In the current competitive business environment, companies are finding themselves in a very challenging environment where they have to fight for survival. They have to find ways of offering their customers unique products that meet their needs in the best way possible while at the same time lowering their costs of operations to improve their profit margin. According to Levin (2013), successful firms have learned the art of breaking down strategic goals and objectives into programs and then projects assigned to individuals with clear expectations, budget, and a timeline within which it should be completed. Program management has become one of the core concepts in the modern-day business environment (Khan 2015).
The ability of a firm to achieve success largely depends on their approach towards program governance. The term program refers to a collection of projects, which should be completed successfully to achieve a given strategic goal in an integrated management system (Martinelli et al. 2014). In many cases, the strategic objectives are often broken down into programs than into individual projects, which should be completed within a specified timeline. Longest (2015, p. 24) defines governance as “the processes, structures, and organizational traditions that determine how power is exercised, how stakeholders have their say, how decisions are taken, and how decision-makers are held to account.” In this definition, it is clear that governance involves bringing together processes, structures, traditions to help in decision-making processes.
Program governance refers to how organizational stakeholders, led by the program managers, work closely within an organizational system to achieve specific goals using resources available to them to help achieve strategic goals of a company. It involves developing a project portfolio and managing such portfolio in a way that would yield a maximum return for the firm. A program manager should know the nature of the individual projects (Levin 2013). He or she should understand how these projects are related and how they can collectively help the organization achieve the desired success. Program governance requires an understanding of how each project should be assigned resources, including employees and time, to achieve the best outcome (Longest 2015). It is possible to find cases where projects are closely intertwined, which means that for one project to be undertaken, another project should have been completed. For example, in a mega construction project, it may be important to break down the entire work into smaller projects. In such cases, one project may be completed before another project can be initiated. A program manager should be capable of coordinating these individual activities to ensure that the primary goal of completing the entire building is achieved.
According to Thiry (2015), several governance styles exist that an organization can use to achieve its strategic goals. The governance style that an organization chooses depends on a number of factors. The level of knowledge and experience of the program manager and his or her team defines the governance style that may be chosen (Saporita 2015). Other factors such as time available, specific goal that may be realized, and resources needed to complete the individual projects may define the style that is appropriate. Khan (2015) says that program governance styles have a major impact on the program management role within an organization (Longest 2015). It is important for a program manager to understand these governance styles for him or her to be successful in the management role. Some styles are more suitable for specific situations in an organizational setting, and one should understand how to apply them based on the prevailing needs and forces. In this report, the focus is to look at program governance styles and their impact on program management role. The research will focus on how program governance styles can be used at Abu Dhabi National Oil Company (ADNOC) to improve performance.
Significance of the Topic
Program governance is a very important aspect of project management. According to Levin (2013), companies in the modern society find it appropriate to break various activities into individual projects to achieve the best outcome possible. Using projects makes it easy to come up with specific action plans and short-term goals that would make it possible to achieve the desired strategic objectives. The management of the firm is able to monitor the level of success of every individual project. Any misstep can be arrested at a project level instead of letting it affect the entire goal of a department or firm. Freeman (2014) says that the level of competition in the market today forces organizations to be very innovative. Once a new concept is developed, time is of great essence. The organization should be capable of taking advantage of the innovative ways before other firms can copy their new strategies. Project governance, especially its aspect of project management, makes it possible for firms to roll out new strategies or products within the shortest period possible. When the entire work is broken down into small projects, it is easy to define when each milestone should be achieved. The top management unit can easily understand when there is any delay, and appropriate actions can be taken to arrest such delays. Steinberg (2014) says that it is easier to address issues that arise from small projects than when they are allowed to affect the entire firm.
The topic is very important, especially for the company that has been selected for this study, the Abu Dhabi National Oil Company (ADNOC). ADNOC is the leading oil and gas company in the United Arab Emirates. It faces stiff competition from other regional companies such as ARAMCO of Saudi Arabia and many other regional and international firms (Williams & Samset 2012). The company is under pressure to meet the emerging needs of customers in the market. It also has to face the reality that oil and gas are products that may become less popular in the future as people move towards green energy. The international oil prices have also been on a downward trend for the last three years, significantly reducing the revenue flow to the company. ADNOC has to face these realities, and it should find a way of adjusting. According to Sarbu (2014), the management of this company has come to appreciate that it needs to diversify its sources of revenue and improve its production strategies to remain sustainable (Khan 2015).
A series of goals have been set, and the company is planning to review its vision to reflect the current and emerging market forces. It is important for the management of this company to understand the concept of program governance. The new strategic objectives should be broken down into specific projects with clear goals and timeline within which they should be completed. The firm can then set systems and structures in place to ensure that these short-term goals are achieved in the best way possible (Levin 2013). The firm should understand that its ability to realize its long-term goals depends on how it is able to achieve the short-term objectives. This research will be informative to the management of this company as it seeks to find new ways of managing operational activities. It will help the management to know how to assign resources and talents to individual projects, and how such projects should be monitored to ensure that they remain focused on the set goals.
Key Research Questions
Program governance is increasingly becoming an important concept to companies, especially the large organizations that have to deal with several activities to achieve their goals. In this report, the researcher seeks to analyze program governance styles and their effect on program management role. The following questions will help in achieving the goal of this study:
- What are the styles of program governance used in the modern organizations?
- How does the program governance styles affect program management role?
- How can ADNOC use program governance styles to achieve success in its normal operations?
Objectives and Aims of the Report
It is advisable to set aims and objectives of a research to define the goal that should be achieved at the end of the project (Dinsmore & Rocha 2012). They make it possible to assess the success of the research when it is completed. A researcher will determine whether the set aims and objectives have been achieved as desired. The primary aim of this research is to identify and discuss styles of program governance and their effect on program management role with the view of determining how it can be applied at Abu Dhabi National Oil Company. The following are the specific objectives that should be realized:
- To identify and discuss styles of program governance used in the modern organizations.
- To determine how program governance styles affect program management role.
- To determine how ADNOC can use program governance styles to achieve success in its normal operations.
Understanding the Concept of Program Management
Program management is currently one of the major concepts that managers all over the world are keen on understanding as they seek to embrace a new approach to management. According to Müller (2012, p. 71), program management refers to “the management of several related projects, often with the aim of improving a firm’s performance.” Whenever a manager is presented with a project portfolio, he or she should ensure that each project is assigned to a team and that the team is facilitated to ensure that they meet the desired goal. In such cases, the program manager will have the oversight authority and the responsibility of making decisions to ensure that the activities are undertaken as per the desired goals and objectives. Program management involves closely coordinating the activities of various projects and ensuring that they are undertaken in line with the set goals. While the project manager is responsible for making sure that, a specific project achieves the set goals, program manager has the duty of ensuring that all the projects are completed successfully in line with the set objectives so that a larger organizational goal can be realized (Longest 2015).
Whenever a single project fails to meet its goals, Levin (2013) says that a project manager should be concerned because it may affect the ability of the overall goal to be realized. It is even more important to realize that all projects are successful when the outcome of one project forms the basis of the next project. It means that failure to deliver the desired result in one project may compromise the success of subsequent projects. Although the program manager may not be directly involved with the daily running of individual projects, he or she should be keen enough to monitor their progress.
Any issue that may arise should be addressed within the shortest time and in the most effective way possible. The program manager should work closely with program managers to get the relevant information needed for decision-making. In some cases, a project may be linked with another being undertaken at the same time (Khan 2015). It may be necessary for the project managers of those projects to work in close collaboration with one another to ensure that the desirable outcome is realized (Steinberg 2014). It is the duty of a program manager to facilitate such close coordination of the related project (Saporita 2015). The program manager will be expected to bring together the affected project managers and to ensure that they share information that would help them achieve the desired goal within the set time.
Goal of Program Governance
According to Levin and Green (2013), before looking at styles of program governance, it is important to look at its goals. One needs to understand what program governance seeks to address in an organizational setting. Understanding these goals makes it easy to understand how each of the styles meets the goals in their own unique ways. Freeman (2014, p. 63) says that one of the cardinal goals of program governance is to “provide active direction, periodically review interim results, and identify and execute adjustments to ensure achievement of the planned outcome.” Program management facilitates a periodic review of individual projects within a given portfolio with the view of identifying areas that require adjustments. Steinberg (2014) says that another primary goal of program governance is to define and effectively implement structures within which program management and administration can be executed. Program governance provides a platform through which program management activities can be executed within a specific timeline. Program managers should understand the concept of program governance to execute his or her goals in the most appropriate manner possible.
Relationship Between Programs and Organization’s Strategy
According to Levin and Ward (2013), organizations often set strategies based on the prevailing circumstances and their vision. They look at the current forces and evaluate their primary goal, and then set strategies that can facilitate achievement of those goals. Success of a firm is defined by its ability to set appropriate goals and to achieve them within the time available. Different organizations may use different approaches to achieve the set goals (Khan 2015). The approach that each firm uses defines its ability to achieve the desired success. Companies are currently using program management as a means of achieving organizational strategy. It is important to look at the relationship between program management and organizational strategy. Figure 1 below demonstrates the link between organizational strategy and program management.
As shown in the pyramid above, it all starts with the mission of an organization. The top management unit is expected to revise the mission statement regularly based on the emerging forces both in the internal and external environment. Saporita (2015) says that change is a force that firms cannot ignore in the current environment and that it why it is important to revise the mission statement regularly. The revision of the mission will give rise to new goals and objectives in a change management approach. These strategic management activities are often supervised by the top management unit of an organization. Once new goals and objectives are developed based on the prevailing forces, the next step is to come up with a portfolio of strategic choices. It involves identifying alternatives available for the organizations to enable it achieve the desired goals. The portfolio management is often a task undertaken by departmental heads. For instance, a marketing manager will be expected to develop a portfolio of choices based on the new goals and objectives set by the top management unit. Program management sets in after coming up with a portfolio of strategic choices.
At this stage, the departmental heads have chosen the appropriate projects that should be undertaken to achieve the strategic goals. At the program management stage, it is expected that the activities that should be undertaken is already defined and the people who should be involved. It is that this stage of implementing goals and objectives that, organizational strategies are implemented. The program managers are expected to find ways in which strategies are to be translated into actions through specific projects. The program manager should understand the portfolio of projects and be able to assign resources that will make it possible to achieve the strategic goals (Levin 2013). The program manager is expected to select project managers and assign them tasks based on their skills, experience, and factors relevant for the tasks. At the bottom of the pyramid is project management. It is the lowest level of implementation of strategic goals within the organization. Freeman (2014) says that in most of the cases the project managers are junior managers who work with small teams in specific departments on specified assignments.
Project Governance Styles
Program management may take different approaches based on a number of factors. According to Finger and Fouzia (2012), skills and experience of the manager, the nature of the project portfolio, the goal that should be achieved, and a host of many other factors may influence the choice governance style that an organization can embrace. Steinberg (2014) says that it is important to ensure that the style chosen is appropriate for the goal that needs to be achieved. The style should also be aligned with the internal factors that may have a direct impact on the success of the firm. Freeman (2014) says that none of the programs can be considered superior to others. None of them can be universally applied. Each of them is unique and may be put into practice under different circumstances. The following are the governance models that an organization can embrace based on the prevailing internal and external forces. According to Manna, McGuinn, and Finn (2013), project governance styles are based on various leadership styles. The following are the common program governance styles that program managers can use:
One of the most common governance approaches that program managers often use is the coercive style. According to Müller (2012), coercive governance approach is applicable when the program manager is sure that only one direction exists that can be taken when handling specific projects. Under this style, the program manager, sometimes referred to as projects coordinator, is expected to issue clear directives that should be followed by the project managers. Little room is offered to the project managers to make independent decisions (Levin 2013). In case they need any clarification about the instructions given to them or task before them, they are required to contact the program manager for directives. This approach is very effective when there is a limited time within which a project has to be completed. It eliminates any time wastage by requiring all the employees assigned to a given project to work as per the specified directive. Morris (2013) says that this approach of governance requires the program manager to be highly skilled and knowledgeable in what he or she is directing others to do. This is so because a limited room is left for dialogue and negotiations.
The skills and experience of the junior officers working in such projects may not be of any significance because they are required to work under strict guidance of the program manager. According to Levin and Ward (2013), many often resent this approach of program governance. Many view it as a dictatorial approach that fails to appreciate the little effort that may be made by the junior officers (Longest 2015). Sometimes such little contributions that these junior officers make may have major impact on the outcome of the project (Khan 2015). The style also kills creativity and innovativeness among the junior employees. As Levin (2013) notes, for creativity to flourish in a business environment, it is important to allow employees to make decisions. The manager should appreciate that sometimes employees can make mistakes. Whenever such mistakes occur, employees should not be subjected to punitive measures. Instead, they should be corrected and helped to avoid making similar mistakes in the future. Coercive style of governance is not very popular in the modern business environment where input of every employee matters. However, it is still common, especially when several projects have to be completed within a short time and the program manager clearly understands what needs to be done.
Authoritative style of governance is not as authoritarian as the name may suggest. In this approach of governance, the program manager explains to his or her team the vision that should be achieved within a given timeline. The program manager discusses with the project manager what needs to achieved and the steps he or she believes can help realize the outcome. However, the project manager is given room to engage with their individual teams and come up with collaborative solutions based on the guidelines provided by the program manager (Steinberg 2014). When using this style of governance, the program manager will allow team members to explore their talents when trying to solve the problems at hand. The team should understand that the program manager has the absolute authority over important decisions in these projects. They are at liberty to explore their skills and talents but should appreciate and respect the authority of the program manager. Freeman (2014) advises that when using this governance style, it is important to ensure that the program manager has the relevant skills needed to guide the other team members. This is so because as a leader, he or she will be expected to offer guidance and then support as the supervisor in these projects. Whenever a mistake is identified, the program manager should offer advice on how the issue should be addressed to achieve the intended goal.
According to Manna, McGuinn, and Finn (2013), authoritative style of governance requires the manager to be in a position to motivate the employees. Instead of limiting the creativity of the team members, the program manager will allow them to try new strategies but under very strict guidelines. It means that these employees can make calculated risks. The project managers and their team members find it easy working in such an environment where they have liberty but with a sense of responsibility. It means that they cannot come up with major changes away from the guidelines provided to them without consulting with the program manager. Currently, this is one of the most common governance styles used by various organizations around the world (Longest 2015).
Steve Jobs, one of the greatest transformational leaders of the 21st century, used this strategy to guide activities at Apple Inc (Morris 2013). He allowed his employees to use their creative skills when developing new products for the company. However, they had to act as per strict guidelines provided by him. His employees respected his approach of governance and drew their motivations from him. He was able to transform the company into one of the most respected and should successful brands in the world. The biggest challenge associated with this approach of governance is that it is time consuming. When a portfolio of projects has to be completed within a very short time, it may not be the most appropriate method. The fact that several stakeholders have to be involved means that decisions takes time to be made.
Affiliative style of governance is a more relaxed approach of authoritative style of governance (Levin & Ward 2013). In this approach, a program manager creates an environment where every member can play a critical role in the decision-making process (Levin 2013). The leader creates a system where every member feels that they are responsible for the outcome of the project. They feel committed to their assigned projects and develop a high sense of responsibility. The program manager may not strictly follow the activities of their project managers on a daily basis (Longest 2015). However, the project managers are required to make regular reports to the program managers about the major milestones achieved and new strategies that need to be implemented (Khan 2015). Care should be taken when using this strategy to ensure that the freedom is not abused. This is so because the freedom is not just granted to the project manager but also the team members involved. Everyone is given room to think independently on how to achieve the best outcome in each of the roles assigned to them. Steinberg (2014) warns that sometimes employees may abuse the freedom that comes with this approach of governance.
The program manager should be capable of taking control of the activities within these projects whenever it is necessary. The employees should be made to understand that their activities may be subjected to scrutiny even though they enjoy freedom. Freeman (2014) says that this is one of the most appropriate approaches to use when one is keen on promoting career growth among the employees. The fact that they are allowed to make independent decisions creates a sense of responsibility and leadership in them. When they find themselves in satiations where they have to make decisions, they cannot struggle much in knowing what should be done. However, it is important to note that this style of governance is not very common (Levin 2013). In the current competitive business environment, firms cannot afford to allow employees to enjoy excessive freedom that may make them give more emphasis to activities not related to their official tasks. When a firm is under great pressure to meet the needs of its clients, it is fair to make the employees understand that there is need to put more effort. If they fail to put extra effort in meeting the assigned goals, the company may fail to meet the desires of its clients. In such situations, it is possible to have most of the customers opting to use products of rival firms. The same employees will be affected when they are laid off because of the underperformance of their company (Morris 2013). It is good to let them feel the pressure exerted on the firm by external forces.
Democratic governance style is another common approach of program governance that is sometimes applied when it is necessary. Levin (2013) compares democratic style of project governance to a committee without a chairperson. In this strategy, the project managers are required to work closely with the program manager in making crucial decisions (Longest 2015). Although everyone knows that the program manager is in control and should be respected, the entire team is expected to contribute in the discussions about what should be done. The program manager is not expected to make sweeping decisions under this approach. In fact, he or she can be overruled by the decision of the majority. In such committees, the program manager is expected to meet with all the project managers on a regular basis to discuss the progress made.
Disagreements may be common in such debates, but the ultimate goal is to come up with a decision that can be accommodating to everyone else. Compromise is critical in such debates and the program manager, although acting as the leader, should appreciate that at times their decisions may not be the best in addressing a given issue. They should be ready to embrace ideas of others to ensure that the best outcome is achieved. This governance approach is common where the project managers have more expert knowledge than the program manager does. For instance, when a program manager is a business executive with limited engineering knowledge and the projects require engineering skills, the program manager may employ this style to coordinate activities of the project managers. These project managers, who are experts in their respective fields, will need to inform the program manager why a given approach has been embraced and the possible outcome that should be expected. Steinberg (2014) says that this approach of program governance is not very common. However, it may be necessary in an organizational setting.
According to Levin and Ward (2013), pace setting is another project governance style that is increasingly becoming common in the modern society. In this approach, the program manager sets the performance standard that should be realized within a specified time. The project manager is expected to apply the same model of governance when managing activities of team members (Levin 2013). The program manager will then compare the performance of the project managers with the set standards. If the standards are met, the project manager and his or her team may be compensated for their success (Longest 2015). Freeman (2014) says that the compensation may take different approaches, not necessarily should money be used. The compensation is meant to motivate them so that they can achieve greater success in the future. When a project manager fails to achieve the set standards, then the program manager is expected to act accordingly to address the issue. First, the failing project manager will be warned against their underperformance and assisted to overcome the challenges they face. In case such a project manager fails to register improvement, they may be required to leave their position of management to another employee capable of steering the team towards the right direction.
According to Dinsmore and Rocha (2012), pace setting is one of the governance styles, which are rapidly gaining popularity because it transfers the pressures that a company has in meeting customers’ goals directly to the employees. The project managers and their team should understand that their performance directly influence the performance of the entire firm. As such, they should meet the set targets within the specified deadline to enhance the performance of the firm. As Steinberg (2014) puts it, they should embrace the concept of shaping up or shaping out based on their capabilities. One of the main benefits of this approach of governance is that it clearly outlines what is expected of every project manager. The standards are set prior to the initiation of the project activities (Khan 2015).
The program manager’s main responsibility is to compare the performance of the project managers against the set standards. One would easily know whether they have underperformed or not. When a punitive measure has to be taken, such as the demotion of the project manager, such an individual will understand why the decision was made. It reduces resentments when such actions are taken. However, Morris (2013) warns that this approach often out a lot of pressure on project managers and team members, especially when the standards are set so high. Sometimes the project managers and their teams may be forced to sacrifice personal life for the sake of their career success. Others may compromise on quality if the standard emphasizes on quality. These are concerns that should not be ignored when using pace setting as a program governance approach.
Coaching is another style of governance that program managers can use to guide the activities of the project managers and their teams (Levin 2013). When using this strategy, a program manager is expected to act as a teacher when working with the project managers. The goal should be to identify the weaknesses of these project managers and to help them overcome the limitations. Every time, the program manager- acting as a coach- is expected to challenge the capacities of project managers. They should be motivated to register better performance that what they registered previously. Rarely do such program leaders use punitive measures to motivate the project managers and their teams. This style is common when a program manager is assigned to lead a team of young project managers who are taking such roles for the first time. The project managers lack skills and experience to register impressive performance that would otherwise be expected of regular project managers. The program manager will closely work with them to empower them with the goal of making them better performers in the future. This approach can only be used for training purposes and when undertaking projects which are not very critical to the firm’s success. It is best used in an experimental setting when the skills or the project managers, and sometimes the program managers, need to be tested.
According to Levin (2013), it is important to look at the relevant theories relating to program management. These theories may help in explaining why specific approaches should be embraced over others when managing projects in various contexts. Program management involves management of people. The theoretical framework in this context should focus on the management of people. The relevant theories when looking at program management include McGregor’s Theory X and Y, and Kurt Lewin’s Change Management Theory.
McGregor’s Theory X
According to McGregor’s Theory X, people resent work and need some form of motivation to deliver the expected results. This theory emphasizes on the need of leaders to work closely with the junior employees, always monitoring their progress and providing guidance whenever necessary (Freeman 2014). It advocates for a hands-on approach management where junior employees are made aware that their actions are under keen observation of the manager. The theory works effectively when one is using coercive or authoritative approach of governance. The project managers and their team members should work under given conditions and under strict rules. Theory X advocates for the use of punitive measures to motivate underperforming employees. It argues that as the performers are rewarded, the underperformers should realize that their actions within the firm have consequences. It may be necessary for a manager to dismiss an employee who is underperforming, just as it is stated in the coercive approach of governance.
McGregor’s Theory Y
McGregor’s Theory Y takes an optimistic approach that people have positive opinion towards work and need limited supervision to do the right thing. It is a trust-based approach of managing people where the manager has the belief that even without close supervision employees will do the right thing. Under this theory, the manager is expected to offer guidance to the employees to facilitate continuous learning and development while at the same time allowing them to exercise their personal skills and talents. This theory is in line with the affiliative style of project governance. People are trusted to deliver the expected outcome with minimal control. The employees are granted opportunity to demonstrate what they have learnt when undertaking specific assignments.
Kurt Lewin’s change management model
Kurt Lewin’s Change Management Model is another popular approach of managing people. It explains how change should be introduced in an organizational context. It appreciates the fact that more often than not people resent change. They feel threatened by it. There is always the fear of the unknown as people try to guess what may become of them if they fail to adjust to the new systems and structures. Resistance to change may make it difficult when it comes to introducing new models. Longest (2015) says that, it is not possible to ignore change. It is the responsibility of those in the management position to find ways of introducing change. The approach they take should ensure that change is introduced in a way that would minimize resistance as much as possible. Lewin’s model explains how this can be done. Figure 2 below explains how that can be done.
As shown in the figure above, change takes place in three stages. The first stage, known as unfreezing, involves ensuring that stakeholders are ready for the change. In a project management context, the team members should be briefed about the new methods and be equipped with the necessary skills that can enable them work under the new system. The second stage is to execute change. The team will introduce the new systems after the members are fully prepared. The last stage, known as refreezing, involves ensuring that changes made become part of the organization. This model can be used to manage changes when managing projects.
In this section of the report, the researcher will explain the approach that was used in collecting data, provide, and provide a brief profile of the organization. Data used in this paper came from two main sources. The first source of data came from a review of literature (secondary sources). According to Freeman (2014), when conducting a research, it is important to take into consideration what other scholars have found out. A research study should introduce new information into the existing bodies of knowledge instead of reproducing already existing information. That is why it is important to start by reviewing the works of other scholars. The secondary sources formed the background information for this study. Review of literature, according to Longest (2015), also makes it possible to identify research gaps that need to be given special attention. Secondary data was collected from books, journal articles, and reliable online sources. The findings made from these sources are presented in chapter 2 of this paper, which is dedicated to literature review.
The second source of data came from participants who were interviewed in this project (primary data). As a researcher seeks to introduce new information into the existing bodies of knowledge, it is important to collect data from primary sources. It is through primary data collection that one is able to gather current information over a given issue. As new trends continue to emerge, organizations are sometimes forced to review their program governance style. The coercive approach to project governance was very important in the past when management emphasized on the need for the leaders to issue instructions that had to be obeyed by the employees. However, that has changed and management currently emphasizes on the need for the leaders to engage junior officers in order to understand how to get the best out of them. Through primary data collection, it will be possible to understand new concepts that are emerging in the field of program management and how they affect the outcome of individual projects. Primary data, as Khan (2015) says, also makes it possible to address the existing research gaps. In this section of the report, the researcher discusses how primary data was collected from the field and analyzed to help inform the conclusions and recommendations made in this study.
The researcher considered it appropriate to collect data from employees of an organization that regularly uses program management to achieve its strategic goals. Abu Dhabi National Oil was the company selected for this project. According to Levin and Ward (2013), Abu Dhabi National Oil Company has over 25,000 employees working in various departments. It would be desirable to collect data from all the 25,000 employees of this company. However, time was an important factor in this project. As an academic study, the project had to be completed within the set time. The researcher decided to come up with a manageable sample from the entire population from whom data was collected. It is important to note that some of these employees of ADNOC are based on overseas branches of this company. Priority was placed on the ease of availability of the employees when coming up with the sample. The researcher used stratified sampling method to select the participants. This approach of sampling was considered appropriate because of the need to collect data from those at managerial and non-managerial positions. In each stratum, a simple random method of sampling was used. A sample of 100 participants was used to collect primary data.
Instrument of Data Collection
It was important to come up with an instrument of data collection that would ease the process. Before contacting the respondents, the researcher prepared questionnaires. Given the fact that it was desirable to harmonize the response of the participants for the purpose of analysis, the researcher considered it appropriate to develop an instrument that would enable the respondents to answer the questions in a common format. The questionnaire had three parts. The first part focused on background of the respondents. Issues such as gender, age, and social background of a respondent may influence the manner in which they answer specific questions.
As such, it was important to capture that aspect of the respondents to ensure that any bias arising from these factors can be properly explained. The second part of the questionnaire focused on academic qualifications and experience of the participants, including their managerial position within the firm. According to Steinberg (2014), the level of one’s education defines how they respond to specific questions. Individuals who are less knowledgeable sometimes respond to questions based on personal emotions instead of facts. Similarly, individuals who are less experienced may opt to make guesses when asked questions they are not sure. Those who are at the managerial positions have a better capacity of explaining the managerial questions relating to program management. That is why the researcher decided to capture these factors when collecting data. The last section of the instrument focused on the questions relating to program governance styles and their effect on program management in the context of ADNOC.
After identifying the right sample from which data had to be collected, the researcher arranged to reach out to them for the purpose of data collection. After getting permission from the management of ADNOC, the researcher made phone calls to the selected participants, requesting them to take part in this study. Given the tight schedule of these employees and the limited time the researcher had to collect data, it was agreed that the questionnaires would be sent to them through their e-mails. After explaining to them their role in the study and the reasons why they were selected, the researcher e-mailed the questionnaires to them. They were requested to go through the few questions and respond appropriately within three days. The answered questionnaires were sent back to the researcher electronically. This was a simple, less expensive and less time-consuming approach of data collection (Levin & Green 2013). Once the filled questionnaires were collected from all the respondents, the researcher embarked on data analysis.
When analyzing data, the focus was to explain program governance styles and their impact on program management role at ADNOC. It was necessary to provide empirical evidence at this stage of the report. The nature of the research questions made it necessary to use qualitative method of data analysis. The first question focused on determining the styles of program governance used in the modern organizations. The second question focused on determining how the program governance styles affect program management role. The last question focused on determining how ADNOC can use program governance styles to achieve success in its normal operations. These three questions needed detailed explanation based on experiences of the respondents and practice within the firm. The analysis had to focus on explaining these program management styles as used within this organization and the manner in which, they have affected this company as it seeks to meet the demands of its customers. Quantitative data analysis was also considered necessary in this study in answering some of the questions. However, it was not the main method of data analysis as the primary goals and objectives had to be achieved using a qualitative approach of data analysis.
When conducting research, Longest (2015) says that it is important to observe a number of ethical concerns. It was ethically required of the researcher to seek permission from the relevant authorities within ADNOC before contacting their employees for the purpose of data collection. The researcher made an official request for the management to allow the study to be conducted in the company. The employees of the company were contacted after getting the permission. It was also an ethical requirement for the researcher to explain the position of the participants in this study. Before collecting data from them, the researcher explained to all the participants the relevance of this study and the reason why they were selected to be part of it.
They were informed that this was an academic research project that was meant to facilitate completion of a degree for the researcher. The participants were informed that they had the liberty to withdraw from the study at any time in case they felt it was necessary without any consequence. For those who agreed to be part of the study after the explanation, their identity was protected to eliminate any form of intimidation. Instead of using their names, the participants were assigned codes to help eliminate cases of their identity being leaked. As an academic research, it was also ethically important to ensure that cases of plagiarism and other academic misconducts are avoided. The researcher strictly followed the code of conduct set by the school in relation to conducting a research. Information collected from external sources was properly cited using Harvard referencing style.
Profile of Abu Dhabi National Oil
The Abu Dhabi National Oil Company is a state-owned corporation that was founded in 1971 under the leadership of Kelvin Roy to facilitate extraction and trade of oil and gas (Khan 2015). The company has its headquarters in Abu Dhabi, the United Arab Emirates. The company is currently the twelfth largest oil and gas firm in the world in terms of production, and the largest company in the United Arab Emirates (Levin & Green 2013). It has a production capacity of 3.1 million barrels per day and employs over 25,000 people. Sultan Ahmed Al Jaber is the current director-general and chief executive officer of the company. The main products offered by this company include crude oil, oil products, natural gas, and petrochemicals. For the financial year ending on December 31, 2011, the company registered revenue of $ 60 billion, making it one of the biggest companies in the region. It operates in the global market.
According to Sarbu (2014), ADNOC is currently facing challenges associated with the declining international oil prices. The company has considered various options on how to deal with this major crisis, including a possible reduction of its production. The goal of such posterity measures is to protect the company from the harsh external economic forces. The goal is to cut down the expenses to be in line with the reduced revenues of the company. The firm has been using program management as one of the ways of achieving improved efficiency and success in its operations. It is changing its operational strategies in line with the emerging international standards. The employees of this company have been actively involved in the restructuring of its operations (Levin 2013). They are in a good position to shed light into the operational activities of this firm and the manner in which program governance styles are used to achieve organizational goals. The strategic position of this company as the largest company in the country informed the decision of the researcher to select it as the primary focus in this study.
In this section, the researcher will focus on the analysis of the research questions. As explained in the section above, the main method of data analysis was qualitative in nature. However, quantitative method was also used to help in quantifying the impact of some of the factors. According to Freeman (2014), when conducting data analysis, it is important to provide empirical evidence that would help in realizing the research objectives.
What are the styles of program governance used in the modern organizations?
The first question focused on determining the styles of program governance that are commonly used at ADNOC. When answering this question, the researcher was open to the fact that different circumstances may necessitate the use of different styles of program governance. It is, therefore, possible that two or more of the governance approaches have witnessed at this company. That is why the respondents were provided with a list of the common program governance styles and asked to select the ones they have experienced at this company. To facilitate qualitative analysis, they were requested to explain why they selected the governance style and the circumstances where it is common. Figure 3 below shows their response:
The respondents were asked to rank the most common program governance styles common in this company. According to their response, as shown in the figure above, authoritative style of governance is the most common approach that leaders in this organization use. When asked to explain, the respondents stated various reasons why they felt authoritative governance is the most common, as shown below:
Respondent 1 said, “I believe authoritative governance is the most common approach of program management in this firm. The top managers sometimes allow the employees to make personal decisions. However, these employees should ensure that they follow the patterns set by the leaders and make appropriate consultations if they feel changes are needed.
Respondent 4 said, “The management of this company prefers using authoritative approach of governance when managing programs. This approach helps to give employees some freedom while at the same time enabling the managers to have full control of the activities going on within the firm.”
It was also noted that pace setting is another relatively common approach of governance at this company. When using this strategy, the management sets standards that should be met by the employees of this firm. Those who register impressive performance are rewarded while the underperformers are warned. When the underperformers fail to improve, then the company may consider demoting them or laying them off. One of the respondents, who is in a managerial position, stated that he likes this approach of governance. He stated as follows:
Respondent 14, “I prefer using pace setting style of governance because it outlines what I expect of the employees. They get to understand what they have to achieve within the set deadline. If they fail, then they would feel it is justifiable to subject them to some punitive measures.
The respondents also stated that in some cases, the firm is forced to use a coercive style of governance, especially when a portfolio of projects has to be completed within a short period. It eliminates wastage of time. Coaching is common in this company when handling new employees or those who have been promoted and need support to understand what is expected of them. Affiliative and democratic governance styles are less common at ADNOC. One of the respondents stated that democratic approach of governance grants employees excess powers that they often abuse. It also complicates decision-making process because views of all the parties involved should be taken into consideration. However, sometimes the company cannot avoid this strategy, especially when a program manager deals with experts assigned different projects.
How does the program governance styles affect program management role?
The second question focused on determining how program governance styles affect program management role. In the literature review, it came out clearly that the style of program governance that an organization embraces has a direct impact on the program management role. The researcher wanted to ascertain this fact using data collected from primary sources. Figure 4 below shows the outcome of the analysis when the participants were asked about their view on this issue.
Majority of the respondents (80%) strongly agreed with the statement that governance style affects program role. Another 12% agreed with this argument, while 4% slightly agreed. It means that of the respondents engaged in this study, 96% felt that program governance has an impact on program role. The respondents justified their responses in different ways.
Respondent 3 said, “The style that is chosen defines the outcome that will be achieved. If the style chosen is coercive in nature, then skills and talents of the project managers and their team may not matter. The outcome of such a project will depend on the skills and experience of the program manager and his or her ability to direct the junior employees.”
Respondent 5 said, “When an effective program governance style is chosen, then it would be expected that the outcome would be good and the project portfolio management will achieve its purpose in the best way possible. No single style can be suitable for all the scenarios that a firm may be faced with in its operations.”
How can ADNOC use program governance styles to achieve success in its normal operations?
The third question focused on how ADNOC can use program governance styles to achieve success in its normal operations. The researcher asked the respondents if they believe that program governance style may enable this company to achieve success in its operations. Figure 5 below shows the views of the respondents on this issue:
It is clear from the response of the participants that ADNOC can use its program governance styles to achieve success in its operations. Over 95% of the respondents agree with that fact. Only 5% had a contrary opinion. The respondents were asked to explain how this company could use these styles to achieve the desired goals. They gave various explanations as shown below.
Respondent 14 said, “ADNOC is currently working on various innovative strategies to increase its operational efficiency. Authoritative style of governance could help this firm in empowering the employees while at the same time enabling the managers to monitor their actions closely.”
Respondent 17 said, “The management of this company can use pace setting governance approach to help it set ambitious goals and set programs that can help in achieving them. When necessary, project managers, and their team members can be helped in various ways such as regular training to enable them to achieve the new standards.”
Respondent 21 said, “The top management unit of ADNOC should understand that there is no single governance style that fits in all cases. To achieve success, the managers should understand uniqueness of each situation, and then select the most appropriate strategy that can deliver the best outcome.”
Program management is currently one of the critical issues that those in management positions cannot ignore. The local and international business environment is becoming more competitive. The emerging technologies have eliminated in the field of transport and communication has eliminated most of the barriers to international trade and created a global village. However, the global market that has been created is currently characterized by numerous challenges. Competition is very stiff and new regulations are emerging that that limits freedom of companies when doing business in the Global market. According to Sarbu (2014), the United Arab Emirates is currently one of the fastest growing economies in the world. The government has successfully managed to diversify the economy and tourism and commerce sectors are currently flourishing.
It is important for the companies in this market to come up with appropriate governance approaches that can enable them overcome various challenges. The government has done a wonderful role in creating an enabling environment of doing business. In so doing, it has opened up the local market for international players keen on tapping into the local opportunities. One of the areas that can help a firm to improve performance is program management. The review of literature and analysis of primary data have strongly indicated that it is important for a firm to understand the needs of an organization and come up with programs that can meet those needs in the best way possible using appropriate governance styles. In this section, the researcher will discuss how to select governance style in program management, the need to engage stakeholders when selecting the style, using the selected style to achieve the set goals, and how ADNOC has been using these styles to achieve success in its operations.
Selecting Governance Style in Program Management
According to Levin and Ward (2013), the process of selecting program governance style is very critical. It is important for the management to realize that it cannot choose one style to be the only approach that it uses to manage programs. Longest (2015) says that it may be possible that one governance style will be used more often that others because of its relevance to organizational culture. However, the management should remain very flexible and willing to embrace other styles whenever it is appropriate. According to Khan (2015), one of the most important factors that cannot be ignored when selecting appropriate governance style is the time needed to complete the program (Longest 2015). When the project portfolio is assigned ample time within which it should be completed, then it is possible to consider various program governance styles appropriate based on other factors because time will not be a major issue. However, when time is of essence, then the style chosen should facilitate speedy completion of the project. Sarbu (2014) says that coercive and pace setting are very convenient when working under very tight schedule. These two strategies set strict deadlines that should be observed, and they allow program managers to monitor various activities to assess the milestones achieved.
The level of knowledge, experience, and skills of the program manager and project managers is another important factor that should be considered when selecting an appropriate strategy (Saporita 2015). Thiry (2015) says that when a highly skilled and experienced program manager is working with project managers with limited experience and knowledge, coaching is one of the best strategies that can be used. The program manager will focus on helping the inexperienced project managers to understand how they need to deliver the best outcome. Coercive style of governance may also be appropriate in such circumstances because the project managers should fully rely on the knowledge and experience of the program manager to achieve the desired success. In cases where the project managers are as skilled and as experienced as the program manager, then a consultative approach such as affiliative style may be necessary. Such approaches make it possible for the program manager to engage the project managers to understand how to achieve the desired goals.
The resources available for the project portfolio can also influence the governance style that is selected for a project. According to Steinberg (2014), when an organization is running on a tight budget, it cannot afford to make mistakes. It forces it to avoid styles that accommodate experimentation such as coaching strategy because of the need to maximize the output. Pace setting and coercive strategies may be the most appropriate ones because they allow the program manager to have tight control of all the activities involved in the projects. In such cases, the project managers and their team members are aware that they have to work under pressure and that the assigned resources should be used to achieve the desired goals. Organizational culture is another factor that should be considered when selecting the style. Organizations that have embraced an open-door policy in its management will opt to use styles such as affiliative or authoritative strategies. On the other hand, companies that use strict leadership structure of management where information flows from top to bottom through the laid structures may consider pace setting or coercive management systems as the most appropriate governance style.
Engaging the Stakeholders When Selecting the Style
According to Khan (2015), when selecting an appropriate governance style, it is important to ensure that relevant stakeholders are effectively involved. They should be engaged so that they can understand reasons why a given style has been chosen over others. It is important to avoid possible resistance among these stakeholders when a style is chosen that they consider inappropriate. Thiry (2015) says that by engaging relevant stakeholders, they tend to feel appreciated and are more likely to support the style chosen than when they are not involved. The project managers form the most important group of stakeholders that should be engaged when selecting an appropriate governance style. The chosen style that the program manager will use directly affects the project managers. They are the subjects of such governance styles and it is fair that they are properly engaged.
It is natural that they would prefer and support styles that give them greater opportunity to make decisions when managing their teams. However, when such options are not available, then they should be informed by an alternative style has to be selected. The board of directors may also need to know the style that will be used, especially when handling critical project portfolios. These directors are rarely involved in the daily management activities. However, they are at the top of the decision-making system (Khan 2015). They may want to know the approach that the managers are planning to use to achieve the desired goals when handling a portfolio of projects. They may have their suggestions about what may need to done to achieve the set goals. For instance, they can advise the program manager to embrace a consultative approach of program governance, such as affiliative or authoritative styles, instead of coercive style when managing project managers. Their input cannot be ignored in such an important stage of selecting style of leadership.
In the literature review, one of the theories that were analyzed was Kurt Lewin’s Change Management Model. This model focuses on how firms can introduce change in an organizational setting without facing resistance from the stakeholders. According to Levin and Ward (2013), one of the reasons why change sometimes faces resistance is because of minimal engagement between the managers and the affected stakeholders. Lewin’s model emphasizes on the need to prepare stakeholders, especially the employees, for the impending change. One of the ways of preparing them is to engage them adequately. When a program manager realizes that a time has come to initiate a new program governance approach from the one that is currently in use, they need to engage the parties that will be affected. The program manager should explain to the project managers about the new forces and the new to embrace a new style. It is also important to explain to them how long such new style will be effective, especially if it is not very popular, before the team can revert to the style they are used to within the firm.
Using the Selected Style to Achieve Organizational Success
According to Khan (2015), once a governance style has been selected, the program manager and his or her entire team of project managers should ensure that it is used to achieve the set goals and objectives. At this stage, it is expected that all the stakeholders will understand and appreciate the need to embrace a given strategy. When coaching has been selected as the most appropriate strategy, then it should be clear that one of the most important goals that need to be achieved is to empower young and inexperienced project managers to understand what they need to do in their respective departments (Levin 2013).
The program manager may need to come up with a specific period within which these employees should have the necessary skills to undertake their duties. In case pace setting is chosen as the most appropriate strategy, then the project managers should understand that they need to achieve set goals as set by the program manager. They should use the resources made available to them, including time, to ensure that their department attains the goals desired. Thiry (2015) says that success can only be achieved if the style selected is in line with the goal that should be achieved. For instance, it would be impossible to achieve success when a program manager chooses coaching as the appropriate governance style when there are strict deadlines that should be met using limited resources. If one fails to understand the style that is needed, then they may not be very successful even if they apply the tenets of that governance style in the best way possible.
ADNOC’s Program Management Styles
Abu Dhabi National Oil Company plays a critical role in the United Arab Emirates, not only as one of the top earners of foreign exchange, but also the leading employer in the country. Success of this company is critical in enabling the emirate of Abu Dhabi, and by extension the entire country, to achieve the set economic goals. That is why it has been critical for the government and other stakeholders to ensure that this company achieves success in its operations. The management of this company needs to understand the concept of program governance, and the manner in which different styles of governance may influence success of this firm.
Successful multinational organizations are currently embracing program management as the most appropriate ways of managing their operational activities. ADNOC should also consider embracing this approach of managing operational activities. However, it requires an understanding of governance styles appropriate for each situation. Program managers need to know the strategy that should be embraced when faced with different environmental forces. Currently, the primary data should that coercive governance style is the most common. The current forces in the company make this governance style very appropriate. However, it does not mean that the program managers should ignore other governance styles that this company can possibly use (Levin 2013). Pace setting is another style that may be very appropriate, especially at the moment where the company is faced with the dropping international prices of its products.
Conclusions and Recommendations
Program management is becoming a popular approach that large companies around the world are using to manage their operational activities. Managers of small and medium enterprises find it easy coordinating activities of their companies, but as a firm grows, the management role becomes complex. Managers find it difficult to control activities in every department and it is easy for mistakes to be committed without their knowledge. In large corporations such as Abu Dhabi National Oil Company, it is not practically possible for a manager to monitor activities at all the departments, especially if it is operating in the global market. It explains why program management has become a critical tool that these managers are currently using to manage activities at various departments.
Once a strategic goal is set, it is broken down into a portfolio of projects with clear goals, resources needed, and timeline within which it has to be completed. Each project is assigned to project manager in the relevant department and the manager is assigned a team of employees to help in realizing the desired goals. The senior manager becomes the program manager. Instead of managing all the activities at the unit level, he or she will be managing the project managers. The program manager will work closely with project managers to ensure that their progress is in line with the set expectations. Program managers need to understand the most appropriate program governance style that should be used to achieve the desired goals. As shown in the above discussion, success of program governance depends on the appropriateness of the style chosen. At ADNOC, it is evident that authoritative and are the most common styles. However, it is important to realize that no single approach can be used at all times (Levin 2013). Different forces and circumstances may require different styles. The following recommendations should be taken into consideration by the management of ADNOC:
- The management of ADNOC should be flexible enough to use program governance style that is most appropriate based on the circumstances that the company has to deal with in managing various projects. The governance style should reflect the objectives that should be achieved based on the prevailing forces.
- ADNOC should embrace a culture where project managers and other relevant stakeholders are actively involved when adopting a new program governance style. These stakeholders should be made to understand why the prevailing forces make it necessary to embrace a given style and not the others.
- Once a program governance style has been selected, the program manager should be supportive of the project managers. They should be helped to understand how to operate under the new rules and regulations even if the management is using coercive approach.
- Regular evaluation of the governance style should be done to ensure that the desired goals and objectives are achieved. When it is noted that a chosen style is not delivering effective outcome as per the desirable standards, it may be necessary to try a different alternative.
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