The truth is “Governance” means different things to different people. It causes confusion because its meaning is not precise. It’s used in a Corporate sense and also in a Program context – with vastly different meanings and interpretations.
Corporate Governance refers to the mechanisms and processes by which companies are run. Its importance is well-understood.
The process is prescribed and continually improved by various governing bodies and shareholders.
In other words, companies treat it very seriously.
A Program Governance model describes what a program will do and the value it will deliver. It defines what operating processes will be used; how decisions will be made – and how different groups working on the program will cooperate with each other.
The intent of Program Governance is to make sure a program delivers the value the business case was based on. But there is little common ground on the meaning of Program Governance and company attitudes to it vary hugely.
To emphasise the point, just Google “governance models” and you’ll find a ton of diagrams representing the huge variations out there.
If you run a program, almost everyone agrees you need a governance model. They could probably have a good shot at defining its purpose and what it should deliver too – alignment, accountability, control, transparency and compliance.
But with over two-thirds of business-critical programs failing, it’s clear that governance on most programs hasn’t improved in the past 50 years.
In other words, companies don’t take it seriously.
Most companies have “published” their own program governance model, describing how it should be done. In truth, they’re rarely used.
In many cases, it’s impossible to see how program governance even connects with corporate governance.
Why is it so complicated?
Every post-mortem on a program failure identifies three or four major problems that played a big part in a programs downfall:
- The program objectives weren’t clear
- The plans were unrealistic
- Interdependencies weren’t managed properly
- The program execution organisation wasn’t up to the job
But one key reason always stands out.
The commitment by the senior management team to the program was lukewarm and ineffective.
This is remarkable – given the time and effort its costs companies to straighten things out later. That is, if the program is not abandoned entirely.
Invariably, there was a program sponsor, a program director and a governance team in place. But somehow, they didn’t get the job done and fatal program problems were never flushed out.
So, the key question is….
Do companies pay enough attention to the make-up of their governance teams?
A common view is that the program governance team is there to support the program sponsor and “ask the right questions.” But asking the right questions demands specific knowledge and a skill set most governance teams don’t have.
How many governance teams would actually know what a credible program plan looked like? Would they understand the resourcing implications of a plan, by skill domain?
Could they see past soothing but irrelevant notes supporting Red-Amber-Green “traffic light” program reports? Could they truly measure program progress, as opposed to “hoped-for” progress?
The evidence is overwhelming. Most program governance teams can’t ask the right questions.
The team doesn’t have enough ‘know-how’ to unearth critical gaps in the program execution approach. The team composition has major flaws.
No matter how good they are, the Program Sponsor and the Program Director can only do so much. They must rely on other executives to actively support and champion a program throughout the business – especially when a program is business-critical.
There will always be a few executives who champion a program passionately. But there will be others who “forget” their role when they leave meetings. They can make careless statements undermining the program and even criticise colleagues behind closed doors who hold different views. These behaviours are corrosive and leave staff confused and hesitant.
So, how does all this happen?
Most companies do a reasonable job selecting a Program Sponsor and a Program Director – not always, but mostly.
But many companies have a cavalier approach to program governance, selectively choosing which governance bits to use and which to discard.
Instead, they decide “we don’t need all this bureaucracy, let’s just pitch in and get on with it.” There are too many soft options teams can take and bypass successful program governance.
What’s more, the team can easily get padded out with non-essential function heads, mainly interested in looking after their own parochial interests.
Some members may be great contributors but, on balance, most of them can’t “ask the right questions.” They may be excellent managers in their functional roles but simply don’t have the background and experience to “govern” a business-critical program. They have no experience-based contribution to make.
Inevitably, this leads to fudges over accountabilities, resource allocation, control and transparency. Why? Because senior managers don’t want to offend people, sometimes only focusing on making sure everyone “feels included” – no matter what the cost.
Nowhere is the 40-40-20 rule more visible than in these governance meetings.
We know 40% of them know what they need to know. We also know they think they know another 40% – and we know they don’t know the other 20% of what they need to know.
The problem is we don’t know which 20% that is.
But the bottom-line is, collectively, they are blind to about 60% of what they need to know. You don’t have to be good at arithmetic to know this is a very serious knowledge gap.
It means the governance team won’t understand a lot of what they’re being told – or be in a good position to make decisions on what they are being told. This is a key reason why time-critical program decisions are delayed for weeks, as the program team is bombarded with needless requests for more “clarity” and “what if” reports.
For Program Directors this is bad news.
Program failures have little to do with how well the Program Director runs the program.
The root cause of most program failures is unskilled governance, directly caused by the team’s ignorance of common program issues. And for as long as companies feel it’s acceptable to trivialise program governance, failures won’t go away. They’ll just keep on happening.
With Mentor clients, we invest a lot of up-front time in getting a good skill and capability balance in the governance team. They must understand their role and be in a position to ask the right questions. This usually takes some education and coaching.
The governance process should be custom-built for the program you are running.
The process shouldn’t be over-bureaucratic or cumbersome, but neither should it be impotent. To be effective, governance must have teeth; it’s always a question of balance.
If this is done well, the Program Director’s job is to get the right information to the governance team so they can discuss key issues, ask” informed” questions and make crisp decisions the program team can then act on.
What is the message for Program Directors?
You put massive effort into building your own program team and your plan. Why not match that when it comes to building a program governance system and team?
Your life will be so much simpler.
Poor governance can hobble a program from outset – and frequently does. Grasp the nettle, and use your personal influence to get your company to field its “A” team.
There are so many “unknowns” at the outset of any complex program. Having the right people who truly understand your challenges and can constructively help you – as you climb the North Face of the Eiger – literally makes the difference between winning and losing.
Program failure is preventable. Download our Special Report “Getting with the Program” and get wisdom from veteran CEOs on the pitfalls of program failure.