PRINCE2 Foundation and Practitioner - Organisation Theme Tutorial

5.15 Role of Project Board

Project board consists of executive, senior supplier(s) and senior user(s) (read as: senior supplier or suppliers and senior user or users). The Project Board has authority and responsibility for the project. However, the Executive is accountable for the success of the project and he can make Senior Supplier and Senior User accountable for the project. The Project Board is accountable for the success or failure of the project in terms of the business, user and supplier interests. The Project Board is responsible for facilitating integration of the project management team with the functional units of the participating corporate or external organisations. The Project Board should provide the resources and authorise the funds necessary for the successful completion of the project. The project Board consists of Executive, Senior Users and Senior Suppliers so all of them are responsible for providing the resources required for the project. Project board ensures effective communication both within the project team and with external stakeholders.

5.16 Role of Senior Supplier

There should be a representation from the team who would be involved in designing, developing, facilitating, procuring and implementing the specialist products of the project. This role is accountable for the quality of products and for the technical integrity of the project. The Senior Supplier provides supplier resources, which can be internal to the organisation or can be obtained from external vendors or service providers. After understanding three important roles, let us now discuss the role of a Project Board, in the following screen.

5.1 Organisation Theme

Hello and welcome to PRINCE2 Foundation Certification Course offered by Simplilearn. This lesson is about the Organisation theme. Organisation is one of the seven themes of PRINCE2 methodology. This theme is based primarily on the principle Defined Roles and Responsibilities. Let us discuss the objectives of this lesson in the next screen.

5.2 Objectives

After completing this lesson, you will be able to: Define key terms in Organisation theme Explain the PRINCE2® approach to Organisation theme Identify the roles and responsibilities in an Organisation theme Let’s look at the purpose of organisation theme in the next screen.

5.3 Purpose of Organisation Theme

The purpose of Organisation theme is to define and establish the project’s structure of accountabilities and responsibilities. This theme is based on the principle of Defined Roles and Responsibilities. PRINCE2 is based on a customer/supplier environment. It assumes that there will be a customer who will specify the desired result and probably pay for the project and a supplier who will provide the resources and skills to deliver that result. Let’s discuss the definition of an organisation in the next screen.

5.4 Programme—Introduction

This is one of the most important PRINCE2 themes. People are required to perform the project activities and so it is essential to define the project organisation structure beforehand. Let us study the key definitions associated with Organisation. To understand PRINCE2 methodology, these definitions have to be remembered and understood. Programme is a temporary organisational structure created to coordinate, direct and oversee the implementation of a set of related projects and activities to deliver the outcomes and benefits related to the organisation’s strategic objectives. Programme has a longer life than a single project. A project can be a standalone entity or be a part of a programme of related projects. Let us continue our discussion of the definitions in the following screen.

5.5 Project—Introduction

Project is a temporary organisation created for delivering one or more business products according to the agreed business case. PRINCE2 does not define management jobs to be allocated to people on a one-to-one basis. It defines roles, each of which is defined by an associated set of responsibilities. Roles might be shared or combined according to the project’s needs but the responsibilities must always be allocated. Let’s look into the three project interests in the next screen.

5.6 Three Project Interests

PRINCE2® defines a project as a temporary organisation that is created for the purpose of delivering one or more business products according to an agreed Business Case. The PRINCE2® principle of defined roles and responsibilities states that a PRINCE2® project will always have three primary categories of stakeholder. As seen in the image on the screen, they are Business, User and Supplier. The reason for undertaking a project is to introduce change to meet the current business challenges. We will continue our discussion on the three project interests in the following screen.

5.7 Three Project Interests (contd.)

The reason for undertaking a project is to introduce change to meet the current business challenges. The output of the project should meet a business need which will justify the investment in the project. The project should also provide value for money. The Executive role is defined to represent this business interest view point of the project. The user viewpoint should represent who uses the output to realise the benefits. It also represents the individuals or groups who will operate, maintain or support the project’s output and who will be impacted by the project’s output. This view point is represented by Senior User role. The supplier viewpoint should represent those who will provide the necessary skills and produce the project’s product. The project may require both in-house and external supplier teams to create the project product. This view point is represented by Senior Supplier role. All the three roles, i.e. Executive, Senior User and Senior Supplier are part of the Project Board. The three roles represent the three project interests or primary stakeholders of the project. The term Customer is also used in PRINCE2, normally in the context of a commercial customer-supplier relationship. Customer can usually be interpreted as a collective term for the business and user interests. Let us look at an example which illustrates these three project interests in the following screen.

5.8 Examples of Three Project Interests

For example, for the project to construct the Sydney Opera House, the business was NSW State Conservatorium of Music and Ministry of Public Works. The users were the Australian Ballet, Sydney Theatre Company and Sydney Symphony Orchestra. The suppliers were construction firm Civil and Civic and Hornibrook Group Pty Ltd. Let’s discuss the PRINCE2 approach to organisation in the next screen.

5.9 PRINCE2® Approach to Organisation

PRINCE2 separates the direction and management of the project from the delivery of the project’s outputs. As seen in the image on the screen, the project management structure has four levels. Three of which represent the project management team and the fourth which is outside of the project. As per PRINCE2, the four levels of management are: Corporate or program management, Directing, Managing and Delivering. Let us discuss these levels in detail in the following screen.

5.10 Levels of Organisation

Corporate or program management level is outside the project management team. However, they will be responsible for commissioning the project. This level is also in charge of identifying the Executive and defining the project-level tolerances within which the Project Board will work. The second level, called Directing, is represented by the Project Board, which is responsible for the overall direction and management of the project within the constraints set out by corporate or programme management. The Project Board is accountable for the success of the project. The third level, called Managing, is represented by the Project Manager, who is responsible for the day-to-day management of the project within the constraints set out by the Project Board. The Project Manager’s prime responsibility is to ensure the project yields the required products in accordance with the time, cost, quality, scope, risk and benefit performance goals. The last level is called Delivering. Representing this level, team members/managers are responsible for delivering the project’s products within defined time, cost and the quality expectations. In the next screen we will look at the project management team structure.

5.11 Project Management Team Structure

PRINCE2 suggests a strong project management team structure. As seen in the image on the screen, a project management team structure allows for channels of communication to decision-making forums. PRINCE2 suggests that the skills, knowledge and experience required for all roles in the project organisation should be described for effective project management. Along with the roles and responsibilities, the reporting structure and the authorities for various activities should also be defined. PRINCE2 also gives the guidelines on which roles can be combined, if needed. The Executive, representing the business viewpoint and Senior User representing the user viewpoint roles can often be combined. However, some of the PRINCE2 responsibilities cannot be shared or delegated for managing the projects effectively such as the Project Manager and Executive roles. Also, the Project Manager and Project Board decision-making accountability cannot be delegated. Let us discuss all the roles depicted in this diagram in detail. From the foundation exam PRINCE2 perspective, you should understand the roles and responsibilities clearly. In the next screen, we will discuss the first role, which is Executive.

5.12 Role of Executive

The Executive is appointed by corporate or programme management and eventually is responsible for the project’s success. Executive is also responsible for the Business Case. The Executive has to ensure that project gives value for money and appoints the rest of the project management team including project manager. In the following screen, we will discuss the next role, which is Project manager.

5.13 Role of Project Manager

Let’s look at the role of a project manager in a PRINCE2 project. This role should NOT be shared. It is the project manager, who is responsible for day-to-day management of a PRINCE2 project. Project Manager is responsible for the work of all the PRINCE2® processes except Managing Product Delivery, Directing a Project process and appointing the Executive and the Project Manager in the pre-project, Starting up a Project process. The project manager is responsible for liaison with project assurance and project board. A project manager will need to send the Highlight report which reports the progress of the stage to the project board. The project manager will interact with project assurance and will seek their active involvement in developing Business Case and Benefits Review Plan. If there is a team manager present in a project environment, the project manager may delegate responsibility for developing specialist products. The Project Manager will be responsible for day-to-day management of the Team Managers and Project Support team members. Usually, project manager comes from the customer corporate organisation, however there may be projects where the project manager also comes from the supplier organisation. In the next screen we will look at the senior user role.

5.14 Role of Senior User

As per PRINCE2, there should be a representation of the users of the project’s products, on the project management team. This role is played by the Senior User(s) (read as: senior user or users) The primary responsibility of this role is to specify the needs of the users for the specialist products. The individuals or group of individuals performing this role monitors the solutions from quality, functionality and user-friendly view point against the requirements. The Senior User commits the user resources. This role is also responsible for specifying the benefits and accountable for demonstrating the realisation of benefits. This role may also be involved in the post-project life. We will now discuss the role of a Senior Supplier in the next screen.

5.17 Role of Project Board (contd.)

Now, let’s look at the four key characteristics of a Project Board: Authority: The members of the Project Board should be senior enough within the corporate organisation to make strategic decisions about the project. Credibility: The credibility of the Project Board members within the corporate organisation will affect their ability to direct the project. Ability to delegate: A key part of the Project Board’s role is to ensure that the Project manager is given enough space to manage the project by keeping Project Board activity at the right level. Availability: Project Board should be available to make decisions and provide direction to the Project Manager. In the next screen, we will understand what project assurance is.

5.18 Role of Project Assurance

The project board may not have skills, knowledge and/or time to perform the assurance activities. For example, the senior supplier may be managing multiple product lines and do not have sufficient time for assurance activities for the projects. In that case, the Project Board may appoint other members of the corporate organisation to take a specific Project Assurance role. Team members of Project Assurance report to project board. Personnel involved in Project Assurance are also responsible for supporting the Project Manager, by giving advice and guidance on issues such as the use of corporate standards or the correct personnel to be involved in different aspects of the project. It has to be kept in mind that the Project Assurance team members are not decision makers. Ultimate decision making power rests with the Project Board. The Project Assurance can review, advice and monitor the project work. It is important to note here that the Project Board should not assign any Project Assurance roles to the Project Manager as they monitor all aspects of the project’s performance and products independently of the Project Manager. Members of this team may come from an organisation’s Project Management Office (PMO). For example: Environment Canada’s Project Delivery Office guides and advices the Project Manager on project management and its best practices. In the next screen we will look at the personal in charge for change authority.

5.19 Role of Change Authority

As per PRINCE2, it is the Project Board’s responsibility to agree to each potential change before it is implemented. The Project Board may wish to delegate some authority for approving or rejecting requests for change or off-specifications. Projects in a dynamic environment which expects lots of requests for change may appoint a separate Change Authority. The Project Manager and/or the people with delegated Project Assurance responsibilities may act as the Change Authority. For example, the project may be given an authority to approve the changes only if the impact on the time scale is less than five days. Change Authority may need to have technical knowledge to evaluate potential changes. Depending on the severity, the request for change could be handled by Corporate or Programme Management by the Project Board or it may be delegated to either a Change Authority or the Project Manager. Let’s discuss the role of the Team Manager in the next screen.

5.20 Role of Team Manager

In PRINCE2, the only optional role is that of Team Manager. If the project is small then a Project Manager may not appoint a separate Team Manager. The Team Manager reports to and looks for direction from Project Manager. The Team Manager’s primary responsibility is to ensure production of those products allocated by the Project Manager. The Project Manager should plan the role during the “Starting Up a Project” process or for each stage in the “Managing a Stage Boundary” process. The Project manager allocates Work Packages to Team Managers or Team Members. The team manager is responsible for production of the allocated products as per the work package. The projects are usually executed in Customer/Supplier environment, the Team Manager may come from the supplier corporate organisation. In this case, there could be a reporting line to a Senior Supplier. One important point to understand is that the structure of the project management team does not necessarily reflect seniority. What is important here is the role on the project. For example, an Executive may not have the skills for project assurance, however should be able to represent the business view clearly. The Executive should have the authority to secure funds for the project. The Project Manager or even a Team Manager may be more senior in the corporate organisation. We will now discuss the role of project support in the next screen.

5.21 Role of Project Support

This role is not optional. Project Support is the responsibility of the Project Manager. If there is a lot of administrative work or guidance is required on the use of project management tools or configuration management in the project, the Project Manager may decide to delegate some of this work to a Project Support role. Project Support defaults to the Project Manager if it is not otherwise allocated. It could also provide specialist functions to a project such as planning or risk management. Project Support is also responsible for administering any configuration management procedure and tools as defined in the Configuration Management Strategy. Project Support and Project Assurance roles should be kept separate to maintain the independence of Project Assurance. After all, Project Assurance needs to be independent of the Project Manager while the Project Support team reports to the Project Manager. In the next screen, we will find out how to work with the project team.

5.22 Working with the Project Team

It is important to understand how project team works together. Knowledge of different types of personalities and how they work together help the Project Manager in assembling balanced teams that can work effectively during a project. As a Project Manager, extra care should be exercised by the project manager in case of part-time teams. For example, reporting needs may be different and stringent in case of part time workers. It’s also important to understand that at the start of the project, team members may need training. Few examples of trainings can be: Training on any process and standard to be used on the project, i.e. configuration management procedures, progress reporting and quality methods. Training on introduction to the project and its goals, and training on PRINCE2 processes and terminologies. As a Project Manager, extra care should be exercised by the project manager in case of part-time teams. For example, reporting needs may be different and stringent in case of part time workers. In the next screen, we will find out how projects fit into the overall corporate organisation.

5.23 Working with the Corporate Organisation

There are usually two structures in a corporate organisation. The first is Line Management or Functional Management. In this setup, Project Managers can find difficulties when managing cross-functional projects due to the disagreement on overall leadership from various groups. The second structure is Centre of excellence concept. This structure consists of a central standards unit, which defines standards, such as processes, templates and tools and provides skills, training and possibly independent assurance functions to a number of projects. In the next screen we will learn about organisation’s working with stakeholders.

5.24 Working with Stakeholders

People are required to perform activities as it cannot be performed solely by machines. A professional project manager must understand the importance of stakeholders in a project. In PRINCE2 terms, there are some individuals or groups who may or may not be a part of the project management team but may affect, or be affected by the project. These groups or individuals are the ones who can support or oppose the project, who gain or lose as a result of the project delivery or the ones who consider project as a threat or enhancement to their position. There are active supporters or blockers for the project and its progress. A project manager should perform the stakeholder Analysis to understand the stakeholder Engagement and find the information needs of the stakeholders. Though there are number of stakeholders involved in the project, all the information are not shared with every stakeholder. In the next screen we will discuss the procedure for stakeholder engagement.

5.25 Procedure for Stakeholder Engagement

Let us now understand the six step procedure for stakeholder engagement as suggested by Office of Government Commerce, UK’s Managing Successful Programmes. The first step is “Identifying Stakeholders” which involves identifying individuals and groups affected by the project. Grouping similar stakeholders together helps in effective addressing of key messages. This Step answers “Who are the Stakeholders”. The second step is creating and analysing stakeholder profiles. From a project perspective, it is very important to analyse the importance and power of each stakeholder. There is a need to gain an understanding of the influences, interests and attitudes of stakeholders. They have the potential to affect the success of the project, so, it is very important to address their perceptions even if it is erroneous and negative for the project. This step answers “What do the stakeholders think of the project”. This step answers the “How to engage with a stakeholder” question by defining stakeholder engagement strategy. It is important to define how the project can effectively engage the stakeholders including defining the responsibilities of communication and key messages which need to be conveyed. The fourth step “When to engage with stakeholders” is planning the timing of engagements. Defining the methods, frequency of communication is critical for project success. For each interested stakeholder, the information sought from the project requires to be understood, timing, in what format and how the information needs to be sent, and lastly, the sender and recipient of the communication. The fifth step is actually performing activities to engage stakeholders. “Do” involves carrying out planned engagements and communication. The success of effective stakeholder engagement lies in measuring effectiveness of stakeholders’ engagements. “Results” step is all about checking the benefits of the current stakeholder engagement activities by assessing the current stakeholders who have been identified, their information needs and the communication channels being used. In a PRINCE2 project, this measurement may be undertaken by the Project Assurance. For example, Transport for London regularly sends out emails to its customers asking for their opinions before taking major decisions. The customers who have registered on the website are included in this mailing list. In the next screen, we will look at an example to illustrate this concept.

5.26 Procedure for Stakeholder Engagement—Example

For example, ANZ Bank states that “stakeholder engagement helps to minimise risks, identify ideas for new products and services”. Hence, for a project, they typically do the following: Identifying Stakeholders: by conducting regular dialogue across a number of business and functional areas on an annual basis, which includes consideration of 'silent' stakeholders such as future generations and the environment. A global stakeholder database is used for managing information and communicating to our stakeholders. This list includes governments, regulators, customer and community groups, suppliers, investors and employees. Defining stakeholder engagement strategy: ANZ’s strategy is based on the principles of Congruence, Consultative, Collaborative, Creative, Communicate and Commitment. The approaches include: Dialogue in the form of stakeholder forums, participation in multi-stakeholder initiatives and meetings Consultation through surveys, focus groups and online feedback forms Communication through CS newsletter and website Employee engagement through annual survey, 'My Voice' and through on-line 'CEO Chat' feedback forum. Engaging Stakeholders: ANZ holds forums for specific stakeholder groups each year to seek formal input into their business agenda. These forums are attended by a consistent group of stakeholders, along with new participants, ensuring progress and tracking of issues that have been raised in past forums, together with the identification of new and emerging issues. Measuring Effectiveness: ANZ does this through the Shareholder Review, Annual General Meeting and engagements with Australian Shareholder’s Association. In the next screen we will learn about the communication management strategy.

5.27 Communication Management Strategy

Strategy is an approach designed to achieve a long-term aim, which can exist at the corporate, programme and project levels. In PRINCE2, the communication management strategy describes the means and frequency of communication to all internal and external stakeholders. It facilitates controlled and bi-directional flow of information between the stakeholders. The strategy includes communication procedure/communication method to be used and may specify the tools that need to be used for communication. The strategy also includes information needs for each interested party. The project manager is responsible for documenting the communication management strategy. For example, a Project Manager prepared the Communication Management Strategy while initiating the project. However, during the project, one of the suppliers changed. During the next stage boundary, after the supplier is off-boarded and the new supplier is on-boarded the project, the Communications Management Strategy needs to be updated by deleting the old supplier and putting the name of the new supplier instead. This change has to be approved by the Project Board. Hence, PRINCE2 suggests that communication management strategy should be reviewed at each stage boundary and while planning the final stage. In the following few screens, we will look at the responsibilities of the different roles in this theme.

5.28 Roles and Responsibilities in Organisation Theme

The table on the screen depicts the responsibilities of Corporate or programme management in Organisation Theme. The Corporate/Programme management appoints the Executive and possibly the Project Manager. They also provide information to the project as defined in the Communication Management Strategy. The Executive appoints the Project Manager if it is not done by corporate or programme management. He also confirms the appointments to the project management team and the structure of the project management team and approves the Communication Management Strategy. The Senior User is responsible for providing user resources and defining and verifying user requirements and expectations as well as the project’s benefits. The Senior Supplier is responsible for providing supplier resources to make the project’s product. The project manager prepares the communication management strategy and reviews and updates the Communication Management Strategy. The project manager also designs, reviews and updates the project management team structure and prepares the role description for the project team. Project manager is responsible for the day-to-day management of the project. The team manager manages the project team members and advises on project team members and stakeholder engagement. The project assurance advises on selection of project team members and stakeholder engagement. The project assurance ensures that the communication management strategy is appropriate for the project and the planned communication activities actually take place. Project support provides administrative support for the project management team. Let us move on to the quiz questions to check your understanding of the concepts covered in this lesson.

5.30 Summary

Here is a quick recap of what we have learnt in this lesson: Purpose of the organisation theme is to define and establish the project’s structure of accountabilities and responsibilities. The PRINCE2® principle of defined roles and responsibilities states that a PRINCE2® project will always have three primary categories of stakeholder. They are Business, User and Supplier. The four levels of organisation as defined by PRINCE2® are Corporate or programme management, directing, managing and delivering.

5.31 Thank you

In the next lesson, we will discuss the third theme Quality.

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