Chapter 9: EROM Meets TCA, SAR, and PPR
Book: Enterprise Risk and Opportunity Management: Concepts and Step-by-Step Examples for Pioneering Scientific and Technical Organizations
Author: Allan S. Benjamin
ISBN: 9781119288428
Chapter 9 is short but important. Benjamin asks a question that comes up in every large technical organization: if we already have review teams for capabilities, strategy, and portfolio performance, why add EROM teams on top? His answer is blunt. EROM does not duplicate those processes. It feeds them something they often lack: rigorous treatment of risks and opportunities.
Three teams you probably already have
TRIO enterprises typically run three kinds of interorganizational review:
- Technical Capability Assessment (TCA) teams look at whether the enterprise has the right workforce, facilities, and equipment for current and future missions.
- Strategic Annual Review (SAR) teams evaluate progress toward strategic objectives, as required by the GPRA Modernization Act.
- Portfolio Performance Review (PPR) teams (NASA calls theirs a Baseline Performance Review) give senior leaders a recurring look at program and project performance.
Different agencies use different names. The functions are familiar.
TCA: right-sizing assets with uncertainty baked in
TCA teams work in three dimensions: technical capabilities, organizational entities, and the portfolio of programs and projects those capabilities support. Analytical models help them right-size workforce and physical assets.
EROM connects to TCA in two directions.
TCA to EROM: The TCA team maps interfaces between technical centers, mission support, program directorates, and enterprise strategic objectives. That interface picture feeds directly into EROM’s objectives interface template.
EROM to TCA: EROM’s risk-and-opportunity-based asset optimization tells TCA how uncertainties should influence right-sizing decisions. Planning future workforce and equipment without accounting for risks and opportunities is incomplete planning. Benjamin argues EROM should be essential to TCA, not optional.
The unique EROM contribution here is balancing risks and opportunities during asset sizing. TCA asks “do we have enough capability?” EROM asks “given what could go wrong or go right, is this the right amount?”
SAR: making strategic reviews defensible
Federal SAR processes respond to GPRAMA and OMB Circular A-11. Agencies must assess progress on multiyear and annual performance goals, performance indicators, risks, external factors, and events that could affect outcomes.
OMB A-11 Section 270.10 warns that hitting quantitative performance targets is necessary but not sufficient. Agencies should also consider evaluations, lessons learned, budget constraints, and probable risks over the next year or two. Section 270.11 explicitly encourages agencies to use existing enterprise risk management efforts when identifying and prioritizing risks.
Benjamin reads that as an opening for EROM’s longer-term view. Near-term risk identification is encouraged. Longer-term strategic risk perspective is encouraged but not yet mandated.
The EROM templates from Chapters 4 through 7 already hold the data SAR teams need: individual risks and opportunities, leading indicators, near-term performance objectives, and longer-term strategic objectives. Roll-up templates show how lower-level risks affect the likelihood of meeting strategic goals. Because the roll-up process is transparent and systematic, SAR evaluations become more defensible. You are not guessing whether a strategic objective is on track. You can trace the logic.
PPR: shorter horizon, still useful
PPR processes focus on current performance. They integrate metrics, highlight cross-cutting issues, and give senior management action items. For federal agencies, quarterly progress reviews under GPRAMA and A-11 Section 6 satisfy formal requirements.
PPR tends to be more tactical than TCA or SAR. It concentrates on present issues more than future risks. EROM has a longer default horizon, but it also tracks annual performance goals. So the overlap is mainly in short-term performance.
Where PPR and EROM meet:
PPR to EROM: Questionnaires and review meetings supply data for risk, opportunity, and leading indicator templates. Status and trends on cost, schedule, technical, and safety margins are especially valuable.
EROM to PPR: EROM roll-ups at the program directorate and technical center level rank the likelihood of success for each top objective. Those rankings feed PPR’s attempt to aggregate performance across the enterprise.
For organizations whose PPR has a more strategic flavor, the EROM interface grows accordingly.
Does EROM duplicate or enhance?
Benjamin’s short answer from the chapter opening still holds. Integrated EROM teams running alongside TCA, SAR, and PPR teams provide a service the other teams cannot easily replicate on their own. They introduce risks and opportunities into enterprise discussions and account for them rigorously in assessment processes.
Think of it this way. TCA optimizes capability. SAR judges strategic progress. PPR drives near-term performance action. EROM supplies the uncertainty layer that connects all three. Without it, each review can look healthy in isolation while the enterprise drifts toward an aggregate risk nobody owns.
What this means in practice
If you are standing up EROM in a TRIO organization that already has these rhythms, do not fight them. Map your templates to their data flows. Offer roll-up rankings to PPR. Feed interface maps from TCA into your objectives hierarchy. Hand SAR teams both near-term indicator status and longer-term roll-up logic.
Chapter 9 is the integration chapter. It tells you EROM was never meant to be a standalone silo. It was meant to make the reviews you already run smarter about what could go wrong and what you might gain.
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