Organisations invest in projects in order to achieve changes to their organisational capability. The expectation is that sufficient benefits will be realised in order to improve the ‘bottom line’ and that this justifies the expenditure. The practice of benefits realisation is regarded as a critical success factor in all international standards for project delivery.
Key Challenges for Benefits
Benefits should be realised whenever there are changes made to organisational capability, but this is not a guaranteed outcome. A benefits management plan needs to be applied throughout any project.
Benefits realisation management is a distinct discipline and is best structured as a separate stream within any project, likely providing similar management across a number of projects. When project goals change, as they inevitably do, this approach should ensure that any impact on benefits is key to informed decisions and that benefits always remain aligned and relevant to the business.
A key element of the benefits management framework is that benefits realisation continues well beyond the lifecycle of the project, and the project team, that delivers the desired organisational capability change. This ongoing realisation into an often moving business environment must be managed.
Our approach, which we pragmatically adapt for clients, incorporates the key categories of benefits, including:
Financial befefits – measurable in financial terms
Quantifiable benefits – measurable in non-financial terms
Recognisable benefits – measurable via indirect measures only
Intangible benefits – non-measurable improvements
Governance for benefits management must integrate into the highest levels with senior executive level buy-in and ownership of benefits. Progression (or otherwise) of benefits needs to be reported on regularly to provide management with an overview of actual project outcomes, not just the on-time, on-budget implementation.