Losing thousands from a badly run project might be an issue for the large multinational companies, but for a charity it could mean the difference between life and death, sometimes literally!

At the Matchett Group we are witnessing Corporate Governance growing in prominence. With high profile failings such as the banking crisis, illustrating the dangers created by weaknesses in accountability, disclosure and reporting at all management levels. Many organisations now find that their projects also suffer from these shortfalls.

News reports suggest that project failure is a common occurrence. The NHS IT project, Wembley Stadium, ID cards, Trident, have all fallen under the spotlight, demonstrating the problems of not controlling and monitoring projects and stakeholders better.

Without clear management and performance indicators, projects can quickly derail and cost far more than budgeted. Even worse, they can put organisations into disrepute – for charities this could lead to a reduction in support from key funding.

This is why organisations need to focus more on how they set up projects and why they are doing them in the first place. Intelligent selection is critical – without linking projects with the strategic core values and objectives, they can put the organisation at risk, financially or by reputation.

As a result of a lack of a governing structure for projects, many organisations have no processes to start and manage projects or to ensure they are implemented well. This can lead to:

• Projects starting before they have been clearly scoped out or approved.
• Unrealistic deadlines.
• Project sponsors not understanding what the role entails and unavailable to discuss resources, risks, issues, progress, or to authorise changes with project managers.
• Projects without any senior level support.
• No structured escalation of risk.
• Mismanaged communications, as people cover their backs.

These dangerously expose organisations to high levels of risk, waste and ultimately, project failure. Project Management becomes constant crisis management and, when time and resource constraints are fixed, quality gets cut. The worst case scenario is that poor governance can cost jobs, entire companies and even peoples’ lives.

If organisations are to meet this challenge the first step is for senior managers to establish processes that support projects and underpin structured governance principles.

Suggested actions to support Project Governance in your organisation:

• A project board (or the directors’ board) takes responsibility for the governance of all projects.
• Roles, responsibilities and performance criteria for projects are clearly defined and all project staff are suitably trained and authorised to make decisions at their level of delivery.
• Projects are only implemented with an approved business case, linked with the strategic objectives of the organisation, and a signed off project plan. There should be key authorisation points and robust reporting procedures to ensure that progress is communicated accurately and in a timely fashion.
• Processes and controls are set up and applied throughout the project, along with independent auditing where necessary.
• Transparent communications are encouraged to ensure that information is shared and risks and issues are escalated, not hidden.

These actions link to the Association of Project Management principles of Project Governance , which set governance standards. However, it is important to maintain the balance between establishing strong governance procedures whilst allowing sufficient flexibility for projects to progress.

With the push to deliver value for money alongside increased services and support, charities and the public sector have to proactively control activities that cost time, money and resources. There is, therefore, more insistence on good governance and by association better Project Governance to minimise exposure to risk and support stringent auditing procedures.

Find out more about Matchett’s project management course offerings.