MONTHLY COLUMN:

ADVANCES IN PROJECT MANAGEMENT

Project Governance

By Dr Ralf Müller

Editor’s note: The series on Advances in Project Management was launched with a Guest Editorial by Professor Darren Dalcher and first article in the December 2009 edition of PM World Today. Please read that introductory editorial here, where Professor Dalcher explains and sets the stage for articles in this exciting series by leading authors in the field of project management. Please read previous articles in the series by visiting the archives, beginning with the December 2009 edition. Each month’s article is introduced by Professor Darren Dalcher, editor of the Series on Advances in Project Management. To read Professor Dalcher’s introduction to this month’s article, visit www.pmworldtoday.net.

Governance starts at the corporate level and provides a framework to guide managers in their daily work of decision making and action taking. At the level of projects governance is often implemented through defined policies, processes, roles and responsibilities, which set the framework for peoples’ behaviour, which, in turn, influences the project. Governance sets the boundaries for project management action, by

• Defining the objectives of a project. These should be derived from the organization’s strategy and clearly outline the specific contribution a project makes to the achievement of the strategic objectives

• Providing the means to achieve those objectives. This is the provision of or enabling the access to the resources required by the project manager

• Controlling progress. This is the evaluation of the appropriate use of resources, processes, tools, techniques and quality standards in the project.

Without a governance structure, an organization runs the risk of conflicts and inconsistencies between the various means of achieving organizational goals, such as processes and resources, thereby causing costly inefficiencies that negatively impact both smooth running and bottom line profitability.

Approaches to governance vary by the particularities of organizations. Some organizations are more shareholder oriented than others, thus aim mainly for Return on Investment for their shareholder (i.e. having shareholder orientation), while others try to balance a wider set of objectives, including societal goals or recognition as preferred employer (i.e. having a stakeholder orientation). Within this continuum, the work in organizations might be controlled through compliance with existing processes and procedures (i.e. behaviour control), or by ensuring that work outcomes meet expectations (i.e. outcome orientation). Four governance paradigms derive from that and are shown in Figure 1 below.

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About the Author Dr. Ralf Muller Author   Dr Ralf Müller is Associate Professor at Umeå University, Adjunct Professor at the Norwegian School of Management BI and at SKEMA Business School in France. He lectures and researches in project management, leadership, governance of project-based organizations, as well as research design and methodology. Prior to his academic career he spent 30 years in consulting large enterprises in project management and governance, e.g. as worldwide Director of Project Management at NCR Teradata.