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How do you make the change? Re-imagining project governance

Expanding conversations, develop capability

The following articled is derived from a report from ICCPM and John Grill Centre examining the important topic of leadership of large scale complex projects.

The track record of projects delivering outcomes and realising benefits continues to remain poor despite the development and use of increasingly sophisticated project management methods. Effective leadership at the level of the project director or project manager is important to address this poor performance but this needs to be complemented by effective leadership from senior organisational executives in terms of how projects are governed.

Expanding the Governance Conversation

Project complexity means that many factors are likely to influence project outcomes and benefits, and that any assumptions about these can change quickly and dramatically. This does not render efforts to achieve outcomes and realise benefits redundant. Instead the opposite is true, and outcomes and benefits need to be a critical part of governance conversations and high on the agenda of governance committee discussions. Senior-level organisational executives are best placed to identify, evaluate and oversee important interdependencies with projects from a benefits and outcome perspective, and as a collective are likely to have influence on bringing about the organisational changes required to derive value from project investments.

Governance committees also need to consider expanding their life beyond project completion to ensure necessary executive oversight so that outcomes are achieved, and benefits are realised. As a minimum, there needs to be a hand-over and seamless transition to another governance function in the organisation, be this program- level governance or corporate governance. Critical aspects of the expanded governance conversation include reflecting on whether envisioned outcomes and benefits are being achieved and securing further executive-level actions that are required to optimise value. In addition, it is critical that lessons are learned on the complex relationship between completion of project outputs and envisioned benefit and outcomes, so that this can be incorporated in future project initiatives and business cases.

We shut down programs too early. Projects finish and then often the steering committee shuts down six to eight weeks after that. I think that’s actually when the steering committee could really be working hard to extract the value from the outputs in the investment.
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Governance conversations are also expanding from a focus on delivery, benefits and outcomes to ensuring that decisions adhere to ethical and societal expectations. These expanded conversations vary in terms of project context, but typically encompass considerations of whether both the project team as well as recipients of project outputs, such as organisational employees (that are likely to experience change in their workplace) or the broader community (for oil and gas or public infrastructure projects), are being treated equitably and fairly.

Governance conversations are further extending into choices about the supply chain for projects and whether project spend and the associated economic benefits are distributed appropriately through society. As organisations revisit their role in terms of contributing to a fair and just society, a more sustainable environment, and their stance on other important social and policy questions, project governance must likewise expand its focus to ensure alignment between organisational perspective, position and project activity

There needs to be ethical considerations regarding the capacity to deliver, and the scope of work undertaken. This is with regards to the pressures that they can then create on the work force. Once we’ve promised that, we’ve got to deliver it, otherwise there are going to be reputational, and financial adverse impacts, possibly long-term.
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Developing Governance Capability

Relying on extremely capable hero-like leaders as project sponsor or project director or project manager is risky for complex projects. A more effective approach is to develop the collective leadership represented on project boards and steering committees through uplifting governance capability. This requires both uplifting individual capability as well as nurturing the right conversations at a board and committee level. Roundtable participants commented that those in governance roles often applied an ‘operating business mentality’ rather than a ‘project mindset’. Consequently, they did not understand the implications of project burn rates on decision- making processes, the implications of having an open scope, and the resource mobilisation implications of complex projects that move into a different phase of the project lifecycle. Building knowledge and awareness of the project context, how this differed from the operating context, and the implications for those in governance roles is important, and especially so for complex projects.

Developing governance capability needs to extend beyond knowledge and awareness and must include behaviours. Governing for adaptability, adding value and expanding governance conversation requires specific behaviours of executives such as trust-building, empathy, influence, and the capacity to sense and adapt to weak signals. To help governance executives achieve and sustain these behavioural shifts requires robust and honest reflection about the effectiveness of status quo practices, combined with executive coaching and mentoring over time. Governance requires dedicated investment. Where this is done, the payoffs can be manifold.

Board members need to be more proactive in their roles because having an accountability in roles and responsibility chart versus actually taking an active role in directing and governing and leading the project may require, again, additional tools, additional skill sets that those members may need.
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This report is based on the Roundtable series in 2018 builds on previous themes through its focus on Project Leadership as the game changer in large scale complex projects. Combining the complementary expertise of International Centre for Complex Project Management (ICCPM) and its Series Partner, the John Grill Centre for Project Leadership, this report examines the important topic of leadership of large scale complex projects.

Roundtable workshop participants were asked to consider the leadership paradigm shifts that are needed to successfully deliver large scale complex projects. This report is the distillation of the contributions from events held across Australia, Canada and the UK. It draws on the experience of the participants and the expertise of ICCPM and the Series Partner, The John Grill Centre for Project Leadership, to present insights that individuals and organisations can use to improve their project performance.

Dr Maurizio Floris, Director of Leadership Programs, John Grill Centre for Project Leadership

Collin Smith, Managing Director & Chief Executive Officer, International Centre for Complex Project Management

Professor Suresh Cuganesan, Chief Executive Officer, John Grill Centre for Project Leadership

I get very challenged when you go into projects and the benefits management sort of falls on the project team. I think, ‘How on earth can they extract the value?’ They’ve gone. They’ve delivered the widgets and they’re gone. It really needs to be the responsibility of the business leadership.
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