Introduction
In the financial services industry, project management offices (PMOs) are being established more and more often to improve efficiency, deliver strategic capabilities and reduce risks. A recent survey found that 84% of companies have at least one project management office (PMO).
What are the essential functionalities expected to be created when establishing a PMO?
The essential expected functionalities are as follows:
- Standardizing project management processes and practices.
- Improving communication and collaboration between projects and business units.
- Providing a focal point for project management expertise.
However, a PMO can also be costly and time-consuming to set up and maintain, so it is important to develop a business case to highlight the strategic importance, needs, and financial viability before implementing one.
What are the benefits of establishing PMOs in financial services organizations?
Financial institutions can improve efficiency by implementing project management practices and delivering products and services that meet customer needs. The establishment of centrally managed PMOs can help financial institutions achieve the following benefits:
- Increased efficiency: Project management offices can help financial institutions become more efficient by making it easier to coordinate tasks and share information about resources.
- More consistency: Project management offices can help ensure that all departments and locations deliver products and services the same way.
- Cost savings: Project management offices can help financial institutions save money by making it easier for tasks and resources to work together.
- Improved risk management: Project management offices can help financial institutions manage risk by identifying and reducing possible risks early in a project’s life cycle.
Despite the positive outcomes that may come from creating a PMO in a financial services company, the challenges and risks associated with project management in this industry are unique, can be challenging, and should be considered before making any significant investments.
One of the biggest challenges in financial services is managing stakeholder expectations. In this industry, projects are often complex and time-sensitive, so it is important to ensure that all stakeholders are on the same page regarding expectations and objectives. If expectations are not managed properly, it can lead to costly delays and frustration among stakeholders.
Managing risk is another challenge in financial services. Because the financial markets are complicated and highly regulated, there is always a chance that something will go wrong with a project that will directly affect the operations of the PMO.
However, to do so, the company must also take measures to reduce risks and make the most of the benefits and strategic values created by the PMO. Therefore, it is essential to have a solid risk management plan and be prepared to react quickly to any potential problems, making it possible for financial service companies to realize more benefits by simplifying the process so they can complete more projects under the direction of a centralized project management office.
Finally, the project management office should have a solid improvement plan deeply embedded in its core processes. This will allow the PMO to develop a realistic incremental maturity improvement plan, which will gradually enhance the delivery of projects and be reflected in the number of completed projects.
About the Author:
Loay Dirar, educates, writes, and advises on strategy development and implementation, as well as change management and risk management for major regional organizations in the Middle East and North Africa. He has 19 years of management experience, including ten years as a manager in multinational subsidiaries of organizations based in the Middle East and North Africa (MENA).
