In today’s complex project management landscape, what you don’t hear can hurt your portfolio more than what you do. As portfolio and program leaders, we’re trained to manage visible risks, but the most dangerous threats often lurk in whispered conversations happening beyond our reach.
The Hidden Reality of Portfolio Governance
Every portfolio manager has experienced that sinking feeling when you discover decisions about your initiatives were made without your knowledge. It’s not just uncomfortable—it’s a symptom of a fundamental leadership gap that threatens delivery success.
When stakeholders circumvent established governance structures, many portfolio managers mistakenly blame the stakeholders. However, the truth is more uncomfortable: shadow governance emerges when formal channels fail to serve stakeholder needs. This represents a leadership failure that must be addressed head-on.
Strategic Solutions for Eliminating Shadow Governance
Successful portfolio managers don’t simply hope backdoor discussions aren’t happening—they create environments where such conversations become unnecessary and ineffective. This requires a proactive approach focused on three critical strategies:
1. Command the Portfolio Narrative
High-performing portfolio offices own communication completely. When you control the flow of information, you eliminate the information gaps that typically spawn alternative narratives.
This means:
- Establishing yourself as the authoritative source for portfolio updates
- Proactively addressing potential concerns before they drive stakeholders underground
- Creating consistent, transparent reporting that leaves no room for speculation
2. Design Forums for Surfacing Concerns
Effective portfolio leaders create psychological safety within governance structures. They establish forums specifically designed to bring difficult conversations into the open.
This involves:
- Regular cadence meetings explicitly focused on surfacing risks and concerns
- Anonymous feedback mechanisms that encourage honest communication
- Stakeholder sessions that prioritize listening over defending
3. Force Critical Conversations into Open Forums
When portfolio managers detect signs of shadow governance, they don’t ignore them—they actively redirect those conversations into official channels.
Practical approaches include:
- Direct engagement with stakeholders known to participate in shadow discussions
- Addressing difficult topics head-on in governance meetings
- Creating structured escalation paths that are more effective than back-channel communications
Real-World Impact: Healthcare Transformation Case Study
In a major healthcare portfolio transformation exceeding £200 million, the first critical step wasn’t reorganising the project schedule or replacing team members—it was dismantling the shadow governance system that had developed around formal structures.
By creating transparent forums where stakeholders could voice concerns without fear of repercussion, the portfolio quickly regained control of delivery. Issues previously discussed in corridors became visible, manageable risks that could be systematically addressed.
The Brutal Truth for PMO Leaders
Portfolio governance isn’t about documentation or meeting schedules—it’s about being the central nervous system for all portfolio-related discussions. When you’re no longer the primary forum for critical conversations, you’ve already lost control of delivery outcomes.
Key Takeaways for Portfolio Management Professionals
The most successful organisations understand that portfolio governance excellence requires both technical expertise and emotional intelligence. Many companies are turning to specialised project management headhunters who understand these nuanced leadership qualities when building their teams. It’s not enough to simply hire project managers with technical certifications—you need leaders who can create psychologically safe governance environments.
Effective project resourcing strategies must consider both hard and soft skills for portfolio management roles. The ability to eliminate shadow governance might be the most critical yet overlooked qualification when staffing your PMO.
Building a Portfolio Management Strategy
For organisations without internal expertise, project management as a service solutions can provide immediate governance expertise while developing long-term internal capabilities. These partnerships often reveal shadow governance issues that have become normalised within organisational culture.
