You’re a crew member on a ship. Your ship’s captain has reviewed all of the necessary nautical maps, charted out where you’re headed, and decided on the route you’ll take to get there. The captain ensures that you stay on course, making high-level decisions as they arise, and monitoring for oversight, like hidden reefs. If a storm blocks your way forward—all hands on deck!—the captain must find safe passage from the storm, before steering the ship back in the right direction. The same can be said of effective project governance. 

Project governance is what steers the decision-making process for projects. In fact, the word ‘governance’ and ‘governor’ come from the Greek word for the steersman of a ship—or the captain. Project governance is about setting the project’s direction in alignment with the rest of the organization, making strategic decisions, and managing oversight throughout the project’s lifecycle. It’s all about making good decisions and being accountable. 

According to the Project Management Institute, project governance is an “oversight function that is aligned with the organization’s governance model and encompasses the project life cycle.” They also say that “good project governance is the secret weapon of effective project-based organizations.” 

Poor project governance is often the culprit when projects go rogue. A captainless crew. When projects don’t align with the organization’s objectives, the chain of command for decision-making and communication is unclear, and no one is responsible. Time to abandon ship! 

The Key Purposes Of Project Governance

Let’s dive into the key reasons why organizations need project governance and then uncover how to apply it effectively within your company.  

Aligning The Project’s Strategic Direction With The Organization

One of the main purposes of project governance is to align projects within your organization. Your organization has strategic goals and visions, and most likely, a governance model of its own. Think of this as the charted direction in which your entire company is heading toward. Everyone should be in the same boat, heading on the same course—and establishing good governance on a project level ensures that.

Every project should, therefore, support and align with the strategic direction and governance of your organization. Otherwise, if a project does not support your business objectives, what is its purpose?

Finding The Sweet Spot Of Project Governance Case-By-Case

Before moving on, let’s pause there for a moment. Does every project really need governance? What if having a captain on deck only slows your crew down? They’ve done this project in so many iterations and it works well without stakeholders, meetings, and reporting blocking their sprints.  

Setting the right tone and amount of project governance for each project is important. After all, you’re looking for effective project governance, not ineffective. If the project has a quick timeline, narrow scope, and low risk, it may require no or less governance than a complex, risky, important, and stakeholder-heavy project. Too much project governance can slow projects down and become unnecessary blockers. 

If you can make the case to your captain that your crew doesn’t require their oversight for particular projects to be effective and efficient, then that is a worthwhile discussion to have on a case-by-case basis. 

Making Strategic Decisions And Managing Project Oversight

This brings us back to the key purposes of project governance. Besides organizational alignment, it helps to make strategic decisions and manage project oversight as the project timeline unfolds. Time is the operative word here. In other words, project governance must be followed, monitored, and controlled from start to finish (and jump from project to project). Think of it like a long-haul journey that follows the course plotted out by your organization’s trajectory. 

As the project timeline unfolds, decisions have to be made. That’s where effective project governance comes in. Let’s take a look.

How Project Governance Shifts Through A Project’s Lifecycle:

• Project Initiation: Strategic decisions at a project’s initiation must include establishing the project governance framework, setting roles and responsibilities for who’s accountable for what and when, and deciding on project stakeholder engagement and communication. 
• Planning: Assess risk and issue management and establish clear protocols and “rules for engagement” for oversight and issues, such as missed milestones or resource re-allocations, if and as they arise. 
• Execution: Before the project moves from planning to execution, ensure that all strategic decisions and plans are clearly communicated and understood. As the project unfolds, update progress in meetings and reports, while monitoring and controlling for oversight and making decisions as they arise. 
• Completion: On project completion, assess what worked and what didn’t, adapting and adjusting to ensure effective project governance plans for future projects of all scopes, shapes, and sizes. 

Establishing Roles And Responsibilities For Effective Project Governance

So who’s in charge here? Who’s making these strategic decisions, assessing the risk, reporting on progress, and managing the project? Surely, they’re not all one person, right? That’s correct. Everyone has a role to play—and it’s important to assign roles and responsibilities to the right person/people for the job. 

Just like every ship has a captain in charge, followed by a first mate, and then crew in varying rank and order (not to mention whoever’s funding the journey), there are roles and responsibilities within the project governance framework. They are the project sponsor, project stakeholders, steering committee, and project manager. All of the roles are essential for ensuring effective project governance. 

Let’s uncover what each role does and is accountable for.

• Project Owner: Owner And Champion Of The Project

The project owner is responsible for the direction, alignment within the organization, and overall success of the project, especially at the leadership level. They’re often a senior executive and are held accountable throughout the entire project lifecycle from approving the business case to prioritizing progress.

• Project Stakeholders: Those High-Invested In The Project Outcome 

Project stakeholders are not involved in the daily operation or inner workings of the project, but they must be kept informed of milestones and potential risks or issues through high-level meetings and reporting. They are often members of the board of directors, investors, or part of the organization’s executive team. 

• Steering Committee: Supervisory Board Providing Operational Direction 

The steering committee is responsible for business issue oversight, risk management, quality control, and project timelines. They help set project goals and determine how to measure them, approve project plans, ensure organizational alignment, and flag any potential issues, such as resourcing. 

• Project Manager: The Day-To-Day Manager Of The Project 

The project manager is responsible for the overall management of the project, which includes overseeing the tasks, duties, teams, deliverables, and timelines to completion. They execute the project plan based on the objectives set by the project sponsor and steering committee and rely on them for decision-making. 

Building A Foundation For Good Project Governance

By now, you may have even discerned that project governance is made up of structure, people, and information. While they are separate, they are also inextricably linked (much like a venn diagram), as you will see: 

• Structure: The structure includes decision-making process, the roles and responsibilities, and the makeup of the board or group of people involved in project governance. 
• People: The people, of course, make up each role and are accountable for upholding their responsibilities, engaging with the project, communicating with teams and stakeholders, and should be selected accordingly. 
• Information: Lastly, the information is the outcomes of decisions, meetings, and reporting, and the crucial sharing of information openly and clearly and understanding roles, responsibilities, and accountability. 

All three pillars of good project governance must operate in tandem in order to work effectively. High-level decisions, for instance, must be clearly communicated from the sponsor to the project manager, who then disseminates that information to those team members working on tasks that are affected by the decision. If some part of the structure, people, or information is broken, then project governance falls apart. 

A Quick Recap On Effective Project Governance 

Effective project governance is about making good decisions at every step of the project that align with the company. Everyone has a role to play, from project owner or sponsor, stakeholders, and steering committee, to the project manager. And finally, there are three pillars of good project governance: structure, people, and information.  

By building a strong foundation with the right structure, people, and information-sharing in place, you can ensure that projects align with your organization and good decisions are made.