Background

A newly spun-off company—with over $700M in revenue—had an experienced IT leadership team.

But they were struggling with something fundamental: Governance.

Specifically around:

• Scoping
• Estimating
• Change and release management

The Problem

Despite strong technical talent, critical gaps existed:

• No auditable process for production changes
• No single source of truth (who, what, why, when)
• No consistent testing, approvals, or rollback plans
• No structured way to provide cost estimates or track actuals
• No formal approval framework

Changes were happening.  Control was not.

Analysis

The issue wasn’t capability—it was structure.

A fragmented environment had emerged:

• Documentation spread across email, Word, and Excel
• Code changes not tied to specific requests
• Database updates not tracked
• No clear alignment between business requests and IT execution

At the same time, the company needed to meet strict audit requirements..

Key Insight

Without governance, even high-performing teams create unmanaged risk.

Solution

ClarityBridge Partners focused on practical, high-impact changes—not complexity.

1. Introduced structured change governance

• Formal change management meetings
• Business prioritization of requests
• ROI tied to each initiative

2. Centralized everything

Designed and implemented a web-based change & release platform:

• Single system for all documentation and code
• Eliminated email-based tracking
• Real-time status, approval, and testing notifications
• Full audit trail (who, when, why)
• Integrated with upstream systems (e.g., IT help desk)

3. Built audit-ready reporting

• Partnered with Big 4 auditors
• Created automated reports aligned to audit requirements
• Ensured complete visibility into the change lifecycle

Outcome

From engagement to implementation: < 90 days

• Governance embedded directly into daily operations
• Full auditability and compliance achieved
• Dependency on tribal/legacy knowledge eliminated

Audit impact:

• Audit preparation reduced from days → <1 hour
• 100% accuracy and completeness
• Global, traceable approval process
• Emergency changes governed with same rigor

Business impact:

• Increased business engagement and ownership
• Shifted budgeting responsibility to requesting departments
• First audit: zero findings

Key Lessons

• Keep solutions focused and intuitive - complexity creates risk
• Governance must be designed in, not layered on later
• Reliance on email, spreadsheets, and informal systems:
• Increases risk
• Reduces productivity
• Fails under audit scrutiny

Call to Action

These challenges aren’t unique to IT.

The same risks exist anywhere organizations rely on:

• Informal processes
• Legacy knowledge
• Disconnected systems

 

 

ClarityBridge Partners helps organizations build practical governance and audit-ready processes—without overengineering the solution.

Organizations often assume that if:

• The documentation is complete
• The meetings are happening
• The methodology is being followed
• And the status reports are green

…then the project must be on track.

That is not always true.

This case highlights how a major financial institution nearly missed a critical regulatory requirement—even after months of structured project work using a modified Six Sigma DMAIC methodology.

Background

A major bank entered into a stipulation agreement requiring updates to its mortgage servicing application to properly account for mortgages in bankruptcy.

Under the required process:

• Past-due mortgage balances would be separated from the original loan
• The primary mortgage would be restored to current status
• Arrears would be tracked separately as a second obligation
• Late charges would not accrue if both payments were made on time

The existing mortgage servicing system did not support this functionality.

A project was launched to modify the application and bring the bank into compliance.

The project team followed a modified Six Sigma DMAIC approach and produced extensive project documentation across the: Define, Measure, Analyze and Improve phases

At first glance, the project appeared well managed.

• The templates were complete.
• The narratives were polished.
• The process diagrams were detailed.
• The meetings were occurring regularly.

Everything looked correct.

The Problem Nobody Saw

After several months on the project, something felt wrong.

While reviewing the project deliverables, I modified the end-to-end process map to include the proposed solution and associated accounting flows.

That exercise exposed a critical issue:

The proposed solution did not actually account for how the modified loan balances and payments would be managed within the servicing system.

In other words:

The project documentation was complete, but the core business and regulatory requirement had not been solved.

Root Cause Analysis

Several issues contributed to the failure:

1. Lack of Domain Expertise

The project manager did not have deep mortgage servicing or bankruptcy processing experience.

As a result, the team focused heavily on process execution without fully validating operational outcomes.

2. Critical SME Exclusion

Only one individual had deep technical knowledge of the legacy loan servicing platform.

That resource was not actively involved in the project.

The team lacked the system-level understanding required to validate whether the proposed solution was technically and operationally viable.

3. Fragmented Team Structure

Different remote teams handled separate project phases:

• • Define
  • Measure
  • Analyze

This created process silos and reduced continuity across the initiative.

Each group completed its assigned deliverables, but no one owned end-to-end validation.

4. Failure to Validate Against Regulatory Requirements

Most importantly:

No one formally reviewed the proposed solution against the original government stipulation requirements.

The project focused on completing methodology artifacts rather than validating compliance outcomes.

The Turning Point

After repeatedly escalating the issue and highlighting the missing functionality, the project team finally reassessed the initiative.

The result:

• The project was reset.
• Additional subject matter expertise was added.
• The structure of the initiative was revised.
• And the organization realigned the project around the actual business and regulatory requirements—not simply document completion.

Outcome

The project experienced delays and restructuring.

However, the revised effort ultimately met the regulatory stipulation requirements because:

• Appropriate SMEs were engaged
• Project governance improved
• And the team validated the solution against real operational requirements

Key Insight

The regulatory requirements were clear from the beginning.

So how were they missed?

Because the project had:

• Weak integration between teams
• Insufficient project governance
• Inadequate subject matter involvement
• And no clear ownership for validating final business outcomes

Most importantly:

No one consistently asked the most important question: “Does this solution actually meet the stipulation requirements?”

That single question changed the direction of the project.

Final Thought

Many struggling projects are not failing because teams are not working hard.

They fail because:

• Teams become disconnected
• Process replaces critical thinking
• Governance focuses on deliverables instead of outcomes
• Organizations lose visibility into whether the business problem is actually being solved

At ClarityBridge Partners, this is exactly the type of disconnect we help organizations identify before projects become significantly more costly and difficult to recover.

👉 Find out if we can help you!