In an increasingly challenging economic and political landscape, shareholders and citizens want more value for money. They want benefits, and it is up to the project managers, business owners and senior politicians to actively and enthusiastically engage in the pursuit of identifying and realising quantifiable, visible benefits.
/WHY DO WE NEED BENEFITS MANAGEMENT?
A Benefit is defined as “the measurable improvement resulting from an outcome perceived as an advantage by one or more stakeholders, which contributes towards one or more organisational objective(s).”
So why do we need Benefits Management when we have project, programme, risk and portfolio management, project and enterprise offices, software systems, and a plethora of tools and techniques to help us manage the delivery of our change initiatives in order to build or develop things that will, hopefully, satisfy our strategic objectives?
After all, once we have decided what projects to do, we then attempt to justify the cost of these projects with benefits. Right?
Of course this is wrong.
Simms calls this “upside down thinking” and points out that this leads to “wave after wave of programmes rolled across our organisations with little positive impact.” Benefits must be defined and validated first, then we can look for solutions and associated costs!
The solution is multi-faceted, with an opening point of adopting a benefits-driven rather than an initiative-driven approach, starting with the ‘end in mind’, where the scope and requirements of the initiative are determined by the required benefits rather than vice versa.
And of course there is another key factor. Benefits are not just another dimension of project and programme management; they are the rationale for the investment of taxpayers’ and shareholders’ funds in all change initiatives (S. Jenner).
/GETTING IT RIGHT
We will have to make considerable changes to the way we think and work. This means moving away from our “delusional optimism” in forecasting, inconsistent delivery approaches, passive benefits tracking and backward-looking accountability. And moving towards an approach that uses a benefits management framework driven by realism in planning, benefits led projects, enthusiasm in delivery, actual fulfilment of both planned and emerging benefits, and participating stakeholders, especially senior management.
This Benefits Management framework has been released by APMG International. Titled “Managing Benefits”, and authored by Stephan Jenner, this manual of the latest thinking and application of Benefits Management has been carefully designed to complement existing Best Practice in portfolio, programme and project management. It consolidates existing guidance on Benefits Management into one place, while expanding on the specific practices and techniques aimed at optimising benefits realisation. It is not about trying to prescribe a single solution; it’s about providing insight to choose what is most appropriate for your particular circumstances.
Benefits Management must be demonstrated and ensure that forecasted benefits are complete, where all sources of potential value are identified and realised, and the required business behavioural changes take place so that the performance of the investment matches the “promise”.
This calls for approaches that overcome barriers to effective benefits management, brought on by our tendency towards delusional optimism, cognitive bias and strategic misrepresentation and adopting a portfolio wide approach that manage benefits consistently using a set of sensible practices and principles. The role of your portfolio and change managers has just got a lot more important.
It’s important that your benefits management implementation is managed as a benefits-led initiative that should pay for itself.
Also, practice maturity. Use the new Benefits Management Guidance from APMG-International, coupled with the P3M3 maturity model. It provides a repeatable, criteria–based evaluation process that facilitates comparisons over time and provides an incentive to, and a road map for, on-going improvement in Benefits (and Project) Management. In addition, regular assessment of maturity can play a role in sustaining progress by assessing progress made to date and identifying those areas where action is required.