VP, Institutional Services The Benefits and Risks of Technology Projects FIRMA Risk Management Training Conference Sandra Sherman VP, Institutional Services Project Management April 21, 2011

Agenda Project Management & Technology Benefits of Technology Risks of Technology Project Stages/Gates Key Risks to Manage Project Stages/Gates Faster, cheaper, better Risks of Technology Budget Constraints Time to Market In this ever changing market place with pressures from all areas, how do we ensure that we provide quality products to employees and clients?

Project Management & Technology Why Project Management? Create full circle governance Develop requirements Manage expectations of all stakeholders Assess risks at all stages Why Project Management? Structure & Risk Management Create full circle governance Not just Schedule meetings, Manage tasks, ensure goals are met Manage expectations of all stakeholders Various business lines, technology groups, clients Used to be that the “Team” to implement a technology project was comprised of the Sponsor and the developers, it can no longer be that way. The Team has expanded to include system security, audit, compliance, and legal. At each stage of project is it critical to review the goals of the project with all these stakeholders, to ensure that nothing in the market place has changed since the last gate.

Benefits of Technology Automated solutions replace manual processes Reduce risk of manual input errors Reduce time to process activity Less prone to error than manual processes Automated solutions replace manual processes

Benefits of Technology Enforce company rules and policies Encourage consistency Develop collaboration and information sharing Create efficiencies both in dollars and time spent Client access to information from multiple locations Reduce phone calls to relationship teams A technology can enforce company rules and policies by encouraging a specific way of doing things. Use of a technology across an organization can be self-sustaining, requiring little enforcement for the use of the tool. Widespread use of a technology encourages consistency. Use of a technology can encourage collaboration and information sharing that would be otherwise difficult or impossible. Use of the technology can reduce the cost and effort of performing the activity as compared to what it replaced. A technology or tool can reduce the time it takes to make decisions and may support better decisions by providing better quality and more timely information. Reduce phone calls to relationship teams, RM’s no longer have close knowledge of the needs of client

Risks of Technology Automated processes introduce risks that must be addressed through sound technology governance and infrastructure risk management programs Automated solutions replace manual processes No longer reviewed by a person, things can be missed Could Limit types of activities

Project Stages/Gates Idea Planning Design/Development Testing Delivery Post Implementation Review Idea Definition of Initiative Planning Development Testing Implementation

Idea Automation Requests New Vendor “Automate the process” “Eliminate fax requests” “Make it easier” New Vendor “XYZ vendor will make my process better” “Implement new software” How many ideas have never been implemented because they took too long to determine “what’s next?”

Planning – What’s Next? “Automate the process” Goals Assess Risks Specific across all constraints Technical/Scope Schedule/Time Cost Assess Risks “Automate the process” What does that really mean? Goals Projects that do not meet expectations are still failures in the minds of the sponsor/requestor Must be well defined in all three constraints of the projects Must get specific, vague requirements result in failure Assess Risks Process changes Time Constraints Cost Constraints Acceptance by users Technology limitations Security concerns

Need to identify Critical vs non Critical to achieving the goal of the project Do we have enough $ to fund the project Do we have the organizational resource commitment to complete the project Is the scope well defined Project Risk Drivers Identification & initiation of a project has been misrepresented, wrongly assessed or overlooked Scope definition, requirements and other key deliverables that encompass the business objectives are ambiguous or poor quality Insufficient resources assigned to the project are either lacking in proper training, experience or availability Inaccurate measurement of project performance and status, resulting in a misleading report of scope, cost and schedule Misrepresentation of changes in scope, schedule and cost of the project without understanding impact to the business Lack of identification and resolution of project risks and issues

Design/Development Re - Assess Risk

Testing Front to Back testing of all requirements Re - Assess Risks Access Security risks

Delivery Re - Assess Risks Right when you think you are hitting your grove and the project is on it’s way to success, the wind shifts (compliance regulation change) and you have to reassess your way to the next mark (gate) Re - Assess Risks

Key Risks Technology Projects Achievable Goals Risk/Activity Type Resources Organizational Setting Project Participants Technology Maturity Risk/Activity Type Project mgmt Risk Technology Risk Product Risk Resources Staff, $, computers, Space etc Organizational Setting How many different parts of the Bank need to be involved Project Participants Experience Levels Bevis or Einstein Technology Maturity New state of the art, little experience within the Bank Established known technology

Post Implementation Can’t plan for all risks, but need to try to anticipate as much as possible or you will get flipped

Questions?