What is the Board's role in governance and do they follow good practice?
What does good look like?
Are there good practice guidelines available?
And in particular how can you influence your board to adopt good practice in governance of project management?
These are some of the questions answered at the latest evening session of the APM Governance SIG.
This was one of a series of sessions that the Governance SIG is presenting to enable good practice to be shared.
Poor governance of projects and project management is a major cause of project failure. Recent research (by both PwC and APM) has shown a direct correlation between organisational and project success and good governance. So good governance is the key success factor in delivering successful project outcomes. Shouldn't Boards take note and make improvement of governance a strategic objective?
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How can you influence your Board to adopt good governance of project / change management?
1. How can junior project
members be empowered to
influence their Board to adopt
good governance of project /
change management?
1
APM Governance SIG
2. Governance SIG
Objectives
ï¶ Be the UK focus
ï¶ Advance understanding
ï¶ Contribute to good practice
ï¶ Influence national and
international standard making
authorities
ï¶ Influence those operationally
responsible
ï¶ Develop ambassadors and
exemplars of excellence
2
âŠ.in the governance of project management (change)
Activities
ï¶ Engagement â CxO level
as well as APM members
ï¶ Conferences and Seminars
ï¶ Publications
ï¶ Influence of, and
contribution to, standards
3. Directing Change
2nd edition 2011
3
Co-Directing Change
2007 (being updated)
Sponsoring Change
2009
Free to APM members at www.apm.org.uk/memberdownloads
GovSIG Publications
Agile Governance
(being developed)
To get involved
http://bit.ly/apm-agile-governance-preregister
4. Getting Involved with GovSIG
ï¶ APM GovSIG
ï¶ Blogging
ï¶ Research
ï¶ Committee
4
5. Donât forget our annual
conference on 1st October
See www.apm.org.uk for details
5
APM Governance SIG
6. How can junior project
members be empowered
to influence their Board
to adopt good governance
of project / change
management?
Scott Bryce, Matt Foley & James Beck
16th September 2015
7. PwC
Objectives for the session
Discuss the challenges and consequences of
organisations failing to operate good
governance for project / change management
Identify how junior project team members can
influence their seniors to adopt good
governance of project / change management
7
8. PwC
4th Global PPM Survey
Do those who commission change
get what they want?
View the full survey results here:
http://www.pwc.com/gx/en/services/advisory/consulting/portfolio-
programme-management/global-ppm-survey-2014.html
8
9. PwC
To what extent do you agree or disagree with the following statements?
14
18
13
3
4
3
44
41
46
9
20
24
Decision making across the portfolio is
supported by objective criteria and quality
data to ensure alignment to the organisation's
priorities
There are clear decision accountabilities
(RACI) within the programme/project that
enables delivery
There is an appropriate
sponsor/client/leadership representation on
programme/project steering committees
(%)
Neither/
nor
DisagreeStrongly disagree Strongly agreeAgree
Donât
know
9
Base: 1,774
4th Global Portfolio and Programme Management Survey
The survey highlighted the importance of effective governance,
through appropriate leadership representation at committees,
clear RACI, and decision making supported by quality data
13%
16%
23%
1%
1%
7%
10. PwC
Which factors do you consider to be the top three contributors to programme/project delays?
10
4th Global Portfolio and Programme Management Survey
Base: 1,774
0
4
3
6
6
8
10
11
12
15
15
21
23
24
27
30
39
41
Don't know
Other
Lack of management information
Ineffective procurement/ supplierâŠ
Change in environment
Change in strategy
Not the correct skillset
Poorly designed/ executed governance
Inadequate risk planning
Lack of executive sponsorship
Lack of Change control management
Weak project planning
Poorly defined goals/ objectives
Lack of stakeholder involvement
Poor communication
Insufficient resources
Poor estimates in the planning phase
Change(s) in scope mid-project
(%)
Poor governance is a root cause contributor to programme
/ project delays
11. PwC
Regular verbal updates/presentations and clear exception
based documented status reports are the most popular ways
in which C-suite respondents like to be briefed
11
4th Global Portfolio and Programme Management Survey
4
31
36
37
37
41
46
63
Other
Live 'portal' to see
programme updates
A plan on a page
A 'RAIDD' log*
Financial reports
Data driven reporting
Clear exception based
documentated status
reports
Regular verbal updates/
presentations
2
20
16
17
10
8
18
10
1
15
15
14
15
10
16
15
1
7
8
7
12
14
30
22
Other
Data driven reporting
Financial reports
A 'RAIDD' log*
A plan on a page
Live 'portal' to see
programme updates
Regular verbal updates/
presentations
Clear exception based
documentated status reports
Rank 1 Rank 2 Rank 3
% ranking% ranking 1st, 2nd or 3rd
81.74
80.12
80.0
76.81
68.57
70.14
67.31
71.43
Mean score
NB. Only C-Suite answered this question
*Risk, Assumptions, Issues, Dependency log and Decision Register
Base: 193
12. PwC
Analysis of the PwC PPM Global Benchmarking Tool
highlights that governance is one of the top priorities for
successful portfolios and programmes in seven industries
12
1 2 3
Aerospace and Defence Clear Scope Smart Financing Managed Risk
Banking and Capital Markets Governance Enabling Managed Risk Smart Financing
Communications and Technology Smart Financing Delivery Enabling Integrated Support
Energy, Utilities and Mining Agile Change Governance Enabling Clear Scope
Entertainment and Media Integrated Support High Performance Smart Financing
Governance, Education and
Enterprise
Governance Enabling Clear Scope Engaged Stakeholders
Health, Pharma and Life Sciences Governance Enabling Managed Risk Clear Scope
Industrial Products Governance Enabling Clear Scope Smart Financing
Insurance Governance Enabling Clear Scope Smart Financing
Retail and Consumer Goods Integrated Support Governance Enabling Smart Financing
âą Governance is one of the strongest themes emerging from the Benchmarking Tool, appearing in the
top three for seven of the industries analysed
PPM Global Benchmarking Tool
14. PwC
Case study: the cost of poor governance
About:
BP is Britain's largest producer of oil and gas. It is
an integrated oil and gas company which operates
in more than 80 countries around the world. BP's
oil rigs are run as the equivalent to a portfolio of
projects.
In April 2010, BPâs Deepwater Horizon oil
platform exploded in waters off the Gulf of Mexico,
killing 11 men and unleashing an estimated 176m
gallons of crude into the water. After settling
federal and state claims totalling $18.7 billion, the
total pre-tax charges associated with the spill for
BP amount to $53.8 billion.
US district Judge Carl Barbier found that
BP made decisions during the drilling of
the well that led to the deadly blowout.
âThese instances of negligence, taken
together, evince an extreme deviation from
the standard of care and a conscious
disregard of known risks.â
"A large number of decisions were made
that were highly questionable and
potentially contributed to the blowout of
the Macondo well... . â
Prof Donald Winder, Chairman of the National
Academy of Engineering investigation
14
Note: this case study is based on analysis of publicly available information only
15. PwC
What are the key indictors of poor governance?
15
Unclear roles and
responsibilities
Lack of delegated
authority
Information overload
from programme teams to
leadership
Lack of clear sponsorship /
sponsors unclear of their
role and responsibilities
Culture prevents juniors
engaging with leadership
for fear of doing something
âcareer-limitingâ
16. PwC
The APM guidance on Directing Change makes the case for
the benefits of effective programme governance, as well as
highlighting the consequences of poor governance
The APM has found that poor governance of portfolios, programmes and
projects leads to:
ïœ Lack of a clear link with key strategic priorities.
ïœ Lack of clear senior management and, in government projects, ministerial ownership
and leadership.
ïœ Lack of effective engagement with stakeholders.
ïœ Lack of skills and proven approach to project and risk management.
ïœ Lack of understanding of, or contact with, supply industry at senior levels.
ïœ Evaluation of projects driven by initial price, rather than long-term value for money.
ïœ Too little attention to breaking down development and implementation into
manageable steps.
16
17. PwC
How can junior project members be empowered
to influence their Board to adopt good
governance of project / change management?
17
18. PwC
Case study: Influencing upwards in
a transformation environment
Conditions for success:
ï¶ Leadership courage to challenge the Board
ï¶ Data backed justification of the âart of the
possibleâ
ï¶ Organisation creates the right culture for
constructive challenge
ï¶ Leaders listen to their subject matter experts
ï¶ Provide explicit opportunities, both formal and
informal, for people to have their voices heard
âI will always challenge my senior
managers to deliver, it is up to them
to prove to me that I am asking the
impossibleâ
CEO
18
âI have seen change âdoneâ to
organisations by senior leadership and
it rarely âsticksâ. Involving staff and
empowering them to contribute to the
change secures better buy in and a
greater probability of successâ
Director of Transformation
Learning Points
ï¶ Be clear with staff what is expected of them
ï¶ Have a very clear narrative for what change will
deliver â and how people will benefit
ï¶ Organisation creates the right culture for
constructive challenge
ï¶ Leaders listen to their subject matter experts and
use them to co-create solutions
19. PwC
Case study: start with the end in mind
About:
The client is a major UK banking player with international
links. The bank is currently restructuring its operations in
the United Kingdom and worldwide, involving significant
jobs cuts in an attempt to reduce costs and improve
profitability.
We supported a multi-year transformational change
programme, leading a number of work streams, supporting
others, and having no involvement in other areas. We
noticed that a key work stream was not contributing to the
desired outcome. However, the reporting was showing
positive progress and the sponsor insisted everything was
alright.
In a catch up 18 months later, the client revealed
that the work stream in question had delivered
little in the intervening time, despite positive
progress reporting throughout.
âWhile project teams are good at delivering processes and activities, all
too often people are unclear about the outcome required from the project.
As a result, a project team can deliver and yet still close without having
achieved its objectives.â
PwC Partner
Learning Points
ï¶ Good governance should review progress against
delivering the outcomes/objectives and remind teams to
focus on this, and not focus on delivery of the outputs and
activities
ï¶ To support this, reporting should be against
outcomes/objectives rather than activities as is the norm
ï¶ Junior team members need to be empowered through
clear MI and data, with a clear escalation process to reach
senior stakeholders
ï¶ Rather than just receiving a report, to support good
governance leaders should move away from formal
channels to get under the skin of the programme â and
give their people a clear view of what good looks like
ï¶ Programme managers need to have delegated authority
and be held accountable for delivering the desired
outcomes
19
20. PwC
Observations from the banking sector and
portfolio management experience
Common Key challenges to good
governance
Ineffective and often opaque governance model
Poor quality of reports including limited
traceability along with fear of bad news â
avoidance of âred risksâ
Spans of command often too broad, complex or ill-
defined â i.e. poor scope
Resource management â particularly of key
personnel â often overlooked
Perceived challenge is in balancing value
add activities (portfolio planning, dependency
identification, thematic risk management, etc.)
with control activities (quality control,
investment & benefits management, change
management, etc.)
Stakeholders often asked PfMO to translate
ivory-tower standards into project
management realities. There is strong appetite
to share best practice
Learning Points
ï¶ Governance structures, with cleared terms of reference,
that get the right voices heard and provide the necessary
intelligence to the right decision making boards
ï¶ Team charters and portfolio, programme and project
mandates â that can be revised!
ï¶ Management of key resource supported by a clear resource
strategy and plan
ï¶ Deliberate and holistic continuous improvement plans
contribute to establishing effective and stable teams over
the long term
âThe trick is to separate the change
agenda from the day to day business
creating organisational capacity to
deliver bothâ
CEO
21. PwC
Portfolio Capability: Framework
21
The 12 Elements of Portfolio and Program Management Excellence are underpinned by four outcome-
orientated principles: Insight, Alignment, Control and Efficiency
Connect execution with the
organisationâs strategic
direction driving aligned
investment priorities across all
key parts of the bank unifying
goals and expertise across
functions. Review and
recalibrate the portfolio where
necessary as plans change and
ensure projects are aligned with
enterprise architecture
Well calibrated reporting that
allows effective progress tracking
of all strategic change initiatives
with effective communication to
all key stakeholders. Key
performance indicators are
accurately reported to the relevant
governance body board at an
appropriate level of detail.
Mature, and consistent, portfolio
and program management
delivering controlled
implementation in agreed
timelines. Risk management is
effective with risks identified
owned and managed. Changes to
plans are transparent and
controlled.
.
Optimized delivery across
the portfolio to identify and
eliminate overlap or
duplication and exploit
synergies leading to efficiencies
and savings. Efficiency
enhanced by use of standard
best practice project
management processes and
common tools.
The 12
Elements of
Delivery
Excellence
22. Efficiency
âą Programs generally struggle to
obtain and maintain resource e.g.
SME time, and stable IT teams
âą Lower performing programs
generally have lower levels of
process automation through tools
âą Most PMOs are distracted from
delivery through excessive manual
reporting and ad hoc low value
administrative requests from
central functions
âą Multiple examples of under-
resourcing were identified across
the programs
Findings & observations: Programme management
22
Alignment
âą At the program level there is a lack
of visibility of the Group strategic
objectives
âą Most programs focus on
deliverables and not benefits
âą At the program level it is difficult to
determine the aggregated business
impacts given lack of visibility and
poor interdependency management
Stronger areas of program management tend to be early lifecycle and oversight activities e.g. Governance,
and Stakeholder management. Benefits management stands out as an area where perceptions are higher than
industry but PwC rating is lower; to a lesser extent this applies to Scope management and Planning
Insight
âą Program level teams in most banks
struggle to implement common
standards & processes and instead
reactively develop bespoke
practices
âą Lower performing programs tend
not to be adequately engaged with
governance structures and/or have
lower capacity to engage
stakeholders
âą The most effective programs have
high quality plans, reporting and
engaged leadership
Control
âą Half of the clientâs peers have
focussed efforts on more robust
program / project controls
âą PMOs across most peer groups find
it hard to formally control quality
and avoid surprises
âą Across all peers, programs
experience a lag between the
implementation of appropriate
governance, central standards &
systems and increased performance
and benefits delivery
Alignment Insight Control Efficiency
Average Maturity
2.4 2.5 1.9
23. ï· Describes recommendations around
portfolio and program management
policies, frameworks and underlying
processes such as risk and issue
management, planning, cost
control, portfolio prioritization,
benefits management and quality to
enable central control and efficient
delivery of the portfolio
Standards & Processes
ï· Describes recommendations for
enabling and supporting the people
change agenda related to portfolio
and program management
capability across the organization
(e.g. career models and training) to
enable effective ways of working
across the change organization
People, Capability & Culture
ï· Describes recommendations relating to
organizational structures, governance and team
roles including the GSCM functional
responsibilities and how it interacts with the other
change teams/functions across the bank to achieve
an effective and efficient holistic model
Organization & Interfaces
Summary recommendations
Recommendations are presented by operating model component touching upon policies and processes as
well as the underlying information models and tools that support Portfolio and Program management. The
recommendations also highlight the âsofterâ change considerations critical to achieving sustainable results
Organization &
Interfaces
People,
Capability &
Culture
Standards &
Processes
Comms &
Brand
Systems &
Technology
Operating Model
Components
Reporting
& MI
ï· Describes recommendations relating
to configuration, prototyping, build
and rollout of portfolio and program
management systems and other
technology such as collaboration
and knowledge sharing tools, to
support efficient coordination,
workflow, information and delivery
Systems & Technology
Reporting & MI
ï· Describes recommendations relating
to communications between GSCM
and the wider change community
across the bank. The
communications plan also highlights
how GSCM needs to clearly
communicate their mission and
values to interact effectively with
other change functions in the bank
Communications & Brand
ï· Describes recommendations relating to decision
making and how that is enabled by effective
reporting and data standards and processes
23
24. PwC
Overall approach
The maturity of Executive Board reporting varies greatly across industry. Within Financial Services
CEOs and Executive Boards, given the new pressures on margin are increasingly âshining a lightâ on
their âchange the bankâ spend but the underpinning systems to provide high quality data are still
evolving.
24
âą Understanding the purpose
of, and audience for, reporting
and who needs what
âą Aligning the reporting with
required governance to
accelerate decisions and
defining the level of reporting
required at each level
1
âą Refocusing reporting in line
with the required decisions
âą Creating the reporting
designs, including key metrics
and dashboard designs
required at Investment /
Executive Board level
2
âą Creating a flexible delivery
model which evolves and
flexes to the business need
âą Ensuring information is
timely and robust and with
helpful supporting analysis
Reporting
delivery model
(data, process,
systems, people)
3
âą Establishing the critical
attributes required to drive
appropriate behaviours and
informed actions
âą Addressing the capability
gaps
4
Governance
and reporting
alignment
Insights and
metrics
Reporting use,
education and
behaviours
âŠunderstanding the
audience for the reportingâŠ
âŠdefining what is
important to that
audienceâŠ
âŠdefining the decisions
for each audienceâŠ
...defining what the
audience will receiveâŠ
âŠhow the data and
analysis will be createdâŠ
âŠhow reporting is
presentedâŠ
âŠunderstanding where
education is neededâŠ
âŠand which behaviours
need to changeâŠ
25. PwC 25
Download our PPM Global
Survey Report at
www.pwc.com/ppmsurvey
Scott Bryce
Scott.bryce@uk.pwc.com
Thanks for your time
Connect with us
www.linkedin.com
Matt Foley
Matt.foley@uk.pwc.com
James Beck
james.beck@uk.pwc.com
26. Donât forget our annual
conference on 1st October
See www.apm.org.uk for details
26
APM Governance SIG