Dr.

Ata Ul Musawir
Riphah School Of Business and Management
Riphah International University
Lahore, Pakistan
• The Project Management Institute (PMI) defines a project as a
temporary endeavor undertaken to create a unique product or
service or result or some combination of the three. The
temporary nature of projects indicates a beginning and an end
to the project work or a phase of the project work. Projects can
stand alone or be part of a program or portfolio.

• Unlike regular operations or Business-As-Usual (BAU), projects

have a definite beginning and an end

• Projects also involve one or more elements that have not been
done in the past, and are therefore unique

1-2
Source: Larson, E. W., & Gray, C. F. (2018). Project management: The managerial process. McGraw-Hill. 7th ed.
1-3
• The Project Management Institute (PMI) defines project
management as the application of knowledge, skills, tools, and
techniques to project activities to meet project requirements.
Project management refers to guiding the project work to deliver the
intended outcomes. Project teams can achieve the outcomes using a
broad range of approaches (e.g., predictive, hybrid, and adaptive).

• The primary challenge of project management is to achieve all of the

project goals within the given constraints.

• Project management must also satisfy the strategy and objectives of

the funding organization. Project management must also consider
the requirements of other stakeholders

1-4
 Companies are made up of small operational islands that refuse to communicate
with one another for fear that giving up information may strengthen their
opponents. The project manager’s responsibility is to get these islands to
communicate cross-functionally toward common goals and objectives.
Source: Kerzner, H. (2017). Project management: a systems approach to planning, scheduling, and controlling. John
Wiley & Sons. 12th ed. 1-5
• Global Projects (e.g., Int. Space Station, Large Hadron Collider, Paris Accord,
U.N. poverty alleviation projects)

• Regional projects (e.g., the individual corridors of China’s Belt and Road
Initiative)

• National projects (e.g., literacy campaign, polio vaccination campaign, CPEC)

• Organizational projects (e.g., automation of business processes, building a

new branch office, developing a new product)

• Projects in local neighborhoods (community projects e.g., cleanliness drive,

school function)

• Projects at a personal level (e.g., student projects, learning to drive,

planning a vacation)

1-6
• Internal projects are those where the client/funding organization and
performing organization are the same. For example:
• Upgrading the company's IT infrastructure
• Creating a new product/service and selling it to the market
• Most small-scale capital expenditure (CAPEX) projects

• External (customer) projects are those where the client organization and
performing organization are separate (project-based organizations conduct
primarily customer projects). For example:
• A contractor who builds a new office building for a client
• A software company developing a customized accounting software
• A construction firm that bids for a government contract to build a coal-fired
power plant

1-7
 Funding
Organization

Consultant
Organization

Performing
Organization

Peripheral
Organization

Type I – Project Led by a Type II – Project Led by a Type III – Project Led by a Network of
Single Organization Dyad or Triad of Organizations
Organizations

Source: Musawir, A., Abd-Karim, S. B., & Mohd-Danuri, M. S. (2020). Project governance and its role in enabling organizational
strategy implementation: A systematic literature review. International Journal of Project Management, 38(1), 1-16.

1-8
• In a project-based organization (PBO), such as construction or aerospace, most or all
work is conduct through projects, with each project as a separate cost center having
its own profit-and-loss statement. The total profit to the corporation is simply the
summation of the profits on all projects. In a project-driven organization, everything
centers on the projects.

• In a non-project-based organization, such as low-technology manufacturing, profit

and loss are measured on vertical or functional lines. In this type of organization,
projects exist merely to support the product lines or functional lines.

• Increasingly, organizations are conducting more work through projects.

1-9
Source: Nieto-Rodriguez, A. (2012). The Focused Organization. Gower: London
1-10
Based on data from the UK Department of Economic History
• Now, organizations need to be dynamic: constantly modifying the range of
products and services, need to constantly improve or risk going out of
business, marketing to a millennial audience in the age of information
pollution and shrinking attention spans, opportunities and challenges due to
social media, changing your business model to survive, etc.
• Organizations need to constantly make major changes to survive – changes
accomplished through projects, e.g.:
• Apple is constantly working on new iPhone models to keep revenues up, integrate the
rapidly developing technology, and keep ahead of its competition
• Microsoft has changed its business model to move away from delivering packaged
software and toward selling subscription-based cloud services
• Amazon’s business model is not based on any product or service – it is based on scalability
and exploiting economies of scale
• News agencies have had to shift from print media to electronic media while handling
competition from social media and increasing public skepticism
• Many traditional video games developed are shifting towards mobile gaming and a free-
to-play model

1-11
• Survival in today’s dynamic business environments, especially in fast-paced
tech industries, requires an organization to constantly change and adapt
• Even public sector organizations need to adapt in the face of growing
pressure from an increasingly informed (and angry) public
• These changes are accomplished through projects
• Companies that do not adapt end up bankrupt or lost to history
• More and more business executives are recognizing project management as
a critical competency for their organization

1-12
 A collection of projects, programs, and sub-
portfolios managed as a group to achieve strategic
Portfolio objectives. An organization may have one portfolio
overall or multiple portfolios, e.g. one for each
business unit or particular geographical region.

A group of related projects managed in a

Program coordinated way to obtain benefits and control not
available from managing them individually.

A temporary endeavor undertaken to create a

Project unique product or service or result or some
combination of the three.

1-13
Project Portfolio Dashboard Example

1-14
1-15
1-16
 The word ‘governance’ was derived from the
Latin word ‘gubernare’ which means ‘to steer’

1-17
 • Separation of ownership from control leads to the agency problem.

Citizens Politicians
Shareholders Directors & Management
Project Owner/Sponsor Project Manager

1-18
• In (democratic) nations – Governments are elected to optimally utilize
the resources of a country in order to maximize the present and future
well-being of the population (as well as the world in general).

• In organizations – Board of directors are elected to secure the interests of

the owners (shareholders), which is to maximize their wealth. For this
purpose, boards set the overall strategic direction of the organization
(direction) and may create structures (e.g. audit committees) and policies
(e.g. ethics guidelines, executives remuneration, rules and regulations)
(control).

• In projects – Project sponsor/owner, steering committee/board, PMO,

and various other structures are created to secure the interests of the
funding (client) organization and sponsoring (performing) organization.

1-19
 Views of Governance (Key References)
PMI (2016) APM BOK (2012) Müller et al. (2016)
PMI PMBOK (2013) APM (2011) Müller et al. (2015)
PMI OPM3 (2003) APM (2009) Müller (2009)

Corporate Corporate
Board of Organizational Governance Governance
Directors Governance Governance of Project
Management (GoPM)
Organizational Level

Organizational
Organizational Project
Project Management Management
(OPM) Framework (OPM) Governance

Governance of
Portfolio Portfolio Projects
Portfolio Governance Governance

Governmentality
Program Program
Program
Governance Governance

Project Project Project

Project Governance Governance Governance

Three Views of Governance in the Realm of Projects

20
Project governance (PG) is the framework within which project decisions are made and
decision-makers are held accountable (PMI, 2016b). It serves to guide project management
activities to achieve organizational strategic and operational goals (PMI, 2016b).

It defines:
- Who makes the decisions (decision rights and authority structures)
- How the decisions are made (processes and procedures)
- What are the collaboration enablers (trust and behavior controls)

Poor project governance Good project governance

goal? goal

vs.

start start
21
“Project Governance has been neglected yet a governance team
can destroy more value in five minutes than a project team can
destroy in five weeks. Poorly understood, poorly supported and
poorly executed it is not surprising that more projects fail due to
poor project governance than poor project management. Yet
while we invest millions in project management, we invest next
to nothing in project governance.”

Source: Totally Optimized Projects (2020)

22
 Project Governance ≠ Project Management

Direction and control – strategic Implementation – operational and

(PMI, 2016) tactical (PMI, 2016)

Defines and approves strategy, goals, Implements strategy, goals, and

and objectives objectives

Determines and provides funding Identifies and requests for funding and
and resources resources

Determines and/or approves key Monitors/measures KPIs;

performance indicators (KPIs) creates/consolidates reports

Accountable for project success Responsible for project success

Good project governance enables good project management 23

 Organizational Strategy

• What projects do we need to undertake? Which projects should be prioritized?

Project • Why do we need to do these projects? What are the expected benefits?
Governance • Who is responsible and accountable for project success and benefits realization?
• Is project progress on track? Are stakeholders’ interests being served?
• What support and resources are required to overcome barriers to success?

• What do we have to do?

Project • How are we going to do it?
Management • What is the budget?
• When do we need to deliver it?

24
 25
Source: Müller (2010)
Source: Zwikael, O., & Meredith, J. R. (2018). Who’s who in the project zoo? The ten core project roles.
International Journal of Operations & Production Management, 38(2), 474-492. 1-26
• A person or group who provides resources and support for the project
and is accountable for enabling success.

• May be part of the client organization or performing organization, usually

a senior manager.

• In charge of overseeing business interests. Performs two main roles:

• Governance
• Support

• Approves the investment of business resources into a project.

• Can initiate and approve major changes if needed.

• Can initiate (and sometimes approve) the termination process if needed.

1-27
• Sometimes used interchangeably with project sponsor.

• Generally has a wider range of responsibilities than a sponsor, owner also:

• Accepts all risks pertaining to the project
• Establishes overall project management structure
• Promotes project to senior management and other stakeholders

• In some cases, projects have both a sponsor and an owner:

• Sponsor represents performing organization
• Owner represents client organization

*Note: Roles are defined by organizations, therefore may vary by organization and even by
project

1-28
• Sets the operational and strategic direction of projects.

• Often headed by the project sponsor/owner.

• May also include:

• Other senior managers
• Subject matter experts
• Representatives of key stakeholders
• External, independent representatives, e.g. auditors, quality consultants, environmental agency
representatives

• Analogous to a corporate Board of Directors.

1-29
• May govern a single project or multiple projects, in some cases even program(s) or portfolio(s).

• Responsibilities:
• Ensure the project’s outputs meet the requirements of the business and key stakeholders
• Review the progress of the project
• Review high-level risks, potential legal problems
• Help resolve conflicting priorities and resources
• Can approve termination of the project

• Generally, it focuses on high-level issues.

1-30
• The Project Management Office (PMO) is a management structure that
standardizes project-related governance processes and facilitates the
sharing of resources, methodologies, tools, and techniques across projects.

• PMOs are typically staffed with:

• The PMO Director: The PMO Director provides project oversight in virtually all areas of the
organization, managing enterprise-level projects and enterprise-wide resource distribution and
allocation on all projects. Any project that crosses divisional boundaries, as well as some large
projects performed within a department, would be under the oversight of this PMO Director.

• Project and Program Managers: In the recent past, it was rare for PMOs to maintain and manage
their own project management staff. However, since 2008, there has been a significant trend in this
direction. It’s only logical that, as organizations move further away from the functional organization
and ad hoc projects, project expertise becomes more centralized. Today, the most successful
organizations are those with enterprise PMOs that include project managers and project support
staff.

• Project Support Staff: Several roles complement the project manager(s) to efficiently execute
programs and projects:
• Project Schedulers
• Project Planners
• Project Controllers

1-31
• Responsibilities of the PMO can range from providing project
management support functions to actually being responsible for the
direct management of one or more projects:

• Supportive. Supportive PMOs provide a consultative role to projects by supplying

templates, best practices, training, access to information and lessons learned from
other projects. This type of PMO serves as a project repository. The degree of control
provided by the PMO is low.

• Controlling. Controlling PMOs provide support and require compliance through various
means. Compliance may involve adopting project management frameworks or
methodologies, using specific templates, forms and tools, or conformance to
governance. The degree of control provided by the PMO is moderate.

• Directive. Directive PMOs take control of the projects by directly managing the
projects. The degree of control provided by the PMO is high.

1-32
• PMOs can also be classified by the scope of their responsibilities within
the parent organizational structure:

• Project Management Center of Excellence (PMCoE). Defines standardized project

management standards, procedures, methods and tools to support project teams
across an entire organization; includes administrative services and training in process,
methodology, and tools.

• Project PMO. Established for the duration of a single large project or program; includes
administrative support, controlling, reporting and monitoring.

• Divisional PMO. Provides support to projects for a specific business unit within an
organization; includes portfolio management, training, resource planning, and project
coordination.

• Enterprise PMO. Ensures that projects align with the organization strategy and
objective; these have the broadest remit of all PMO types, typically reporting direct to
the CEO (or similar role), and have authority to make strategic and tactical decisions
across all projects.

1-33
• Traditional PMOs tend to be located within a department (e.g., IT or
engineering).

• They struggle to maintain a strategic orientation because they are set up

with a focus on their department, not the organization as a whole.

• Research during the past 5 years has demonstrated that executive

sponsorship was a critical requirement for PMO success and lack of it was
a key reason for PMO failure.

• To overcome these limitations, the concept of the EPMO was created as a

centralized function that should operate at a strategic level with
executives (typically reporting directly to CEO or CFO, may oversee
traditional PMOs). It should ensure strategic alignment between business
objectives and the projects and programs that deliver them.

1-34