As some bankers grow alarmed at the failure rates of large technology installations, they are discovering the importance of project management.

Seventy percent of major information technology projects-data warehouses being a prime example-do not meet expectations or fail altogether, according to Meta Group, Stamford, Conn.

"The No. 1 skill that's lacking for all these projects is solid, fundamental project management," said John Ladley, the research organization's senior program director.

No one needs to tell that to Richard McLaughlin, vice president, relationship marketing at Royal Bank of Canada. The bank has completed one- third to one-half the installation of a large-scale data warehouse for marketing and relationship-building applications.

The people building the warehouse are steadily involved in "thousands upon thousands" of component miniprojects.

"The timing and management are critical," said Mr. McLaughlin, who came to Royal Bank a year ago from a large Canadian retailer. "Well over 90% of my job is change management."

Last summer, $166 billion-asset Royal Bank opened a program management office of about 15 people devoted to nothing but tracking, prioritizing, and implementing concurrent projects. Bank employees make up about half the group. The rest are from American Management Systems, Fairfax, Va.

"These are some of the most critical people we have in terms of their ability to track projects and get things done," Mr. McLaughlin said.

Before the management office was created, the warehouse was up and running, but the bank lacked methodologies that would let employees in different business units fully exploit the data. A main concern of the office is to help integrate technology to fit business requirements.

"The technology would be useless without the organizational alignment," Mr. McLaughlin said.

AMS helped the bank set up four cross-functional teams at various management levels to ensure that appropriate data reached the right people.

"I believe this is a trend we will see increasingly," said Mr. McLaughlin. "The surviving organizations of the future will rally teams of people out of functional units and put them together to drive change in applications that are truly cross-functional."

Meetings of the teams often prompt "healthy debate" that forces a focus on the client, Mr. McLaughlin said. "If there's a disagreement, we ask, 'What would the client say if he knew we were having this conversation?'"

Improvements identified by Royal Bank include a 61% reduction in the time needed for marketing campaigns, direct-marketing response rates exceeding 40%, and an increase in revenue per direct-marketing dollar of 160% in the last three years.

Kinsey Potter, vice president at AMS, said her company is working with several of the 20 largest banks in North America on projects similar to Royal Bank's. "One of the major pitfalls is to look at it only as a technology project," she said. "There needs to be an equal emphasis on the business drivers and results."

Added Mr. McLaughlin, "The technology expertise is minuscule compared to the focus on change management."

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