Many years ago I proposed that an organization appoint “Account Managers” between the IT department and its multiple business units. It was the standard approach of the time. One business unit CEO challenged me, “What is the Account Manager accountable for that someone else is not already accountable for?” I assured him there was an answer to this and so one Saturday we spent the whole day discussing the roles and accountabilities of an Account Manager. And the CEO was right—the Account Manager had no unique accountabilities.
Portfolio management accountabilities?
As Portfolio Management Offices (PMOs) are a relatively new “invention” the same question is relevant, “What are they accountable for that someone else is not already accountable for?”
NB Here we are talking about ‘accountability’, not ‘responsibility’. Project Portfolio Management may have a role to play, but are PMOs accountable for the results?
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Project delivery? — No, the project/program manager is accountable for the efficient and effective delivery of their project/program.
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Benefits delivery? — No, the project sponsor and steering committee are accountable for the full delivery of the available business benefits.
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Cash flow management? — No, the project manager and then the CFO are accountable for ensuring the required funds are available to pay the project costs as when due.
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Strategy execution? — No, the investment committee or executive team is accountable for deciding which strategy execution projects are approved and funded.
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Prioritization? — No. They can be accountable for validating proposals to ensure they are viable, worthwhile, do-able and optimized, but they are not accountable for the prioritization of specific projects/programs — that is the investment committee’s accountability.
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Resource utilization? — Maybe. The resources may not be owned by the Portfolio Office or even report to it but ensuring they are available when required can be a Portfolio Office accountability.
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Interdependency management? — Partly. Whereas each project is accountable for tracking and managing its own dependencies, the Portfolio Office can be accountable for managing the cross-portfolio dependencies, optimizing the projects, eliminating redundancies and duplication, and avoiding delays due to foreseeable problems and deployment clashes.
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Capability to deliver? — Partly. It is the investment committee or executive team’s accountability to manage the organization’s capability to successfully deliver projects. They will also initiate and approve organizational value delivery capability uplift programs, but it can be a Portfolio Office’s accountability to ensure these programs are efficiently and effectively delivered AND sustained to deliver the desired results over the long term.
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Risk management? — Partly. Whereas each project is accountable for identifying and managing its own risks, the Portfolio Office can be accountable for managing the portfolio’s overall risk profile, cross-project risks and for managing risks common to multiple projects so as to prevent duplication of effort.
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Quality validation? — Partly. Within each project the project/program manager is accountable for the quality of the results delivered; and the sponsor and steering committee are accountable for ensuring the required quality is achieved and sustained; but the Portfolio Office can be accountable for ensuring the delivery processes are being applied so that projects do not unexpectedly deliver compromised results.
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Standards and policies? — Yes. The PMO can be accountable for establishing and promulgating the standards, policies, tools, techniques and processes that enable the organization (not just the project teams) to efficiently and effectively deliver the strategy, projects and benefits. This accountability can also include taking “lessons learned” and incorporating them into the standard processes and policies.
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Status and performance reporting? — Yes at the portfolio level. But this is a low-value role.
Responsible (and valuable) but not accountable
What has happened is that the PMO has been given a number of ‘responsibilities’ by others that it is not accountable for but is often held to account for. Uncomfortable with being held to account for areas that it is not accountable for many a PMO has withdrawn to the few areas it can control — reporting, methodology policing and resource management.
However, the value of a PMO is in the areas where others are accountable but it can make a real difference to their effectiveness — eg strategy execution, prioritization, capability uplift. By taking responsibility for these areas, ensuring the necessary tools, techniques and processes are in place for them to be effective, the PMO can advance the organization, improve business results and eliminate wasted project investment.
To successfully take on these portfolio management responsibilities in areas where you are not accountable requires diplomacy, cross-organization coordination, close relationships with the executive team, political skills and effective execution skills.
How many of these skills and attributes are measured by the conventional competency standards for portfolio management?
TOP has developed a complete Terms of Reference for a Strategic Project Portfolio Management Office that can be used as a benchmark.
