Project governance

Abstract

The literature on project governance continues to grow as this paper is being written. In this paper, project governance will be examined from various points of views, such as concepts and ideas; the project sponsorship perspective; the three levels of governance (the executive board level, the context level, and the individual project level) within the project-based organizations; governance of project management (GoPM); project, program, portfolio governance levels; governance of multi-owned projects (GoMOP); project owner point of view; relationship between corporate governance and project management; project governance models, and project governance frameworks. It is also important to denote, that this paper outlines the previous literature that has been written in the area of project governance and ultimately it delineates the conclusions and recommendations for further research on project governance. This literature review is an interim result of an ongoing research that addresses the relationship between corporate governance and project management.

Introduction

Project governance is the bridging mechanism between corporate governance and project management. As a result, project governance ensures that the board of directors and senior management are able to share and exercise ultimate accountability, transparency, and disclosure on material matters of the enterprise investments made via projects, programs, and portfolios. In the same way, it is the responsibility of the project manager to assure that project governance is implemented properly. This paper is organized into the following sections: (1) About Corporate Governance; (2) Project Governance—Reviewing the Past; and (3) Project Governance—Envisioning the Future: Conclusions and Recommendations.

About Corporate Governance

According to the Organization for Economic Cooperative Development (OECD), corporate governance is

“A set of relationships between a company's management, its board, its shareholders, and other stakeholders. Corporate governance also provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined.” (OECD, 2004, p. 11)

Similarly, FitzRoy and Hulbert (2005) highlight that shareholders, the board of directors, and management represent the “interactive 3 poles power-driven dynamics” in corporate governance. Furthermore, they affirm that shareholders are the firm's owners and their holding of shares in the firm represents this ownership. Thus, shareholders elect members of the board of directors so they can indirectly oversee actions undertaken by the managers; in return, managers act as agents of the shareholders, as they are expected to perform in the best interests of the shareholders (owners). In the same manner, members of the board of directors assume the responsibility of monitoring, directing, and appointing the firm's managers (Lashgari, 2004). Additionally, as mentioned in the OECD's definition, other stakeholders are referred to as the customers, suppliers, employees, creditors, local communities, and consumers, among others.

In order to conclude the understanding of the concept of corporate governance, it is necessary to emphasize that the OECD's corporate governance definition is supported by the following six principles:

Principle 1: Ensuring the Basis for an Effective Corporate Governance Framework

Principle 2: The Rights of Shareholders and Key Ownership Functions

Principle 3: The Equitable Treatment of Shareholders

Principle 4: The Role of Stakeholders in Corporate Governance

Principle 5: Disclosure and Transparency

Principle 6: The Responsibilities of the Board

Project Governance—Reviewing the Past

This section presents the prevalent literature review associated with project governance, starting with concepts and ideas; followed by the project sponsorship perspective; continued with the three levels of governance within the project-based organizations; then, governance of project management; thereafter, project, program, and portfolio governance levels; next, governance of multi-owned projects; successively project owner point of view; afterward, control mechanisms; the relationship between corporate governance and project management; subsequently, project governance models; and, finally culminating with project governance frameworks.

Project Governance Concepts and Ideas

Turner and Keegan (1999) provide an insight into the first published paper on the governance of project-based organizations, “The Versatile Project-based Organization: Governance and Operational Control,” in which the words “governance” and “project” were used together in the same sentence for the first time. Since then, project governance has been presented in many different ways, with multiple meanings and interpretations and from different perspectives. For example, project governance is being addressed as governance of project management and sometimes it is also referred to as governance of a project. There are cases in which the concept is linked to corporate governance or just related to project management. This makes project governance attractive, diverse, and a very interesting area of research.

Table 1 shows the definitions of project governance from different authors’ points of view. Additionally, in the following paragraph, such concepts are further analyzed.

According to Turner. The concept “Governance of a Project” from Turner (2009) is an adaptation of the definition of corporate governance from the OECD. Idowu and Louche (2011, p. 2) denote that the “stakeholder theory stresses the importance of all parties who are affected, either directly or indirectly, by a firm's operations,” as presented by Wearing in 2005. It is noted that Turner's definition is aligned with the Stakeholder Theory by referring to it as a set of relationships between the project's management, its sponsor (or executive board), its owner, and other stakeholders. This definition is focused on providing the structure to set and achieve the project objectives and monitor their performance. Looking at the OECD's definition of corporate governance, it can be construed that Turner's concept of governance of a project is fundamentally based on the core structure of corporate governance. This provides a corporate and enterprise perspective to the insight of project governance, elevating project governance to a board of directors and senior management level.

Table 1: Comparison of project governance definitions.

According to the Association for Project Management (APM). The APM (2004) definition of “Governance of Project Management (GoPM)” refers to those areas of corporate governance that are specifically related to project activities. Likewise, this definition takes into consideration the application of portfolio management by suggesting the alignment of the project portfolio with the objectives of the organization. At this point, it is important to introduce the Information System Concept, as well as to recall the Stakeholder Theory. According to Van der Heijden (2009), an Information System is a set of interrelated components that collect (or retrieve), process, store, and distribute information to support decision-making in an organization, as presented by Laudon and Laudon in 2004. Consequently, the GoPM definition is aligned with the Stakeholder Theory and Information System Concept by supporting the means by which the boards and other major project stakeholders are provided with timely, relevant, and reliable information. In addition to GoPM, the APM (2007) has developed the concept of “Governance of Multi-owned Projects (GoMOP).” Multi-ownership entails having more than one company or organization sharing ultimate control over a project. The GoMOP concept is aligned with the Stewardship Theory, which “examines the relationship between two parties, where a principal delegates tasks to a manager, who is termed steward” (Klöckner, 2009, p. 41).

According to Müller. The definition of “Governance of Projects” from Müller (2009) has to do with the governance of projects, programs, and portfolios, and the prioritization of resources among projects. Because of these three levels (projects, programs, and portfolios), Müller's definition is more in line with Project Management Institute's (PMI) concept of Organizational Project Management (PMI, 2008d).

According to Klakegg, Williams, and Magnussen. The concept of “Governance of Projects” from Klakegg, Williams, and Magnussen (2009) is based on the APM. Their concept is related to corporate governance (public or corporate) in terms of those areas of corporate governance that are specifically related to project activities. This concept is also directed towards formal and informal arrangements by which decisions about projects are made and carried out. Similarly, it is oriented towards ensuring the good governance of projects.

According to Alvarez-Dionisi. The term “Project Governance” from Alvarez-Dionisi (2008) is a process-driven oriented concept, which is aligned with the Stakeholder Theory, Information System Concept, and Organizational Project Management. Alvarez-Dionisi's definition is also linked to corporate governance by acknowledging project governance as a subset of corporate governance. Likewise, accountability in project governance is introduced, by having the executive management and board of directors accountable for project governance. Alvarez-Dionisi addresses governance at the project, program, and portfolio levels.

According to Renz. The “Project Governance” concept of Renz (2007) is process-oriented and emphasizes the strategic direction of projects. The definition includes elements of integrating management, ethics, and holistic control, among others. Renz's concept is oriented towards the governance of a project.

According to Raterman. Raterman's (2003) definition of “Project Governance” delineates that projects are completed according to plan, and that business objectives and benefits are delivered, and this definition is based on the governance of a project.

PMI—Project Governance. The “Project Governance” concept of PMI (2008a) focuses on the governance of a project by controlling the project in order to guarantee its success.

PMI—Program Governance. The “Program Governance” concept of PMI (2008b) is a process-oriented definition used towards the governance of a program.

PMI—Portfolio Governance. The “Portfolio Governance” concept of PMI (2008c) is a process-driven definition that describes the governance of a portfolio in alignment with the strategic objectives of the organization.

Project Sponsorship Perspective

Project governance has been studied from the role of the executive sponsor's perspective (Crawford & Cooke-Davies, 2005). Crawford and Cooke-Davies considered that the executive sponsor of a project or program is the pivotal link between corporate governance and project governance. Following are the interrelated roles that an executive sponsor needs to play as presented by Dinsmore and Cooke-Davies in 2005:

1. Governor of the project
2. Owner of the business case
3. Harvester of benefits
4. “Friend in high places” (to the program or project manager)
5. Champion of the project

Additionally, project sponsorship is being addressed by the Governance of Project Management Specific Interest Group, from the Association for Project Management (APM), in its guide Sponsoring Change: A Guide to the Governance Aspects of Project Sponsorship (APM, 2009). This guide was developed with the purpose of influencing directors and senior managers to adopt excellent practices regarding project sponsorship. The APM highlights that the effectiveness of the project sponsor is the best predictor of project success or failure. The personal attributes of the successful project sponsor are: understanding, competence, credibility, commitment, and engagement. In that sense, project-owning organizations should consider the following three critical success attributes to improve effective sponsorship: support, continuity, and alignment (APM, 2009).

Three Levels of Governance within the Project-based Organization

According to Turner (2009), there are three levels of governance within the project-based organization: executive board level, context level, and individual project level.

Executive Board Level. This level is considered the highest level of governance of a project-based organization. In this level is where the board of directors exercises a high level of interest on key and large project investments. The board of directors should take an interest in such projects by:

• Setting the project objectives
• Empowering and encouraging people with resources to execute the projects
• Ensuring the right controls are in place to achieve project objectives in terms of realization of benefits and proper utilization of resources

Context Level. This level entails the environment in which projects take place. Within this level, two components are taken into consideration: (1) Developing the right infrastructure of program and portfolio management to link projects to corporate strategy in order to make sure that the right projects are executed, and (2) Making sure that the capability exists within the organization to deliver the project successfully so that the projects are executed the right way.

Individual Project Level. This is the level of the individual project. This level relates to the governance structure and roles on projects that should be present within the individual project, including the three steps of governance:

• Define the objectives
• Define the means by which the objectives are accomplished
• Define the means by which progress is monitored

Governance in terms of the executive board level has been addressed by Shannon (2004) as well as by the APM (2004). This will be further elaborated later in the next subsection “Governance of Project Management (GoPM).” Governance in terms of the context level has also been addressed by Blomquist and Müller (2006) in the study on the “Practices, Roles, and Responsibilities of Middle Managers in Program and Portfolio Management.” This research is in perfect alignment with the context level of governance and addresses program and portfolio management as the linkage between corporate governance and transaction cost economics. This was done from two parallel perspectives: the first perspective “takes into account the interconnectedness of the various project objectives,” and the second perspective “is concerned with interrelationships among the management requirements of these projects in order to achieve the organization's overall business results.” Governance in terms of the individual project level was initially addressed by Turner and Keegan (2001) in their research, “Mechanisms of Governance in the Project-based Organization: Roles of the Broker and Steward” by describing how successful project-based organizations adopted governance structures to manage the interface between projects and their clients. This was achieved by applying the roles of broker and steward, along with transaction cost economics, as a governance mechanism. Additionally, Alvarez-Dionisi (2011) also addressed the three levels of governance (executive board level, context level, and individual project level) in his research on the relationship between corporate governance and project management. This research will be further discussed later on in this paper.

Governance of Project Management (GoPM)

GoPM was created by the Governance of Project Management Specific Interest Group from the APM in its guide Directing Change: A Guide to Governance of Project Management (APM, 2004). This guide was developed with the objective of directing how the board of directors should deal with the four main components of governance of project management, namely portfolio direction, project sponsorship, project management effectiveness and efficiency, and disclosure and reporting. According to the APM, the purpose of this guide is “to influence directors and others to adopt excellent practices regarding the governance of program and project management activities” (APM, 2004, p. 2). This guide is aligned with two corporate governance codes, the UK Listing Authority's Combined Code and the U.S Sarbanes-Oxley Act 2002, and it was structured into 11 principles and 42 questions to test the application of such principles. Furthermore, the 42 questions were classified into four components in order to address the scope of project direction and management. These four components are: portfolio direction (with 10 questions), project sponsorship (with 11 questions), project management (with 9 questions), and disclosure and reporting (with 12 questions).

Project, Program, and Portfolio Governance Levels

Project Management Institute (PMI) addresses governance at the project, program, and portfolio levels. At the project level, PMI outlines project governance in A Guide to the Project Management Body of Knowledge (PMBOK^® Guide) (PMI, 2008a). At the same time, the PMBOK^® Guide denotes that project governance should be described in the project management plan and must fit within the larger context of the program or organization sponsoring it. However, there is no Knowledge Area or processes defined in the PMBOK^® Guide as of today that refer specifically to project governance. At the program level, program governance is a Knowledge Area found in the PMI Standard for Program Management, and it includes the following eight processes: Plan and Establish Program Governance Structure, Plan for Audits, Plan Program Quality, Approve Component Initiation, Provide Governance Oversight, Manage Program Benefits, Monitor and Control Program Changes, and Approve Component Transition (PMI, 2008b). At the portfolio management level, PMI includes a Knowledge Area as part of the PMI Standard for Portfolio Management. The PMI portfolio governance Knowledge Area includes the following ten processes: Identify Components, Categorize Components, Evaluate Components, Select Components, Prioritize Components, Balance Portfolio, Authorize Components, Review and Report Portfolio Performance, Monitor Business Strategy Changes, and Communicate Portfolio Adjustment (PMI, 2008c).

Additionally, PRINCE2 (PRojects IN Controlled Environments) also addresses the project governance level (Oakes, 2008). In addition, the Office of Government Commerce (OGC) has also developed the notion of the governance themes at the program management level, as it is indicated in the reference manual, Managing Successful Programmes. The governance themes include: Organization, Vision, Leadership and Stakeholder Engagement, Benefits Realization Management, Blueprint Design and Delivery, Planning and Control, the Business Case, Risk Management and Issue Resolution, and Quality Management (OGC, 2007). By the same token, Müller (2009) captures the concept of governance from the perspective of portfolios, programs, projects, and project management, in a way that all these elements are put together to coexist within the framework of corporate governance. The best interest of the stakeholders (internal and external) is addressed within this concept by allowing projects to accomplish organizational objectives.

Governance of Multi-owned Projects (GoMOP)

GoMOP was developed by the Governance of Project Management Specific Interest Group from the APM in its guide Co-Directing Change: A Guide to the Governance of Multi-Owned Projects (APM, 2007). The purpose of this guide was to “foster excellent practices for the governance of multi-owned projects and programmes.” The audience of this guide is comprised of those individuals with influence over development of corporate governance arrangements or their implementation, such as company directors, project portfolio directors, project sponsors, project managers as well as other professionals with key governance or assurance roles. This guide was structured into a set of 12 principles applicable to all multi-owned projects and 54 questions used to test the application of such principles. The 54 questions were classified into six components: alignment (with 10 questions), owning-organization sponsorship (with 9 questions), project management (with 9 questions), disclosure and reporting (with 10 questions), reward and risk (with 8 questions), and joining and leaving (with 8 questions).

Project Owner Point of View

Taketomi (2009) emphasizes governance of the project from the project owner's viewpoint, whereby, the interaction between the owner and the project life cycle are described in terms of governance. For Taketomi, projects are born from a “stationary activity” into a “non-stationary activity”; henceforth, within the non-stationary activities, the following three stages of the project life cycle occur:

The Scheme Stage: This is when the initial plan is developed and the project owner executes governance by evaluating the validity of the project investment, making sure it is realistic and achievable, with the assistance of selected members and organizations.

The System Stage: In this stage, selected members and organizations bring the project to completion by executing the plan. The project owner executes governance by ensuring the management and monitoring of the project risks.

The System Service Stage: This is when the business operates well in accordance with the original plan, and business objectives are realized by the new system. The project owner executes governance by including processes in the project operation.

Control Mechanisms

Johnstone, Huff, and Hope (2006) view governance in terms of control mechanisms, including three components described as follows:

Authority Structure: This component delineates the positions with the responsibility for decision-making and designates by whom those positions will be occupied.

Mechanisms: This component adopts all the necessary processes, procedures, and methodologies that assist the decision-makers to make and implement decisions.

Policy: This component provides a clear connection between strategy and decision-making. Policy allows senior management to properly disseminate their views on decision guidelines and constraints.

Relationship between Corporate Governance and Project Management

Project governance has been studied in terms of its relationship between corporate governance and project management (Alvarez-Dionisi, 2011). This research has addressed the following areas:

• Project governance as the link between corporate governance and project management
• How the board of directors and senior management are accountable for project governance
• How project managers are responsible for project governance
• How project governance supports project management in corporate strategy implementation

Accordingly, Alvarez-Dionisi's research is aligned with the executive board level of governance by studying project governance as the link between corporate governance and project management, and how the board of directors and senior management are accountable for project governance. Similarly, his research is also aligned with the context level of governance by studying project governance as a support of project management in corporate strategy implementation. In the same way, his research is aligned with the individual project level of governance by studying how project managers are responsible for project governance.

Project Governance Models

This subsection illustrates the following project governance models: Turner (2009), Information Systems Audit and Control Foundation (2002), Renz (2007), Alvarez-Dionisi (2008), Müller (2009), and the Office of Government Commerce (OGC) (2009).

Model 1 – Turner

The project governance model of Turner (2009) ascertains the governance structures and roles on the project. This model entails four project governance roles, such as:

Sponsor: The sponsor is somebody from the client or user department who identifies the need for performance improvement and there is a change that can be made, which will deliver that performance improvement in a cost-effective way. Additionally, Turner also highlights that the sponsor will also identify assets and capabilities that will in turn enable resolving a problem or enhancing a given opportunity. Similarly, the sponsor takes up the role of approving the statement of requirements and also the goals, outcomes, outputs, and also designing benefits map. Furthermore, the sponsor becomes the project ambassador in order to obtain support from their organization and resources for the project. Turner further emphasizes that the sponsor's role as an ambassador should continue throughout the project.

Steward: The steward is a senior manager from the technical department who works with the sponsor in designing the new assets and its capabilities. Additionally, the sponsor and steward work hand in hand in revising and finalizing the benefits map.

Project Manager: The project manager is responsible for defining and managing the project process to deliver the new asset and defining how the project will be monitored and controlled. Additionally, the project manager ensures fitness of use of project outcomes delivered and also makes sure that it enables the creation of new capabilities in order to resolve the problem or enhance opportunity.

Owner/Business Change Manager. The Owner/Business Owner is someone from the user department with the responsibility of ensuring that the new capabilities are aligned with the benefits map defined previously and that the new capabilities help overcome the problem. The owner of the new asset is ultimately responsible for this last step of control but he or she may delegate it to a business change manager.

Model 2 - Information Systems Audit and Control Foundation

The project governance model of the Information Systems Audit and Control Foundation (ISACF) (ISACF, 2002) highlights the need for strong management support, the use of project management processes, and the formal training of project managers in project management areas. The ISACF model comprises four key elements that should be present in carrying out the governance of a project, which are:

Evaluation and Approval Processes: These are the processes used to evaluate, approve, and initiate projects, only if they provide sufficient business benefits.

Project Oversight Mechanisms: These are the mechanisms used to oversee projects, including implementation of appropriate control processes, management of risks, and realization of business benefits.

Executive Feedback Mechanisms: These are the mechanisms used to provide feedback to the executives and the board on the project's progress in terms of meeting business goals.

Project Management: This has to do with having in place sound project management practices in order to ensure that the project achieves its objectives.

Model 3 - Renz

The project governance model developed by Renz (2007) consists of six modules:

System Management: It deals with the systemic and systematic understanding of the project environment.

Mission Management: It provides the core governance tasks in the areas of strategy, structure, and organizational culture.

Integrity Management: It provides a process model (drawn based on the combination of discourse ethics and recognition ethics) to assess and resolve challenges related to the integrity of the project.

Extended Stakeholder Management: It provides a mechanism for identification, managing, and monitoring of stakeholders involved in the development project.

Risk Management: It provides a risk identification and integrated risk management cycle based on the systemic understanding of the project environment.

Audit Management: It provides a holistic and control audit approach for development projects.

Model 4 – Alvarez-Dionisi

Alvarez-Dionisi (2008) developed a project governance model vis-à-vis an interrelationship digraph. This model comprises four main areas, including: (1) Good Governance Characteristics from the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) (UNESCAP, 2011). In that sense, the UNESCAP addresses the eight characteristics of “good governance,” which are participation, rule of law, transparency, responsiveness, consensus oriented, equity, and inclusiveness, effectiveness and efficiency, and accountability; (2) Corporate Governance Ellipse, which shows the relationship between the data elements of shareholders, board of directors, management, and other stakeholders, as presented by the definition of corporate governance of the OECD; (3) Project, Program, and Portfolio Domains Ellipse, which is based on the concept of Organizational Project Management; and (4) Strategy data element, which represents the organization's corporate strategy developed and implemented through the management of portfolios, programs, and projects, as highlighted by Morris and Jamieson (2005). The logical relationships between the data elements were built graphically through the interrelationship digraph. The model sketches the theoretical association (logical relationships) of concepts (data elements) through a co-word diagram that shows the co-occurrence and dynamic interplay.

Model 5 - Müller

Before entering into Müller's model, it is important to describe Transaction Cost Economics, Agency Theory, and Institutional Theory. York University (2011, n. p.) refers to Transaction Cost Economics as the “cost incurred in making an economic exchange.” Correspondingly, there are various types of transaction costs, such as the following: Search and Information Costs, Bargaining or Negotiation Costs, and Enforcement Costs. Likewise, Walters and Tang (2006, p. 24) accentuate that the Agency Theory “involves examining the relationship between managers (agents) and owners (principals) of organizations.” According to Müller (2009, p. 87) the Institutional Theory uses “legitimacy to emphasize conformance with society and stakeholder values and expectations.” Drawing on Transaction Cost Economics, Agency Theory, and Institutional Theory, Müller (2009) has created a model for project governance wherein the project manager role is supported by the Agency Theory, by moving and creating an instance of governance across the five project management Process Groups (Initiating, Planning, Executing, Monitoring & Controlling, and Closing) and has been supported by the Transaction Cost Economics perspective. At the same time, the steering group is supported by the Institutional Theory (legitimacy perspective) and interacting with the project manager. Likewise, Müller shows the project governance hierarchy, by presenting the board of directors in interaction with the strategic objectives, and with portfolio management (portfolio manager who is an agent). Thereafter, portfolio management has a link with the steering group or program management (program manager who is an agent), which has a link with project management (project manager who is an agent). In the end, the strategic objectives, portfolio management, program management, and project management, have interfaces with the project management office (either strategic PMO or tactical PMO).

Model 6 - Office of Government Commerce (OGC)

Another project governance model is the one used in PRINCE2 (Oakes, 2008). PRINCE2 has four levels of management within its project management structure, which are Corporate or Programme Management, Project Board (directing), Project Manager (managing), and Team Member (delivering). The last three levels make the Project Management Team. Additionally, the Senior Users, Executive, and Suppliers are the members of the Project Board (OGC, 2009).

Project Governance Frameworks

“Governance framework is an organised structure established as authoritative within the institution, comprising processes and rules established to ensure projects meet their purpose” (Klakegg, Williams, & Magnussen, 2009. p. 60)

Examples of project governance frameworks that have been studied by Klakegg, Williams, and Magnussen (2009) are: OGC Gateway Process by the Office of Governance Commerce (UK), MoD Acquisition Operating Framework by the Ministry of Defence (UK), and the Norwegian Quality Assurance Scheme (QA1 and QA2) by the Ministry of Finance (Norway).

Furthermore, Winch (2001) has also studied and introduced a conceptual framework for the understanding of the governance of construction project processes, drawing on transaction cost economics. Likewise, the Department of Transport and Main Roads in Queensland, Australia has created and embraced its own project governance framework (Queensland Government, 2010). Similarly, the United Services Automobile Association (USAA) developed its own project governance framework, which it refers to as decision-making groups (Ross, 2004).

The project governance frameworks listed above will be described as follows:

Framework 1 - OGC Gateway Process

It is a framework that reviews key decision points of the life cycles of programs and projects, with the objective of successfully progressing to the next stage. The Gateway Process has six gateway review points: Gateway 0—Strategic Assessment, Gateway 1—Business Justification, Gateway 3— Investment Decision, Gateway 4—Readiness for Service, and Gateway 5—Operations Review & Benefits Realization (OGC, 2011).

Framework 2 - MoD Acquisition Operating Framework

This framework comprises two gateways: the Initial Gate, which is used towards funding for the assessment of the project; and the Main Gate, which is used to release the funding for the main project (MoD, 2011).

Framework 3 - Norwegian Quality Assurance Scheme (QA1 and QA2)

It is a framework that “embraces the systems and processes that the government (or more, generally a financial party) needs to secure successful investment” (Christensen, 2009). It includes two separate analyses, the quality assurance of the choice of concept (QA1), and the quality assurance of the basis for control and management, including cost estimates and uncertainty analysis for the chosen project alternative (QA2) (Samset, Berg, & Klakegg, 2006).

Framework 4 - Winch Conceptual Framework

Winch (2001) conceptual framework of the governance of construction project processes consists of three elements: (1) contingency factors, i.e., the features of the transaction under consideration, which are uncertainty, frequency, and asset specificity; (2) behavioral factors, i.e., the ways in which managers typically respond to those features, namely bounded rationality, learning, and opportunism; and (3) context, originally called ‘atmosphere’ by Williamson, i.e., the institutional context within which the transaction is embedded, and in turn is situated within the broader national socio-cultural context.

Framework 5 - Queensland Government: Department of Transport and Main Roads

The Department of Transport and Main Roads in Queensland, Australia has developed the OnQ Project Governance framework to ensure consistency in the delivery of project results in accordance with the government's organizational policies and strategic objectives. This framework includes key components such as Guiding Principles, Project Organizational Model, Project Roles and Responsibilities, and Approval Processes (Queensland Government, 2010).

Framework 6 - United Services Automobile Association

The United Services Automobile Association (USAA) adopted the decision-making groups’ framework to make sure that governance decisions were absorbed by each IT project within the organization in order to produce project- and enterprise-wide benefits. USAA accomplished this by establishing five different decision-making groups: Enterprise Business Operations (EBO), IT Company (ITCO), Architecture Committee, Integration Steering Committee, and Executive Committee (Ross, 2004).

Project Governance—Envisioning the Future: Conclusions and Recommendations

Walking through the paths of this literature review, several ideas emerged on the work associated with this study, which are the foundations for further research in the ever-evolving landscape of project governance. In light of the fact that there has been no research on project governance addressing the five Process Groups of the PMBOK^® Guide, it is recommended to include project governance as one of the Knowledge Areas of the PMBOK^® Guide for the benefit of the project management practitioners, researchers, and board of directors and senior management. A second option possible for PMI is to develop the Governance of Project Management Extension (gPME) to the PMBOK^® Guide. This new standard should outline the guiding principles for governance of project management and provide a framework to ensure accountability, transparency, fairness, and disclosure on material matters of the projects. Additional areas for future research that should be taken into consideration are as follows: aligning and integrating existing project governance models and frameworks with international project, program, and portfolio management standards from PMI, OGC, and APM; study of the governance of outsourced project based organizations; study of the relationship of project governance with IT governance; study of the governance of projects, programs, and portfolio in the public sector; and study of the relationship between project governance and financial auditing practices.