One of the topics that comes up a lot when we’re talking with our customers is governance. Questions like, ‘how do we remove some of the bureaucracy from our governance processes’, or comments like ‘we are in a never-ending reporting cycle, the day after it ends, it starts again’. Of course, organisations have governance in place for good reason, to ensure that organisational investments are being managed in a way that ensures a positive return for the Sponsor or Shareholder. However, more and more, we are talking to PMO Managers about ensuring that governance is ‘right sized’ or ‘fit for purpose’.
One size should not fit all
When we talk about ‘fit for purpose’ governance, we’re acknowledging that one size usually does not fit all. A large complex project should go through stage gates, have steering committees and a reporting cadence that reflects the organisational value of the projects. The same logic should be true of smaller or more simple projects. The governance requirements could, in theory at least, be lighter to reflect a lower risk profile to the organisation.
In most organisations however, governance is not right sized. It’s a uniform process that all projects go through with very little difference between smaller projects and larger ones. Some organisations decide to group smaller projects into one steering committee rather than having multiple meetings but generally the effort that goes into reporting and preparation is still disproportional for the size of the project.
This disproportional effort often leads to a number of negative consequences. Potentially, there is a waste of effort at each point in the chain, possibly many hours each week or month by the project managers who prepare the reports, the PMO who check and consolidate the reports and the senior leaders who read the reports. Another consequence is that all of the people in the chain understand it’s a waste of effort, often leading to resentment, a lack of motivation and poor morale.
Inefficient Reporting Processes
Mixed methodologies can form part of the solution
Some organisations have implemented Agile methods to try and reduce this inefficiency. This can work well for business-as-usual type projects or projects where scope is unclear or there are no fixed boundaries of time and cost. However, for most government agencies and publicly owned companies, this approach only exacerbates the problem by removing a level of transparency and governance from the process. This is generally not a satisfactory long-term solution.
The best solution to the problem is to workshop what ‘fit for purpose’ governance looks like for your specific organisation, based on the type, size and complexity of the portfolio.
While there are some common methods of reducing the governance burden, (eg. shorter reports, meetings by exception) the key to success is to work with the leadership team to understand the criteria of the projects that they really care about. Consider where will the effort spent achieve the most organisational value. Then assess what the next level down looks like and the level below that. The outcome of this exercise should be that the most effort is spent where it needs to be, leading to not only improved project outcomes but also improved productivity and employee morale.
This issue of ‘fit for purpose’ governance is something we’re helping our customers with today. Please reach out if you’d like to talk to us about your situation.