Paul Hart is still considering staying at Portsmouth after his sacking yesterday.
Pompey say they will move swiftly to appoint a replacement.
Blues chief Peter Storrie said: "The decision has been made reluctantly by the board and is based on results that leave the club at the bottom of the Premier League.
"Paul was offered the role of technical director, developing players from the ages of 18-21, but declined the position."
But the Daily Mail says a source close to Hart challenged the statement.
"Paul has been offered the role of technical director. It is something that he is considering and he has not turned it down. Today's turn of events have certainly been surprising."