Regulatory Project Management Interview: Leading Change In Capital Markets

The financial crisis of 2008-2009 caused a great deal of turmoil. I remember reading about the collapse of Lehman Brothers and the alarmist media coverage following that event. During the crisis, regulatory authorities did what they could to cope with events. After further reflection, legislators decided to implement sweeping changes. In today’s interview, we will learn about how new laws and regulations have reshaped the capital markets industry.

Today’s featured guest is Susan Mannella, PMP. She is self-employed project management consultant. She is currently working with Scotiabank Global Banking and Markets. Prior to Scotiabank, Susan worked on projects at CIBC, Bank of Montreal and other financial firms.

Bank of Nova Scotia At A Glance (“Scotiabank Global Banking and Markets” is one part of the Bank of Nova Scotia)

  • Founded in 1832 in  Halifax, Nova Scotia.
  • 2013 Profit: $6.6 Billion Canadian
  • 2013 Global Banking and Markets Profit: $1.4 Billion Canadian
  • 86,000 employees serve over 20 million customers
  • Bank of Nova Scotia (BNS) is Canada’s most international bank with operations in over 40 countries, including much of the Americas

1) What is your favourite project?

I worked on the project to implement the Dodd-Frank Act at Bank of Montreal in 2012-2013. The complexity and scope of the regulatory reform and the impact it had on large financial institutions was an opportunity to participate first hand in the broad and deep impact the act at the organizational level.   The scope of the project expanded beyond technology and operations to the front office staff, middle office groups, compliance, legal and trade floor supervision areas of project management that I was interested in pursuing.

The project gave me an understanding of how the legislation impacted the bank. In that case, I worked closely on the effort to update and improve the reconciliation process to achieve compliance with the regulations.

2) How did you get started in project management?

I became attracted to project management because there were excellent opportunities to do interesting work in a constantly changing environment.

One day, the light just came on – I enjoy the world of capital markets. Earlier in my career, I was the business lead on a large project. During that time, I learned the importance of project skills to supervise staff and stay organized.

3) What’s the largest project you’ve ever worked on?

At RBC Investor & Treasury Services, I worked on a multi-year project  which involved developing a new consolidated technology offering designed to bring together legacy technology from RBC (Canada) and Dexia (Luxembourg)  providing a new platform to service custody and mutual fund clients.

That project involved major challenges of integrating two diverse technology platforms within a newly formed firm with equally diverse cultures. My work required that I work to satisfy multiple client groups and provide for the vast range of mutual fund and custody product software and enterprise infrastructure required for the new firm. I needed to bring my expertise in technology, financial markets and people management to bear on that project.

4) What frustrates you the most in project management?

The unrealistic expectations of project sponsors can be frustration. Some sponsors have a work style where they tend to dictate. Such sponsors also tend to struggle with listening well.

As a consulting project manager, I encounter a lot of Type-A aggressive people in capital markets. At times, team work suffers in those environments. That said, I love the energy and drive of the capital markets world and understand the driven personality so it actually is the most satisfying environment for me to work in.

5) In your work, what regulations have triggered the greatest need for project work?

The Dodd–Frank Wall Street Reform and Consumer Protection Act brought the most significant changes to financial regulation in the United States since the regulatory reform that followed the Great Depression.  The Act was responsible for the majority of financial institutions to outsource project management due to the extent and complexity of the act and compressed timelines.

I once walked by the desk of a trader: he had 10 Post-It notes on his PC to cover all the different steps and nuances to the sales and marketing process leading up to executing a trade that our project team had implemented. It was highly evident how the act was re-shaping derivative trading. This was just an example of one part of the change that the Dodd-Frank was phasing into the derivative marketplace.

The Dodd-Frank Act has also reshaped what firms are able to participate in the market. Fewer small and niche firms are able to manage the compliance costs imposed by the regulations. In a way, the legislation has benefited large firms with the resources to implement regulatory projects and created a project management challenge for smaller organizations.

6) Following the completion of a project, how is the new regulatory process sustained?

The project team brings a lot of energy to introduce the regulation and what is required to implement new regulatory processes. This requires an in-depth understanding of the change the regulation will have on the firm once implemented.

After the project is complete and the team moves on to its next project it is up to the traders, sales staff and other staff to comply with the new regulations and processes on a daily basis. When I work on these projects, I adopt an auditor/manager mentality. The team has to be able to show evidence that we have implemented the regulations while training the day to day staff to adapt to the change on an ongoing basis.

Audits are inevitable so the documentation and the staff have to be ready to successfully demonstrate compliance in a clean and efficient manner.

In addition the legal and compliance departments rely on staff adhering to the process . In the case of Dodd-Frank, there was an additional requirement to submit process maps to the Securities and Exchange Commission (SEC) for firms registering as Swap Dealers.  The processes needed to demonstrate compliance with the act to attain registration so they had to be correctly implemented and sustained by all Swap Dealer staff.

7) How is project management evolving in maturity and depth?

More banks and financial firms are acknowledging the value of project management. There is an understanding that large regulatory projects have a lot of moving parts. Further, I think that executives understand that many of their staff have limited capacity to take on large projects above and beyond their daily workload that’s where a project manager comes into the picture.

Project methodology in regulatory projects is interesting. I see a hybrid of traditional waterfall and agile approaches. The need to be able to respond quickly to changing regulations calls on the agile concept. On the other hand, the requirement to fulfill the regulations as written are better suited to traditional project management techniques.

Over time, I expect that these compliance and regulatory projects will lead to the creation of new project methodologies.

 8) What resources do you use to stay informed on project management and your industry?

As a consulting project manager, I am always looking for ways to understand what is going on at different organizations to implement the same regulation. This requires keeping in touch with your peers and participate in industry working groups to understand what is impacting the marketplace. I am also looking to become more of a niche consultant to make myself more valuable to firms executing regulatory projects. I am planning on pursuing the Certified Anti-Money Laundering Specialist program.

 9) What comes to mind first when somebody says project management to you?

It’s exciting! When I think about projects, I think about change. It’s about changing technology designed to overcome the challenges and the change it brings to the desks of staff working in the industry.

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3 thoughts on “Regulatory Project Management Interview: Leading Change In Capital Markets

  1. Within capital markets, the notable effect of technology will be the complete transformation of the cost base and business model, as well as the rise in prominence of industry utilities to reduce costs and drive efficiency. As noted above, project management is critical to balance the needs of the organization with an increasing numbers of regulations (see Capital Markets 2020 for interesting perspective.

    Pressures to stay ahead of market trends will force capital markets players to stretch towards new partnerships in order to look for efficiencies from third-party services, such as cloud computing and reference data management. All of this coordination will also required skilled project management expertise in all capital markets participants.