Finance professionals are regularly engaged in multiple varied projects that require multi-disciplinary teams. Whether or not you are formally tasked with project management, having project management skills can help you better satisfy stakeholder expectations and build allies throughout the organization.

What is a project?

A project is a finite effort to create a unique product, service or result. It has a defined beginning and end, which distinguishes it from ongoing operations. Even if a project involves similar tasks or goals as previous projects, each project should be distinct, whether due to the specific context, stakeholders, constraints or desired outcomes.

What is a project manager?

A project manager (PM) coordinates the various elements of a project and oversees its completion. Using planning and scheduling tools and problem-solving and communication skills, they ensure the project meets the required standards and is completed on time and within budget.

In finance, some projects — especially if they are complicated, sophisticated or expensive — may be assigned a PM. Other times, the finance professional may be tasked with serving as the PM. Many routine work efforts that may not be formally considered projects would still benefit from project management practices, so it is a good idea to add them to your toolkit.

Project management framework

The Project Management Institute's framework breaks project execution into five critical phases: initiating, planning, implementing, monitoring and closing. What sets this approach apart is its commitment to ongoing validation — a systematic process that ensures projects consistently align with their original vision and objectives.

Phase 1: Project initiation

During project initiation, PMs engage directly with stakeholders and sponsors to establish a clear shared understanding of the project's foundational elements. Stakeholders (individuals or groups impacted by the project's outcomes) and project sponsors (typically senior leaders who provide strategic support and resources) collaborate to set the foundation.

This conversation is particularly important for finance professionals who are managing multiple projects with limited resources. Effective project management relies on the balance of three interconnected factors: project scope, deadlines and available resources. Underestimating the need for this balance early on doesn't solve problems — it creates them.

The project initiation phase culminates in the project charter, a strategic document that lays out the PM's understanding of the project. A well-crafted charter effectively guides the project team by clearly articulating expectations, potential obstacles and the strategic framework within which the project will operate. While not every project demands a formal written charter, its key elements — authorization, resource delegation, scope of work, critical assumptions and resource cost estimates — should always be considered.

Phase 2: Creating the project plan

This phase begins with a project kick-off meeting, which brings team members together to establish a shared understanding of the project's strategic direction, individual responsibilities and communication protocols. During this meeting, PMs need to paint a complete picture of the project. This includes defining objectives, outlining scope and quality parameters, and establishing individual roles and accountability metrics. Team members should leave with a clear understanding of their specific contributions and how to access necessary resources.

The overall project plan should include these six sub-plans.

1. Work breakdown structure (WBS)

This defines the separate tasks that must be performed as part of the project, as well as the time and resources necessary for each.

2. Resource plan (e.g., personnel and budget)

Once the WBS is complete, the PM can begin to assemble project resources — personnel (allocated to the project team) and financial resources (allocated to the project budget) — and draft a project budget and schedule. The main challenges with resource planning are locating the necessary resources and getting approval to access them.

3. Project schedule

Tasks identified in the WBS must be sequenced to determine whether the time required for the project fits the project’s deadline. A dependent task requires another task (or multiple tasks) to be completed before it can start; independent tasks can be completed simultaneously and allow for parallel processing.

4. Quality assurance plan

Quality indicators can be built into a project in a couple of ways. Some may reflect the required performance of the project’s output (e.g., the information a new process will generate), or each task in the project could be assigned specific quality indicators. The responsibility for developing quality metrics and ways of monitoring and testing quality should be assigned to appropriate project team members.

5. Risk management plan

The risk management process should include all stakeholders to ensure that project risks are considered from a variety of perspectives. A conventional risk identification and management process can be applied for each phase of the project, and should involve the PM, key stakeholders and key project team members. The risks to consider are those that would affect the ability to secure resources or cause the team to miss key milestones. Be sure to also discuss what management strategies should be employed so the project team is prepared to detect the risk occurrence and respond effectively.

One helpful risk management tool is the pre-mortem, a strategic planning technique used to identify potential project risks and pitfalls before they occur. During a pre-mortem, project team members imagine that a project has failed and brainstorm potential reasons for its failure. This proactive approach allows the team to address and mitigate risks early in the project life cycle, enhancing the likelihood of success. By anticipating challenges and developing contingency plans, the pre-mortem process contributes to more robust project management and overall project resilience.

6. Communication framework

Communication is a key element of successful project management. PMs should design communication frameworks that balance information sharing with team efficiency, preventing both information gaps and overload. This might involve creating a formal communication plan that specifies what information needs to be shared, when, with whom and through what channels.

Phase 3: Implementation

The project implementation phase marks the transition from planning to execution. In this phase, PMs simultaneously support team productivity, facilitate communication and navigate (inevitable) challenges. PMs serve as information conduits, transferring information between team members and stakeholders through status reports and project meetings.

Status reports provide a visual of completed tasks, ongoing work, upcoming milestones and emerging insights. Project meetings represent the most direct method for coordinating team knowledge and aligning efforts, but they should be used sparingly to avoid becoming a time suck.

The ability to motivate others is particularly important in this phase. Effective project leaders understand that inspiration stems from more than directives. By modeling professionalism, demonstrating active listening and consciously understanding each team member's individual drivers, managers can cultivate genuine commitment to project goals.

Problem-solving skills are equally important. When challenges emerge, PMs need to shift the focus to solutions rather than blame. It’s crucial to identify the issue quickly and come up with a resolution collaboratively, particularly when navigating potential conflicts among team members and stakeholders.

Phase 4: Monitoring

The project monitoring phase helps ensure a project stays on schedule. Relevant project metrics commonly monitored include resource use, schedule or completion of defined deliverables by milestone dates, deliverables, and project scope as defined at project initiation. The PM evaluates progress using various tools, such as the project schedule, status reports, and resource and expense reports. They then identify emerging issues and report them as needed to senior management.

Project scope can be one of the most serious factors affecting a project’s ability to satisfy its stakeholders. The phenomenon of "scope creep" — the gradual, often imperceptible expansion of project boundaries — can erode project efficiency and, therefore, ROI. PMs need to maintain a disciplined approach and evaluate any proposed changes against the project's core objectives.

For high-stakes initiatives, strategic gates or decision points provide opportunities for comprehensive review. At each of these critical junctures, leadership can assess the project's progress, viability and continued strategic relevance, making informed decisions about whether to proceed, pivot or potentially terminate the project.

Phase 5: Close the project

There are two objectives during the project closing phase: 1) turning over deliverables to the project’s stakeholders and 2) a project team debrief.

The project closing phase represents a critical moment of transition, reflection and consolidation. Deliverables undergo rigorous review against the original project scope and objectives, and stakeholders have the opportunity to accept the work or request refinements, creating a final checkpoint for quality assurance. Potential scope expansions that were previously tabled can now be discussed, setting the groundwork for future enhancements and continuous improvement.

The project team debrief — also referred to as a post-mortem or after-action analysis — is a valuable learning opportunity. Team members share perspectives, dissect challenges and collaboratively identify strategies for ongoing organizational learning and process refinement. It’s crucial that this process not be about assigning blame but rather about extracting critical insights that can elevate future project management practices.

The debriefing should consider the following:

• Was the planning adequate?
• Can you identify the root cause of the problems encountered?
• Are there additional learning or training opportunities team members could participate in?
• Did the established processes work, and if not, where and how did they lead to inefficiencies or conflicts?
• Was communication adequate? How could it be more effective in future projects?

The importance of project management in finance

Project management provides structured frameworks for planning, executing and monitoring initiatives, enabling finance professionals to navigate challenges, optimize resource allocation and deliver meaningful value to their organizations. It bridges technical expertise with leadership and ensures that financial projects are in alignment with the organization’s goals and executed with precision and efficiency.