What is Project Governance? Components, Frameworks, Examples

The difference between Project Management and the Project Governance is often misunderstood by people working in corporates. Although Project Governance and Project Management work towards a common goal of project/organizational success – it is necessary to understand and defining the roles and boundaries of Project Governance, Project Management and the role of Project Governance in the Project Management.

To simplify things – it helps to understand that the Governance in project management acts like a constitutional guideline for the Project Management based on the principles, objectives, goals and policies of the organization – under which the project management, advisory committee and project development team has to operate. Let us try to understand the finer aspects, differences and boundaries of project governance, project management and the role of project governance in project management.

What is Project Governance?

The definition of project governance refers to a framework or a collection of structures, procedures, guidelines, and policies that are agreed upon by the project management team to drive project progress and measure project success. These guidelines are the basis of all important decisions that are made during project lifecycle. 

Project governance is usually outlined or charted by the Project Management Office (PMO) of the organization in alignment with the organization’s policies. All Project Management classes online explain and demonstrate project governance in project management in varying capacities using real project scenarios. Let us also take a deep dive in understanding what is meant by project governance and why it is important.

Why is Project Governance Important?

Project governance meaning sets the goal and lays the path for the Project Management team to plan, drive, execute, and measure all projects in an organization. It provides a framework to the project management team to take result-oriented decisions that align with the larger organization’s goals and policies. 

It also defines and sets standards of project planning, project communication, project execution and evaluation. Therefore, Project governance standards work as the guiding principles of all project management decisions and derivatives. PMP Corporate Training provides in depth understanding of the roles and responsibilities in the Project Management and the influence of Project Governance in the overall project management.

The Three Pillars of Project Governance

The relevance, effectiveness and the success of project governance relies on 3 foundational pillars.

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• Structure: The project should have a defined foundational structure of support and guidelines from the organization or the senior leadership. This means that the decision capabilities, inter-dependencies, business flows and the integration of everything that lies in between is clearly explained and understood by all relevant stakeholders of the project management.   This is usually the pillar of vision in the project governance.
• People: Bringing in right balance of experience, competence, and representation of all interests into the project management. This is where the senior management brings in efficient project manager(s) to drive the project towards laid of goals.  
• Information: Information is a tool to drive many important and corrective decisions to reach the project goal. Open, uninterrupted, and timely communication is of paramount importance to facilitate the flow of the information in real time to be able to benefit from statistics and metrics.

What Does Project Governance Include?

Project Governance is not a one-size-fits-all tool or framework for an organization. The project management office carefully evaluates and develops a tailor-made framework and guiding principles for the project management teams to follow during project planning and execution. It therefore depends largely on the project management office to determine what elements collectively constitute Project Governance. In general in includes:

• Policies and Procedures: Policies and Procedures are guidelines to help project managers to plan, execute, and deliver a successful project. 
• Regulations: These guidelines usually deal with compliance.
• Functions: The basic functions include planning, organizing, staffing, controlling, etc
• Processes: The process include Project Initiation, Project Planning, Project Execution, Monitoring, etc.
• Responsibilities: This element represents the ability to own, direct, demonstrate and manage individual tasks or teams to ensure project success.

We recommend accredited PRINCE2 training for a comprehensive understanding of the project governance in the project management.

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Components of Project Governance

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There are eight project governance components that are relevant in the real-world project governance and project management. They are:

1.  Governance Models

Based on critical parameters of project such as timeline, relevance, complexity, budget, and importance – project management office along with the senior leadership will formulate and customize a governance model or framework with a sequence of important and compulsory project governance inclusions that the project management should adhere to - such as policies, procedures, regulations, functions, etc.

2. Accountability and Responsibilities

Project management clearly etches out a plan with accountability and responsibility for all project tasks. The part of this Project Governance component is to pick the right person for the right job and to ensure everyone understands their roles and responsibilities within the project team. Apart from defining who is responsible for the task, project management also defines who needs to be accountable and who needs to be consulted for discussion and completion of the project task.

3. Stakeholder Engagement

This component talks about identifying and engaging all relevant stakeholders by analysing the complete project ecosystem. We will need to identify and bring in the sponsors, vendors, the project development team, legal advisors, product/project owners, business leaders, etc. This will ensure everyone will be aware and contribute to ensure project success. Project manager has to define stakeholders.  

4. Stakeholder Communication

After stakeholders are identified, and responsibilities are defined, project manager develops a project communication plan to streamline effective project communication across all stakeholders. Once the communication plan is formulated, it needs to be published to all the stake holders so that the stakeholders know when and how to expect the project communication from project manager and the project teams. A good project communication plan ensures that the information is always timely, concise, accurate and relevant to all the audience of such communication.

5. Meeting and Reporting

Meeting and Reporting are also a part of the project communication plan that is devised in the Stakeholder Communication component of the project governance. A balanced schedule of meeting and a framework for reporting is crucial to ensure all relevant parties are included and consulted in brainstorming, knowledge sharing and project update meetings. A clear schedule of meeting reporting will help to track milestones and navigate decision gates with an inclusive approach.  

6. Risk and Issue Management

Due to the dynamic nature of the project requirements and developments, risks and issues are always going to be a part of project lifecycle. While it is impossible to identify all risks at the beginning of the project – the project stakeholders can and should agree on the means to identify and categorize risks before even devising the plan to mitigate risks. This is a preliminary step to identify and arrive at mitigation steps to eliminate risks.

7. Assurance

The Project Assurance component concentrates on management and mitigation of risks and develops metrics to instil the stakeholder or project sponsor’s confidence on the probability of the successful delivery of the project. The important aspect of assurance is to develop metrics to accurately measure project success or completion.

8. Project Management Control Process

The monitoring and controlling process controls tasks and metrics related to the project and measures progress. Also, this is not a one-time assessment; the manager needs to measure the performance regularly and to be able to act on any deviations on time/resource mapping.
The complete guide to Project Management and the implementation of Project Governance in the project management is available on KnowledgeHut’s Online Course for Project Management.

Project Governance Model

As mentioned , Project Governance Model is an individual model adopted with the Framework, for the project needs and organizational goals considering various project parameters such as complexity , stakeholders, business goals, customer needs, etc.

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Project Governance Frameworks

Project Governance Framework simply provides us with a set of guidelines or the collection of processes that can be used to run the project whereas in its simplest form, Project Governance Model is a way of devising and enabling synchronous interaction between decision-making structures, Operating Procedures, and effective collaboration processes.

To further answer what is project governance? In many cases, the governance Framework and Model are used interchangeably but in reality, while the framework provides guidelines – the model implements the guidelines to create a working structure of policies and procedures that works best for the project needs and organizational goals. We will see further as to how we can use a Project Governance Model.

Project Governance Roles

Project Governance Roles can be broadly categorized into 3 groups:

• Project Owner: The project owners set the responsibilities and accountability of the project manager who will lead the project.
• Key Stakeholder: The key stake holders are sponsors who fund the project, suppliers, vendors, and business users of the end product of the project lifecycle.
• Advisory Group: Advisory group helps break logjam and make decisions when multiple parties or stakeholders of various interests are in involved.

How to Use a Project Governance Model?

We can follow the below steps to effectively create and use a Project Governance Model that works best for our organizational needs. To create a good governance model, you will have to ensure all relevant  Components are catered to by your Model

1. Identify Stakeholders
2. Choose and Prioritize Business Goals or Strategic Objectives as applicable to your organization and customer needs
3. Create result oriented and transparent processes.
4. Choose the right people for the right job and ensure representation of all interests
5. Provide necessary tools to make the project contributors more efficient.
6. Identify and Remove Bottlenecks
7. Communicate Clearly

The detailed steps for project governance have been discussed at length in the Project Governance Components section of this article.

Project Governance Examples

To better understand the role of project governance in the real world, let us take an example of project governance of a domestic soccer team that is preparing for an upcoming premier league. The owner of the team will act as a project sponsor. The team squad will be the project team where everyone’s roles and responsibilities are well defined and understood by everyone. The captain along with the coach will be the project management team or the project managers tasked with ensuring project success, which in this case is to perform above the defined standards in the upcoming tournament and finish in the top four spots.

Now the project owners or sponsors will be the owners of the soccer club. The board along with independent consultants can act as an advisory committee. The coach and his support staff can constitute the project management team – which will plan, mentor and analyse the strength, weaknesses, opportunities, and threats of the current team and plan a roadmap for the team to be successful before the season begins. The role of project management governance is critical here. A project governance team, usually constituted by top management, is responsible for giving general directives that need to be adhered to by the project management team, consultant experts, and the project development team. In case of soccer club, the project governance can be something like below.

• Be Punctual, Practice Regularly.
• Attend weekly team meetings without fail.
• Regular medical check-ups are mandatory.
• Maintain team discipline and build team spirit.
• Work to promote the brand of the team sponsors.
• Plan to connect with media and fans with regular press conference.
• Do not indulge in any unlawful activities that can tarnish the image of the club.
• Always be ambassadors of the highest quality of Sportsmanship, etc.
• Build a safe and open environment for the team to thrive.

It is the responsibility of everyone that represents the club to ensure these guidelines are followed and every department, team and individual is operating within the framework provided by the project governance. This is a simple example of what a project governance could mean in general, but this can change and include more specifics depending on the needs and goals of the organization.

Summing Up Project Governance

In conclusion, the answer to understand what is project governance is that it is framework of rules, guidelines and procedures that can repetitively guide project management in decision making to yield successful results. The project management team is expected to act within the framework or ambit of the project governance to ensure the organizational goals, policies and successful are adhered at the individual project level.