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ValuProposition
The
Every project
is different, but
organizations
must look at
each through
a shared lens:
business value.
By Matt Alderton
Portraits by jessyel ty gonzalez
AUGUST 2013 PM NETWORK 41
e
“If I delivered a project on
schedule, on budget and within
the right scope, and no one
ever uses it, I wasted time
and money. That’s why you
need to constantly review
projects for whatever it is your
company considers value.”
—Elizabeth Virdin, PMP, Catholic Health Initiatives,
Englewood, Colorado, USA
42 PM NETWORK AUGUST 2013 WWW.PMI.ORG
way for companies to measure success is to define
those benefits upfront—and track the organiza-
tional impact after each project has been put to bed.
Why Ask Why?
Defining the business value of a project during the
planning process can give project leaders informa-
tion they need to make smart decisions throughout
execution. Knowing where a project should take an
organization, not just what it’s supposed to achieve,
helps practitioners measure how effectively their
initiatives are delivering their intended value.
That can give organizations a powerful edge.
PMI’s Pulse of the Profession™ study identified ben-
efits realization maturity as one of the main factors
hen Elizabeth Virdin,
PMP, became a project manager,
she faced a daunting task shared by
many in the profession: explaining to
her mother what she does all day.
“I said, ‘Mom, you know when you
make a lemon meringue pie? That’s a proj-
ect,’” says Ms. Virdin, analytics portfolio manager at
Catholic Health Initiatives, a national not-for-profit
health system in Englewood, Colorado, USA.
The number of pies needed is the scope. The
amount of time until they’re needed is the schedule.
The ingredients are the resources, and the amount
allotted for groceries is the budget.
But the most important part, Ms. Virdin explains,
is the taste. If the pie is a hit, it has delivered its
intended value. If the guests wanted ice cream, the
project would be considered a failure.
“If I delivered a project on schedule, on budget
and within the right scope, and no one ever uses it,
I wasted time and money,” Ms. Virdin says. “That’s
why you need to constantly review projects for
whatever it is your company considers value.”
Be it a dessert or an IT system, every project
needs to deliver its intended benefits. And the only
AUGUST 2013 PM NETWORK 43
that distinguishes high-performing organizations
from their low-performing peers. Organizations
with high benefits realization maturity delivered
79 percent of their projects successfully, compared
with 56 percent of projects completed by less
mature counterparts.
Elevating maturity requires measurement, says
Nealand Lewis, PMP, vice president, wholesale
banking program manager, Wells Fargo Bank,
Charlotte, North Carolina, USA.
“It’s difficult to manage what you don’t mea-
sure,” he says. “If you don’t have metrics in place,
you can’t measure business value. And if you don’t
measure business value, you can’t service your cus-
tomers’ needs.”
Organizations with high benefits
realization maturity delivered
79 percent
of their projects successfully,
compared with 56 percent
of projects completed by less
mature counterparts.
Source: Pulse of the Profession™, PMI
Project leaders should start that process even
before the project’s launch. At Catholic Health
Initiatives, Ms. Virdin and her manager apply five
measures to assess the strategic value of analytic
development projects in the planning process and
throughout the life of the product, even after the
project is completed:
1. Business value: Does the solution advance the
organization toward its goals?
2. Satisfaction: Does the solution create value for the
user community, relative to alternative solutions?
3. Performance: Does the solution do what it was
contracted to do, at the level at which it was con-
tracted to do it?
4. Cost: Does the solution deliver sufficient value
“If you don’t have metrics in place, you can’t measure
business value. And if you don’t measure business
value, you can’t service your customers’ needs.”
—Nealand Lewis, PMP, Wells Fargo Bank, Charlotte, North Carolina, USA
PMI’s Pulse of
the Profession™
study identified
benefits
realization
maturity
as one of the main
factors that
distinguish
high-performing
organizations
from their
low-performing
peers.
for its cost, and does that cost maximize savings
opportunities, such as volume discounts?
5. Risk: Does the solution mitigate risk by providing
appropriate security and controls?
To assess value in each of these categories, Ms.
Virdin and her team ask a series of yes-or-no questions
based on the organization’s business requirements.
“It’s green, yellow or red,” Ms. Virdin says.
“You’re considered green if you answer yes to all the
questions. Otherwise, [the solution] isn’t strategi-
cally aligned or of value in relation to the five mea-
sures, and if it’s not strategically aligned, it should
not go any further.”
Rodrigo Cesar Thahira, PMP, takes a similar
approach to determining value metrics in his role
44 PM NETWORK AUGUST 2013 WWW.PMI.ORG
AUGUST 2013 PM NETWORK 45
objectives are and what the organization will do to
deliver its mission and reach its long-term vision,”
he says.
Apples to Apples
Done right, metrics inform executives, helping
them steer their organization in the right direc-
tion. It’s up to project leaders to develop ways to
compare disparate projects so executives have a
baseline against which they can balance the entire
project portfolio.
“By definition, all projects are unique,” Mr. Lewis
says. “But from a metrics standpoint, you want to
get all of your projects corralled on the same table
so that you can look at them across the continuum
from a portfolio or program standpoint and see if
they’re meeting the needs of your stakeholders.”
The projects at Ms. Virdin’s organization often
have very little in common. “It’s not apples to
oranges. It’s apples to pencils,” she says.
Still, the team must find a way to objectively
compare them. To turn pencils into apples, she
relies on the system of questions in the five measure
areas. “It doesn’t matter what’s in your portfolio.
With a ‘yes,’ ‘no’ or ‘does not apply,’ you can mea-
sure the performance and the value of unlike solu-
tions. This allows us to make better decisions on the
strategic fit and need,” Ms. Virdin says.
A shared vernacular around benefits realiza-
tion—and metrics—creates portfolio-level momen-
tum that moves organizations farther, faster. The
alternative, according to Mr. Lewis, is extinction.
“Whichever organization delivers the most value
survives the longest.” PM
as project management officer and project portfo-
lio manager at Leão Alimentos e Bebidas, a food
and beverage company in São Paulo, Brazil. After
the organization defines its strategic goals, project
leaders must define the criteria to achieve those
goals and develop metrics that measure value
against them.
If a project supports a strategic goal of increas-
ing sales, for instance, excellent customer service is
one criterion that would be required to deliver that
value. The project’s ultimate success would then
be measured by how well it met that business goal
over time.
“It will be very hard to discuss business value
without a clear view about what your strategic
“It will be very hard
to discuss business
value without a clear
view about what your
strategic objectives are and
what the organization will do
to deliver its mission and reach
its long-term vision.”
—Rodrigo Cesar Thahira, PMP, Leão Alimentos e Bebidas, São
Paulo, Brazil
“It doesn’t matter
what’s in your
portfolio. With a ‘yes,’
‘no’ or ‘does not apply,’
you can measure the
performance and
the value of unlike
solutions. This allows
us to make better
decisions on the
strategic fit and need.”
—Elizabeth Virdin, PMP

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The Value Proposition - August 2013

  • 1. ValuProposition The Every project is different, but organizations must look at each through a shared lens: business value. By Matt Alderton Portraits by jessyel ty gonzalez
  • 2. AUGUST 2013 PM NETWORK 41 e “If I delivered a project on schedule, on budget and within the right scope, and no one ever uses it, I wasted time and money. That’s why you need to constantly review projects for whatever it is your company considers value.” —Elizabeth Virdin, PMP, Catholic Health Initiatives, Englewood, Colorado, USA
  • 3. 42 PM NETWORK AUGUST 2013 WWW.PMI.ORG way for companies to measure success is to define those benefits upfront—and track the organiza- tional impact after each project has been put to bed. Why Ask Why? Defining the business value of a project during the planning process can give project leaders informa- tion they need to make smart decisions throughout execution. Knowing where a project should take an organization, not just what it’s supposed to achieve, helps practitioners measure how effectively their initiatives are delivering their intended value. That can give organizations a powerful edge. PMI’s Pulse of the Profession™ study identified ben- efits realization maturity as one of the main factors hen Elizabeth Virdin, PMP, became a project manager, she faced a daunting task shared by many in the profession: explaining to her mother what she does all day. “I said, ‘Mom, you know when you make a lemon meringue pie? That’s a proj- ect,’” says Ms. Virdin, analytics portfolio manager at Catholic Health Initiatives, a national not-for-profit health system in Englewood, Colorado, USA. The number of pies needed is the scope. The amount of time until they’re needed is the schedule. The ingredients are the resources, and the amount allotted for groceries is the budget. But the most important part, Ms. Virdin explains, is the taste. If the pie is a hit, it has delivered its intended value. If the guests wanted ice cream, the project would be considered a failure. “If I delivered a project on schedule, on budget and within the right scope, and no one ever uses it, I wasted time and money,” Ms. Virdin says. “That’s why you need to constantly review projects for whatever it is your company considers value.” Be it a dessert or an IT system, every project needs to deliver its intended benefits. And the only
  • 4. AUGUST 2013 PM NETWORK 43 that distinguishes high-performing organizations from their low-performing peers. Organizations with high benefits realization maturity delivered 79 percent of their projects successfully, compared with 56 percent of projects completed by less mature counterparts. Elevating maturity requires measurement, says Nealand Lewis, PMP, vice president, wholesale banking program manager, Wells Fargo Bank, Charlotte, North Carolina, USA. “It’s difficult to manage what you don’t mea- sure,” he says. “If you don’t have metrics in place, you can’t measure business value. And if you don’t measure business value, you can’t service your cus- tomers’ needs.” Organizations with high benefits realization maturity delivered 79 percent of their projects successfully, compared with 56 percent of projects completed by less mature counterparts. Source: Pulse of the Profession™, PMI
  • 5. Project leaders should start that process even before the project’s launch. At Catholic Health Initiatives, Ms. Virdin and her manager apply five measures to assess the strategic value of analytic development projects in the planning process and throughout the life of the product, even after the project is completed: 1. Business value: Does the solution advance the organization toward its goals? 2. Satisfaction: Does the solution create value for the user community, relative to alternative solutions? 3. Performance: Does the solution do what it was contracted to do, at the level at which it was con- tracted to do it? 4. Cost: Does the solution deliver sufficient value “If you don’t have metrics in place, you can’t measure business value. And if you don’t measure business value, you can’t service your customers’ needs.” —Nealand Lewis, PMP, Wells Fargo Bank, Charlotte, North Carolina, USA PMI’s Pulse of the Profession™ study identified benefits realization maturity as one of the main factors that distinguish high-performing organizations from their low-performing peers. for its cost, and does that cost maximize savings opportunities, such as volume discounts? 5. Risk: Does the solution mitigate risk by providing appropriate security and controls? To assess value in each of these categories, Ms. Virdin and her team ask a series of yes-or-no questions based on the organization’s business requirements. “It’s green, yellow or red,” Ms. Virdin says. “You’re considered green if you answer yes to all the questions. Otherwise, [the solution] isn’t strategi- cally aligned or of value in relation to the five mea- sures, and if it’s not strategically aligned, it should not go any further.” Rodrigo Cesar Thahira, PMP, takes a similar approach to determining value metrics in his role 44 PM NETWORK AUGUST 2013 WWW.PMI.ORG
  • 6. AUGUST 2013 PM NETWORK 45 objectives are and what the organization will do to deliver its mission and reach its long-term vision,” he says. Apples to Apples Done right, metrics inform executives, helping them steer their organization in the right direc- tion. It’s up to project leaders to develop ways to compare disparate projects so executives have a baseline against which they can balance the entire project portfolio. “By definition, all projects are unique,” Mr. Lewis says. “But from a metrics standpoint, you want to get all of your projects corralled on the same table so that you can look at them across the continuum from a portfolio or program standpoint and see if they’re meeting the needs of your stakeholders.” The projects at Ms. Virdin’s organization often have very little in common. “It’s not apples to oranges. It’s apples to pencils,” she says. Still, the team must find a way to objectively compare them. To turn pencils into apples, she relies on the system of questions in the five measure areas. “It doesn’t matter what’s in your portfolio. With a ‘yes,’ ‘no’ or ‘does not apply,’ you can mea- sure the performance and the value of unlike solu- tions. This allows us to make better decisions on the strategic fit and need,” Ms. Virdin says. A shared vernacular around benefits realiza- tion—and metrics—creates portfolio-level momen- tum that moves organizations farther, faster. The alternative, according to Mr. Lewis, is extinction. “Whichever organization delivers the most value survives the longest.” PM as project management officer and project portfo- lio manager at Leão Alimentos e Bebidas, a food and beverage company in São Paulo, Brazil. After the organization defines its strategic goals, project leaders must define the criteria to achieve those goals and develop metrics that measure value against them. If a project supports a strategic goal of increas- ing sales, for instance, excellent customer service is one criterion that would be required to deliver that value. The project’s ultimate success would then be measured by how well it met that business goal over time. “It will be very hard to discuss business value without a clear view about what your strategic “It will be very hard to discuss business value without a clear view about what your strategic objectives are and what the organization will do to deliver its mission and reach its long-term vision.” —Rodrigo Cesar Thahira, PMP, Leão Alimentos e Bebidas, São Paulo, Brazil “It doesn’t matter what’s in your portfolio. With a ‘yes,’ ‘no’ or ‘does not apply,’ you can measure the performance and the value of unlike solutions. This allows us to make better decisions on the strategic fit and need.” —Elizabeth Virdin, PMP