Part 2: About Gateway reviews
2.1
In this Part, we describe what a Gateway review involves. We also clarify some common misunderstandings about Gateway reviews.
2.2
During our audit, we came across many people who did not have a good understanding of Gateway reviews. Quite a few people told us that they had not understood Gateway reviews properly until they had taken part in one. By explaining the main features of Gateway reviews, we hope to provide an accurate context for our audit findings in Parts 3 to 6.
What Gateway reviews involve
Gateway reviews provide advice, not judgements
2.3
A Gateway review is a short, focused, independent peer review of a project.
2.4
Gateway reviews are forward-looking. They do not focus on what might have gone wrong. Instead they look for problems that might impede progress or prevent the project from achieving its intended outcomes, and make recommendations to address those problems.
2.5
Gateway reviews do not pass or fail a project. The reviews look ahead to help a project succeed, rather than focus on what might have gone wrong in the past. Even when a review finds serious problems, this does not mean that the project has to stop. It simply means that major risks and issues need to be addressed so the project is less likely to fail.
2.6
Gateway reviews provide advice to project sponsors and make recommendations. It is up to each project sponsor to decide whether, and how, to implement any recommendations. The project sponsor is still accountable for the project and its outcomes.
Gateway review week
2.7
A review team, selected by the Gateway unit, spends a week interviewing people involved in the project and other stakeholders, such as Ministers and chief executives. The review team also looks at documents, such as business cases, risk registers, and project reports.
2.8
At the end of each day, the review team meets with the project sponsor. During this conversation, the review team can alert the project sponsor to any serious concerns. The project sponsor also helps to clarify any issues that have come up during the day's interviews. This helps the team to focus on the most important matters in the limited time available.
2.9
At the end of the week, the review team produces a report for the project sponsor. This report gives the project a delivery confidence rating, sets out the main findings, and presents the team's recommendations.
Projects are given delivery confidence ratings
2.10
A delivery confidence rating is based on the review team's assessment of the project's ability, at the time of the review, to deliver its aims and objectives successfully. To decide on the overall rating, the review team considers factors such as the project's time and cost expectations, whether it is likely to deliver its expected outcomes to the quality required, and compliance with any formal approval requirements.
2.11
There are five levels of delivery confidence rating, ranging from green, through amber, to red (see Figure 1).
Figure 1
Delivery confidence ratings
Source: The Treasury.
2.12
The Treasury introduced delivery confidence ratings at the start of 2014 to replace a system of red/amber/green ratings that indicated the urgency and criticality of any remedial action required for the project to succeed.
There is an escalation process for projects with a low rating
2.13
Along with delivery confidence ratings, the Treasury also introduced an escalation process for projects assessed as red or amber/red. This is consistent with international Gateway practice.
2.14
The escalation process means that appropriate people, such as the agency's chief executive and people with a monitoring role, are informed when a project is found to be at risk of failing. They can then provide additional monitoring and support for the project sponsor. This provides an opportunity to make sure that the project gets the help it needs to resolve any problems it is facing and continue towards a successful outcome.
2.15
Since the escalation process was introduced, eight out of 77 reviews have been escalated.
Outputs from Gateway reviews
2.16
The main outputs of a Gateway review are daily discussions with the project sponsor and the review team's report. The report is written for the project sponsor and is confidential. This means that the project sponsor does not have to share the report with anyone else. In practice, most project sponsors choose to share the reports within their agencies, and sometimes outside them.
2.17
The Gateway unit keeps a copy of each report, but it is available only to staff working directly on Gateway reviews, for archiving and analysis of recommendations as an input to lessons learned reporting. Other parts of the Treasury get to see a report only if the project sponsor chooses to share it with them.
Most projects have several Gateway reviews
2.18
Projects have a series of Gateway reviews before key decision points, such as business case approval. The review process is similar each time, but will focus on different matters at different stages of the project. Figure 2 shows our description of the six "gates" that apply to projects.
Figure 2
Description of gates for projects
| Gate | Gate name | Project stage/review focus |
|---|---|---|
| Gate 0 | Strategic assessment | Start up |
| Gate 1 | Business justification and options | Indicative business case |
| Gate 2 | Delivery strategy | Detailed business case |
| Gate 3 | Investment decision | Contract signing |
| Gate 4 | Readiness for service | Implementation |
| Gate 5 | Operational review and benefits realisation | 6-12 months after implementation, then repeated at intervals |
2.19
The sequencing of Gateway reviews is different for programmes. Programmes, unlike projects, tend not to have a linear sequence of key decision points. Programmes undergo a series of reviews, repeated during the life of the programme and tailored according to the programme's stage. Sometimes a programme review will also consider key decision points for a project that is part of the programme.
Projects do not always go through gates in a linear fashion
2.20
Although most qualifying projects have Gateway reviews, many do not have reviews for each gate. In a few cases, projects miss the earlier gates – for example, because the agency had not submitted a risk profile assessment and the project did not get picked up by the Gateway unit until a later stage. In other cases, the risk profile might increase as a project progresses and the project becomes eligible for Gateway only at a later stage. If a project has not had a Gateway review before the contract is signed, then it will not have any Gateway reviews because the potential benefits would be too few.
2.21
Gate 5 is not used in New Zealand. A Gate 5 review focuses on whether the project is achieving the results set out in the business case and whether the operational assets and/or services are running smoothly. It was found to be difficult to continue with Gateway reviews once a project had been implemented and the project team had disbanded. Agencies often opt for a different type of post-implementation review that covers some of the same matters as a Gate 5 review. This is consistent with the approach in other jurisdictions.
2.22
Gateway reviews often combine two gates in certain circumstances – for example, when there is a short time between two stages. In practice, there is flexibility as to which gate is applied when. Part of the planning for each review is to confirm which is the most appropriate gate, or combination of gates, to apply.