When your project plans bear no relation to your business case and its benefits, the Governance Team (Sponsor/Steering Committee/Project Board) can really only oversight the project and its dimensions.
When, however, the Value Equation™ is used to link the project’s activities to the desired business outcomes, benefits and value, the role of the Governance Team changes. They can now focus on protecting and then delivering the value.
Scope changes can be viewed in terms of how they impact the project’s net value.
Key decisions can be made with the overall long-term value impacts considered rather than just the project cost impacts.
Risks, issues and alike can all be viewed in terms of their impacts on the value.
Cost and time overruns can be quantified in terms of their impact on the value. Often it is more valuable, in the longer run, to go over cost and deliver all of the benefits rather than to cut the project to fit the budget and forego the ongoing benefits.
The importance of change management as the means of value realization increases the Governance Team’s focus on and commitment to the change activities (which too often they slash to save costs).
Previously Governance Teams have not had this ability to effectively and easily track their project’s business value. Now they can. Now they can relate each aspect of the project to its value impact.
At last, the Governance Team’s role makes sense — not to be super-project managers or just overseers of the project manager’s actions, but as owners, protectors and deliverers of the business value (which we define as the business outcomes, benefits and financial value).
It’s a new world for Governance Teams created by The Value Equation™
© Jed Simms, Australia, 2009. Jed@valuedeliverymanagement.com
Further support and useful tools to help you manage your investments, projects and portfolio are available from valuedeliverymanagement.com.
For the previous article in this series visit The Self Evident Truths of Project Management: Truth # 7- “All projects are ‘change projects’”.
For the first article in this series visit The Self Evident Truths of Project Management: Truth #1 - We do projects to realise the Associated benefits.
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