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Benefits management: benefits for you

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Presentation by Dr Richard Breese on 13 February 2017 for the Midlands branch

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Benefits management: benefits for you

  1. 1. Benefits Management: Benefits for you APM Midlands Branch Event – 13 February, 2017 Dr Richard Breese Senior Lecturer Sheffield Business School Sheffield Hallam University r.breese@shu.ac.uk and Committee Member of theAssociation for Project Management Benefits Management SIG
  2. 2. Outline of my presentation  What is benefits management? How does it link with organisational goals and with P3M?  The development of BM as a management idea  What BM involves  What can make BM difficult
  3. 3. Terminology Disbenefit Benefits realisation
  4. 4. Definitions Benefit ‘positive and measurable impact of change', (APM Body of Knowledge 6th Edition, 2012 p124) on the performance of an organisation, contributing to one or more strategic objectives Benefits Management ‘the identification, definition, planning, tracking and realisation of business benefits'. (APM Body of Knowledge 6th Edition, 2012 p124) Benefits Realisation Management ‘the process of organising and managing, so that potential benefits, arising from investment in change, are actually achieved’, (Bradley, 2006, p23) Disbenefit ‘outcomes seen as negative’ (Bradley, 2006, p18)
  5. 5. Evidence that 'it works‘ (Recent studies) ‘Our results show BRM practices being positive predictors to project success on the creation of strategic value for the business ‘ (Serra and Kunc, 2015) ‘most organizations are missing major opportunities to add strategic value because they lack a formal and focused approach to benefits management’. (PMI, 2016), [organisations mature in benefits realisation] ...’are in a position to truly manage business value, even in the face of significant internal and external change and uncertainty’. (Gartner, 2011). BM helps organisations achieve their goals, gives a better chance of success
  6. 6. Terminology – what is the relationship between benefits and value? Disbenefit Value management Benefits realisation
  7. 7. Business cases Business cases and value for money Benefits expressed in financial terms Benefits that are quantified Benefits that are non-quantifiable https://www.apm.org.uk/news/developing-compelling- business-cases-a-product-and-a-process-webinar/ Benefits and value
  8. 8. How do benefits fit with organisational goals? Disbenefit Capability Critical success factors Impact Value management Benefits realisation
  9. 9. Benefits hierarchy in regeneration (Breese, 2012) Make ‘Ztown’ a place where people want to live and work Vision Increase wealth in ‘Ztown’Objectives Increase % econ. active in ‘Ztown’Outcomes People in ‘Ztown’ obtaining a jobOutputs
  10. 10. How does this all fit with P3M? Where are benefits delivered? Disbenefit Capability Critical success factors Impact Value management Benefits realisation Project
  11. 11. Benefits Management (BM) People involved in many different roles in organisations are concerned with managing benefits in different ways. Strong links with change management, performance management and evaluation. ‘BM’ incorporates a concern for benefits into project and programme management processes and proposes specific techniques and tools for achieving those benefits in practice (Cabinet Office, 2011)
  12. 12. The development of BM BM arose out of dissatisfaction with investment appraisal techniques, particularly as applied to IT projects and programmes in the 1980’s (Bradley, 2006) BM has therefore developed earliest in the IT industry, and academic research has been particularly focussed on this sector (Breese et al. 2015)
  13. 13. Stages 1 2 3 4 1980 1990 2000 2010 Consultancy, Training, Research Key Players - consultancies and universities Incorporation into project management and IS/IT guidance Key Players - gov'ts and professional bodies Networks and maturity models Key Players - diverse Accreditation in BM Key Players – trainers and educators The layers and stages model of the development of BM (Breese et al., 2015)
  14. 14. The development of BM (2) The promotion of BM within professional project management bodies/government agencies seems to be furthest advanced in the UK and Australia, but it has spread globally Development of BM associated with the rise of portfolio management (Jenner, 2010) and value management (APM, 2011) APMG-International Certification in Benefits Management, launched in 2012, accompanied by ‘Managing Benefits’ guidance,
  15. 15. Benefits Management Cycle Identify and quantify Value and appraise PlanRealise Review Source: Jenner, 2012
  16. 16. Benefits dependencies/benefits mapping More efficient business routines Higher productivity Higher profits New processes New software package in small business Enabler Change Benefits Business Objective
  17. 17. Benefits dependencies/benefits mapping This is one of the simplest kinds of investment, but at every step there is A logical reason why the link should work Certain assumptions which are made Risks that the logical ‘cause and effect’ relationship might not work, if the assumptions are not met. Dependent on the business context. The complexity is magnified many times for major business decisions, eg out-sourcing decisions, expansion into new markets. Often the extent to which benefit realisation is within the control of the sponsor is over-estimated
  18. 18. Issues with Benefits Realisation – operational Defining benefits Incorporating qualitative benefits Aligning benefits at different levels. Cause and effect are sometimes highly contested Attribution of benefits, at higher levels Setting targets – ‘optimism bias’ Unintended effects of performance targets
  19. 19. Issues with Benefits Realisation - strategic Different stakeholders have different priorities amongst the range of benefits Balancing short term disbenefits against long term benefits Benefits information is used highly selectively, to meet the requirements of the dominant stakeholders Achieving transformational change is extremely difficult, and aspirations are progressively watered down The timescale for meaningful benefits realisation is way beyond the timescale for programme management
  20. 20. Summary BM works at different levels – a mindset and a set of tools and techniques BM enables organisations to be clear about the benefits to be expected from investments, and provides a life-cycle process to help ensure those benefits are optimised BM needs to be fitted into the wider approach to change management, performance management and evaluation BM is not a panacea – it doesn’t take away difficult choices and many factors can undermine its effectiveness
  21. 21. References Association for Project Management, Benefits Management Specific Interest Group, 2011, Delivering benefits from investments in change: Winning hearts and minds, APM APM, 2012, Body of Knowledge (6th Ed), Princes Risborough:APM Bradley G., 2006, Benefit Realisation Management, Aldershot: Gower Breese, R., 2012, ‘Benefits realization management: Panacea or false dawn?’ International Journal of Project Management, Volume 30, Number 3: 1438-1451 Breese, R., Jenner, S., Serra, C. E. M. and Thorp, J. (2015) Benefits management: lost or found in translation International Journal of Project Management, Volume 33, Number 7: 341-51 Cabinet Office, 2011, Managing Successful Programmes (4th Ed), London: TSO Gartner, 2011. Benefits Realization: The Gift That Keeps On Giving Jenner, S., 2009, Realising Benefits from Government ICT Investment – a fool’s errand?, Reading: Academic Publishing Jenner, S., 2010, Transforming Government and Public Services, Farnham: Gower Jenner, S., 2012, Managing benefits: Optimising the return from investments, APMG/TSO Serra, C. E. M. and Kunc, M., 2015, Benefits Realisation Management and its influence on project success and on the execution of business strategies, International Journal of Project Management, Volume 33, Number 1: 53-66 PMI, 2016, ‘Pulse of the Profession’ report, The strategic impact of projects: identify benefits to drive business results.

Presentation by Dr Richard Breese on 13 February 2017 for the Midlands branch

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