IS PRINCE2 USED IN THE BANKING AND FINANCE SECTOR? YOU BET!
Examples of organisations that use PRINCE2 in banking and finance include Barclays, Atradius, HSBC, the Royal Bank of Scotland, Deloitte, African Development Bank, the Commercial Bank of Africa. And there are scores of others.
Barclays is a UK-based financial services group, over 300 years old. It has presence in over 60 countries in Europe, USA, Africa and Asia. Barclays engages in banking, investment banking and investment management. In terms of market capitalisation it ranks in the top ten largest banks in the world.
Barclays spend estimated £750 Million a year on change projects/programmes. These involve over 5,000 people in some 2,000 projects. A business case built up from benefit profiles must exist for each and every project. Benefits profiled must be tangible (financial and non-financial). Accountable Executive (AE) performance contracts include a responsibility for delivery of benefits. AE moving off a project must hand-over delivery of its benefits with the incoming AE to sign up to delivery of Business Case benefits. PRINCE2 calls it benefit realisation.
The leading global trade credit insurer Atradius implemented a PRINCE2 training programme for employees based in multiple locations across Germany, Belgium and the UK. It started in the IT division responsible for delivering complex IT projects. These included large-scale data centre upgrades as well as developing bespoke risk applications for its clients. In the next step, PRINCE2 training was cascaded to include some 4000 employees holding project management related roles in the wider Atradius business.
The African Development Bank´s shareholders include 54 African countries and 26 non-African countries. It has adopted PRINCE2 as its corporate project management method. In 2018 alone, 950 employees of the Bank completed training in PRINCE2.
How is PRINCE2 used in banking and finance?
PRINCE2 aims to provide organisations with a tried and tested project management methodology focused on business viability. Adopting PRINCE2, banks and financial organisations can manage projects that have a clear beginning and end. PRINCE2 enables the executive to assess project viability at every managing stage boundary process. And thus ensure that projects maintain continued business justification.
Within the banking sector, organisations use PRINCE2 for a diverse range of projects. On the one hand, financial organisations work with an array of clients, each with different requirements. On the other, banks and other financial institutions also face unique challenges in terms of managing sensitive data, protecting customers and maintaining financial stability. PRINCE2 projects deliver outputs in the form of products. Use of products creates new outcomes by changing the business environment. These outcomes allow a business to realise benefits specified in the business justification for the project.
One of the key roles for PRINCE2 within the banking sector is to deliver projects in the continuously evolving e-banking environment. Banks are using advances in technology not only to follow changes in consumer habits but also to shape new consumer behaviours.
Financial organisations can also implement PRINCE2 to transition to the new generation of financial instruments and embrace changes in governance frameworks. Use of PRINCE2 allows to forge a consensus of the three key stakeholders – business, users and suppliers – regarding the precise configuration of desirable outputs. It enables the organisation to clearly understand the work that needs to be done to deliver the project’s products, prior to committing to a significant spend.
The product-based approach to planning allows to create product- rather than activity-based plans at project and stage levels. Production of configuration items in an agreed sequence is the key to realizing the business case.
PRINCE2 benefits for project management in banking and finance
- Tailoring to suit the project
A major benefit of adopting PRINCE2 method lies in its flexibility. The corporate level of management can configure the PRINCE2 delivery framework to match project complexity, scope, organisation´s risk appetite and the experience of the project team.
- Defined roles and responsibilities
A minimum requirement of PRINCE2 is a clearly defined and established structure of accountability and responsibilities of the project team roles. The corporate level of management vests the accountability for the project´s success in the executive. The latter delegates the day-to-day running of the project to the project manager within clearly defined limits of delegated authority.
- Increasing value for money by preventing project duplication and overlap
Financial organisations often deliver a large number of concurrent projects. Multiple project teams that stretch across departments can become entangled. PRINCE2 focus on the business case and the continued business justification principle can prevent duplication and overlap of project objectives. As a result, project desirability increases through optimised use of resources.
- Managing risks
Organisations in banking and finance operate in a highly volatile environment characterised by an abundance of dynamic risks. PRINCE2 offers a technique for handling both threats and opportunities, thus improving the ability of projects to succeed. It provides a procedure for identifying and assessing risks, planning and implementing risk responses and communicating risk management activities with stakeholders.
This is what I call the effective risk management mantra.
- The team manager and project manager will identify, capture, and describe risks.
- The project manager will assess each risk for prioritisation.
- The appropriate role in the project team will choose and plan a response to each risk.
- The project team will implement, monitor and control risk responses. Risk responses include avoiding the threat/exploiting the opportunity, reducing the threat/enhancing the opportunity, transferring the risk, sharing the risk, accepting the risk and preparing a contingent plan.