- Simon Pegg
We have been building to this post for a while now. This is the final installment of my series on
project
governance – or, more accurately, governance in the project context. In the first post I introduced my arbitrary,
tongue-in-cheek governance maturity level (gml). Having covered all of the descriptions for
project governance maturity up to this point, it is now time to reveal the
ultimate state of governance of interest to project managers.
Historically, the highest level of governance is some
variation on the theme of continuous improvement or optimizing, but I announced
in my previous
post that that was not the case for this maturity model. And that post described the penultimate
maturity level as alignment with organizational strategy, so what remains for
the highest level of project governance maturity?
For strategic projects, there are really only three reasons
that justify the project: it increases
revenue; it reduces cost; it is a regulatory requirement. (Do you know of any other reasons that
legitimately justify a strategic project?)
For most enterprises, what department has the highest stature? Marketing?
HR? Procurement? FINANCE (hint hint)? Of course it’s finance. And it’s time finance started seeing projects
as generating revenue or reducing expenses.
In May, Angelo
Baratta presented a webinar for PMI’s Information Systems Community of
Practice titled “The
Value Triple Constraint: Project Value Left Behind” (PMI and ISCoP
membership required). In it, Baratta
reminded us that projects have an economic benefit to the organization. So often as project managers, we are focused
on cost (along with time and scope) and leave benefit and value to the
cost-benefit analysis or the charter – and to bean counters or stakeholders
with “higher pay grade.” But because
there is this positive financial component, delays (among other choices) have a
financial impact to the organization.
The highest level of project governance maturity, then, is
when projects are recognized as enterprise assets. Just like raw materials and capital
investments, we (the PM community) should be lobbying to have our projects
recognized as corporate assets. This
would immediately transition us to the big leagues. Our babies would be elevated in stature
within the corporate and political pecking order. Project choices (delay, increase scope, cut
scope, etc.) would have clear financial impact to the organization. Getting resources, as Baratta noted in his
presentation, would be straightforward to justify when the alternatives can be
quantified.
Of course, these benefits don’t come without perils, but
such is the consequence of maturity. We
will no longer be able to operate informally.
We will operate in the spotlight.
We will have to learn to speak “executive” (cut your vocabulary in
half!). Risk management will impact the
corporate risk profile. Governance in
the project context will be integrated into the organization’s financial
governance (think Sarbox).
One of the objectives of PMI is to have “Project Management”
recognized as a discipline (or profession) distinct from “Management.” A step in this direction is to elevate the
governance maturity and to transition project delivery from a technical
discipline to a financial discipline with direct consequence for the enterprise
bottom line.
From gml-I
Chaos, gml-II
Solution, gml-III
Consultancy, and gml-IV
Alignment, we have climbed the maturity staircase. Getting to gml-V Capitalized is governance
your CFO would recognize – the next stage in PMI maturity.
Has this journey been worth it? What changes would you make to gml? Or how would you define a project governance
maturity model?
© 2013 Chuck
Morton. All Rights Reserved.
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