ESTABLISHING APPROPRIATE GOVERNANCE STRUCTURES

Construction Project Communications - Establishing Appropriate Governance Structures

• This presentation is about establishing appropriate governance structures for construction projects.
• A good project governance framework includes a project structure with a project board and support decision bodies.
• All key stakeholders should be identified and structures set up to manage them effectively.
• Decision authorization should be allocated to roles and clearly communicated.
• Project management information systems (PMIS) should be used to provide timely and accurate information.
• A weak governance framework can create problems for project delivery.
• Project governance is about aligning different objectives to ensure successful project delivery.
• Governance can help mitigate conflict and realize mutual gains.
• Survey results suggest a strong correlation between investment in controls and governance and reduced costs.
• An effective project governance structure creates a single point of accountability.
• It improves risk management and enables project managers to monitor risks, identify potential problems, and create mitigation plans.
• It also leads to defined roles, avoiding conflicts and delays.
• Transparency in communication with clear information and key performance indicators (KPI) can be vital.
• Effective project governance is time and stakeholder sensitive, meaning accurate information delivery to the right people is critical.

Guiding Principles of Project Governance

• Establish clear accountability for project outcomes.
• Identify key project stakeholders.
• Implement appropriate systems and processes.
• Implement a monitoring and reporting schedule.
• Establish an effective project governance structure.

Establishing Clear Accountability for Project Outcomes

• The project board's role is to identify clear project outcomes and key roles and accountabilities.
• Accountabilities are determined by contractual obligations.
• Project managers should assemble the team and delegate project deliverables.

Identify Key Project Stakeholders

• Identifying key stakeholders is vital at the beginning of the project.
• Avoid having too many stakeholders.
• Clearly define roles and responsibilities for all stakeholders.

Implement Appropriate Systems and Processes

• Ensure project management, accounting/financial, information management and reporting systems are in place.

Implement a Monitoring and Reporting Schedule

• Regular monitoring and reporting mechanisms are crucial from the start of the project.
• This helps identify potential risks or difficulties before they become issues.

Establish an Effective Project Governance Structure

• Focus on the successful delivery of projects.
• Project governance should support the ability to remain agile.

Characteristics of Good Project Governance

• Clear project definition, including cost and schedule estimates, and project scope.
• Visibility into project performance at each stage of the project life cycle.
• Internal accountability for achievement of project goals.
• Effective contracting strategies.
• Rigorous communication and reporting.

Three Sets of Attributes for Project Governance

• Benefits (advantages).
• Guiding principles (important ideas).
• Characteristics (features).

Benefit, Guiding Principle, or Characteristic? (Examples of diagrams, showing relationships between benefits, principles, and characteristics.)

Components of a Project Governance Structure

• There are components to be considered in setting up a project governance structure.
• Project governance framework.
• Roles and responsibilities.
• Stakeholder engagement.
• Meetings or forums.
• Communication and reporting.
• Risk and issue management.
• Assurance.
• Project management control process.

Project Governance Framework Examples (Structures)

• There are various project board and team examples.

Roles and Responsibilities

• Defining roles and responsibilities ensures clarity.
• Use a RACI matrix to define roles and responsibilities (Responsibility, Accountable, Consulted, Informed).

Stakeholder Engagement

• Identifying project stakeholders is crucial.
• Include internal and external stakeholders, like top management, teammates, resources, customers, government, contractors.
• A team member should be designated to actively manage stakeholder engagement.

Meetings and Decision Bodies

• Striking a good balance between meetings and forums is necessary.
• Typical project examples include the quarterly board, subcommittees, executive management, project governance board, steering committees, project teams.
• Each decision body needs Terms of Reference(ToR) which defines purpose and intent, vested authority, member roles and responsibilities, operating principles.

Operating Principles

• Frequency of meetings, Scheduling of meetings, Location of meetings. -Agenda for meetings, Confidentiality of meetings.

Communication and Reporting

• Organizations need a common source of management information (MI).
• Standardized key performance indicators (KPIs) are essential.
• Use templates that align with project and corporate goals.

Risk and Issue Management

• Early identification of warning signs is crucial.
• Early responses to warnings and issues is critical. 
• Typical concerns include frequent changes, incomplete documents, budget/timeline requests, procurement delays, contractor responses.

Assurance

• Project assurance ensures accountability.
• Ensuring processes and procedures are being followed.
• Provides early warning of potential issues or risks, as well as recommendations for solutions.

Project Management Control Process

• Effective project governance involves using information systems.
• Use PMIS (Project Management Information Systems) to monitor, report, and forecast deviations from the project plan.

Project Governance Outcomes

• Time and Stakeholder sensitivity.
• Project owners who implement tailored governance practices are more likely to meet their cost, schedule, and performance/quality goals.

Who Does Who Belong?

• This slide shows specific individuals’ places within the structure described. (Different individuals fit into different roles, depending on responsibilities.)