Keep Agile: How Project Management Has Changed in Financial Services Today
Providing value and better results faster to bank customers is one benefit of using agile implementation
- |
- Written by Sahil Khullar
Providing value and better results faster to bank customers is one benefit of using agile implementation in project management and software development. It is one way to keep up with consumer demands and increased competition. To successfully adopt agile implementation across an organization, it is important to establish an agile mindset from the top down. From there, it’s possible to assemble and train the right cross-functional teams based on product features. By providing teams with autonomy to drive collaboration, transparency, and adaptation to customer needs, agile project frameworks deliver greater customer satisfaction.
Why agile is necessary in the financial services industry
Agile delivers value to customers incrementally and continuously, in smaller pieces of code, features, or services. These increments are known as “sprints” and refer to a specified amount of time the team takes to tackle high-priority tasks based on product goals. This approach makes agile implementation a perfect fit for any software-related or any non-development work that has a high probability of requirements being changed over time due to market changes, political, environmental, or regulatory impacts, or any internal or external factors that can hit financial and investment institutions. The smaller the sprint, the more quickly the team will learn vital information to adapt and improve. In other words, faster failure results in faster learning. In a rapidly changing and digitally transforming marketplace, investment banking and financial services require an iterative approach to better address customer and stakeholder needs, informed by ongoing feedback and discoveries from previous iterations.
Just like any other market segment that embraces digital transformation, the investment banking and financial services industry is utilizing technology to automate processes and design cloud-based solutions to remain competitive. Currently, artificial intelligence (AI) leads the revolution to reduce or eliminate “low value-added” activities, which are necessary business activities that consume resources but don’t contribute direct value to customers. AI tools and cloud capabilities support functions such as automated fraud detection and prevention, risk assessment, 24/7 chatbots for communicating with external customers or internal stakeholders and reducing human error. Agile implementation makes rolling out such products that address vital customer needs achievable quicker and for less cost by developing a Minimum Viable Product (MVP). An MVP defines the features necessary for a successful product launch by applying various prioritization techniques to identify the top five to ten features that are most crucial for product success. Development and management teams have limited capacity and time-to-market impacts a product’s competitiveness. All these factors call for agile implementation in investment and financial services to deliver value that matters most to the customers.
Five steps to achieve successful agile implementation
It can be a challenge to achieve and maintain alignment between IT, business operations, and other internal and external stakeholders. Because product owners have their own full-time jobs in addition to product owner responsibilities to implement new technologies, it sometimes leads to their reduced involvement in development. However, this is necessary to manage customer expectations, stakeholder input, and work prioritization with the team. Further, since the customer is also a stakeholder in this industry, varying interests are inevitable. Agile implementation can be the answer to better communication and alignment across the entire business ecosystem to embrace digital transformation as an ongoing, organization-wide need, rather than a one-time event delegated to IT. To accomplish this, financial services organizations can take an agile approach with these five steps:
Step #1: Establish an agile mindset from the top down. Unlike traditional project management, agile is not a step-by-step process with deadlines and a linear structure. Instead, it’s a methodology that calls for adaptation, experimentation, and alignment. This requires agile leads, or scrum masters, who can communicate and train the mindset and approach across the organization, starting with executives, managers, and other leaders, trickling down to developers and other team members.
Step #2: Assemble and train the right cross-functional teams. Agile teams consist of a product owner with a clear vision of the product in development, a scrum master to lead all members, a development team, and stakeholders. Whether team members are “right” for the team is based on product features, business goals, and their ability to contribute to the product’s solution. Alignment across teams and stakeholder groups is essential to determining product goals in tandem with capabilities and customer desires, particularly across business operations, data management, and supply.
Step #3: Ensure teams are armed with autonomy, mastery, and purpose. Daniel Pink identified three essential elements of motivation in his book Drive — autonomy, mastery, and purpose. Team members who have autonomy have control over what they do to better understand their impacts, think creatively, and take responsibility. Mastery is not only having the right skillsets in the first place but an ongoing desire to improve. Team members motivated to grow in their practice need opportunities to do so from collaborative team members and mentors, as well as internal educational materials, or access to external resources, events, and experts. Purpose is knowing the answer to “why am I doing this?” and improving their ability to see their own impacts on the big picture. When team members don’t know the answer to this question, they can become demotivated and disengaged. A balance of all three elements drives collaboration, innovation, and alignment.
Step #4: Clearly articulate goals, progress, and changes to customers, prospects, employees, vendors, and stakeholders. Through ongoing collaborative sessions, agile makes consistent communication and alignment about current and future goals a built-in part of the process. This includes quarterly planning, sprint planning, review and retrospective, and daily scrum.
- Sprint planning kicks off a sprint where the entire scrum team collaborates to define the sprint goal, determine which tasks are the current priority and ensure capacity is aligned with capability.
- Daily scrum is a short, focused meeting every day of the sprint to inspect progress toward the sprint goal, make adjustments, and collaborate when needed.
- Sprint review occurs when the product has reached an iteration that is potentially shippable and invites stakeholders to collaborate and provide feedback.
- Sprint retrospective occurs after a product has shipped, to identify what parts of the agile process went well and what requires improvement for future projects. It also incorporates customer feedback.
Step #5: Establish dedicated agile resources. This includes dedicated leadership and training roles, as well as time and budget. Common frameworks include Scrum, Kanban, or a combination of the two called Scrumban. In financial services, a hybrid framework is often the ideal answer to address the specialized needs of the business and achieve scalable growth. With these frameworks, organizations identify value streams and fund them at the top level, a process known as lean budgeting. This ensures that budgeting is not happening at the microscopic, individual project level, which typically leads to inefficient resource allocation and significant backtracking to re-approve budgets.
Agile leads to future-facing, customer-oriented growth
With the adoption of technology within financial services sectors, there’s also been an increased need for innovation in project management to address technology needs, digital transformation, and customer interests. Agile implementation serves as the clear answer to executing projects in financial and investment services today. It represents the ideal company mindset and framework to help financial service firms be the first to market and meet rapidly changing customer needs. Agile has the flexibility to keep daily operations smooth and revenue-generating while fostering growth through a dedicated agile framework and committed mindset shared across the entire organization.
About the Author:
Sahil Khullar holds an undergraduate degree from University of Nebraska at Omaha with majors in finance, banking, and investments. He also earned a master’s degree in management information systems from the University of Nebraska at Omaha. Currently, Sahil is working as a senior consultant in fintech and he specializes in agile project management.
Tagged under Management, Feature, Financial Trends, Financial Research, Feature3, Digital, The Economy, Technology,
Related items
- Crypto Matters for 1 in 7 American Voters, Digital Chamber Survey Finds
- Nearly 2 in 5 Cardholders Have Maxed Out a Credit Card or Come Close
- Using Big Data for Credit Risk Management
- Payments Industry Growth Slows as Cash-to-Digital Shift Reaches Peak
- Sabadell Chair Warns Banking Mergers Could Hurt Consumers