizations still struggle.

What's causing increased project failure rates?

Despite the use of typical PPM governance models and strategies, projects still fail. Sixty-eight percent of projects failed, according to The Standish Group International's CHAOS Summary 2009. Only 32% of projects actually succeeded, meaning they were on time and on budget, with required features and functions.

According to Jim Johnson, chairman of The Standish Group, this is not entirely due to poor project management in the traditional sense. About 97% of the survey respondents used some sort of PPM tool, and "a lot of these companies had a PMO and a great deal of them had steering committees," Johnson said.

Of course, not all projects and organizations are the same, and the bigger the project, the greater the potential for errors and problems. But at what point could processes and procedures actually hinder the success of a project? To answer this, it's often necessary to look at the business and economic environments.

A bad economy could actually encourage more process and PPM governance because people are oftentimes less likely to bend the rules. "When every decision is scrutinized, people follow process by the book," said Shawn Pressley, vice president of project management systems at Hill International Inc., a large construction company with more than 80 offices worldwide. And although Pressley agreed that the best way to manage a project is to stick to process and use the PPM tool as a way to be leaner and more efficient, he added a caveat -- this works only if the project manager has a very firm grasp of the business.

"Just as you wouldn't have an accountant build a house, you wouldn't have a project manager who didn't understand the business needs," Pressley said.

The construction company has a seven-member steering committee that includes executives, to keep projects aligned with business objectives, and field workers, who can provide accurate project expectations. "We keep an odd number for voting," explained Pressley, who called the mix a recipe for success.

The governance processes are modeled after efficiency procedures such as Six Sigma repetition and follow International Society of Automation and American Society for Quality recommendations to maintain speed and flexibility in project deployment. "You can have the biggest guns in the world, but if you don't have the flexibility to come in quick, you're going to lose the battle," Pressley said.

Is process getting in the way of project management success?

According to Johnson, smaller, agile projects have a better success rate because the time frames are tighter and the processes tend to be less complex. When larger projects wobble and begin to show signs of failure, project managers try to brace them with more processes and procedures. The added procedures could then stall the project even further, possibly putting it past deadline or over budget. This often leads to project managers believing more process is necessary, and so on -- leading to "paralysis by analysis."

"It becomes a vicious cycle or process getting in the way of the project when we really just need to get the job done," Johnson said.

Johnson recommends re-evaluating project management processes and procedures to determine if they still have value. "Maybe they worked at one point, or maybe you thought they were good and they weren't," Johnson said. It's important to do a peer review, analyze what the processes are really delivering and measure the business value.

"Remember, these processes are in place for the project," Johnson said. "Project managers should have a little less conversation and more execution."


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