The effect of governance on IT projects

Nick Pelham

Why did we focus on IT projects

• Spectacular headlines about IT failures

• Lifecycle is generally shorter and lessons learnt are used

– Much innovation comes out of IT lessons/improvements• Prince2• Gateway review process

• Governance related issues appear to be increasing in lessons learnt from ‘failed’ projects

– Unclear goals– Conflicting decisions– Resourcing– Poor risk management

Some say….

• Governance is responsible for ….

– Clearly defining the reason for the (ICT) investment– Shaping the solution that will answer the need– Overseeing the procurement and implementation of the

investment– Realising the benefits, including tracking the delivery of

benefits throughout the investment lifecycle

• “IT governance often gets confused with IT management and the CIO gets to be accountable for anything that has the word IT attached to it. As a consequence the business ends up being interested onlookers and expert critics, rather than accountable participants in any business process pertaining to IT”

Investing Smarter in Public Sector ICT : Turning Principles in to Practice, Victorian Auditor General’s Office, 2008.

• We conducted some interviews (as part of a larger project) about governance

What we found

• Project governance may be important for the successful outcome of IT projects, but how governance is actually implemented can vary

• At this point in time, the governance rhetoric does not match the reality

It highlighted the importance of…..

• project management skills, in particular interpersonal communications

• IT projects being more than just the technology – it usually is a business change

• Committees/control groups that review the progress of each project is useful in successful delivery

So what does the literature say…

• Not universally accepted what governance means in a project context

Some definitions

• Governance - is about the rules, processes and procedures of government (Mac Dictionary, 1985).

• Corporate Governance – “...a system by which business corporations are directed and

controlled. The corporate governance structure specifies the distribution of rights and responsibilities among different participants in the corporation, such as the board, managers and shareholders and other stakeholders, and spells out the rules and procedures for making decisions on corporate affairs.” Clarke (2004)

– “Corporate Governance is concerned with holding the balance between economic and social goals and between individual and communal goals” Cadbury (2000)

• Project Governance …as an extension of the principles of governance in to the management of individual projects (Assoc of PMs, UK)

Public - private governance

• Governance is what governments ‘do’– Stakeholder representation and command

(the people) and (parliament/ministers)

– Free, open debate that is publicly recorded

• Corporate governance– Business owners not (necessarily) the people who

manage the business– Management and ownership separated– Board shapes the vision and mission and selects the

CEO

Corporate vs Project governance

Some problems

• Corporate governance is ongoing, and adapts– Sustainability– Social, economic and environmental issues change

• Projects have an end date– Time, cost, quality

IT Governance

Figure 1: Weill and Ross IT Governance Framework