Project and Corporate Governance

Introduction to Project Management

Fire and Rescue Services (FRSs) are increasingly recognising the importance of formal project management and programme support structures to be able to work properly and achieve their business goals.  Defined projects could range from upgrading front line IT systems to designing a new training package for firefighters to a vehicle replacement project or to the provision of a new workshop complex.

Project management and prescribed project management methodologies such as PRINCE2 have been developed and can be applied to all projects and will address the different needs of individual projects for:

• A business case for developing a project to begin with
• Quality planning, management and control
• Defining project outcomes and expectations
• Communication
• Defining project roles and responsibilities
• Planning of resources (including costs and times)
• Accountability
• Measures of success

By adopting these basic principles of project management and project governance, an FRS will be able to reduce or eliminate the risk of project failures and avoid difficulties such as challenges to procedures, procurement, overspends and safety standards.

When an FRS reaches the stage where it is undertaking multiple projects across the organisation, it is valuable to increase the capacity of the organisation to plan, monitor and govern these several discrete projects, which may or may not be related.  This is where the value of a programme management office (PMO) or project support office (PSO) can become invaluable.

Project management is the discipline of undertaking a temporary activity, whereas programme management is the discipline of organising resources and activities to define and deliver an evolving collection of related projects and activities that, in combination, achieve agreed objectives and emergent organisational benefits, including new capabilities. [1]

The role of a PMO or PSO is to coordinate these projects, observe that the correct project governance and corporate governance of the organisation is adhered to, and provide the link between the projects and the body that runs the organisation.  In the case of an FRS, this may be its authority and senior management teams.

In order to deliver projects that meet the objectives of a particular FRS, it is important to ensure the project has accountability, meets corporate goals and fits into the wider objectives of the organisation. This is where project governance and corporate governance structures to monitor and control individual projects are important.

In simple terms, project governance concerns the rules of the project and corporate governance is concerned with the rules of the organisation as a whole.

Project governance and corporate governance

• Project governance is concerned with the project
• Corporate governance is concerned with the governance of project management capabilities of the whole FRS.

For a typical FRS in the UK, corporate governance is concerned with the relationship between the organisation’s management, its board or authority and other stakeholders including the government and the public.  Corporate governance provides a structure through which objectives are set and the means to monitor those objectives.

Fire and Rescue Service legislation

The different fire and rescue service legislation in the UK provides a corporate governance framework, objectives and monitoring.

Part 1 of the Fire and Rescue Services Act 2004 [2] provides the legal governance structure for FRS in England and Wales to operate under a fire and rescue authority ultimately answerable to government under the auspices of the Secretary of State. In Scotland, the specific legislation includes the Fire (Scotland) Act 2005 [3] and Police and Fire Reform (Scotland) Act 2012 [4]. In Northern Ireland, the relevant legislation is the Fire and Rescue Services (Northern Ireland) Order 2006 [5].

Part 2 of the Fire and Rescue Services Act 2004, documents what the objectives of a fire and rescue service are (fire safety, fire-fighting, rescues for RTCs etc).  Part 3 of the Act is the means to monitor the objectives, specifically the administrative functions, of an FRS within the Fire and Rescue National Framework.  The Framework sets out priorities for authorities and guidance on how to discharge functions.

In practice, fire and rescue authorities monitor the performance of fire and rescue services through strong reporting lines; decision-making structures such as committees and boards; correctly defining decision-making through delegation, (including the line and span of control); and documented planning and decision-making to ensure transparency and openness to independent scrutiny.

Project Governance

At the project level, project governance functions will be put in place within an FRS to support projects and ensure that they meet the requirements of the defined corporate governance objectives of the service or authority.

The Association for Project Management (APM) clarifies the position of project governance in a corporate governance structure:

The governance of project management concerns those areas of corporate governance that are specifically related to project activities. Effective governance of project management ensures that an organisation’s project portfolio is aligned to the organisation’s objectives, is delivered efficiently, and is sustainable. Governance of project management also supports the means by which the corporate board and other major project stakeholders are provided with timely, relevant and reliable information. [6]

In summary, project governance helps the project manager to deliver a project within the standards required of the organisation and its defined reporting structure.

How is project governance delivered?

Bodies such as the Association for Project Management (APM) and the Cabinet Office, which is responsible for maintaining the PRINCE2 [7] methodology, differ in their exact principles for project governance, however, there are some common themes, which will provide a governance framework to a project and in its interaction with the wider organisation.

These are:

• A separate board with overall responsibility to govern the project

A project board should be made up of a number of senior staff at the FRS including eventual end-users, those responsible for its development during the project and those responsible for its ongoing maintenance or upkeep.  If the project has a senior sponsor with overall responsibility, this person will be on the board.  The project board will leave the running of the project and day-to-day decision-making to the project manager, but will have overall decision-making control.  This is only likely to be exercised when the project manager looks to the project board for guidance in case of difficulties or a deviation of the project against its intended activities.

The project board needs to consist of decision makers, not representatives of all stakeholders.  This will prevent decision-making forums from becoming clogged with stakeholders who wish to have a say in the project but lack the seniority to authorise immediate change.

• A single point of accountability providing leadership and decision-making

The project manager will be expected to provide day-to-day leadership under the devolved authority of the project board.  This individual will need to be accountable to the board and the FRS to be able to make decisions and manage the project.  It may be necessary for the project manager to be answerable to one or more senior members of staff who act as project sponsors, with a wider understanding of the organisational goals and corporate governance structure.  The project sponsors will be represented on the project board.

• Clear reporting criteria supported by agreed reporting tools

The project management framework of the organisation should have reporting tools in place so that the project team and manager can report to the board in a regular and timely manner.  Reporting tools are described in detail under Project Management Methodology below and include:

• The business case
• Project initiation document
• Status reports, meeting reports and annual reports
• Project closure reports

Predetermined reporting criteria should enable relevant and realistic information to be presented that provides a reliable basis for making authorisation decisions. It is worth noting that the reporting should be appropriate to the nature of the project, so a large multi-faceted project with a considerable budget may need additional reporting to a smaller project with a shorter timescale and more limited scope.

The correct organisational culture

For the governance framework of an individual project to succeed, the organisational culture of the FRS must be open to improvement and open discussion.  This allows project successes and failures to be reported and any risks and issues to be escalated to the appropriate decision-making level.

An important, but sometimes overlooked, function of project governance is that it is a framework in which a project can be stopped, which requires a confident and open organisational culture.

---