PMUni Workshop 2/13
Corporate Governance of the
Process & Project-oriented Company
Roland Gareis
Veszprem, University of Pannonia
October 5th, 2013
Objectives
> Objectives: Informing about …
>
the model of the process & project-oriented company
>
the corporate governance concept
>
ideas about corporate governance for the management of temporary
organizations
>
the relationship between corporate governance and an integrated
management approach
> Non-objectives: Informing about …
>
process, project, change management
2
Context
> Research Project: Corporate Governance of the process & project-oriented
company
>
>
PhD thesis by Renata Mosoci, WU Vienna
>
Supervisors: Roland Gareis and Ralf Müller
>
Research question: How can corporate governance improve the
management quality of the project-oriented company?
Book edited by Laurence Lecoeuvre, to be published by Gower
>
Book chapter: The performance of projects and project management:
Sustainable delivery in project-intensive company
>
Case study work by RGCresearch
>
Presentation contributing to the happy projects‘14: One Management
3
Overview
> The process & project-oriented company
> Corporate governance concept
> Corporate governance for the management of temporary organizations
> Corporate governance and an integrated management approach
> Conclusion
4
RGC Process Map & Projects
Clients
Primary
Processes
Selling an
in-house
service
Selling a
seminar,
coaching
Selling
a product
Performing
a seminar,
coaching
Performing
an event
Performing
a consulting
contract
Performing
a research
assignment
Procuring
a service,
material
Developing
a service,
product
Developing
the
organisation
Managing
the
personnel
Managing
the
infrastructure
Managing
finances,
controlling
Managing
stakeholder
relationships
Marketing/
PR
Strategic
management
Operational
management
Process
management
Project and
program
management
Porject
portfolio
management
Change
management
Knowledge
management
Management
of sustainable
development
Secondary
Processes
Tertiary
Processes
5
Process & Project-oriented Company: Organization Chart
Management Board
Business
Unit B
Business
Unit A
Business
Unit C
Department
Department
Department
Department
Department
Department
Expert
Pool 1
Expert
Pool 3
PcM/PM
Office
Expert
Pool 2
Expert
Pool 4
Process
Managers
Project
Managers
Project
Portfolio
Group
Projects,
Programs
Projects,
Programs
Projects,
Programs
6
Clusters of Projects
Relationships between projects
a set of sequential
projects
all projects of a projectoriented company
a set of coupled
projects
a set of closely coupled
projects & work
packages
over a period
of time
at a point
in time
at a point
in time
over a period
of time
chain of projects
project portfolio
network of projects
program
Clusters of projects
7
coMATURE
Project management
Process management
Program management
Assurance of the management
quality of a project or program
Personnel management
Organisational design
Initiation of a project or program
Project portfolip coordination
and networking between projects
8
Organizational Fit Model
Strategy:
Management by Projects
Process &
Project-oriented
Company
Structures:
Permanent and Temporary
Culture:
New Management Paradigm
9
Process & Project-oriented Company: Definition
> A company which …
>
defines processes holistically and applies process management formally
>
uses projects & programs as temporary organizations for the performance
of relatively unique processes of medium and large scope
>
applies “Management by Projects” as an organization strategy
>
considers processes, projects & programs, the project portfolio and
networks of projects as management objects
>
has Management Offices and a Project Portfolio Group as integrative
organization structures
>
provides corporate governance for process, project & program, and project
portfolio management
>
has employees with competences in process, project & program, and
project portfolio management
>
applies a “new” management paradigm
10
Overview
> The process & project-oriented company
> Corporate governance concept
> Corporate governance for the management of temporary organizations
> Corporate governance and an integrated management approach
> Conclusion
11
Corporate Governance: Definition (OECD, 2004)
> CG involves a set of relationships between a company’s management, its
board, its shareholders and other stakeholders.
> CG provides the structure through which the objectives of the company are set,
and the means of attaining those objectives and monitoring performance are
determined.
12
Corporate Governance: Objective, Tasks, Results
> CG objective is to achieve …
>
transparent structures and repeatable processes
> CG tasks are to define …
>
the objectives of the organization
>
the means of obtaining those objectives
>
the means of monitoring the performance of processes
>
the relationships between management and stakeholders
> CG results are …
>
high level rules and regulations
>
which are relating to all identity dimensions of an organization, and not just
to the financials
13
Identity Dimensions of an Organization
Contexts
> Structures of the organization
>
Objectives, strategies
>
Services, products
>
Technologies
>
Organizational structures
>
Organization culture
>
Personnel
>
Infrastructure
>
Budget, financing
Stakeholder
Structures
Stakeholder
relation
Stakeholder
> Contexts of the organization
>
Higher social system
>
Stakeholders
>
History and expectations about the future
14
Corporate Governance: General Examples
> Objectives, strategies, values
>
Processes, methods, and rules about how objectives, strategies, and values
are to be planned, communicated and controlled
>
Definition of overall objectives, strategies, and values
> Services, products
>
Rules about which services to be provided for which markets
>
Processes, methods, and rules about the delivery of the services and
products to different markets
> Organizational structures
>
Processes, methods, and rules about how role descriptions, organization
charts are developed
>
Important role descriptions and organization charts
>
Rules about how processes to be documented
>
Important process documentations
> ….
15
Corporate Governance: Characteristics
> Implicit vs explicit, values vs company rules
> Complain and explain vs complain and penalize
> Relating to the principles of sustainable development, e.g. transparency,
accountability, responsibility, fairness (Aras & Crowther, 2010)
> Regular reviews to maintain effectiveness and benefit
> Managing is not governing
16
Overview
> The process & project-oriented company
> Corporate governance concept
> Corporate governance for the management of temporary organizations
> Corporate governance and an integrated management approach
> Conclusion
17
Hypotheses: Objects of Consideration for Corporate
Governance
> CG in the process & project-oriented company relates to the company overall.
This includes the governance of the management of temporary organizations
and of the project portfolio.
> Specific objects of consideration of CG of the process & project-oriented
company are
>
its specific objectives, strategies, and values
>
its specific processes, namely project initiation, project management,
program management, and project portfolio coordination
>
its specific organizations, namely projects, programs, the PcMO, the PMO
and the Project Portfolio Group
>
its specific roles, namely process managers, project/program sponsors,
project/program managers, and project/program teams
18
Hypotheses: Objectives of CG of the Process & Projectoriented Company
> CG improves the management quality of the process & project-oriented
company, including the management quality of its projects and programs.
> Sustainable development principles are implemented by CG.
19
Hypotheses: Implementing, further Developing, and
Controlling CG
> The PMO and the PcMO contribute to implementing, further developing, and
controlling the CG of the process & project-oriented company.
> Stakeholders are involved in implementing, further developing, and controlling
CG in the process & project-oriented company.
> Regular audits/health checks ensure the compliance of the process & projectoriented company with its CG.
20
Guideline: Project & Program Management (Example)
1. Introduction
2. Definitions
2.1 Definition: Small project, project, program
2.2 Definition: Project discontinuities - crisis, chance
2.3 Definition: Project and program management
2.4. Project and program types
3. Project management process
3.1 Project management: Objectives, structure
3.2 Project starting: Objectives, structure
3.3 Project coordinating: Objectives, structure
3.4 Project controlling: Objectives, structure
3.5 Project transforming, re-positioning: Objectives, structure
3.6 Project closing: Objectives, structure
4. Project organization
4.1 Project organization chart
4.2 Project roles and project communication structures
4.3 Project values
4.4 Project management methods and templates
5. Program management process
5.1 …..
21
Project Organization Chart: Standard (Example)
Project Organisation
Project
contributor
Project
contributor
Project
contributor
Project
contributor
Project team
member
Subteam 1
Project team
member
Subteam 2
Project Team
Project
manager
Project
contibutor
Project
sponsor
22
Project Management Methods (Example)
Methods for Project Starting
Project scope planning
>
Project objectives plan
>
Project objects of consideration plan
>
Work breakdown structure
>
Work package specifications (for essential work packages)
Project scheduling
Must
Must
Must
Can
>
Project milestone plan
>
Project bar chart
>
Project CPM schedule
Project resource planning and project budgeting
>
Project resource plan
Must
Must
Can
>
Must
Project budget
Can
>
Project finance plan
Project context relationships
>
Project stakeholder analysis
>
Investment cost-benefit analysis
Can
>
Analysis: Relationships to other programs and projects
Can
>
Analysis: Pre- and post-project phase
Must
Must
Must
Designing the project organization
>
Project assignment
>
Project organisation chart
Must
Must
>
Project role descriptions
Must
>
Project communication structures
Must
Methods for Project Controlling
>
…
Guideline: Project Portfolio Management (Example)
1. Introduction
2. Definitions:
2.1 Definition: Project portfolio, network of projects
2.2 Definition: Investment
2.3 Definition: Project portfolio management
3. Project initiation process
3.1 Objectives, structure of the process
3.2 Project initiation roles
3.3 Project initiation methods and templates
4. Project portfolio coordination process
4.1 Objectives, structure of the process
4.2 Project initiation roles
4.3 Project initiation methods and templates
5. Networking of projects process
5.1 Objectives, structure of the process
5.2 Project initiation roles
5.3 Project initiation methods and templates
24
Project Initiation Process
Short, mid & long-term
impacts
Economic, ecologic &
social impacts
Start
Project
defining
Project portfolio
analyzing
Project
proposal
preparing
Project
deciding
no
End
yes
Project
assigning
Local, regional,& global
impacts
End
Stakeholder & risk
orientation
25
Role Description: Project Portfolio Group (Example)
Objectives
>
Optimizing the project portfolio results and the project portfolio risk
Organizational position
>
Reports to the board of directors
Tasks in the project
initiation
>
>
Coordinating the project objectives with the strategies of the projectoriented company
Deciding about the organization for implementing the investment
(project or program)
Nominating the project sponsor
>
>
>
>
>
>
Analyzing the project portfolio structure and optimizing it
Deciding about project priorities
Analyzing and managing relationships between projects
Coordinating scarce internal and external resources
Promoting the networking between projects
…..
>
Tasks in the project
portfolio coordination
Project Portfolio Score Card (Example)
Stakeholder relations
15.01.2013
15.04.2013
15.08.2013
Customers
Partners
Authorities
Suppliers
Results of
Projects/Programs
15.01.2013
15.04.2013
15.08.2013
Project Portfolio Structure
Progress
Number of projects per type
Schedule
Project portfolio budget
Resources
Project portfolio resources
Costs
Project portfolio risk
15.01.2013
15.04.2013
15.08.2013
15.01.2013
15.04.2013
15.08.2013
Revenues
15.01.13
15.04.13
15.08.13
Overall Status
Project Portfolio
Organisation
15.01.2013
15.04.2013
Investment Strategies
15.08.2013
Multi-role assignments
Innovation strategies
Application pm procedures
Financial strategies
PM auditing
Customer relations strategies
PM personell development
Process strategies
very poor
poor
average
good
very good
27
CG Roles in the Process & Project-oriented Company
> Board of Directors
> The Board of Directors decides about the GC structures regarding process,
project & program, and project portfolio management
> Process Management Office (PcMO)
> Develops process management guidelines (including templates)
> Supports the documentation of single processes
> Project Management Office (PMO)
> Auditors
> Not a CG Role: Project Sponsor
> A Project Sponsor has a content-related interest in the project
> The Project Sponsor performs a management role in the project
28
CG Role of the PMO
> Providing guidelines (including templates) for …
> project and program management
> project and program consulting and auditing
> project portfolio management
> Providing standard project plans
> Providing software for
> project and program management
> project portfolio management
> Communicating the CG structures by …
> providing brochures, newsletters, maintaining a PMO homepage, etc.
> organizing events, e.g. project vernissages
> Controlling the compliance of the CG structures by regular audits/reviews
> Not: Controlling projects
29
Overview
> The process & project-oriented company
> Corporate governance concept
> Corporate governance for the management of temporary organizations
> Corporate governance and an integrated management approach
> Conclusion
30
Competing Management Approaches
> Process, project, and change management as well as business analysis are
considered as distinct management approaches, which require specific roles,
methods and terminologies.
> On the one hand a differentiation between these approaches provides
orientation, on the other hand in their practical application these approaches
often need to be combined.
> In companies sometimes parallel guidelines and competing organizations being
responsible for these guidelines, such as a Quality Management Department, a
PM Office and PcM Office, a Change Management Department, etc., exist.
> The integration of process, project, and change management as well as
business analysis, in order to contribute to the management quality of the
company, is a CG function.
31
Business Analysis Body of Knowledge Guide
32
21. – 23.05.2012
Change, Processes, Projects, and Business Analysis
Change
Feasibility Study
Vision
Statement
Conception
Implementation
Stabilization
Business
Requirements
Documents
Technical
Design
Specifications
Project
Plan:
Study
Project
Plan:
Conception
Project
Plan:
Implementation
Project
Plan:
Stabilization
33
ONE Management
> Common methods and a common terminology for process, project, and change
management as well as business analysis contribute to the management
quality of the process & project-oriented company.
> An integrated Management Office assures appropriate CG structures for the
process & project-oriented company. It contributes to sustainable process,
project and change management. It contributes indirectly to sustainable
processes, projects, changes and business solutions.
> Common values considering the principles of sustainable development can be
applied to all management approaches.
> Change owners, change managers, and change agents require process,
project and change management as well as business analysis competences.
> Process, project and change manager as well as business analysts require
common values as a basis for their efficient cooperation.
34
Overview
> The process & project-oriented company
> Corporate governance concept
> Corporate governance for the management of temporary organizations
> Corporate governance and an integrated management approach
> Conclusion
35
Resume: Corporate Governance
> CG is not management
>
CG provides structures for management
>
The CG responsibility is different from the management responsibility
> CG is values-based
>
Principles of sustainable development are a basis for CG
> CG is holistic
>
CG integrates different management approaches
> CG provides …
>
holistic governing structures, i.e. for the company overall, including single
organizations of a company
>
permanent, mid to long-term and not temporary, short-term governing
structures
36
Resume: CG of the Process & Project-oriented Company
> CG of the process & project-oriented company has specific objects of
consideration.
> Specific GC objectives in the process & project-oriented company are to define
how process, project and project portfolio management is to be performed.
>
…and not to do process, project or project portfolio management
> The governing structures for process, project and project portfolio management
as well as business analysis have to be integrated.
> An integrated Management Office can provide CG services for the process &
project-oriented company.
37
There is no Project Governance!
> To define how projects and programs are to be managed generally is a CG
function.
>
this is defined at a generic level and not for a single project
> Single projects (and programs) are to be managed and not governed.
>
this applies also to projects (and programs) with multiple owners
> The lack of understanding and performing the project sponsor role
appropriately cannot be compensated by „project governance“
38
39
Happy Projects!
Roland Gareis, www.rolandgareis.com