Governance of Project Management, issues and contributions

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Governance of Project Management, issues and
contributions
Presented by
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Structure

• Why
• How
• What
• Where

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Initial Issues

• Governance of increasing concern and now imposed
• Importance of Project Management
• Lack of corporate project management metrics
• Project Management needs
• Small input to governance debate from project
  management specialists

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Benefits sought

• 1.  Introductory guide for Boards
• 2.  Initiate a work programme
• 3.  Encourage further research
• 4. To influence those interpreting new governance
  requirements to take proper account of the
  significance and special needs of project
  management

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How have we worked

• Working Group
• Mix of professionals
• APM support
• Studied texts
• Regular meetings and own interactive website
• Involved with experts in related forums
• Action planning

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Governance

• a set of relationships between a company's
  management, its board, its shareholders and other
  stakeholders. Corporate governance also provides
  the structure through which the objectives of the
  company are set, and the means of attaining those
  objectives and monitoring performance are
  determined."
• (Source OECD)

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Governance of PM Focus

• Use term Project Management to include portfolio
  management and programme management
• NOT involved in methodologies

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GoPM SIG Development

• September/October 2003. Scoping and publicity
• 29 October 2003, Oxford. Inaugural meeting
• October/November 2003. Website established
• November 2003. Problem Formulation
• January 2004. APM SIG recognition
• 28 April 2004. Guide issued for consultation
• 9 June 2004. Eighth meeting
• 9 June 2004. 56 website registrants

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Working Group composition
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Working Group Guide production method
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What have we achieved?
Guide to Governance of Project Management
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Guide contents

• Purpose
• Introduction
• 11 Principles
• Components and 40 key questions
• Principles related to Combined Code and
  Sarbanes-Oxley Act 2002
• 11 pages including Foreword

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(No Transcript)
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Context
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Existing Governance requirements

• UK Listing Authoritys Combined Code
• comply or explain
• USA Sarbanes-Oxley Act 2002
• legal enforcement and stiff penalties

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The four components

• 1.   Portfolio Direction, Effectiveness and
  Efficiency
• 2.   Project Sponsorship, Effectiveness and
  Efficiency
• 3.   Project Management, Effectiveness and
  Efficiency
• 4. Disclosure and Reporting

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Principle 1

• The Board has overall responsibility for
  governance of projects.

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Principle 4

• A coherent and supportive relationship is
  maintained between the overall business strategy
  and the project portfolio.

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Principle 6

• Members of delegated authorisation bodies have
  sufficient representation, competence, authority
  and resource to enable them to make appropriate
  decisions.

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Principle 7

• The project business case is supported by
  relevant and realistic information that provides
  a reliable basis for making authorisation
  decisions.

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Principle 10

• The organisation fosters a culture of improvement
  and open disclosure of project information.

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Check questions on application of principles

• Portfolio Direction 10 Questions
• Project Sponsorship 11Questions
• Project Management 9 Questions
• Disclosure and Reporting 10 Questions

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Question PD7

• Does the organisations engagement with project
  suppliers encourage a sustainable portfolio by
  ensuring their early involvement and by a shared
  understanding of the risks and rewards?

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Question PS3

• Do project sponsors hold regular meetings with
  project managers and are they sufficiently aware
  of the project status?

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Question PM2

• Is the Board assured that the organisations
  project management processes and project
  management tools are appropriate for the projects
  that it sponsors?

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Question PS3

• Is the organisation able to distinguish between
  project forecasts based on targets, commitments
  and expected outcomes?

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Relation with Combined Code

• A.5 Information and professional development.
  Main Principle
• The Board should be supplied in a timely manner
  with information in a form and of a quality
  appropriate to enable it to discharge its duties.
  
• All directors should receive induction on joining
  the Board and should regularly update and refresh
  their skills and knowledge.

GoPM principles 6, 7, 8, 9, 10 refer
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Relation with Sarbanes-Oxley Act 2002

• Clause 404 - Management assessment of internal
  controls
• (a) RULES REQUIRED.- . . . each annual report . .
  . to contain an internal control report . . .

GoPM principles 2, 3, 4, 5, 6, 7, 8, 9, 10 refer
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Where are we going?

• Guide consultation period finishes end of May
  2004
• Guide launch target September 2004
• ?

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Research ideas

• 1.    Link between governance of project
  management, cost of capital and commercial
  performance.
• 2.    Widen literature search.
• 3.    Organisational performance improvement
  considerations.
• 4.    Formal developments with standard setting
  bodies.

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More research ideas

• 5.    Tools and techniques
• a.    assessment metrics
• b.    evidence guides
• c.    sector specific applications
• 6.    Director behaviour
• 7. Control/Learning usage
• 8.    Predictive budgeting/reporting links
• 9.    Organisational network projects

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Strap Lines?

• Drain the swamp
• Love your projects
• Harness the power of change

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Acknowledgements

• SIG Committee David Shannon, Ian Isaac and
  Martin Hopkinson
• Those most involved in drafting Guide as listed
  in Guide acknowledgements
• Website

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Contacts

• GoPM www.mylara.com/gopm/
• Draft guide www.mylara.com/gopm/forum_posts.asp?T
  ID67PN1
• APM www.apm.org.uk
• OPM david.shannon_at_oxfordprojectmanagement.com
• Tel [phone]
• Presenter