The document discusses project governance and PRINCE2. It provides background on Andy Murray, the director of Outperform and lead author of PRINCE2 2009. It then summarizes criticisms of PRINCE2 2009 for not adequately addressing governance. Definitions of governance from various organizations are provided. Project governance is described as ensuring project alignment with organizational objectives, efficient delivery, sustainability, and timely reporting to stakeholders. The presentation concludes that PRINCE2 addresses these aspects of governance through themes like organization and business case.

1. Effective Project Governance and PRINCE2® 2009
Andy Murray
Director, Outperform
PRINCE2 Lead Author
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2. Speaker Profile – Andy Murray
• Andy Murray is a Chartered Director and PRINCE2 Registered
Consultant, having worked in the field of Projects and Programmes
for over 15 years.
• He is currently a director of Outperform UK Ltd
(www.outperform.co.uk), an Accredited Consultancy Organisation
(ACO) licensed to consult in the OGC’s best practice trilogy of
PRINCE2™, MSP and M_o_R®.
• Andy was an early adopter of PRINCE2™, back in 1997, and has been
helping organisations implement and gain value from PRINCE2™ ever
since. He has helped implement PRINCE2™ in numerous organisations
in more than a dozen countries.
• Andy has been using maturity models as a consulting aid for more
than five years, since they help diagnose an organisation’s strengths
and weaknesses, prioritise improvement initiatives and measure
progress. Andy has used the OGC’s PRINCE2™ Maturity Model (P2MM)
and Portfolio, Programme and Project Management Maturity Model
(P3M3) as a means to both benchmark organisations via the APM
Group assessment process and to define improvement plans.
• Andy is the co-author the P2MM Guide - published in July 2007 by
TSO.
• Andy was the Lead Author for PRINCE2 2009.
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3. Company Profile - Outperform
• A specialist consultancy
– Helping organisations improve their
bid, project and programme
management performance through the
practical application of best practice
methods
• Accreditations
– ISO9001 Certified
– Accredited Consulting Organisation
• Professional membership
– APM corporate member
– Best Practice User Group™ member
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4. PRINCE2 2009
• New version updated in June 2009
• Refreshed to improve alignment with other OGC guidance (MSP,
MoR, P3O, P3M3)
• Refresh to reflect latest research on project management, in
particular ‘Rethinking Project Management’
• Over 170 organisations involved in public consultation, 15
organisations participated in pilots and 86 people reviewed the
draft manuscripts
• 2 year project, 7 iterations
But Gartner’s review criticised PRINCE2 2009 for not addressing
‘governance’
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5. So, what is governance?
• OECD
– Corporate governance involves 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.
• IOD
– A governance framework should ensure that corporate boards effectively
monitor managerial performance and achieve an equitable return for
shareholders – reinforcing the values of fairness, transparency,
accountability and responsibility.
• Independent Commission on Good Governance in Public Services
– The function of governance is to ensure that an organisation or partnership
fulfils its overall purpose, achieves its intended outcomes for citizens and
service users, and operates in an effective, efficient and ethical manner.
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6. What is Project Governance
• APM Governance SIG
– The governance of project management concerns those areas of
corporate governance that are specifically related to project
activities.
– Effective governance of project management ensures that an
organization’s project portfolio is aligned to the organization’s
objectives, is delivered efficiently, and is sustainable.
– Governance of project management also supports the means by
which the corporate board and other major project stakeholders
are provided with timely, relevant and reliable information.
Directing Change: A Guide to Governance of Project Management (reprinted with minor
revisions 2005), APM Governance SIG. © Association for Project Management, 2004.
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7. My interpretation – 5 common elements
Delegated authority Reporting
Alignment to
organisational
objectives
Independent Decision
assurance gates
© Outperform UK Ltd
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8. Strategic Alignment
Golden thread
Reporting
of delegated authority
Alignment to
organisational
objectives
Independent Decision
assurance gates
• Requirement
– Engage with stakeholders to define the organisational purpose and
objectives and how the project contributes
• Why Important
– Ensures the organisation is doing the right projects
– By right projects we mean those that are in the best interest of the
organisation’s shareholders/stakeholders
• How addressed by PRINCE2
– Organisation theme
• Stakeholder interests
– Business Justification principle
– Business Case theme
• “should be linked to the organisational context and should explain how the project will enable the
achievement of corporate strategies and objectives”
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9. Delegating Authority
Golden thread
Reporting
of delegated authority
Alignment to
organisational
objectives
Independent Decision
assurance gates
• Requirement
– Define where decisions can be most effectively made
• Why Important
– Decisions should be made at an appropriate level within an organisation
– It should be clear who should make what type of decisions
– Everyone should be held to account by someone
• How addressed by PRINCE2
– Defined roles and responsibilities principle
– Organisation theme
• 4 management layers – commissioning, directing, managing, delivering
– Manage by Exception principle
• Tolerances
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10. Reporting
Golden thread
Reporting
of delegated authority
Alignment to
organisational
objectives
Independent Decision
assurance gates
• Requirement
– Ensure transparency of decisions and actions and report their outcome
• Why Important
– An essential element of good governance is that those who are delegated
authority should:
• periodically report progress against the responsibilities delegated to them
• report if they are unable to meet their accountabilities within the authority they have
been granted.
• report if there are any conflicts of interest which may affect decisions and actions they
undertake using the authority they have been granted
• How addressed by PRINCE2
– Manage by Exception principle
– Progress theme
• Time based reporting
• Event based reporting
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11. Independent Assurance
Golden thread
Reporting
of delegated authority
Alignment to
organisational
objectives
Independent Decision
assurance gates
• Requirement
– Verify through independent review
• Why Important
– Assurance enables transparency of decision-making and provides
confidence to those granting authority that objectives can be met without
them needing to get more involved.
– Without on-going assurance, those granting authority are solely relying on
the self-reporting by those they have delegated authority to.
• How addressed by PRINCE2
– Organisation theme
• Project Board’s responsibilities
– Quality theme
• Project assurance
• Quality assurance
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12. Decision gates
Golden thread
Reporting
of delegated authority
Alignment to
organisational
objectives
Independent Decision
assurance gates
• Requirement
– Define when critical decisions need to be made
• Why important
– Decision gates provide a final ‘fail-safe’ if the reporting element masks
the true position and any issues or weaknesses are missed by the
assurance activities.
– Decision gates provide a periodic opportunity to check if the other
governance elements are adequate or whether they need to be amended.
• How addressed by PRINCE2
– Manage by Stages principle
– Plans theme
– Directing a Project process
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13. Practical application - Mapping Governance
Objectives Authority Reporting Reviews Gates
Sponsoring Group
(Investors)
Programme Board
(Directors)
Programme
Manager
(Captain)
Project Managers
(1st Mate, Chief
Engineer, Purser)
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14. Conclusion
• Key elements of governance addressed by PRINCE2
– Alignment - Engage with stakeholders to define the
organisational purpose and objectives and how the project
contributes
– Delegation - Define where decisions can be most effectively
made
– Reporting - Ensure transparency of decisions and actions and
report their outcome
– Independent review - Corroborate through independent review
– Decision gates - Define when critical decisions need to be made
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15. Contacts
• UK • UAE
– t +44 8451 304861 – t +971 50 321 7420
– e info@outperform.co.uk – e info@outperform.ae
– w www.outperform.co.uk – w www.outperform.ae
• Licenced Partners in other countries
– Germany: PMFX Consulting Project Management GmbH
– Ireland: PMOworks Limited
– KSA: Future Educations Ltd
– Switzerland: Profeo Ltd
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Outperform™ is a Trade Mark of Outperform UK Ltd
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