Program Governance Tutorial

Program Governance
Welcome to the seventh chapter of the PMI-PgMP tutorial (part of the PMI-PgMP® Certification Training.)
In this lesson, we will focus on the fourth program management performance domain,
which is, program governance.
In the next section of the program governance tutorial, we will look at the objectives of
this lesson.

Objectives
After completing this lesson, you will be able to:

 Explain what program governance is

 Elucidate the concept of the program governance board
 Discuss the constitution and responsibilities of the program governance board
 Describe how the board interacts with other aspects of program management
 Describe the specific roles individuals play in the context of governance
 Explain how the overall organization structure impacts the program manager’s
structure.

Let us understand program governance in the next section of the program governance
tutorial.

What is Program Governance?

The term governance can mean many things to many people, so let us first try to
understand what governance exactly means.
Governance refers to the systems and methods by which a program and its strategies
are defined, authorized, monitored, and supported. It also refers to the systems and
methods by which the program team monitors and manages the components of a
program.
The program manager is an integral part of the program governance structure and
manages the relationship of the program with the overall governance framework,
including with the governance board. We will discuss these functions in the subsequent
sections.
Let us understand program governance better in the following section of the program
governance tutorial.

What is Program Governance? (Contd.)

Let us look into the expected outcomes and the specific contribution that a program can
expect from the program governance framework.
Effective Framework
First, program governance must lead to an effective framework for making decisions on
the program. This could mean that the decisions should be made after consulting the
right people at the right level, depending on the gravity of the decision.
Continous Alignment
Next, the governance structure should ensure that the program remains continuously
aligned with the strategy of the organization. This is where the governance domain
overlaps with strategic program alignment.
Create Appropriate Components
Then, it should lead to the creation of the appropriate components to pursue and
develop the work of the program.
Provide Escalation Mechanism
It should also provide an escalation mechanism to allow risks and issues that cannot be
managed at a lower level to be raised to a higher level and resolved systematically.
Effective Management
Moving on, it should lead to effective management of the deliveries on a program, to
ensure that the program is delivering the expected benefits. That is, it should ensure the
delivery of specific outputs from the components of the program and the delivery of
benefits from the program itself.
Applicable Standards
Next, it should ensure that the program conforms to the various applicable standards in
the organization. It should result in the capture and dissemination of data, information,
knowledge, and wisdom from the program, and their utilization in previous works to
ensure the success of the program.
Hence, the scope of program governance is fairly broad and therefore setting up an
appropriate governance structure is a critical success factor for the program.
The next section of the program governance tutorial will give us an overview of program
governance.
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Sample Program Governance Structure

In this section, we will take a look at a sample organization structure.
The image below provides some insight into the possible governance framework for a
program.
As we can see, at the top level is a program board.
We will look at the program board and the role it plays in detail later. For the moment,
we can consider it as a high-level steering committee for a program.
The program manager reports to the program board. The program sponsor is the
chairperson and the convener of the program board.
Other probable members of the board include the manager of the portfolio of which the
program is a part, the functional heads and other stakeholders with a significant
influence on the program, and potentially some representatives from the customer
organization if the program is being executed on behalf of a customer.
The program management office also provides guidance and hence is shown within the
governance structure. However, the nature of support they provide is different, and we
will discuss this in detail later.
Within the program, there are components which may be in the form of projects or the
program could involve “other work.” Typically, the managers of the components or
projects would report to the program manager, at least for the program work.
The program may optionally have a program office which provides administrative
support to the program. The program office is different from the program management
office and forms a part of the program manager’s staff.
As mentioned before, this is just a sample structure. The actual organization would vary
depending on the nature of the program. The key takeaway from this section is that the
program board is a steering committee that guides a program and the program itself
needs to establish a governance mechanism over its components.
Let us focus on program governance boards in the next section of the program
governance tutorial.

Program Governance Board Structure

Let us now take a closer look at what the program governance board looks like and the
role it plays. The program governance board is a steering committee or a committee
that makes decisions on behalf of the program. It provides the systems and methods
necessary for governing a program.
As discussed previously, the membership of the board can include

 Program sponsor executives who can bring in a strategic insight into the program
 Senior functional leaders
 Other sponsors of the program
 Representatives from the customer organization
 Other influential stakeholders
 Program manager, who is an invited member of the board and represents the
program in front of the board.

The program manager in a way represents the program team to the board and
represents the board to the team.
The program sponsor is usually the chairperson and convener of the board and has
veto powers in decision making. The governance board is sometimes referred to as a
steering committee, and the members are not assigned to a specific program on a “full
time” basis. They will step in when required.
In the next section, we will delve into the responsibilities of the program governance
board.

Program Governance Board Responsibilities

The various responsibilities of the program governance board are discussed in this
section.
Establish Governance Mechanism
First, the program board establishes the governance mechanisms of a program and
provides the vision and goals of the organization to the program.
Initiation of Components
Second, they approve the program and endorse initiation of components. This includes
providing final authorization to the program through the issuance of a program charter,
and also getting involved in the chartering process of components within the program.
Approve Funding Request
Third, the board approves the funding request from the program.
Establish Program Governance Plan
Fourth, the board helps the program manager in establishing an overall program
governance plan. The board also reviews and approves the program approach and
plans.
Support the Program
Fifth, the governance board supports the program in various ways, for instance, by
resolving issues that get escalated from the program level.
Monitor and Review Progress
Sixth, the board also monitors and reviews the progress of the program and determines
if there is a need for a change in strategy or tactics. The board gets involved in
conducting the phase gate reviews and other critical decision points in a program.
Approve Component Initiation
Finally, the program board approves component initiation or transition as per the
requests from the program, and also the transition and closure of the overall program.
As we can see, the role of the board is fairly broad. Therefore, the constitution of the
membership of the board with the right people with the authority, interest, and skills that
are relevant to the program’s success is very important.
Let us continue our discussion on the responsibilities of the program governance board
in the following section.

Program Governance Board Responsibilities (contd.)

Let us delve deeper into the role that the program board plays and how it takes the
decisions necessary for the program to move ahead.
The role of the program governance board can be discussed with respect to the
following categories:

 Program initiation, transition, and closure

 Approving program approach and plans
 Program success criteria, communication, and endorsement
 Program funding and preparation of program governance plan
 Program performance support
 Program reporting and control processes
 Program quality standards and planning
 Monitoring program change and the need for change
Let us discuss each of these in the following sections.

Program Governance Board Responsibilities (contd.)

Probably the most important set of decisions involves the initiation, transition, and
closure of the program and its constituent projects.
The program governance board approval may be required during initiation, and
transition to a new project component or program. Sometimes, the program manager
will be able to issue the charter for the components of a program.
The approval of, or at least informing, the board may be necessary, depending on the
quantum of investment being made in the component. While seeking authorization of
the board, should that be deemed necessary, the program manager acts as the sponsor
of the component, and prepares the component charter in partnership with the
component manager.
The approval process for program governance includes:

 Developing, modifying, or reconfirming the business case for the component

 Defining or reconfirming individual accountabilities for management and pursuit
of the components
 Authorizing the governance structure established by the program to track the
progress of the component against its goals.

The governance board plays a critical role in making a decision regarding the closure of
the overall program.
This decision to close the overall program involves:

 Confirming if the conditions that warrant closure of the program have been
fulfilled
 Ensuring that the reasons for the closure of a program are consistent with
organizational vision and strategy
 Ensuring adherence to appropriate closure formalities, regardless of whether the
termination is in the event of a successful or unsuccessful end to the program

Let us look into the other responsibilities of the program governance board in the next
section.

Program Governance Board Responsibilities (contd.)

In this section, we will cover the role of the program board in decisions around program
funding and preparation of the program governance plan.
Sufficient and timely availability of funding is critical to the success of the program. The
program board plays a vital role in ensuring that this happens and also ensuring that the
sanctioned funds are utilized in a manner that is consistent with the organizational
priorities.
The program governance board and the program manager together come up with a
program governance plan. The plan sets up the overall framework for governance on
the program.
Such a plan should cover the following:

 Summary of the high-level goals of the program; the structure, membership, and
composition of the program board;
 Clear definitions of the roles and responsibilities of every person on the program
board, as well as everyone on the program team who is involved in governance;
the scheduled for governance and the phase gate review meetings;
 The criteria to be used for making decisions regarding the initiation of
components
 The criteria to be used for making decisions regarding the closure or transition of
components
 The schedule and agendas for periodic health-checks of the program
 The process for escalation of issues up to and beyond the program governance
board

The next section deals with the other responsibilities of the program governance board.

Program Governance Board Responsibilities (contd.)

In this section, we will discuss the role of the program governance board in establishing
the program success criteria, communication, and endorsement; in approving the
program’s management plans and approaches; and also in supporting the program
performance.
The program board is responsible for setting up the minimum success criteria for a
successful program. Methods for endorsement of the success criteria are widely
communicated across the organization and the executive leadership.
The program governance board reviews and approves the program management plan
and the approach that the program will take in trying to achieve the benefits. In line with
the plans and the success criteria that are established, the board will also approve the
appropriate monitoring and controlling framework for the program and its components.
The program governance board should play a constructive and supportive role in
ensuring the success of the program. This includes supporting the program
performance and ensuring that the necessary organizational resources are made
available to the program and its components.
Also, the program board will create a program management office to support the
program.
We will continue to look at the responsibilities of the program governance board in the
next section.

Program Governance Board Responsibilities (contd.)

In this section, we will discuss the role of the program governance board in:
  Setting up the program’s reporting and control processes
 Setting up the program’s quality standards and planning
 Monitoring change in the program and then establishing the need for change.

The governance board will make sure that the control and reporting framework for a
program comply with the organization’s standards and other applicable compliance
requirements.
The board has to create a reporting structure that provides for information necessary to
monitor continued compliance. The framework has to be appropriate; not just from a
compliance standpoint, but also in ensuring that the right information is being reported
at the right frequency to the necessary stakeholders.
The program governance board supports the creation, review, and approval of the
program level quality plan, and helps the program to come up with quality policies and
standards in line with the organization’s quality expectations.
This includes ensuring that the necessary organizational standards and frameworks are
applied and that there are enough oversight and guidance provided to the components
as they go about the quality management processes within the program.
The program governance board is responsible for monitoring the environment of the
program, and making sure that changes necessary for ensuring the continued success
of the program are pursued and introduced in a planned and consistent manner.
The governance board also helps the program manager in establishing a change
management system for the program.
Let us find out the relationship between program governance and program management
in the next section.
The relationship between Program Governance and Program
Management
It is clear that effective governance is critical to the success of the programs, and the
governance function and the governance board essentially supports the program
management in ensuring that there is adequate governance.
The program managers depend on the program governance board for ensuring
continued organizational support for the program. This could be by way of funding,
resource assignments, guidance about strategic alignment, change management,
resolving escalated issues, etc.
We have seen plenty of examples of how the governance board supports the program
in the previous sections. It is critical that the relationship between program management
and program governance is collaborative and symbiotic rather than adversarial.
Governance represents a key mechanism for an organization to ensure that its interests
are safeguarded as a program invests the organization’s resources. The program also
relies on the board to relay the organizational priorities to make sure they are reflected
in the program’s priorities.
In the next section, we will look into the common individual roles related to governance.
Common Individual Roles Related to Program Governance
So far, we discussed the governance framework as a cohesive body acting in concert.
Now, let us examine the roles of individuals within this framework.
Program Sponsor
The sponsor is typically an executive from the organization who sponsors the program.
The sponsor is responsible for directing the organizational vision and the investment
decision on a program.
Since a sponsor has committed the organization’s resources for a program, the sponsor
is personally interested in the success of the program. So we can view the sponsor as a
champion for the program at the executive level.
Program Governance Board Members
The program governance board members act as a collection of executives who bring in
their expertise and knowledge to authorize and supervise the program. The program
manager is also part of the governance structure as he sets up and manages the
program.
Program Manager
The program manager ensures continued alignment of the program goals and
objectives to strategic objectives and the organization’s priorities. Sometimes the
program manager may be referred to as the program leader.
Project Manager
The project manager of a component of the program is responsible for managing that
specific component. The project manager plans, executes, and tracks the progress of
the project and ensures that the project delivers an output that is in line with the project
charter and the program plan.
Program Team Members
The role of the program team members within governance refers to the program office
staff who support the program manager. The program team is responsible for
contributing to the program strategy/plan or coordinating the activities of the
components to ensure that the right level of oversight is provided in terms of
governance.
As project managers and managers of the components also work with the program
manager, they can also be included as a part of the program team.
The governance function along with the board may appoint specific program team
members or assign specific work to the existing members of the program team.
Moving on, we will understand programs as governing bodies – the governance of
program component.

The program as Governing Bodies: The Governance of

Program Component
A program containing multiple components is a microcosm of the organization. Just as
the organization needs to provide oversight to the program, the program also needs to
provide oversight to its components. Programs have functions similar to the governance
board.
Program managers and program teams may become responsible for the governance
function referred to as component governance. Therefore, the program manager and
the program office have a role to play that is similar to the role of program governance.
This is a delicate balancing act for the program manager.
On the one hand, the program manager needs to provide autonomy and delegate
powers to the managers of the components.
On the other, the program manager needs to ensure that the components are working
in concert and moving the program in the right direction.
The degree of autonomy to be given to the components depends on the experience of
the program manager, size, complexity of the program and the components, and the
degree of communication that is required.
Let us understand other governance activities that support program management

Other Governance Activities that Support Program

Management
The governance of the program is primarily done through the program board and the
program manager.
However, there may be other activities or functions within the organization that also help
the program manager in achieving these goals.
In this section, we will look at five of these activities or functions.
These are:

 Program management office

 Program management information systems
 Program management knowledge management
 Program management audit support
 Program management education and training.

There are a variety of PMO roles in organizations, consisting of different shades of roles
and responsibilities. So what the PMO does in an organization may be very different
from what PMI intends the PMO’s role to be.
One of the best ways to express the role of a PMO is to call it the “Center of Excellence”
for program management in an organization. This means that the best of the program
management expertise, knowledge, and skills lie within the PMO.
What does the PMO do?
The PMO mentors, provides coaching and guidance to the program managers in the
organization.
It maintains a repository of an organization’s knowledge in program management
including best practices, guidelines, policies, templates, etc.
It is usually a centrally administered function in an organization and does not get directly
involved in managing individual programs.
It is not assigned to a specific program, but it supports all the programs and program
managers in an organization.
In smaller organizations, the PMO may be set up informally, and play a more direct role.
However, the role should be similar to what we have mentioned here. Some of us may
have encountered the PMIS in the context of a Project Management Information
System.
The PMIS for programs is similar in concept and purpose. It enables the collection,
storage, access, retrieval, reporting and analysis of information related to the
management of projects and programs within a portfolio or an organization.
This refers to managing the knowledge that an organization has about program
management. The more mature an organization, the more mature is the knowledge
management function. This would mean that the organization will use this knowledge to
become better in program management.
The knowledge of program management has these three primary elements.
They are:

 The knowledge that is collected and shared across the programs

 The individuals and subject matter experts who possess specific program
knowledge
 The program management information systems in which the collected program
knowledge and artifacts are stored.

To this effect, the knowledge management function includes the program management
information systems.
The program managers contribute to and utilize the knowledge in the knowledge
management system and ensure that the information is easily accessible to
stakeholders who need it.
In many organizations, the PMO is the custodian of the knowledge management
function for program management.

Organizational Context for Governance

The organization pursues its work through multiple means.
One way of classifying this work is operations-like and project-like, i.e., projects,
programs, and operations.
Operations look to generate, preserve, and protect value by providing services that are
consistent and repeatable. Projects look to add value by delivering changed or new
products and services.
Both these worlds, i.e., management of functions and operations; as well as
management of projects, programs, and portfolios; need governance, in the form of
processes, tools, and metrics.
However, because of the inherent differences in the nature of work in operations and
projects, the governance structure tends to be different for both.
For example, processes in operations tend to be well-defined, almost rigid. Processes in
the project world, on the other hand, have to evolve based on the needs of the project
and as they go through progressive elaboration.
Let us understand functional organization in the following section.
Functional Organization
In the next three sections, we will examine the differences that the structure of an
organization can make to the way projects, and programs get administered.
We will start with the functional organization, which tends to be common in the industry.
In a functional organization, the resources of the organization are grouped by “function”
– sometimes called departments.
Examples of functions are “Sales,” “Finance,” “Administration,” “Manufacturing,” etc.
As seen in the image below, each function plays a definite role in the organization and
is headed by a functional head or supervisor. All the resources in such an organization
report directly to their functions.
Therefore, a salesperson would report into the sales organizational hierarchy, a
purchase executive would report into procurement, and so on. In a functional
organization, the project or program manager’s role is not explicitly defined.
When a functional organization embarks on a project, each of the functions that are
involved may volunteer some resources to work on the project. One of these resources
may end up playing the project manager’s role. The resource assignments may not
even be full time, and sometimes even the project manager is part-time.
It is to be noted that the project manager has no authority over any of the resources that
do not belong to their functions. So they need to rely upon the functional head to
influence other resources from other functions, through their respective function heads.
This would make it challenging to coordinate project work.
However, functional organizations provide an opportunity for specialization.
For example, if a purchase executive were reporting to the purchasing department, that
executive would have exposure to all the purchasing that happens within the
organization and has a well-defined career path.
Let us now look at the projectized organization structure.

Projectized Organization
As the name suggests, the projectized organization has all the resources aligned
around projects and programs.
As seen in the image below, the project managers have complete control over all the
resources working on their projects.
The biggest advantage of a projectized organization is that the resources have the
dedication to their projects, and project execution becomes easier. This kind of structure
is suitable for organizations whose work is primarily project-related and requires the
project manager to be in a position of absolute authority.
There are some disadvantages of such a structure.  
The first is that once a project is completed, the resources are orphaned, i.e., they no
longer have a “home” until they get assigned to another project.
The other issue is that some people with highly specialized roles within a project may
not be fully occupied all the time. For example, a purchase executive may have work for
selected periods on a project while purchase activities are going on.
However, for the rest of the period, their capacity may not be optimally utilized. There is
less scope for functional specialization as the project boundaries limit the kind of work
that resources can work on.
Next, let’s look at the matrix organization

Matrix Organization
Now, let us look at a hybrid structure that often evolves when a functional organization
tries to work on projects or programs.
This is called the matrix organization.
As seen in the image below, in a matrix organization, the resources still belong to
specialized functions, but there is a designated project manager who is responsible to
coordinate and manage the project’s activities.
There might even be a function that represents all the project managers in the
organization, which provides project management expertise. There are three variants of
the matrix structure.
These are commonly referred to as weak, balanced, and strong matrix. In a weak
matrix, the authority of the project manager is the weakest, and it is the strongest in a
strong matrix structure.
Typical titles given to project managers in functional or weak matrix organizations are
projecting expeditor or project coordinator. They would be called project manager in a
balanced or strong matrix structure, and have slightly more authority over time on the
team members.
The advantage of a matrix structure is that resources can be optimally utilized while
preserving the capacity of the project manager to get projects executed efficiently.
Resources can specialize in their functions resulting in stability in their careers, and at
the same time contribute toward many potential projects.
The disadvantage of the matrix organization is that the communication overhead
increases significantly. This is because every resource in the organization belongs to a
project and also into a function, leading to a dual reporting structure.
In the next section, we will summarize the advantages and disadvantages of different
organizational structures.
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Advantages And Disadvantages of Organizational Types

There are many advantages and disadvantages to all types of organization. Although
there are unlikely to be direct questions on this in the PgMP exam, the organizational
type and the peculiarities may be a factor in some scenario-based questions, and
therefore it is important to understand this context.
Type Advantages Disadvantages
Functional  Group of specialists  Departmental work given
 Clearly defined career paths higher priority than project work
 Avoids confusion due to the  No career path in project
 presence of one manager management

 Less efficient use of resources

 Better communication within
 No home when the project is
projects
Projectize completed
 More loyalty towards the
d  Limited and diffused skill
project goals
development

 Better coordination  Higher potential for conflict

 Maximum utilization of  Greater communication
Matrix
resources complexity

Summary
Let us quickly summarize what we learned in this lesson.

 Program governance establishes systems and methods by which a program’s

strategy is defined, authorized, and monitored.
 Program governance boards are established to represent the organization’s
interest in the program.
 Program governance board is formed by the executives and representatives of
an organization.
 Program management relies on governance for decision-making, guidance, and
resolution of escalated risks and issues.
 Program sponsor usually heads the governance activities by providing the
necessary resources, funding, and support for the program.
 Program governance establishes the support structure of a program, including
PMO, PMIS, and knowledge management.
 The organizational structure influences the program governance and program
management.

Conclusion
We have now come to the end of this lesson. In the next lesson, we will look into
program lifecycle management.