Benefits focused portfolio management - beyond project delivery!

Matt WilliamsPMP MAIPM
Managing Director
Connexion Systems
Benefits-focused Portfolio Management:
beyond project delivery

Transforming project outcomes
Into stakeholder value
About Connexion Systems
Connexion Systems knowledge areas:
• Benefits Realisation Management
• Project Portfolio Management
• Project Investment Management
• Best Practices (PRINCE2, MSP, P3O)
• Project Controls (Schedule, Earned Value)
Enterprise Systems = People + Process + Tools

Some of our Customers

What is the problem?
• Major improvement in the maturity of
project delivery
PRINCE2, PMBoK
Project Risk Mgmt (AS4360)
• But project ‘success’ rates are not
improving: (Standish)

“A measurable improvement resulting from an outcome
perceived as an advantage by one or more stakeholders”.
-UK Government Cabinet Office
“A business outcome that delivers value to the organisation.”
-NSW Department of Finance & Services
Benefits defined

“The identification, definition, tracking, realisation and optimisation of benefits at initiative
and portfolio level.”
- Steve Jenner, Managing Benefits (APMG)
Benefits Management defined

Why Now?
• Benefits Realisation is not a new idea
• So why is there so much interest right now?
 Uncertain economic times
 Shrinking Budgets
 Demanding Customers
 Globalisation
• Mean we need to get it right the first time

The Objective
• Select the right projects
that contribute to strategic objectives
that deliver the necessary change to the organisation
• Create accurate, validated business cases
• Maximise return on capital investment
Track and report on the benefits being realised
during and post execution

What is the Problem?
Traditional approach is:
 Define the business case,
 Get approval and funding,
 Hand over to the project delivery team
 Monitor progress
 Receive the finished product/output

Problem 1- Responsibility
Either:
a) the project/programme is made responsible for
benefit realisation, or
b) No-one is!
Project/Programme managers are focussed
on delivery, not business benefits
Time/Cost/Quality are their measures of success

Project Handover Process
Project Benefits

Problem 2 - Visibility
• The link between project outputs,
capabilities, outcomes, benefits and goals
is often unclear or poorly defined
• This means we lack early-warning
indicators of missed goals and outcomes

Problem 3 - Validation
No processes or systems in place to
validate benefit estimates (assurance)
This can lead to optimistic estimates
Double-counting can occur
Need to validate assumptions during execution
Complex models without appropriate supporting
processes and tools can lead to errors

BenefitsProject
Benefits
Benefits
Benefits
Benefits
Project
Project
Project
Project
Optimistic Estimates example

Project
Project
Project
Assumption
Goal
Capability
Business Change
Benefits
Double counting example

Complex Model example
Complex to build, impossible to maintain
– a calculation sheet for a single benefits can
have up to 5-deep linked files and be spread
across multiple sheets within the files.
Addressing the issues
- the more complex the model is to maintain the
less integrity there is around with the numbers
overtime and the less accountability and
ownerships it will have. Add on top the
inefficiency of management it on an ongoing
basis.

Benefits-focused Approach
• Many organisations only perform the first step
• Need to follow a defined lifecycle, that includes the
whole Benefits Realisation team
• Strong governance with clear accountabilities and a
defined framework

Benefits Identify Plan Realise Evaluate Payback
Programme Definition Delivery
Project Initiation Delivery
Benefits-focused Approach

Step 1 – Identify
• Ideally, this should occur before the establishment of an
initiative, not after.
• First, identify the stakeholders
• Then, identify the intended benefits and their ownership
• This encourages a collaborative approach to Benefits
Identification, and attains buy-in from all parties

Step 1 – Identify
• Three Column Analysis technique involves asking 3 simple
questions, and using the answers to graphically develop a
benefits pathway in one page.
• Represents how current business problems can be
addressed to achieve the desired benefits.

Step 2 - Plan
• Benefit Maps are a ‘road map’ to support understanding and
management of the complexity inherent in the benefits
realisation process.
• A Benefit Map is normally created from Right to Left
(Starting with the end in mind).
• The Benefits identified in this map become the
measurement points for tracking benefits realisation.

Step 2 - Plan
• If a benefit is “a measurable improvement resulting from an
outcome perceived as an advantage by one or more
stakeholders”,
• Then the ability to measure these improvements is essential
in order to quantify the benefits achieved.
• A Benefit Profile allows us to set a time-phased target
benefit value, against which we can track the improvement
over time.

Benefit Profile

Step 3 - Realise
• Take measurements at pre-defined intervals
 Responsibility can be assigned to appropriate
person (eg in HR, Payroll, IT etc)
• Automate where possible
 Semi-automated - Notifications (email, dasboard etc)
 Fully-automated – Integrate with source systems

Step 4 - Evaluate
3 key activities for evaluating outcomes/benefits:
1. Compare and Verify
2. Report the Results
3. Take Corrective Action where necessary

Step 4 - Evaluate
• Monitoring, reporting and escalation of actual vs. targeted
performance is supported by the benefits reporting function.
• It provides realisation progress and informs corrective actions
required.
• A continuous process that commences as soon as business change
starts to be delivered.
• In the post implementation phase, reporting should continue beyond
program closure.

Conclusion
A Benefits-focused Portfolio Management approach
leads to more successful outcomes by:
1. Assigning responsibility for realisation to those
who can make it happen (the business)
2. Defines visibility of the link between project
outputs, outcomes and business objectives
3. Validation of the estimates and assumptions
made, using a consistent, repeatable and
verifiable process

Remember
• … to get the best benefits from application
investments,
• The first step is actually trying to measure the
results.
• Only 37% of companies actually measured
their business cases at least once after go-
live.
Bill Swanton, Gartner 2011

Matt Williams PMP, MAIPM
Managing Director
Connexion Systems Pty Ltd
E: mwilliams@connexion.com.au
M: +61 414 847 040
www.connexion.com.au
QUESTIONS?

Benefits focused portfolio management - beyond project delivery!

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (6)

Similar to Benefits focused portfolio management - beyond project delivery!

Similar to Benefits focused portfolio management - beyond project delivery! (20)

Recently uploaded

Recently uploaded (20)

Benefits focused portfolio management - beyond project delivery!