Key Takeaways
- Project governance is the framework of rules, policies, and procedures that guides decision-making, accountability, and oversight throughout the project lifecycle
- Governance structures define clear decision-making pathways, escalation procedures, and reporting relationships for all stakeholders
- Escalation thresholds and paths must be documented in the governance plan, specifying when and to whom issues should be elevated
- The three pillars of project governance are Structure (frameworks), People (expertise and accountability), and Information (transparency)
- Governance structures should be flexible enough to adapt as the project evolves while maintaining consistent decision-making principles
Establishing Project Governance
Project governance provides the overarching structure that ensures projects align with organizational objectives, are properly controlled, and deliver intended value. The PMP Exam Content Outline emphasizes the project manager's role in determining appropriate governance and defining escalation paths.
Understanding Project Governance
Project governance is a management framework that guides decision-making, accountability, and oversight throughout a project's lifecycle. It establishes clear authority structures, roles, and processes to ensure projects align with organizational strategy and deliver intended value.
Governance vs. Project Management
| Aspect | Governance | Project Management |
|---|---|---|
| Focus | Oversight and direction | Day-to-day execution |
| Questions | Should we do this? Is it on track? | How do we do this? |
| Decisions | Strategic, high-impact | Tactical, operational |
| Performed By | Steering committee, sponsors | Project manager, team |
| Frequency | Periodic reviews, milestones | Continuous |
The Three Pillars of Project Governance
Effective governance rests on three foundational pillars:
1. Structure
- Frameworks for oversight and decision-making
- Clear organizational hierarchy
- Defined roles and responsibilities
- Reporting relationships
- Committee and board compositions
2. People
- Expertise and domain knowledge
- Accountability and ownership
- Authority to make decisions
- Skills and competencies
- Stakeholder representation
3. Information
- Transparency in reporting
- Timely and accurate data
- Performance metrics and KPIs
- Decision support systems
- Documentation and records
Governance Structure Components
A comprehensive governance structure includes:
| Component | Description | Purpose |
|---|---|---|
| Steering Committee | Senior leaders overseeing project | Strategic direction, major decisions |
| Project Sponsor | Executive champion | Accountability, resources, escalation |
| Project Manager | Day-to-day leader | Execution, reporting, team management |
| Working Groups | Specialized teams | Technical decisions, domain expertise |
| Change Control Board | Change evaluators | Change approval/rejection |
| Advisory Bodies | Subject matter experts | Guidance and recommendations |
Governance Hierarchy
Typical governance hierarchy:
- Executive Level: Strategic alignment, portfolio decisions
- Steering Committee: Program/project oversight, major decisions
- Project Sponsor: Accountability, escalation point, resources
- Project Manager: Day-to-day governance, operational decisions
- Team Leads: Technical decisions within defined boundaries
Decision-Making Structures
Governance defines how decisions are made and by whom.
Decision Authority Levels
| Decision Type | Authority Level | Examples |
|---|---|---|
| Strategic | Steering Committee/Sponsor | Project continuation, major scope changes |
| Tactical | Project Manager | Schedule adjustments, resource assignments |
| Operational | Team Lead/Team | Technical approaches, task assignments |
Decision Rights Matrix (RACI for Decisions)
| Decision Area | Steering Committee | Sponsor | PM | Team |
|---|---|---|---|---|
| Project Go/No-Go | Decide | Recommend | Inform | Inform |
| Budget Changes >10% | Approve | Decide | Recommend | Inform |
| Scope Baseline Changes | Approve | Approve | Recommend | Consult |
| Resource Allocation | Inform | Approve | Decide | Consult |
| Technical Approach | Inform | Inform | Approve | Decide |
Escalation Paths and Thresholds
Escalation is the process of elevating issues and decisions from one level of authority to the next when they cannot be resolved at the current level.
Defining Escalation Paths
Escalation paths should clearly specify:
- Who can escalate
- To whom issues are escalated
- When escalation is required
- How escalation is performed
- What information must be provided
Escalation Thresholds
Not all issues require escalation. Thresholds define when escalation is needed:
| Threshold Type | Example | Escalation Target |
|---|---|---|
| Budget Variance | >10% over budget | Sponsor |
| Schedule Variance | >2 weeks behind | Steering Committee |
| Scope Change | Any baseline change | Change Control Board |
| Risk Materialization | High-impact risk occurs | Sponsor |
| Quality Issues | Critical defects | Quality Board |
| Stakeholder Conflict | Cannot be resolved at PM level | Sponsor |
Escalation Best Practices
| Practice | Description |
|---|---|
| Escalate early | Don't wait until crisis point |
| Provide context | Include background and analysis |
| Propose solutions | Come with recommendations |
| Document | Record escalation and outcomes |
| Follow up | Ensure resolution and communicate results |
Governance Documentation
Governance Plan Contents
| Section | Content |
|---|---|
| Governance Framework | Overall structure and principles |
| Roles and Responsibilities | Who does what |
| Decision Rights | Authority levels for different decisions |
| Escalation Procedures | Paths, thresholds, protocols |
| Meeting Cadence | Governance meeting schedule |
| Reporting Requirements | What, when, to whom |
| Change Control | How changes are managed |
| Issue Management | How issues are handled |
Project Charter Governance Elements
The Project Charter typically includes:
- High-level governance structure
- Sponsor authority and responsibilities
- Key stakeholder roles
- Initial decision-making framework
Adapting Governance
Governance should be appropriate for the project context:
Factors Affecting Governance Complexity
| Factor | Lower Governance Needs | Higher Governance Needs |
|---|---|---|
| Project Size | Small | Large |
| Complexity | Simple | Complex |
| Risk | Low | High |
| Stakeholders | Few | Many |
| Organizational Impact | Limited | Significant |
| Regulatory Requirements | None | Heavily regulated |
Governance Flexibility
While governance provides structure, it should also be flexible:
- Adjust oversight intensity based on project phase
- Modify meeting frequency as needs change
- Adapt decision authorities as project matures
- Tighten or loosen controls based on performance
Governance in Different Methodologies
| Methodology | Governance Characteristics |
|---|---|
| Predictive | Formal, document-heavy, milestone-based reviews |
| Agile | Lightweight, iterative, embedded in ceremonies |
| Hybrid | Blended approach, formal for major decisions |
Agile Governance Elements
- Sprint Reviews as governance checkpoints
- Product Owner as business representative
- Self-organizing teams with defined boundaries
- Servant leadership model
- Continuous improvement through retrospectives
Key Takeaways
- Governance provides the framework for project oversight and decision-making
- The three pillars are Structure, People, and Information
- Decision rights must be clearly defined and communicated
- Escalation paths and thresholds ensure issues reach the right authority
- Governance should be appropriate to project context and adaptable
A project manager discovers a schedule delay of three weeks. According to the governance plan, delays over two weeks must be escalated to the steering committee. What should the project manager do?
What are the three pillars of project governance?
Which body typically has authority to approve major scope changes that affect the project baseline?