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Project Governance
New Solutions to Common Problems
Mark Swan 20 May 2011
Schedule for the Morning
• Introduction & Get to Know You
• 1st session – Recap on Why Projects Fail
• 2nd session – Recap on Stakeholder Management
• Coffee Break (10:15, approx.)
• 3rd session – Programme / Project Governance
• Questions & Answers
Introduction
• Me:– Chemical Engineer by training– Now, a practising programme and project manager– Also, advise on best governance arrangements– Work in both public and private sectors
• You:– ?– ?– ?
1st Session - Recap on Why Projects Fail
•
• – central records project; £2.7bn spent to date!! A terrible example case study
• So, why DO projects fail?• What do you think?
“This project is a
farce and has
been an utter
waste of money!”
Simon Burns, Health Minister
BBC Radio 4, 18 May, 2011
1st Session - Recap on Why Projects Fail
• : says it’s often a lack of:
– Link between an organisation’s strategy and the project
– Agreed measures of success– Ownership and leadership– Engagement with stakeholders, incl. suppliers– Relevant skills (P.Mgr?) and proven approach– Manageable steps in the plan– Properly documented business case– Follow through on benefits realisation
1st Session - Recap on Why Projects Fail
• Research at Queensland University of Technology (QUT) 2010: all of the above +
– International, cross industry study; key conclusion was that:
“Dominant issue is poor Project Sponsor/Project Board performance ………”
1st Session - Recap on Why Projects Fail
• Ross Garland and Me: all of the above +
– Lack of focus on service delivery
– Ineffective Project Board decision-making
– Confusion over objectives
– Risk aversion – favours the right thing, rather than what is right (e.g. dogged adherence to methodology)
1st Session - Recap on Why Projects Fail
• Some key thoughts –you need to get these right!
Project Manager (s)
Methodology and -
its application !
Stakeholder
managementGovernance
1st Session - Recap on Why Projects Fail
• 1st Break Out Session
– What are the qualities of a good project manager?
– What’s your blockbusting question, when recruiting a PM?
– 15 minutes– 2 from 7 teams to report back
1st Session - Recap on Why Projects Fail
• The Qualities of a Good Project Manager (PRINCE 2); should be good at:– Planning– Time management – People management– Problem solving– Attention to detail– Communication– Negotiation– Conflict management
1st Session - Recap on Why Projects Fail
• The Qualities of a Good Project Manager (research by Pearce Mayfield – the ‘Mental Crib Sheet’):
The ‘α – trait’ manager:
1. Exhibits self
awareness
2. Has a bias towards
relationships
3. Plans naturally for the
unplanned
1st Session - Recap on Why Projects Fail
• Methodologies; 7 principles of PRINCE 2 are not a bad start:
Continued
Business
justification
Learn from
experience
Defined roles &
responsibilities
Manage by
stages
Manage by
exception
Focus on
product delivery
Tailor to suit
your needs
1st Session - Recap on Why Projects Fail
• Methodologies; as well the 7 themes of PRINCE 2 are good pointers for success:
– Focus on business case throughout
– Organisation of the project is critical
– Quality really matters
– Plans – provide communication & control
– Risk – look ahead to see what might bite you!
– Change – it’s a certainty, so manage it!
– Progress – cue for decision-making
1st Session - Recap on Why Projects Fail
• Your experiences?
• Questions?
2nd Session – Stakeholder Management
• A PRINCE 2 definition:
– Any individual, group or organisation that can affect, be affected by, or perceive itself to be affected by, an initiative (programme, project, activity, risk)
2nd Session – Stakeholder Management
• Two grids to think about to help you manage stakeholders……..
2nd Session – Stakeholder Management
• Grid 1 – The Power / Interest Chart
Keep satisfied
Keep informedMonitor
Manage closely(see next grid)
Low HighInterest
Power
Low
High
2nd Session – Stakeholder Management• Grid 2 - Type of Stakeholders
Supporters (positive
but not active)
Champions (use
their power to get
people behind them)
Fence –sitters
Critics (negative, but
only passively resist)
Blockers (use their
power to undermine)
Passive Active
Opposition
Support
2nd Session - Stakeholder Management
• Your experiences?
• Questions?
• Coffee Break (20 minutes)
Research sponsored by OGC and APMG at Queensland
University of Technology, published 6 August 2010
“……………The dominant issue for failure to deliver
against programme objectives is poor Project
Sponsor/Project Board performance…………….”.
3rd Session – Governance
Project governance is the
management framework within
which project decisions are
made.
3rd Session – Governance, Common Issues
Silo Decisions Pet ProjectsManagement Time
Narrow Vision Too Many Projects Wasting Money
3rd Session – Governance Principles
1) A single point of
accountability for the
success of the project
Speedy project
initiation, clear direction
2) Service delivery
ownership determines
project ownership
Ensures project
outcomes meet service
delivery needs
3) Separation of
stakeholder management
from decision-making
activities
Avoids numerous
stakeholders clogging
decision-making forums
4) Separation of project
governance and
organisational governance
Empowers the project
board to act independently
3rd Session – Governance
Project Owner is the Service Owner
Service Level
Existing Service Level
New Future Service Level
Project enables transition to new
service level
The Project
Time
Service degrades naturally over time
3rd Session – Governance, A generic model
Senior User Project Owner Senior Supplier
Project DirectorProject Board
Investment Decision Group
Project
Manager
Project Team
decision making path
advisory & feedback path
Stakeholder Working Group
Chair: Project Director
Strategic Advisors Group
Chair: Project Owner
3rd Session – Governance• Real Case study – a new start-up regional gas utility company has won the
franchise:– to inherit ownership of the existing gas pipeline network from British Gas;– to deliver a new connection service to new domestic and business
customers;– to provide an emergency gas leak response unit;– and, to set up routine maintenance on the network.
• The business environment is heavily regulated and there are stiff penalties for failure – e.g. on failure to hit response times and for overruns on ‘holes in the ground’. A new organisation is needing to be trained, but staff and management terms and conditions have still to be finalised. There are lots of existing working practices, but nobody knows whether they will suitable in the new business environment. Some old computer systems are available from British Gas, but most are new and have been purchased from a variety of suppliers, and have never been tested together before. A £18m budget for the Change Programme has been granted by the owners / investors, but have made it very clear, if this programme fails, then the business fails!
• Who are likely to be the stakeholders and as Programme Director how should I include their views? What governance arrangements should I set up?
• 2nd break out session – 30 minutes; 2 teams to report.
Session 3 – Governance and Key Closing Messages, Follow Up Actions
• Define and agree a clear enterprise policy on programme governance
• Determine investment ownership and accountability
• Ensure efficient project and program initiation
• Define decision rights – i.e. which governance bodies make what decisions
• Agree gating processes to ensure on-going executive management control
• Review current portfolio for performance; cull no-hoper projects and free up scarce resources (people, skills and £)
3rd Session - Governance, The Book
Governance
Published by Kogan Page 2009
Builds on established best practice
Acknowledged by the OGC, Association of Project Management
Practical guide to decision making
Integrated governance for Portfolios, Programmes & Projects
3rd Session - Governance
• Your experiences?
• Questions?
Thank You
Back up charts
Effect of Poor Use of Scarce Resources
Note: size of circle represents planned effort needed to fulfil project. Colour of
circle represents expected return: green is high; orange is low; red is a loser
These 4 Planned
Projects
In the Pipeline are
‘Crowded Out’
High expected returns
High expected returns
Low expected returns
Low expected returns
Scarce operational budget (£)
for ‘business as usual’
Scarce operational headcount budget
(#FTEs) for ‘business as usual’
„Dog‟ project
„Dog‟
„Dog‟
A Project Portfolio in Trouble