Subscriber only lesson.

Sign up to the Project Management for Experts course to view this lesson.

View pricing

About this lesson

Project governance is the organizational institutionalization of a project management methodology.

Exercise files

Download this lesson’s related exercise files.

Project Management Governance.docx
210 KB Project Management Governance - Solution.docx
209.8 KB

Quick reference

Project Governance

Project governance is the organizational institutionalization of a project management methodology.

When to use

Large organizations with many projects find a need for governance to improve communication and project performance.  Project governance ensures that all project teams and stakeholders are following the project management methodology.  This standardization simplifies some aspects of project management (planning and reporting) although it can become bureaucratic and burdensome if the methodology is not flexible and responsive to the unique needs of each project.  Effective organizational project governance requires a Project Management Office (PMO) to maintain the methodology and ensure compliance.

Instructions

A small organization with only a few projects maintains governance as part of project planning, control and stakeholder communication.  Each project can be unique and still be adequately supervised by senior management.  However in large organizations, a PMO is normally used for project governance.  There is no standard for what a PMO is or does, but they typically can be characterised as one of three types.  Your organization needs to decide which type is best suited to your organizational culture and business needs.

Subject Matter Expert (SME) PMO

The SME PMO is normally a one person organization.  The SME maintains the procedures and templates that comprise the methodology.  The SME will also act as a coach for a project team or stakeholders if they require it.

Oversight PMO

This PMO is normally a small team of individuals who are project management SMEs.  They maintain the procedures and templates of the project management methodology.  In addition, they often chair or run the management reviews, stage gate meetings and technical reviews.  They do quality audits on the projects to ensure that the project teams are using the methodology correctly.  They often create and maintain dashboards or summary reports for how all projects are progressing.

Leadership PMO

This PMO is really a project department.  In addition to doing everything that the other two types of PMOs do, in this case, the Project Leaders and often the Core Team members are assigned to this organization.  The PMO manages the project resources in addition to managing the project management methodology.

Definitions

Project Governance: “The alignment of the project objectives with the strategy of the larger organization by the project sponsor and project team. A project’s governance is defined by and is required to fit within the larger context of the program or organization sponsoring it, but is separate from organizational governance.” PMBOK® Guide

Project Management Office (PMO): “An organizational structure that standardizes the project-related governance processes and facilitates the sharing of resources, methodologies, tools, and techniques.” PMBOK® Guide

These definitions are taken from the Glossary of the Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Fifth Edition, Project Management Institute, Inc., 2013.

  • 00:04 Hello, this is Ray Sheen.
  • 00:05 I'd like to talk with you about project governance.
  • 00:08 The Project Management Body of Knowledge, the PMBOK Guide,
  • 00:11 defines project governance as the alignment of the project objectives with
  • 00:16 the strategy of the larger organization by the project sponsor and project team.
  • 00:21 A project's governance is defined by and
  • 00:23 is required to fit within the larger context of the program or
  • 00:27 organization sponsoring it, but it is separate from organizational governance.
  • 00:33 Wow, that's quite a mouthful.
  • 00:35 So, what does that mean?
  • 00:37 There are two elements associated with project governance.
  • 00:40 The first is a successful implementation of a comprehensive project
  • 00:44 management methodology.
  • 00:46 This will be the standard used to check for with governance.
  • 00:50 Second is regular reviews and oversight to ensure that
  • 00:54 the project teams are using the project management methodology.
  • 00:59 Project governance then is the way the organization ensures projects will be
  • 01:02 managed in a way that incorporates approved best practices and
  • 01:07 increases their probability of meeting the project goals and objectives.
  • 01:11 A good governance approach impacts the way projects are managed.
  • 01:16 One impact is a clear understanding of the expected project activities and
  • 01:20 the impact those activities will have on the project and the project goals.
  • 01:24 First, by the project core team.
  • 01:27 They know what's expected of them.
  • 01:28 They understand how they will be measured and
  • 01:30 monitored, what they need to accomplish.
  • 01:33 Second, by the stakeholders.
  • 01:35 They know what should be delivered, when it should be delivered, and
  • 01:38 what they should be reviewing and monitoring.
  • 01:40 And third, by the functions providing project objectives and
  • 01:44 often the project resources.
  • 01:46 They understand what is expected of them, what they can change, what they
  • 01:49 can't change, also the type of oversight that is required for the resources.
  • 01:54 Another impact of having project governance is a continuing improvement in
  • 01:58 the overall project management methodology.
  • 02:01 As the organization finds what worked well and
  • 02:04 what does not work, changes are made to the methodology.
  • 02:08 Through the governance function, procedures are updated,
  • 02:10 templates approved, and personnel are trained in the best practices.
  • 02:15 The next impact is metrics.
  • 02:18 Governance leads to standard metrics and
  • 02:20 a measurement that brings accountability with it.
  • 02:22 You get what you measure.
  • 02:24 By measuring the right things, the organization is able to get the kind of
  • 02:27 project performance and behavior they would like to have from the project team.
  • 02:32 The last impact point may or may not apply to your organization.
  • 02:35 When appropriate, project governance can also be used to
  • 02:38 ensure compliance with industry or organizational standards and requirements.
  • 02:42 Project governance ensures that the appropriate standards have been
  • 02:46 identified, they are being applied correctly, and
  • 02:48 that they have been audited to ensure that the standards are being followed.
  • 02:53 Governance is commonly implemented in an organization through
  • 02:56 a project management office.
  • 02:58 The Project Management Body of Knowledge,
  • 03:00 the PMBOK Guide, defines a project management office as an organizational
  • 03:05 structure that standardizes the project-related governance processes and
  • 03:09 facilitates the sharing of resources, methodologies, tools, and techniques.
  • 03:14 Since the PMO is normally responsible for governance,
  • 03:17 let's consider the three typical approaches used when creating a PMO.
  • 03:21 This description of PMOs is based upon how they operate,
  • 03:24 not necessarily the specific name or title of the organization.
  • 03:28 There are many books and gurus who will tell you how to set up a PMO.
  • 03:32 These are the categories that I have seen effectively implemented.
  • 03:37 One type is the SME, or Subject Matter Expert PMO.
  • 03:40 This is typically a single individual.
  • 03:43 Many times, this project management governance function
  • 03:46 is an additional duty for an individual who already has another role or
  • 03:50 responsibility within the organization.
  • 03:53 In this PMO, the job is to make sure that the procedures, templates, tools and
  • 03:57 techniques are kept current and up-to-date.
  • 04:00 When either teams or
  • 04:01 stakeholders have problems or questions about the project management or
  • 04:04 the methodology, they turn to this person for some advice and coaching.
  • 04:10 Another type of PMO is the Oversight PMO.
  • 04:13 This is normally a small, dedicated team.
  • 04:16 This PMO performs all the same functions that an SME PMO performs.
  • 04:21 In addition, they track project progress,
  • 04:23 often creating a dashboard communicating that progress to the stakeholders.
  • 04:28 In many cases, they lead or
  • 04:30 participate in project reviews, stage gate reviews, and technical reviews.
  • 04:34 They perform an oversight role, but not an actual management or implementation role.
  • 04:41 The third type of PMO is the Leadership PMO.
  • 04:44 This PMO performs all the functions of the SME and
  • 04:47 Oversight PMOs, but it now has direct responsibility for
  • 04:51 the projects in addition to project governance of the methodology.
  • 04:55 This PMO includes all the project managers, and
  • 04:58 many times will also include individuals from the functional
  • 05:01 departments who've been assigned full time to support projects.
  • 05:06 This PMO is responsible for planning and managing the projects.
  • 05:10 It is often a standalone department on the org chart reporting to senior management,
  • 05:14 rather than an individual or a small team.
  • 05:17 Whatever type of PMO you are using, whether it's an SME, Oversight, or
  • 05:21 Leadership PMO, you still need to provide project governance to ensure
  • 05:26 the methodology is being applied correctly and
  • 05:28 maintained to a level that is consistent with your business goals and objectives.

Lesson notes are only available for subscribers.

PMI, PMP and PMBOK are registered marks of the Project Management Institute, Inc.

Gift this course