Governance
Governance
This domain tests decision rights, accountability, and oversight for the portfolio. Expect questions on the portfolio management plan, component authorization, portfolio review boards, thresholds, escalation, and stage gates.
Core rules
- Governance defines who decides, who is accountable, and how performance is reviewed; management executes within those rules.
- The portfolio management plan sets authorization criteria, tolerances, reporting requirements, and change thresholds.
- Authorization is a continuing decision: components are re-authorized at gates or when thresholds are breached.
- Oversight should be proportional-enough control to protect strategic value, not so much that it delays decisions.
Worked example A component requests a 25% budget increase. The portfolio management plan states that increases above 15% require the portfolio review board (PRB). The project sponsor approves it informally. Correct action: escalate to the PRB with an impact analysis covering strategic fit, portfolio balance, resource capacity, and risk. The PRB may re-prioritize, fund from a de-scoped component, or terminate. Reasoning: the sponsor lacks delegated authority above the threshold; bypassing the PRB undermines portfolio governance even if the project is healthy.
Traps
- Confusing governance with day-to-day management.
- Allowing a sponsor to approve changes above the defined threshold.
- Treating the PRB as a rubber stamp instead of a decision forum.
- Designing oversight so heavy that it consumes the capacity it is meant to protect.
- Failing to document governance decisions and their rationale.