Project Management governance is critical for successful project execution. I have videos on specific types of governance with template examples, which you can view here. But first, what is the best governance model for your project? Managers may think there is only one way of working when it comes to governance, but that's not true. Various models fit different requirements, focus on different project types, and are built to meet different objectives. This article will show you exactly how these models work and the use case for each. 

Why Do Projects Use Governance Models

Governance refers to the system of policies, procedures, and decision-making processes. These processes guide an organization's management and oversight of projects. They provide a framework for ensuring that projects are aligned to:

• the organization's strategic objectives

• ensure the project's effective execution

• deliver the expected results

There are various project management governance models that organizations can adopt to ensure effective project management. 

If you are still getting familiar with some of the points discussed, this article includes links to additional content to explain more.

Let's explore five common project management governance models and their key features.

Hierarchical Governance Model

 In a hierarchical governance model, decision-making authority is centralized. They are run by a single individual or a small group of high-level executives within the organization. This group is responsible for setting:

• project management policies 

• procedures

• standards 

• and selecting other advisory bodies, such as user groups

In addition, they also may make strategic decisions related to project selection, prioritization, and resource allocation. The governance board may also manage the project's key constraints or outcomes.

Project managers report to these executives and follow the established governance framework. This model ensures a top-down approach to project management, with clear lines of authority and decision-making. Costs are often higher because the governance model requires significant executive oversight. Therefore, this model works best when the project's strategic goals are critical to the organization. It is, therefore, cost-effective for the project to have a high level of executive oversight. 

Key features of a hierarchical governance model:

• Top-down approach to project management

• Centralized decision-making authority

• The Project Manager reports to the governance body

• Clear reporting lines to high-level executives

• Defined roles and responsibilities

• Standardized policies, procedures, and standards

• The project team executes based on governance output

Collaborative Governance Model

In a collaborative governance model, the decision-making authority is distributed among multiple stakeholders. This model includes the following:

• project managers,

• project teams

• and other relevant stakeholders

Collaborative governance emphasizes cooperation and engagement among various project stakeholders. This allows them to make decisions related to project management collectively. The project manager is a facilitator and coordinator, working closely with cross-functional teams and stakeholders. This way of working ensures alignment with project objectives and organizational goals. If your project requires a diversity of viewpoints, this model does it best. Managers will need to build a  high-performing team to execute this model. This way of working promotes a collaborative and inclusive approach to project management. It will need a team capable of shared ownership and accountability.

Key features of a collaborative governance model:

• Distributed decision-making authority

• Emphasis on collaboration and engagement

• The Project Manager is part of the governance body

• Collaboration and engagement among project stakeholders

• Emphasis on shared ownership and accountability

• Flexible and adaptable approach to project management

• Focus on alignment with project objectives and organizational goals

Decentralized Governance Model

In a decentralized governance model, decision-making authority is delegated to individual project managers or project teams. Each project manager has the autonomy to decide on their respective projects. This authority includes:

• project planning

• execution

• and monitoring

The decentralized model provides project managers with greater autonomy and flexibility. They can tailor each approach to the specific needs of their projects. However, it also requires high accountability and transparency in project management practices. Project Managers are also accountable for aligning with organizational goals and standards. Therefore, this model works best with senior project managers who understand how to manage project outcomes and organizational objectives. Assigned leadership must also be able to address project scope, cost, and deliverables. Project Managers also need excellent communication skills. These skills are needed to address discussions required for business alignment and issue escalation to the departments. Managers must also be capable of managing procurement and sub-contractors.

Key features of a decentralized governance model:

• Decision-making authority delegated to project managers or project teams

• Greater autonomy and flexibility for project managers

• The Project Manager is the defacto Governance authority

• Requires Senior Project Manager with business skills

• Tailored project management approaches for individual projects

• High level of accountability and transparency in project management practices

• Need for alignment with organizational goals and standards

Functional Governance Model

In a functional governance model, decision-making authority is aligned with the organization's functional departments or business units. Project managers report to functional managers responsible for overseeing projects within their respective areas of expertise. This model allows functional managers to ensure that projects align with the following:

• their department's goals and objectives 

• available resources are allocated effectively

• and their ability to run the solution after project handover

It also promotes a close integration between project management and functional departments, ensuring that projects align with the organization's strategic priorities. This model works best when the departments in the governance model are the owners of the final project's solution. Using this model helps with the smooth transition of a solution that will work with the existing models and processes. 

Key features of a functional governance model:

• Decision-making authority aligned with functional departments or business units

• Alignment of projects with departmental goals and objectives

• The Project Manager reports to the department head

• Resource allocation based on departmental priorities

• Close integration between project management and functional departments

• The project solution must fit with existing business functionality

• Department leadership understands the business requirements and project solution
  

Agile Governance Model

The Agile governance model is specifically designed for organizations that adopt Agile methodologies for project management. In this model, decision-making authority is delegated to self-organizing, cross-functional teams. This is consistent with the natural way agile teams work. The addition of an agile governance model:

• supports the project team 

• helps the organization to improve their agile processes

• and allows for efficient decision-making during escalations 

The model is based on agile methodologies' core principles and values, such as the Agile Manifesto. These principles include customer collaboration, responding to change, delivering working solutions, and embracing individuals and interactions over processes and tools.

Agile governance promotes collaborative decision-making processes. Therefore, decisions include appropriate stakeholders. However, all stakeholders are there to support the team, including senior executives. Coaches supply insight and information that the team needs through out work execution. The agile principles of a self-managed team mean that governance supports their work through collaboration and handling issue escalation and resolution effectively and efficiently.

• Specifically designed for organizations using Agile methodologies

• Decision-making authority delegated to self-organizing, cross-functional teams

• The Scrum Master (replacing the PM in the Agile model) is part of the governance body

• The team is supported, not managed, by governance oversight

• Iterative and adaptive project delivery

• Emphasis on continuous improvement and customer value

• A collaborative approach responsive to changing customer needs or market conditions

In conclusion, project management governance is crucial for effective project execution. Organizations should carefully choose the governance model that best aligns with their goals and objectives. Each model has its features and advantages, and it's important to tailor the approach based on the organization's needs. Clear roles and responsibilities, effective decision-making, and alignment with organizational goals are key elements of successful project management governance.

Want to know more about specific Governance Models with Templates you can use for your project? See my articles on Project and Supplier Governance. Or watch my governance model playlist to see how to put governance into action.