The Case for Good Governance: A Program Manager’s Perspective

By Nancy Connolly

This year marks a significant milestone for our organization: 35 years of partnering with healthcare systems to support their strategic, real estate, and project management needs in pursuit of growth. Over the past 35 years, we have managed more than 84 million square feet of complex new, expansion, renovation, replacement, ambulatory care, and acute care projects. While every project and client experience is unique, common themes consistently emerge:

• How do we keep the project within scope?
• How do we maintain budget discipline?
• How do we incorporate innovation and “future-proof” the project?
• How do we build a truly collaborative team—one without finger-pointing?
• How do we define project success?
• How do we strategically engage clinical stakeholders?

Every project involves assembling a team of experts: designers, engineers, construction professionals, and project managers. Yet in focusing on these critical roles, organizations often overlook one of the most important drivers of success:

Good governance.

In our experience, large healthcare capital projects rarely struggle because of design capability or construction expertise. More often, projects lose momentum because decision-making is unclear, inconsistent, or too slow.

When governance is not clearly established:

• Decisions languish
• Scope expands without accountability
• Budgets lose fidelity
• Teams receive inconsistent direction
• Design and construction schedules begin to slip

The greatest risk is inconsistency. Design and construction teams rely on the Owner organization to make timely decisions. Without a defined governance structure—or an accountable executive with the authority to make decisions—issues can move through inefficient approval processes that delay the project and create confusion across the team.

On large-scale healthcare projects, governance is not administrative overhead. It is the operating structure that enables decision-making, accountability, and execution.

The Missing Foundation: Project Governance

With years of experience across projects, we’ve found that what is often underestimated is “project administration”—the foundational structure that places the Owner at the center of the project team.

Many projects do not formally begin until the architect is engaged, and there is often heavy reliance on consultants to determine how the team collaborates. Project managers are expected to “foster collaboration,” but this overlooks a key reality:

Collaboration and effective decision-making do not happen by chance—they must be intentionally designed. They begin with the Owner’s governance structure.

A well-defined governance model establishes:

• Clear decision-making authority
• Accountability across stakeholder groups
• Escalation pathways for critical issues
• Alignment between strategic, operational, financial, and clinical priorities

Effective governance must also define how project decisions flow across:

• Executive leadership
• Finance leadership
• Board and capital committees
• Key operational and clinical stakeholders

This includes governance related to:

• Capital allocation and reporting
• Procurement and legal review
• Operational readiness and transition planning

For large healthcare capital projects, governance typically operates across multiple levels, including:

• User groups and operational stakeholders
• Project leadership teams
• Executive steering committees
• Board or capital committees
• Accountable Executive leadership

The structure itself is important—but even more important is clarity around who has the authority to make decisions at each level.

What Is an Accountable Executive?

Projects often rely heavily on user groups and departmental stakeholders to inform design decisions. While this input is critical, someone must ultimately own the final decision—and the accountability that comes with it.

That responsibility belongs to the Accountable Executive.

Depending on the size and complexity of the organization, there may be:

• An Accountable Executive at the project or campus level
• An Accountable Executive at the health system level

In many cases, both are necessary.

Local site leadership is particularly important because these leaders understand the operational realities, stakeholder relationships, and day-to-day impacts the project will have on the organization.

The Accountable Executive must be able to evaluate decisions in the context of:

• Financial impact
• Operational impact
• Clinical implications
• Stakeholder considerations
• Organizational strategy

Just as importantly, this individual must have the authority—at the site or system level—to:

• Make decisions
• Communicate direction to the project team
• Make recommendations to executive leadership and the board
• Accept accountability for outcomes

Without that authority, governance structures become advisory rather than actionable.

When authority is diluted across large committees or unclear reporting structures, decision-making slows and projects lose momentum. In contrast, when governance clearly defines decision rights and empowers accountable leadership, project teams can move with greater speed, clarity, and confidence.

Governance in Practice: Why Decision-Making Matters

Every major capital project encounters difficult trade-offs. For example:

• Scope may need to be right-sized after user group requests expand beyond the original program assumptions
• Budget pressures may require reevaluating design priorities
• New technologies may require additional investment and long-term operational planning
• Market conditions may create cost escalation that requires immediate response

In each situation:

• Who makes the decision?
• Who communicates the decision?
• Who owns the outcome?

The speed and consistency of these decisions have real-world implications on project execution.

Design and construction teams cannot progress efficiently when direction changes repeatedly or approvals stall. Delayed decisions can impact:

• Design schedules
• Procurement timelines
• Construction sequencing
• Budget accuracy and forecasting
• Team alignment and morale
• Increased project escalation costs

Strong governance provides a framework for making these decisions consistently and at the appropriate level.

Real-World Examples of Governance in Action

Consider a project nearing completion. Within 12 months of opening, department leaders and prominent physicians approach the CEO requesting significant changes to the facility.

The CEO understands both the requests and the reasoning behind them. However, after carefully assessing the potential impact on the project schedule, budget, and clinical operations, the CEO decides not to move forward with the proposed changes. Implementing major modifications at this late stage would substantially delay project completion, exceed the approved budget, disrupt the planned transition and activation schedule, and hinder the effective operationalization of the facility. Additionally, the delays could slow the organization's speed to market and potentially result in a loss of market share.

That is governance in action:

• Clear authority
• Defined accountability
• Alignment to broader organizational priorities

Another common example involves budget management during construction.

Imagine a project encountering a $10 million cost overrun. Someone must have both authority and accountability to:

• Evaluate the issue, initial capital cost vs. long-term clinical operation outcomes
• Determine the appropriate response
• Make recommendations to the board for additional funding approval

Conversely, if the project realizes $10 million in savings, leadership must decide whether to:

• Return the savings to the organization
• Reallocate funds toward deferred scope items or add alternates
• Invest in additional strategic priorities

These decisions cannot remain unresolved or circulate endlessly through committees. They require accountable leadership with the authority to act.

Where Governance Breaks Down

Even well-intentioned projects can struggle when governance is not clearly defined or consistently followed.

Common breakdowns include:

• User group requests expanding scope without trade-off accountability
• Committees that are too large to make timely decisions
• Inconsistent communication across stakeholder groups
• Escalations bypassing established pathways
• Leaders lacking the authority to enforce decisions once made

These issues create confusion for the project team and reduce confidence in both schedule and budget forecasting.

The result is often a project environment where:

• Decisions are revisited repeatedly
• Teams hesitate to advance work
• Accountability becomes unclear
• Momentum is lost

Strong governance minimizes these risks by creating consistency in both process and leadership.

Practical Considerations for Owners

As you plan your next major capital project, consider the following:

1. Go slow early to move faster later. Time invested upfront defining governance will accelerate decision-making throughout the life of the project.
2. Clearly map your internal decision-making structure. This should include operational leadership, executive leadership, the board, public stakeholders, and project teams.
3. Define governance expectations for each phase of the project. Planning, design, construction, activation, and occupancy all require different decision structures and stakeholder involvement.
4. Identify the right Accountable Executive leadership structure. Large systems may require both site-level and system-level accountability.
5. Ensure Accountable Executives have actual authority, not just involvement. They must be empowered to make decisions, communicate direction, and accept accountability for outcomes.
6. Create a consistent framework for escalation and decision-making. The project team should understand:

• What decisions can be made at which level
• When issues should be escalated
• Who has final authority

With governance clearly established, project teams have the necessary structure to operate efficiently and collaboratively.

Conclusion

Every project team wants success. Large capital projects shape careers, reputations, organizations, and communities, and help develop emerging talent into the next generation of institutional leaders.

Strong governance—anchored by the Owner and reinforced by clear accountability—is one of the most important determinants of success on a large healthcare capital project.

When governance is clearly defined:

• Collaboration improves
• Decision-making accelerates
• Budget and schedule fidelity increase
• Accountability becomes clear
• Project teams operate with greater confidence and consistency
• Enhances institutional culture and academic growth

Healthcare organizations invest tremendous resources into planning, design, and construction expertise. Those investments are critical.

But without the governance structure to support timely, consistent, and accountable decision-making, even the best teams can struggle to deliver successful outcomes.