Meridian Insurance: Three Boards, No Decision
Meridian is a mid-sized insurance group running 28 change initiatives worth £140m a year. Three groups meet monthly: the Investment Committee, which approves and releases funding; the Change Delivery Board, which reviews progress and dependencies; and a Portfolio Board that the chief operating officer chairs and that nobody can describe precisely. Programme boards report to all three. In the last quarter the Investment Committee spent most of an hour debating the slippage of a single release; the Change Delivery Board approved a £1.8m transfer of funds between two initiatives without a business case; and a resourcing conflict between the group's largest programme and a regulatory programme was escalated to a programme board that had no authority over either. Decisions take on average six weeks, are frequently reopened at the next meeting, and the sponsor of the largest programme has taken to emailing the CEO directly. The portfolio office reports to the head of IT, who also sponsors four of the largest initiatives.
1. Express Meridian's governance failure in MoP terms, and show how each of the symptoms in the scenario follows from it.
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The failure is a breach of the governance alignment principle: portfolio governance is not coherent with the organisation's wider decision-making, and decision rights, escalation routes and tolerances are undefined. Meridian has three forums with overlapping remits and no rule about which decides what, and programme boards report to all three, which means in practice they are accountable to none.
Trace each symptom back. The Investment Committee debates one release's slippage because no other body is clearly accountable for delivery progress, so the most senior forum absorbs the work the Change Delivery Board should own. The Change Delivery Board approves a £1.8m transfer because nobody has written down whether it holds investment authority, and a body with delivery in its title will fill a vacuum. The escalation lands on a programme board with no authority because there is no defined route upward - escalation is attempted, not designed. Decisions are reopened because a decision right that has never been assigned cannot be relied on; anyone with seniority can revisit it. The six-week turnaround is simply the arithmetic of unclear remits plus a monthly cycle. And the sponsor's direct email to the CEO is the predictable response of a sensible person to a system that will not decide: it creates a shadow decision body alongside the formal ones, which then further undermines the forums.
The diagnostic lesson: treat the symptoms as evidence about decision rights, not as behavioural problems to be trained away.
2. What should be done about the portfolio office's reporting line, and what practical difference would it make?
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The office currently reports to the head of IT, who sponsors four of the largest initiatives. That is a direct conflict of interest: the function asked to provide an objective view of the whole portfolio, and to advise on prioritisation and balance, is employed by the owner of a large slice of it. Any challenge it makes to those four initiatives is a challenge to its own boss's commitments, and everyone in the organisation will know it. MoP places the portfolio office in a position where it can inform and influence decisions across the portfolio with executive access; that is impossible if it sits inside one delivery function.
The practical move is to transfer the function to the chief operating officer or the chief executive's office, with a dotted assurance line to the audit or risk committee so that portfolio information is visibly independent, and to remove the head of IT from sponsorship of any initiative while remaining a portfolio decision-maker in another capacity - or, if that is impractical, at least ensure the office does not report to a sponsor.
The difference is not symbolic. Independent positioning is what allows duplication to be named (the group will not find overlapping spend while the report owner benefits from silence), allows capacity over-commitment to be escalated without career risk, and makes the office's advice on stopping initiatives credible. The counter-risk is drift into a 'super-PMO' that delivers: the office should set standards, supply information and advise decisions while accountability for outcomes stays with senior responsible owners.
3. Design the minimum set of decision rights Meridian needs, and specify how you would know it has worked.
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One page per forum, covering: purpose; remit in and out of scope; membership with each person's decision role; quorum; the decisions it can take without reference upward; financial thresholds; information it requires to decide; escalation triggers and the single route upward; and frequency. Explicitly state that a decision is not revisited unless there is new information or a pre-agreed review point - that single rule removes most of the reopening.
Allocation in outline: the Investment Committee owns strategic fit, new investment and funding release, and should see delivery detail only where a tolerance is breached. The Change Delivery Board owns delivery progress, cross-initiative dependencies and benefits realisation, with a virement authority within an agreed envelope (for example up to £250k) and a requirement to refer anything larger with a business case. The Portfolio Board owns prioritisation, balance and stop decisions. Programme boards own delivery within tolerance and escalate outside it to the Change Delivery Board - not to three forums. Sponsors who email the CEO are routed back with 'take it to the board', reinforced by the CEO visibly doing so.
Measures at 90 days: average decision lead time against a stated target, percentage of decisions reopened, percentage of escalations resolved at the first forum, time the Investment Committee spends on delivery issues, and the number of decisions taken outside the defined rights. Review the terms of reference themselves at 90 days - unclear remits are usually written down somewhere and ignored, so alignment of practice to paper is the real test.