Successful Project Delivery really starts at Go-Live
The Financial Services industry today is faced with ever increasing demands: customers expect services to be quicker and smarter, regulators are applying greater scrutiny and setting higher standards, employees expect more from their employers, and shareholders still expect regular dividends and a good return on their investment.
A combination of these pressures is driving banks to deliver a higher number of complex, interdependent projects and often with restricted budgets. Delivering these projects successfully and efficiently is becoming an important differentiator, and yet over 50% of projects are still delivering less value than expected.
I believe that this is in no small part due to a frequent lack of understanding of the required business outcomes, and a related lack of attention given to the post-implementation activities that are required to achieve them. It appears that regulators are starting to share this view.
Regulators are tracking embedded change
Recently, regulators have shown signs of a shift in focus from enforcing targets and deliverables towards encouraging behavioural and cultural change to be embedded within a bank’s organisations. For example:
- Capital ratios set financial parameters that banks must adhere to, but the true focus is to increase the stability and robustness of the financial system
- MiFID II can be broken down in to multiple deliveries within a bank but ultimately it seeks to strengthen protection for investors whilst improving efficiency of the markets
- The Senior Managers Regime mandates rules and introduces a governance structure for senior leaders within an organisation, but its motivation is to increase ownership and accountability for business decisions at the top of the organisation
This shift in regulatory focus is putting greater pressure on banks to ensure their projects are genuinely “successful” in the fullest sense, and there are a number of steps a good Project Manager (PM) will take in order to achieve this.
- Take time to really understand the business outcomes
Different stakeholders in an organisation can have vastly different expectations of a solution. However, with constant budget pressures and the allure of a “minimum viable compliance“ approach, it is often tempting for a PM to focus on the definition of a “solution” and plan only up to the point where that solution is delivered.
Persuading Business stakeholders to really think through – and document – what success looks like will require upfront investment, clear demarcation of accountabilities and a relentless passion to define and agree plans that detail the necessary business change and post-implementation support activities.
This is especially relevant where technology delivery is the primary solution, particularly in Financial Services where organisations are striving to keep up with FinTech and the disruptive nature of these start-ups.
However, delivering a well-built, well-tested IT system is just the starting point to achieving change. The effort required to train users, to establish new processes, to change the hearts and minds of impacted department heads, to track value and to demonstrate an embedded cultural shift, can easily outweigh the effort required to deliver the technology in the first place.
- Delivery includes transition back to the Business
The benefits of a project are typically not felt until deliverables are implemented and embedded into the organisation. Therefore, an important part of any project – and a deliverable in its own right – is the handover to the business.
The handover needs to define a support model, establish any new operating model elements, and be driven by a clear, agreed transition plan that addresses the needs of all impacted stakeholders – from system users to Accountable Executives. All of this is common sense, however without clear direction and time dedicated from a Project Manager, it can easily become an afterthought rather than a key, planned activity.
As we are starting to see, regulatory projects delivering embedded cultural change as well as compliance will become more common in the future. Delivering these successfully means an increased focus on business outcomes and a successful transition back into the business teams. At the centre of this is a PM that does not underestimate the importance of these aspects and plans for success as defined at inception.
- Communicate, communicate, communicate
The Project Management Institute (PMI) estimates that over 50% of a project’s budget is put at risk due to ineffective Communication. In large-scale regulatory programmes, for example, this can be incredibly apposite due to the fact entire organisations can be impacted by the necessary change. However, the value of ensuring outcomes are known and understood across all stakeholders cannot be overstated, and the fact that the regulator(s) themselves are an important stakeholder group can’t be forgotten.
A good PM understands this and will engage stakeholders early and often; they will identify the differing needs and differing outcomes that are of importance to those stakeholder groups and will tailor their communication approach accordingly. In large-scale regulatory reporting projects such as IFRS 9, for example, it’s crucial to ensure that realistic outcomes are agreed and communicated between key parties such as Risk, Finance and the lead Economist in order to deliver the benefits of such complex programmes.
In summary, PMs have always known that these aspects – business outcomes, transition planning and communications – are vital to successful project delivery. However, with the increased presence of regulatory projects in any given portfolio and the ongoing focus around culture and compliance, there needs to be a shift in focus towards ensuring that they are planned, executed and tracked with the same determination and attention to detail that is routinely given to the traditional “design, build, test” aspects of a project.