Put your money where your mouth is
Consumers aren't likely to invest their hard-earned cash with a company that seems to lack business sense. Yet more than $300 million per year is being wasted on poorly managed IT projects due to a failure to efficiently run the business, according to an international survey of Global 2000 companies in the financial, health care, retail and telecommunications sectors conducted by Business Engine. The cause: poor visibility and control of IT projects, a failure to align a company's IT with its business strategy, and the under-utilization of existing resources.
Strategic alignment and resource allocation are two of the most crucial yet mishandled business decisions. An obvious solution for a growing number of financial services organizations is a project management office (PMO). Organizations with project and program management processes, such as portfolio management, are more profitable than those without them, according to a survey released by Robbins-Gioia. Nearly 75 percent of respondents pointed to their portfolio management and project management capabilities as integral to realizing greater financial returns or exceeding business goals.
Financial services executives share their insight beyond the numbers.
Garrett Gleason is vice president of the enterprise program management office at Thrivent Financial for Lutherans, which is headquartered in Minneapolis, Minn., USA. He has worked in the financial services industry for 13 years with roles in the IT, marketing and sales support fields.
Project management has long been a priority at Thrivent, but it's been reborn in the last two years as the result of a merger between the Aid Association for Lutherans and Lutheran Brotherhood, two leading U.S. fraternal organizations.
Our mission is to improve the quality of life of our members and their communities through financial services and charitable programs. Project management helps us do this— we get work done on time and on budget, and we deliver what's expected. Essentially, an organization invests in its future by investing in its projects and capabilities.
We track our strategic and business objectives with a fairly elaborate mechanism that shows how we're doing on schedule and budget. If we set a goal for improvement, we're able to track deliverables and determine how we can improve our expected business outcomes.
We believe in tracking the success of our projects and therefore have a project scoring metric that is tied to performance incentives. We know that the benefits can be very real, and we take success very seriously. Looking back at our project history, we are confident that project management has contributed to our rate of success. Through tracking and oversight, we document our lessons learned so we can constantly improve, but our benchmarks are already high.
Today, we're focusing on the skills and competencies of our practitioners. The leadership behind our projects must be developed, and our people deserve attention. We've spent time defining our methodology, so we know it's rigorous and well designed for our organization. Effective project managers leverage those tools and processes to get the work done effectively. They provide the guidance to get the work done. Project management is not a cookbook—it's not that prescriptive. You have to have the right leaders, and we believe in developing our project managers.
Donald Gardner, PMP, president of Gardner Project Integration Group Ltd., Hastings-on-Hudson, N.Y., USA, helps build project management offices in financial institutions. He has spent the majority of his career in financial services firms with 13 years at Citibank, four years at Bank Leumi Trust Co. and six years at Irving Trust Co. He has provided consulting services for a number of financial institutions, including Deutsche Bank, Zurich Financial and Morgan Stanley, among others. Gardner also is past chair of the PMI Financial Services Specific Interest Group.
Financial services companies are about product to market and time to market. Project management capability allows executives to know, with confidence, that products are going to hit market effectively with a lot less rework prior to rollout. With the proper discipline, projects are structured effectively from the beginning with a team that understands the vision of the sponsor and stakeholder needs. Project managers are able to articulate all of that with comprehensive requirements, specifications and risk plans.
The margins at financial institutions are thin—we can't afford to get it wrong. We have to get it out there fast, whether through the Internet or the branch system, and our service delivery must be of the highest quality. Those products must satisfy customers' needs better than the competition.
PMOs allow financial services staff to understand the portfolio of projects and what the true priorities of business lines are at the portfolio level and project by project. The management team is then able to deploy resources within and across businesses so the bank is seen as a whole.
While I was working at Citibank, which was firmly rooted in project management, a big advantage was executives' ability to identify project managers who were accountable and owned the project from beginning to end. Those project managers, in turn, nailed down requirements and brought stakeholders together. We put coherent plans together, and managers knew that the important things were covered. There was transparency—executives knew they would get what they wanted when they wanted it.
To have confidence in your deliverables, you need to know your projects are being done with a rigorous, repeatable process. Organizational project maturity must be alive and well.
Joseph E. Weider, PMP, is a senior vice president with SunTrust Banks Inc., an Atlanta, Ga., USA-based financial holding company. Previously, he worked at The Coca-Cola Co., where he managed Y2K remediation efforts.
In a heavily regulated industry, unplanned activity is a fact of life. We used to proceed with projects and then pull resources off to fight a fire. Once extinguished, another fire would appear, and, before you knew it, the original project was delayed and over budget.
SunTrust made a conscious decision to invest in project management almost a year ago to deliver products more quickly to our internal clients, to become more efficient and to establish uniform processes.
We developed a project management career path and a formal training program, but knowing that education will go only so far, the bank built a project infrastructure—including coaching and mentoring, project quality and audits, technology governance, tools and methodologies—to support effective execution.
Enterprise Information Services (EIS) supplies the knowledge and talent to make projects successful. The project portfolio includes maintenance, new development, regulatory and integration work as a result of mergers and acquisitions.
The enhanced rigor and discipline associated with project management has spawned a renewed focus on maturing our processes and portfolio management. We want to move forward and strengthen our project portfolio's alignment with governance—to reduce those fires—and resource management utilization.
By applying those principles, the organization has greater confidence in time and cost estimates, the ability to deliver and the quality of final product.
Without project management, we would consistently disappoint our partners, shareholders and customers. The organization would be in a constant fire-fighting mode, and we couldn't capitalize on available resources or hidden opportunities that may advance our mission and strategic goals.
JOSEPH E. WEIDER
Executive management also is more interested in and more sensitive to project activity than before. Without project management, executives couldn't track unnoticed or undocumented activities. In an era where there is strict attention to business practices, our executives are held accountable for everything SunTrust does—whether they know about it or not. We cannot afford to allow any activities to violate regulations. Quite simply, project management yields critical predictability in an industry that is anything but predictable.
LALIG J. MUSSERIAN
Lalig J. Musserian is enterprise risk manager with John Hancock Financial Services Group, Boston, Mass., USA. She is also president of PMI's Massachusetts Bay Chapter.
The lack of a dedicated project controller can spell disaster.
The project controller supports the project manager, but this person's job is to capture issues and follow-up items to add to the project plan for tracking. The project controller also manages the issues database and maintains the project plan by creating reports to send to team members with upcoming deliverables, who is behind schedule and other management reports to alert stakeholders of potential issues and delays.
During my career at BankBoston, I often played this role. It is invaluable for stakeholders and frees up the manager to enhance communication and stakeholder management, while leaving the tactical, daily work of managing deliverables and tasks for the project controller. Everyone assumes someone else is tackling the issue or pursuing the idea, and without a clear, documented follow-up process, there is no assurance that anything actually will get accomplished.
“Follow up” should happen when people go to a lot of meetings and talk about a thousand great things that “should be done” and everyone walks away thinking they had a successful meeting. But after all is said and done, 90 percent is said and 10 percent is done.
A project controller frees project managers from administrative burdens, allowing him to concentrate on actual project management, securing resources, running interference on issues and consensus seeking. While the controller is managing the project plan, the issues and the deliverables, project managers focus on the continuous aspect of “sales” when managing the stakeholders expectations and keeping them in the loop.
SEPTEMBER 2004 | PM NETWORK
PM NETWORK | SEPTEMBER 2004 |WWW.PMI.ORG
PMI research shows project teams that draw from an array of perspectives and skillsets deliver powerful outcomes.