Many years ago, I had neighbors who owned and operated a B&B. They had a barn on their property which burned to the ground. Instead of replacing the barn, they decided to build a large conference space that included a commercial kitchen and the ability to seat over 100 guests. The plan was to hold conferences and weddings. They got their building permits and off they went. The project could have benefitted from a project management compliance process.
Unfortunately, they never checked the local zoning ordinance. While they were permitted to operate a B&B at their location and serve incidental meals to their guests, they were not allowed to hold conferences or host wedding receptions. The code allowed them to build the facility but not operate it. Had they done their research, perhaps contacted the town, they could have saved themselves a lot of money.
Compliance is important, some would say of paramount importance, since if a project is not in compliance it would most likely fail or at least incur significant cost and delay.
Clearly a project needs to be in compliance. It is the environment in which the project operates. There should be a project management compliance process for every project. This process can be simple or extensive, depending on the size and complexity of the project as well as the project environment. The process touches on many aspects of project management, including risk, requirements, stakeholder engagement, planning and many others. Let’s start with compliance requirements.
Compliance Process in Project Management
- Compliance Requirements
- The Project Management Compliance Process Checklist
- Engaging Stakeholders
- Tips to Improve Compliance
Gathering compliance requirements is similar to gathering requirements in other aspects of the project. A project manager should engage internal and external resources.
Associations and Affiliations
External organizations can have information and provide recommendations and standards that could provide compliance guidance, best practices and standards. If your firm is a member of one of these organizations, and even if they are not, the organization may be willing to help by providing advice or even assistance. Examples of organizations could be Underwriter’s Laboratories or even the Internal Revenue Service.
Compliance Tool Kits
Open-source software or documents and guides could be a valuable resource or tool kits for compliance. Examples could be health and safety, risk or quality guides or a business rules engine.
Lawyers and accountants come to mind in helping a project manager to shape and understand their compliance environment. Business and financial consultants can also prove to be valuable resources as well.
The Project Management Compliance Process Checklist
Gathering compliance requirements is only the first step. A project manager now needs to create a process for compliance to be followed throughout the project. The project manager also needs to be mindful of the fact that many compliance requirements change over time and that this could occur during the life of the project. Any project management compliance process must:
- Inform the project manager of laws and regulations.
- Require the project manager or a member of the project team or an outside expert to periodically check for and communicate changes to the compliance environment.
- Determine whether the organization has the maturity and structures in place to maintain compliance.
- Ensure that any process created involves interested or necessary stakeholders.
- The process must identify obstacles to compliance.
- Finally, the compliance process must continuously improve.
A stakeholder is anyone who has an interest in the outcome of a project. This is a pretty wide net you are casting. In addition to including customers or others who might benefit from the product resulting from your project, it could also include members within the organization who could be adversely affected by your projects failure to be in compliance.
Stakeholders can be a valuable resource in identifying compliance issues. The project manager can find out where they encounter issues or roadblocks. They may also provide valuable insights into compliance solutions or even suggest polices or practices that could streamline compliance.
Of course, a project manager must exercise common sense when engaging stakeholders. Some projects require a degree of secrecy and under the broad definition or stakeholder, such broad disclosure could endanger that secrecy. As examples, I’m thinking business transactions or the creation of a new product. Over engagement could result in disclosure of proprietary information.
Tips to Improve Compliance
In addition to engaging stakeholders and identifying compliance requirements, here are a few tools you can use to help you categorize your compliance requirements:
1. Affinity Diagram
This is an organization tool to help you manage compliance. You can group compliance into categories such as security, systems or regulatory. This should allow for more efficient management.
2. Identify Missing Groups
Work with stakeholders when reviewing affiliate diagrams to see if anything or anyone is left out.
3. Engage with Specialists
At the end of the day, call someone that knows more about this than you do. As a project manager, you’re not expected to be an expert, in law, accounting or HIPPA compliance. If these issues arise call someone who knows more about this stuff than you do.
4. Create a Compliance Register
This is a project document that allows you to track and share compliance information. The register could include a compliance requirement name and number and describes the compliance requirement. The description should include the category, type of compliance issue and what needs to be done within the project to deal with it.
There can be a cross reference to the risk register if the compliance issue presents threats or opportunities as well as plans for dealing with them. Who is going to respond to the issue as well as what needs to be done?
RMC’s Compliance Expertise
Your efforts in managing compliance can result in you identifying gaps in your knowledge and shortfalls. We suggest that you create a repository to capture what you know about compliance that can be used by others in your organization.
If you find that there are significant gaps in your abilities to manage compliance, RMC is here to help. View RMC’s webinar Focus on Compliance: Expand Your Awareness and Improve Project Success to expand your knowledge of compliance.
Compliance is part of the Business Environment Domain on the PMP Exam. If you are preparing for the PMP exam, you should expect questions about it. RMC expert in preparing you to take and pass the exam. Check our PMP exam prep class schedule.