Formal Networks in the Organization
Governance and Assurance Processes
In construction companies, every worker’s action can significantly impact the project’s success. In the selected company, governance refers to the process of managing projects and their organization, planning, and implementation. The formal approaches are divided into several areas: portfolio direction, sponsorship relations, and quality assurance.
For instance, before a project begins, it has to be approved by the board, implying that this level of management has a responsibility for the overall creation of the project. To align with the project’s foundation, the board reviews a plan and develops a business case. To support the project, the business case is presented to potential sponsors selected by the board. The two parties hold meetings to discuss the availability of funds and the prospects of the suggested venture with the assistance of the project manager.
The quality assurance process is a crucial part of governance, unfolding throughout the project’s duration. First, the board appoints the team responsible for assurance and tasks it with gathering the necessary information for project planning. Then, the data is used to identify potential issues related to the location, performance, resources, and risks.
The assurance report is created based on this analysis to demonstrate the existing threats and possible future dangers to the organization’s activities. For instance, the document may contain findings about specific performance issues that were found during the project’s completion. Furthermore, it may also provide recommendations for the company to implement in subsequent steps or other projects. Common themes and risks are often identified as requiring solutions at a higher management level.
PMO and CPO Roles and Responsibilities
A Project Management Office (PMO) is responsible for maintaining project consistency and efficiency. The primary duties at the selected construction company are to maintain the standards of the project lifecycle – encompassing planning, implementation, evaluation, and improvement. The PMO focuses on enhancing stakeholder communication and resolving conflicts that may arise.
The PMO is involved in assurance management by collaborating with quality assurance managers and engineers, and keeping all parties informed. Risk management is also a responsibility in this occupation – a PMO may identify risks based on personal expertise and collaborate with the appointed assurance team to prepare the report for the board. Overall, the PMO and the office’s subordinates focus on the quality of project management and communication between all types of stakeholders within the company.
A Chief Project Officer (CPO) stands as a leader of the PMO in the company while also having a place on the board. Therefore, the roles and responsibilities of this professional are closely aligned with those of the PMO. For instance, the CPO is tasked with maintaining the quality of governance and developing the project process.
All activities related to active projects are reviewed by the CPO, who collaborates with advisers and PMO experts to ensure their completion. PMO is directly managed by the CPO, who receives information from managers and assurance officers. This person also serves as an intermediary between the board members and other stakeholders within the PMO.
Project Sponsorship and Steering
The selection of project sponsors occurs during the initial stages of planning, following the board’s acceptance of the initial proposal. Board members select the project sponsor and assume a leading role in the PMO, handling major events and decisions while maintaining oversight of daily activities. The sponsor is responsible for more than financing capabilities – this individual is also tasked with developing the case for the project, as well as a vision and governance structure. In the majority of undertakings for the selected construction company, the role of the project sponsor is given to the CPO, as their duties are similar. As the organization often leads several projects simultaneously, the CPO delegates most smaller tasks to several project managers while focusing on the vision and strategy.
Since the CPO assumes the role of a sponsor, the tasks of these two roles are not well-defined within the company. As a result, the sponsor acts as a leader for all projects that the organization completes, and it is often assumed that the CPO will work in this capacity at all times. Thus, the CPO guides the PMO in the direction discussed with the board and key stakeholders. As a board member, the CPO has authority and an established communication channel with other leaders, which enables this individual to deliver and receive new information quickly. The sponsor also has a role in approving significant steps in the project, such as moving into implementation or closing the project.
Project Management Capability and Skills
To deliver good results on projects, the company sets specific standards for project managers’ performance and skills. The organization currently categorizes its main capabilities into three areas: communication, professional expertise, and management knowledge. First, managers are expected to possess leadership skills and be able to manage a team. Here, areas such as effective communication, discipline, and efficient information delivery are prioritized. It is expected that project managers share and receive news quickly and can communicate with employees at various levels of the company and within their own department. Leadership skills include the ability to motivate employees and prevent mistakes through careful planning.
Apart from soft skills, the standards also emphasize the need for project managers to have a background in construction, enabling them to lead complex projects and effectively communicate with stakeholders. Thus, technical communication, as well as core knowledge, is necessary for project managers upon hiring. Many currently employed managers have been transferred from other positions and have previously worked in construction. Regardless of their previous employment, managers are expected to be familiar with zoning, protection, design, and other key elements of most projects. Finally, the managerial skills of forecasting, strategizing, scheduling, and assurance are also deemed essential for managers. The company requires all project managers to complete courses in budgeting and analytics if they have not received such training as part of their degree.
Recommended Changes
Governance and Assurance Processes
Although the company distinguishes different areas of governance in its projects and pays attention to assurance, risk management, and the relationships among various specialists, further improvements can be made to enhance these elements. In particular, the organization can focus on improving its quality planning and assurance to enhance consistency in assurance analysis and reporting. One of the major problems currently facing the company is the lack of structure for the various levels of assurance. The PMO conducts all types of research and analysis, with the same specialists responsible for all reports.
According to the UK Government (2021), a business should have at least three levels of assurance, including first-line checks, guards for first-line defense, and independent audits. In contrast, the selected construction company has only the first and second levels, while internal audits are sporadic and lack standards of quality comparable to those of all projects. As a result, it is unclear whether all assurance activities are conducted with the same level of rigor.
Therefore, a recommendation for the organization is to review its current assurance policy and introduce clear guidelines for three tiers of quality checks. The first level should be conducted by the specialists of the PMO and focus on following the standards and methods outlined in the company’s current documents. Second, the company should appoint several individuals to review the appropriateness of the standards designed and implemented by the PMO, ensuring they align with the organization’s goals and values (Miller, 2014). Here, the CPO may be responsible for picking specialists and delegating this authority to them based on their skills.
Finally, an internal audit task should be assigned to a separate set of experts who are not managed by the CPO (UK Government, 2021). It is crucial to appoint specialists who can provide an unbiased perspective on the company’s affairs through interviews, observation, project analysis, and other means.
It is expected that this change will lead to more robust standards for assurance and better quality outcomes for projects. For example, scheduling assurance reviews before making decisions and starting major projects can provide the board with a clearer view of the company’s current status (ICE (Institution of Civil Engineers), 2019). Documentation should be detailed enough to use the collected information for improvement. If any problems arise, a three-tier system of assurance is likely to detect them early or find trends or issues at different stages of project completion.
PMO and CPO Roles and Responsibilities
As noted above, the company has a small PMO and a CPO that oversees the department, which is a positive step toward a solid structure for project management. Nevertheless, the CPO’s role encompasses many tasks that are not clearly defined. At the same time, the PMO is small and comprises a limited number of people who possess the necessary knowledge to delegate responsibilities effectively. Moreover, the team lacks self-organization and requires constant supervision, which negatively impacts both the workload and the quality of final project planning efforts. According to Buttrick (2020), the best results are achieved by teams that can effectively organize themselves, while a leader is necessary for motivation and a clear vision. The current PMO is unable to act efficiently, which slows down project development and results in financial losses.
A potential solution for the PMO to perform more effectively and reduce the need for CPO involvement in all operations is to adopt an agile approach. The PMO should review the roles and responsibilities of its professionals and create more horizontal interaction in the department (Buttrick, 2020). Currently, all specialists, including project managers and the CPO, have a limited understanding of their duties, and they work slowly through the steps of project planning, implementation, and assessment.
An agile methodology, suggested by many scholars, can be applied to some aspects of project development, although it may not be entirely suitable for the construction business. For instance, Buttrick (2020) states that agile behaviors can be implemented by teams in all types of projects, including horizontal communication, clear performance goals, an informal atmosphere, open discussion, acceptance of conflict, mutual respect, and more. Thus, all PMO employees should be engaged in communication and feedback.
This measure can be implemented by analyzing the current responsibilities of each worker and seeing where they can be made more effective with the help of agile behaviors. For example, the current official channels of communication, such as written reports, can be replaced by regular meetings where everyone is encouraged to share their opinion (Heffernan, 2021). Thus, a new role of all employees in the PMO is to contribute to the conversation and offer their knowledge. This change may help improve communication among employees and clarify their roles within the department more effectively.
Project Sponsorship and Steering
The role of the project sponsor also belongs to the CPO in the selected organization. While this practice is common for businesses, the lack of separation between responsibilities can create new issues (Buttrick, 2020). Breese, Couch, and Turner (2020) note that senior management often views their position as one that conforms to the expectations set out by the organization.
At the same time, project sponsors should also exercise creativity and innovation to increase project profitability while aligning it with the company’s vision (Breese, Couch, and Turner, 2020). As a result, many managers treat this responsibility as a part of their seniority role and do not distinguish their duties as a manager and as a sponsor. Such a lack of recognition may lead them to approach each sponsored project as just another daily task that does not require additional attention.
A recommendation for the chosen organization would be to assign different sponsors to the projects, rather than selecting the CPO as the default option. It is possible that the CPO does not distinguish between the usual duties of a manager and a sponsor because all projects are typically sponsored and led by a single person. Similarly, the board may not recognize the potential of sponsoring as they do not see the different perspectives that professionals may offer.
Choosing to appoint technical advisers or experts in strategy from the PMO can bring more advantages to the company, as it will see how people with different skill sets respond to the tasks set in projects. Furthermore, it may also enable professionals to take responsibility for decision-making and experience the process of overseeing a project (Buttrick, 2020). Experts in technical aspects, these new sponsors may approach project viability and governance from a new perspective.
As a result, the new sponsors may acquire new skills, and the company will see which knowledge is essential for project success. As sponsors often make significant decisions, delegate tasks, oversee work, and analyze their results, they develop skills necessary for working with teams of people. At the same time, they need a deep understanding of the goals and objectives that the company and its workers pursue. Appointing different sponsors for projects can allow the organization to identify which skills are lacking among current CPO and PMO employees.
Project Management Capability and Skills
Finally, the last aspect of project management is the skills that managers currently possess, as the company considers them. As discussed above, significant attention is paid to the managers’ social and professional skills. Nevertheless, these standards are rigid, not allowing leaders to exercise different styles of communication and motivation for their employees.
Moreover, the concept of feedback is not currently present in these capabilities. As a result, employees often fail to discuss failures or preventable errors promptly. Furthermore, the presence of a hierarchy in communication further limits the employees’ ability to share valuable information quickly. The company suffers in productivity and efficiency due to these factors, as workers are not motivated to participate and grow professionally.
To address this issue, the company should introduce innovative approaches to leading its project management department. Heffernan (2021) provides an example of inspiration as a contrast to obedience and intimidation. By opening new channels of communication and teaching leaders skills such as active listening and giving feedback, the organization can increase employee motivation and achieve positive results (Khan et al., 2021). Moreover, teaching managers communication skills can also positively affect conflict resolution and prevent potential misunderstandings (ICG (Infrastructure Client Group), 2017). This knowledge is valuable for both leaders and subordinates, but leaders can especially benefit from education.
Thus, the recommendation includes a set of educational measures to improve managers’ conflict management, communication, motivation, and teamwork. An open communication style can be a significant change for the company, but its results may change the current relationships between management and employees (Khan et al., 2021). Furthermore, it can increase the creation of input from employees, as they will be encouraged to provide feedback. Overall, this change is valuable in the long term, as it may affect the corporate culture and other aspects discussed above.
Reference List
Breese, R., Couch, O. and Turner, D. (2020) ‘The project sponsor role and benefits realisation: more than “just doing the day job”‘, International Journal of Project Management, 38(1), pp. 17-26.
Buttrick, R. (2020) The programme and portfolio workout: directing business-led programmes and portfolios. New York: Routledge.
Heffernan, M. (2021) Wilful blindness: why we ignore the obvious at our peril. New York: Bloomsbury.
ICE (Institution of Civil Engineers) (2019) Reducing the gap between estimates and outturns on major infrastructure projects and programmes.
ICG (Infrastructure Client Group) (2017) From transactions to enterprises: a new approach to delivering high performing infrastructure.
Khan, A., Waris, M., Panigrahi, S., Sajid, M.R. and Rana, F. (2021) ‘Improving the performance of public sector infrastructure projects: role of project governance and stakeholder management’, Journal of Management in Engineering, 37(2), p. 04020112.
Miller, K. (2014) Extreme government makeover: increasing our capacity to do more good. Washington: Governing Books.
UK Government (2021) GovS 002: Project delivery. Government Functional Standard, HM Government.