Laying the Foundations for Project Success


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  • Take a pragmatic view:What is the range of applicability of the new guidance? Where will it work; where will it not work?How does this new guidance fit with existing guidance? How well does it integrate?What additional value does it bring?
  • Introduce BBC, why its needed, how it fits with other guidanceThen look at the central elements of the BBC guidanceFinally, look at the experience to date in using BBC.
  • UK Treasury’s Green Book – very detailed guidance on the appraisal and evaluation of investment proposals in the UK public sector. The Green Book is referenced in Better Business Cases, but is not part of the syllabus in guidance aimed at a global audience.In 2007, Victorian Treasury began work developing an Investment Logic Model to support a more rigorous approach to high risk or high value ICT projects. The ILM in essence is very similar to the Benefit Map in MSP but with some useful additions. This has since been expanded to became an Investment Management Standard. IMS is applicable to investment proposals in central Govt in Victoria, and is attracting attention internationally. IMS approach maps on to the Better Business Cases guidance, with a lot of common terminology, possibly derived from a common source in the Green Book, but from my initial analysis I believe BBC concepts could add some value to the IMS. Generally, my experience in both public and private sectors is that Business Cases are like dogs – there are an enormous variety of breeds, some useful, some elegant, some too small, some bloated, some dangerous, and some frankly appalling, but all referred to with the same noun. My interest in Better Business Cases arises from an obvious need to better support corporate governance through a consistent approach to decisions to invest large amounts of corporate assets in change through programmes and projects.
  • When money is scarce, organisations need to make the best use of their assets. Ad hoc approaches to investment appraisal and evaluation might have worked in the good times, but in a more demanding world corporate governance demands greater rigour. Audit findings in Australia at both national and State level, that whereas stated Govt procurement policy is to prioritise value for money over price, that more often than not contracts were awarded to the tenderer who offered the lowest price.Key requirements for decision making include:Is there a case for change? For doing anything at all about a problem or opportunity, when they may be many problems and opportunities?Clear objectives? How have we ensured that we have identified the optimal value for money proposition?Did we attempt to broaden our thinking before focussing too much on solutions. Truman quote: “You can always amend a big plan, but you can never expand a little one”. Best investments address multiple issues, rather than putting out spot fires or oiling the squeaky wheels.How confident are we that we will get out of this investment more than we put in?And finally, how confident are we that the changes required in ‘business as usual’ can be achieved? Not just from a technically perspective, but also from a broader organisational or societal perspective?Better Business Cases is a systematic and objective approach to all stages of the business case development process. It supports management at key decision points along the investment lifecycle. It provides management with the opportunity to engage stakeholders to ensure buy-in for successful investment outcomes.BBC is best though of as a framework for engaging stakeholders in the structured thinking process developing a robust argument supporting decision to invest, or to not invest at all. The Business Case is then simply a repository of information and evidence of the quality of thinking.
  • The Five Cases Model says that there are five key questions around each investment proposal and that the Business Case needs to answer each of these questions.Strategic Case – makes the case for change; demonstrates the strategic fit of the proposed investmentEconomic Case – identifies a ‘long list’ of realistic and achievable options to generate a ‘short list’ and ‘preferred direction’, and then identifying a ‘preferred option’ that demonstrates that the proposed investment optimises value for moneyCommercial Case – demonstrates that the ‘preferred option’ will result in a viable procurement (the supplier can deliver) and a well structured deal (including value add and innovation)Financial Case – demonstrates that the ‘preferred option’ will result in an fundable and affordable deal, that the cost and benefit estimates are realistic over the life of the investment, as well as the impact of the proposal on the organisation’s financial positionManagement Case – demonstrates that the ‘preferred option’ is capable of being delivered successfully , that governance structures, plans and resources are in place for successful implementation and post evaluation, and that there is a robust approach to delivery with agreed systems and processes based on proven best practice
  • BBC guidance identifies a number of version of a Business Case.At the highest level, if the investment is part of an overall programme of change, but there is no current and approved Programme Business Case, then a document called a Strategic Outline Programme should be produced to set the strategic context of projects within the programme, assess alternative approaches and delivery mechanisms, and form the basis of programme approval.The next step then depends on the nature of each element of the investment (BBC uses the word ‘scheme’).For larger, more expensive projects that may be novel in some way or that may require a contested procurement, BBC recommends that the Business Case be developed in three stages:Strategic Outline Case – vsn 1 of the Business Case – confirms the strategic fit and the case for change, develops a long list of options, assesses the value for money equation using ROM estimates, and outlines strategies for procurement and deliveryOutline Business Case – vsn 2 - pre-procurement – shows the way forward is sensible, that the chosen solution is robust, cost-benefit analysis of short-listed options, confirms procurement and contract strategy, identifies resources & delivery management arrangements Full Business Case – vsn 3 - after procurement activities and BAFOs, so that the best estimates of cost and duration, and any value add from the chosen supplier(s), can be incorporatedAlternatively, for smaller, less expensive projects that are not novel and that may use pre-contested procurement arrangements such as framework contracts or panel arrangements, then BBC suggests a ‘lighter’ approach in which a simplified Business Case (still covering the Five Cases) called a Business Justification Case, which may be developed in a single stage.
  • BBC says that Business Cases should be developed over time – this allows time for options to be explored, issues to be resolved and for stakeholders to come to some degree of consensus.Ashley Brilliant quote: When you plan a journey from your mind into mine, remember to allow for the time difference.BBC comes with several aspects that might be considered novel:Even at the strategic end of the development framework, BBC suggests having a look at the achievability of the proposed investment – so develop strategies for delivery and assess their risk profile, develop ROM estimates of cost, and assess the likelihood of success;The other novel aspect is that the Business Case is not considered ‘Full’ or finished until after procurement activities have provided BAFOs for inclusion into the Business Case, to provide the final level of decision support for a decision to proceed to contract.
  • BBC provides a ten step development process.Each of the ten steps is supported by more detailed guidance.Step 10 – finalise governance and delivery management arrangements (strategies and plans) for project management, change management, benefits realisation, risk management, contract management and post-project evaluation arrangements.Many of these steps bring in detailed information derived from the Green Book.
  • For major schemes, those that are high cost or high risk, and that require a contested procurement, then the flow suggested by PRINCE2 is :Pre-project – where the equiv of BBC’s SOC is in the Project BriefInitiation Stage – where the equiv of BBC’s OBC is in the PIDThere may then be one or more stages run, maybe gathering requirements, or developing proofs of concepts for risk reduction purposes, but then there will be a Tender stage. The equiv of BBC’s FBC is in the PID at the end of this tender stage, because the Business Case can now include tenderers’ BAFOs, to support a decision to proceed to contract and continue the project through one or more delivery stages. Of course, the decision may well be to cancel the project at this point.
  • For what BBC calls minor schemes – smaller, relatively inexpensive and low risk projects, not requiring any contested procurement activity, the PRINCE2 pre-project activities are merged into the Initiation Stage. BBC calls the Business Case at the end of the Initiation Stage in these circumstances the BJC.
  • Just for fun, I thought it might useful to look at an agile project being run under DSDM Atern. This isn’t quite as straightforward as for the PRINCE2 case. Atern doesn’t say much about procurement, but it does say that the people who will be part of the agile product development teams must be in place and engaged by the end of the Foundations phase. That means that the BBC FBC maps to the Business Case that is part of Atern’s Business Foundations document and various aspects of the Management Foundations and Delivery Plan documents. Then we can move backwards and suggest that BBCs OBC maps to the Outline Business Case in Atern’s Feasibility Assessment document, and that BBC’s SOC could be incorporated into the projects Terms of Reference document. If there had to be a procurement to secure the availability of some of the agile team members, then this will have had to be run in parallel with the Feasibility or Foundations phases.
  • BBC originates in UK Treasury’s Green Book. The UK Treasury website says that: All public spending proposals should be accompanied by a properly developed and structured business case using the Treasury ‘five case model’ and the supplementary Green Book guidance on development and assessment of business cases. Some departments have development supporting guidance, for example Transport.Welsh Government – mandated the use of BBC in support of delivery of the Welsh Infrastructure Investment PlanIn NZ, BBC is mandated for all major State sector initiatives.There is emerging interest from the World Bank.In Australia, there is a lot of interest from both public sector organisations, at National, State and Local Government levels, and from private sector organisations.
  • BBC’s story in NZ began when Finance Ministers decided that greater confidence in State sector investment decisions.In response, Infrastructure NZ, a part of NZ Treasury, adopted BBC as the core of a NZ-ised concise version, which also included some elements of the Victorian Treasury’s ILM. They’ve also though through how to reconcile BBC with the Gateway Review process, which is mandated in NZ for high-risk State sector projects.In NZ, BBC has been endorsed by Cabinet for use in the State sector, with increasing interest from other areas.CERA – Canterbury Earthquake Recovery AuthorityNZTA - New Zealand Transport AuthoritySocio-economic – for example around Auckland
  • NZ Treasury has developed a range of courses, and has provided training to around 900 people in the last 12 months alone.There is emerging demand for this training from across the public sector, and from those supporting the public sector, such as consulting firms.
  • Of great interest to me, NZ Treasury sponsored a review of BBC and its use across the State sector. The highlights of the findings of this review are shown on this slide and the next one, and can be accessed from the URL shown.Key findings:Support – BBC is more than just the next big thing, it’s seems to be appreciated by those who use it. BBC has been customised for use in NZ, so any rough edges have been rounded off.The value of experienced practitioners has been recognised, as leaders and facilitators;And organisations want their own people brought up to speed;Treasury has identified the need for alternative mechanisms to develop competency;And the need to develop a specific role as a Business Case reviewer has been identified.
  • As a result of this review, Treasury has laid out an agenda for the coming year, which includes:Continued elaboration and extension of current support mechanisms including training and communities of practice;A focus on meeting the needs of core State sector organisations; andA focus on the emerging role of BBC Reviewer.The Infrastructure Group within Treasury will be providing differentiated training to practitioners involved in developing business cases, and reviewers of business cases, and it will be developing support materials for organisations wishing to adopt BBC.
  • Just before wrapping up, I though it might be useful to describe the BBC accreditation framework.IP owned by …Coordinated by …APMG is the accreditation and examination authority globally.
  • There will be BBC standard but allowable Variance – no one size fits all approach. For example, one of my suggestions when I first reviewed BBC was that the UK Treasury’s Green Book should not be examinable under a global syllabus.The BBC Foundation exam …The NZ approach to BBC will likely flow through to the global accreditation arrangements. This means that there may be two practitioner level examinations, currently under consideration for release later this year. One will be aimed at those that write/develop business cases (Better Business Cases Practitioner) and the other at those who review business cases (Better Business Cases Reviewer).
  • To wrap up this introduction of BBC, I thought it might be useful to summarise some key points:The approach taken in NZ has been to develop a flexible framework with supporting infrastructure such as training, and then encouraging organisations to get involved.BBC is primarily a structured thinking process, intended to guide a disparate group of stakeholders through a disciplined process to a consensus view about an investment proposal. To my thinking, really good facilitation would be a key to getting this to work.There is also a need to get enough people to a level where they can add value to the process, through competence in developing sound business cases in the first place, or in reviewing business cases.
  • Laying the Foundations for Project Success

    1. 1. www.apmg- APMG-International Webinar Laying the foundations for Project Success Wednesday 28 August 2013 / 12:00 AEST (Canberra, Australia) Presented by Geoff Rankins, Inspiring Projects
    2. 2. Agenda • Welcome & introduction – Mark Croxford, Business Development Manager – Australasia APMG-International • Laying the Foundations for Project Success – Geoff Rankins (Inspiring Projects) • Q&A • More Information • Close
    3. 3. About APMG-International • Accredit training and consulting organizations & manage certification schemes for professionals • International presence in 13 countries • Extensive suite of professional development products leading to more than 80 world-class qualifications • Publications, courseware and methodologies are translated in up to 23 languages • 350+ Accredited training (ATO) and consulting (ACO) organizations with 1800+ approved trainers and consultants • Certify examination candidates; 18000+ exams per month • More information:
    4. 4. Your Presenter • Geoff Rankins, Lead Trainer, Inspiring Projects • Approved Trainer in PRINCE2, MSP, MoP, P3O, MoV, Managing Benefits, Agile Project Management, Better Business Cases, MoR (soon) • Geoff is a consultant and project director with 35+ years of experience helping organisations manage change • He has held executive, advisory and line management roles in multinationals, ASX50 organisations, Federal and State Governments and Tier 1 & 2 consulting firms • Contributor to several national and ISO standards • He has been an early promoter in Australasia of PRINCE2, MSP, MoV and now Better Business Cases
    5. 5. Objectives Introduce Better Business Cases Touch on its core elements Consider experience to date
    6. 6. Background UK Treasury • Green Book Victoria Treasury • Investment Management Standard, incorporating an Investment Logic Model Other jurisdictions • A multitude of ad hoc methods
    7. 7. The Need for Guidance The key challenge for organisations in a post-GFC world is how to optimise the value returned from their investments Key requirements for decision making: – Is there a clear justification for intervention? – Are there clear objectives? – Divergent (options) before convergent (solutions)? – Likelihood of ‘business value’ through benefits realisation? – Acceptable risk exposure (failure)? A well-prepared Business Case is essential for enabling evidence-based decision making.
    8. 8. The Five Cases Model Strategic Case Management Case Financial Case Commercial Case Economic Case Compelling? Achievable? Value for Money? Viable? Affordable?
    9. 9. Business Case Documents Strategic Outline Programme Strategic Outline Case Outline Business Case Full Business Case Business Justification Case ‘Major’ Schemes ‘Minor’ Schemes
    10. 10. Progressive Refinement Strategic Outline Case Outline Business Case Full Business Case Strategic Economic Financial Commercial Management
    11. 11. Development Pathway Product Steps Strategic Outline Programme 1: Ascertain strategic fit Strategic Outline Case 2: Make the ‘case for change’ 3: Explore the ‘preferred way forward’ Outline Business Case 4: Determine Value for Money 5: Prepare for the potential deal 6: Ascertain affordability and funding 7: Plan for successful delivery Full Business Case 8: Procure the VfM solution 9: Contract for the deal 10: Ensure successful delivery
    12. 12. Large, contentious project under PRINCE2 Pre- Project Initiation Stage Tender Stage Delivery Stage(s) Strategic Outline Case is in the Project Brief Outline Business Case is in the Project Initiation Documentation (PID) Final Business Case is in the updated PID
    13. 13. Smaller, non-contentious project under PRINCE2 Pre- Project Initiation Stage Tender Stage Delivery Stage(s) Business Justification Case is in the PID
    14. 14. Agile Project under DSDM Atern Pre- Project Feasibility Foundations Increment(s) Strategic Outline Case could be in Terms of Reference ? Outline Business Case in Feasibility Assessment Final Business Case in Business & Management Foundations & Delivery Plan
    15. 15. Who uses Better Business Cases? UK Treasury Welsh Government NZ Government Emerging interest from World Bank
    16. 16. New Zealand Ministers of Finance wanted greater confidence in State investment decisions Infrastructure NZ developed a ‘NZ-concise’ version of BBC, incorporating two elements of Victorian Treasury ILM NZ Cabinet has endorsed BBC for use in the State Sector; CERA endorsed BBC for Christchurch Recovery; NZTA endorsed BBC for National Land Transport Programme; Piloting application of BBC to socio-economic programmes.
    17. 17. New Zealand NZ Treasury developed and deliver training across New Zealand In the last 12 months: • ~600 through BBC Foundation and • ~300 through BBC Practitioner Course Emerging demand for training from Tier 2/3 consulting firms, Tertiary Education sector, Health Sector, Government Departments, Local Authorities and State Owned Enterprises
    18. 18. NZ National Evaluation of BBC - 1 Key findings: • Overwhelming agreement that BBC has had a positive impact on the quality of business case thinking and that it is generally fit for purpose; • The process is most effective when applied by experienced and knowledgeable people; • Organisations wanted help to develop internal capability and expertise; • A range of mechanisms should be considered, not just training, to help organisations address the wider capability gaps that have been identified; • Address State Sector Reviewer capability.
    19. 19. NZ National Evaluation of BBC - 2 Objectives set for 2013/14: • Continue the delivery and ongoing improvement of current BBC guidance (plus case studies) and training (plus communities of practice); • Significantly improve the capability (skills, experience, and practice) of priority Public Sector Organisations to produce fit for purpose business cases; • Provide expert advice to support the development of a competent and professional BBC Reviewer capability and capacity within the State sector. Developments: • Support for expert Practitioners and Reviewers; • For the internal adoption/adaptation of BBC within a Public Sector Organisation, development of some organisational characteristics with a maturity model.
    20. 20. ‘Ownership’ Better Business Cases is: - Owned by HM Treasury and the Welsh Government; - Coordinated globally by the International BBC Steering Committee, comprised of representatives from HM Treasury, the Welsh Government, the World Bank and NZ Treasury; - Coordinated in NZ and Pacific Islands countries by the NZ BBC Steering Committee; - APMG is the global accreditation and examination authority.
    21. 21. Certification Content - BBC standard - Country versions with up to 15% variance Foundation - 40 minutes exam - 50 multiple choice questions - Pass mark is 25 (50%) - Closed book exam Practitioner - Currently under consideration.
    22. 22. Summary BBC provides a structured ‘thinking’ process: • Strategic, disciplined, staged • Five Cases Model, progressive elaboration • Competent facilitation Enable organisations to meet a flexible standard, rather than force compliance to an inflexible process Competent practitioners to support Business Case development and review
    23. 23. Upcoming Australasia events • Wednesday 18 September @ midday AEST (Canberra – Australia) Webinar | P3M3® assessment choices - APMG Registered Consultant led assessment or Self-Assessment – but which one is right for your organisation, and when? Presented by Lawrie Kirk & Warren Jolly • Wednesday 2 October @ midday AEST Webinar | Managing Benefits – Optimizing Return on Investments Presented by Stephen Jenner & Philip Reid • Friday 15 November Showcase Event | APMG-International Australasia Showcase @ Melbourne Conference & Exhibition Centre
    24. 24. apmg-international @MCroxfordAPMG @APMG-Inter