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The six functions of governance

PM ADVISORY

By Dr Lynda Bourne

Melbourne, Australia
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Many people in the project management domain confuse management with governance – this paper is designed to dispel many of the myths.

My hypothesis (H1) is that management and governance fulfil different purposes within an organisation. If this hypothesis holds, then my proposition (P1) follows: if something is designated as a ‘management function’ it cannot also be designated a governance function; and conversely governance functions are not management functions.

Probably the easiest starting point is to briefly outline the widely accepted functions of management . Henri Fayol (1841 – 1925) defined the five functions of management in his 1916 book Administration Industrielle et Generale, they are:

  1. to forecast and plan,
  2. to organise
  3. to command or direct (lead)
  4. to coordinate
  5. to control (French: contrôller: in the sense that a manager must receive feedback about a process in order to make necessary adjustments and must analyse the deviations.).

Management undertakes these functions through management structures and committees such as project control boards. For a more detailed discussion of the functions and principles of management see: WP1094 The Functions of Management http://www.mosaicprojects.com.au/WhitePapers/WP1094_Defining_Management.pdf

Given these functions of management are still generally accepted more than 100 years after their publication, P1 states they cannot also be the function of governance.

Governance overview

Governance is the action of governing an organisation by using and regulating influence to direct and control the actions and affairs of management and others. It is the exclusive responsibility of the ‘governing body’, the person, or group accountable for the performance and conformance of the organisation (in a commercial organisation, the Board of Directors).

The objective of ‘good governance’ adapted from the definition by Sir Adrian Cadbury (2002) is: “…… holding the balance between economic and social goals and between individual and communal goals. The governance framework is there to encourage the efficient use of resources and equally to require accountability for the stewardship of those resources. The aim is to align as nearly as possible the interests of individuals, the organisation and society”.

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About the Author

Dr Lynda BourneDr. Lynda Bourneflag-australia

Melbourne, Australia 

Dr. Lynda Bourne is Managing Director of Stakeholder Management Pty Ltd – an Australian based company with partners in South America and Europe. Through this global network she works with organisations to manage change through managing the relationships essential for successful delivery of organisational outcomes.  Lynda was the first graduate of the RMIT University, Doctor of Project Management course, where her research was focussed on tools and techniques for more effective stakeholder engagement. She has been recognised in the field of project management through her work on development of project and program management standards. She was also included in PMI’s list of 50 most influential women in PM.

he is a Fellow of the Australian Institute of Management (AIM) and a Fellow of the Australian Computer Society (ACS). She is a recognized international speaker and seminar leader on the topic of stakeholder management, the Stakeholder Circle® visualization tool, and building credibility and reputation for more effective communication.  She has extensive experience as a Senior Project Manager and Project Director specializing in delivery of information technology and other business-related projects within the telecommunications sector, working as a Senior IT Project Management Consultant with various telecommunications companies in Australia and South East Asia (primarily in Malaysia) including senior roles with Optus and Telstra.

Dr Bourne’s publications include: Stakeholder Relationship Management, now in 2nd edition, published in 2009, the second, Advising Upwards in 2011. She has also contributed to books on stakeholder engagement, and has published papers in many academic and professional journals and is a columnist for PMI’s PM Network. Her next book Making Projects Work is due for publication in 2014.

Dr. Bourne can be contacted at [email protected].