human alchemy - turning people and projects into gold - why adopting benefits management isn't...

Human Alchemylearning how to turn people and projects into gold

orwhy adopting Benefits Management isn’t as hard as you think

Presented by:

Youssef Mourra

Founder & Principal Consultant, Nonsuch Consulting Services

021 423 620 [email protected] @youssefmourra

September 7, 2016NZ Project Management Conference 2016

The Langham, Auckland

[email protected]

A bit about me…

• 26 years’ experience in project, programme and portfolio management in various countries.

• For the past 13 years, based in Wellington and servicing customers and clients in NZ and Australia and nearby.

• I have three children under 13 and when I have time, I enjoy music, reading, fruit trees, cricket, theatre, travel, wine, politics and etymology (the history and study of words).

• I’m a regular presenter at the annual Project Management Conferences in NZ and occasionally in Australia. Some of my more recent presentations have been:• Eddie Obeng – Project Types• The Zombies of Project Management, Programme and Portfolio Management• So You think you’re ready to be a Consultant?• Earned Value using Lego Bricks

September 7, 2016 © Nonsuch Consulting 2016 Slide 2

Agenda

• Words & Definitions – talking the same language today

• What is Benefits Management?

• Why should I be interested in Benefits Management?

• How does Benefits Management work?

• Adopting Benefits Management

• Embedding Benefits Management

I might stop for questions but generally would ask that you leave them to the end.


My Objective for you

• Understand the terminology and basics of Benefits Management and share some tips and techniques +

• Appreciate the importance of Benefits Management and its fundamental role in today’s organisational and business environments +

• Agree that Benefits Management is not hard

=• Excite you enough to want to apply Benefits Management where

you work

Slide 4September 7, 2016 © Nonsuch Consulting 2016

Words & Definitions

• What is alchemy?• The virtues of gold has been

promoted by various alchemists throughout history; one of the best known is Paracelsus as is his production of what he called Aurum Potable. The Chinese called it “Kim” (Gold) and “Yeh” (Juice) becoming “Kimiya”. The Arabic culture then added the definitive article ‘al’ (the) creating “Al-kimiya” or Alchemy.

• Turning base metals into gold or the transmutation of gold into healing tonics, or substances to give a human special advantages.


Words & Definitions

• What is human alchemy?• At its worst…it was slavery.

• At its best….it’s about making ‘gold’ out of our investments in projects and people


Words & Definitions

• What is gold and what does ‘gold’ mean to you?


Words & Definitions

• What is gold and what does ‘gold’ mean to you?


Performance Indicators

Quality

Success

Customer Satisfaction

Doing the Right Thing

Words & Definitions

• The common factor across these definitions of gold is we have raised ‘the value’ of the ‘gold’

• So, what is Value?• Value is the benefits minus the cost (sometimes referred to as the ‘return on

investment’)

• Value is often documented in a Business Case and measured using NPV (Net Present Value), IRR (Internal Rate of Reduction) and/or ROI (Return of Investment) calculations


Benefits – Cost = Value

Words & Definitions

• So, what is or are Benefits?

• Benefits are the hoped for returns on any given project:• Increased Revenue

• Better service delivery

• Greater efficiency

• Reduced Costs

• Greater wealth

• Improved resilience

• Doing the right thing

• Compliance


Human AlchemyWhat is Benefits Management?

Awareness


Benefits

• What is a benefit?• A benefit is the measurable improvement (“value”) resulting from a project’s

outcomes and is perceived as an advantage by one or more stakeholders.

• What is benefits management?• Benefits Management is the process that identifies, defines, measures and

manages the delivery of the benefits to the organisation. It is the process that helps organisations get the most from the project’s outputs.

• Note the focus on Outcomes and Outputs. Is there a difference and is this important?


Outputs

• Projects produce or deliver Outputs (sometimes called Products, or Deliverables). Outputs can usually be seen, touched, or moved about. If you can get your hands on and touch the thing your project is producing, it’s probably an Output

• Example 1:• Recruitment. You might have a project to recruit some new staff. The outputs for

your project might include a recruitment strategy, position descriptions, job adverts, shortlist criteria and so on

• Example 2:• Sales. You might have a project to develop a new car model. The outputs for your

project might include a prototype, specifications, competitor analysis, bill of materials and so on


Outcomes

• An Outcome (sometimes called an Objective) is a level of performance, or achievement. Outcomes are a description of a future new or changed state and often include the quantification and qualification of the same

• Example 1 outcomes may include:• increased capacity to perform particular tasks• Increased capability with new levels of skills and experience to ensure we do things

better for our customers• Improved response time when dealing with customers

• Example 2 outcomes may include:• Increased market share for the vehicle’s class• Enhanced reputation of our brand• Raised awareness of our brand in the NZ marketplace, or with a targeted group


Outcomes and Outputs

• In both cases, understanding the desired outcomes helps us define WHY we are doing projects and helps drive the desired outputs. This establishes the project driver or imperative

• Outcomes come first. They should be expressed quantitatively, wherever possible; e.g.:• to grow sales by 15%, by the end of the year• to reduce customer waiting time to less than 2 minutes, by the end of June• to double our capacity to deliver XYZ widgets, by January 1st

• Outputs come next. This is where we get into the WHAT and How by describing the tangible, in some cases, physical ‘widgets’ or ‘thingies’ your project will create and the approach we will take


What’s the relevancy to Benefits Management?

• Outputs are measured using well known project criteria:• Time – key dates, milestones, schedules etc.

• Cost – Capital and Operating costs (CAPEX and OPEX) , running costs, total cost of ownership etc.

• Scope – range of features, delivery definition, impacted audience/s etc.

• Quality – durability, design, fit for purpose

• Outcomes are measured in benefits:• Qualitatively – through describing the future state in words

• Quantitatively – through $ values and/or establishment of performance criteria


• Original Budget?• $7 million

• Final Budget?• $105 million.

• Original Dateline?• 5 years

• Final Dateline• 14 years

• Delivered 60% of the original specifications

• Maintenance costs are 5 times original estimates even with inflation adjustments


Was this project successful?

Case Study – Sydney Opera House

Case Study – Sydney Opera House

• What were the desired outcomes?• World class building

• Major performing arts centre

• Iconic & major tourist attraction to bring visitors to Sydney

• Opera House visitors• Estimate: 50 000 visitors annually

• Actual: 350 000 visitors annually


Yes, on outcomes. No, on outputs

Human AlchemyWhy should I be interested in Benefits Management?

Desire


Outcomes and Outputs

• Failed outputs and great outcome?

• Fantastic output and failed outcome?


…a lot of pain and bit of luck …a white elephant

Key Failings

(Doing the WRONG things)

•60% of organisations do not link budgets to strategy

•84% of organisations unable to demonstrate the link between budgets and business needs

•44% of board directors cannot identify the key drivers of value in their companies

•69% of major capital projects are neither on time nor on budget

•36% of projects are found to have over-stated their potential benefits

•45% of projects only go ahead because a senior executive insists

•21% of projects should have been approved but lost to those with more vocal support

What’s in it for your organisation?

50%Value

Achieved

50%Value Lost

100%

66%

0%75% 100%

Eff

ect

ive

Se

lect

ion

–‘D

oin

g t

he

Rig

ht

Th

ing

s’Id

en

tify

ing

Po

ten

tia

l Bu

sin

ess

Va

lue

Effective Execution – ‘Doing Things Right ’Realising Business Value

Source: Standish Group, ‘Chaos Report’ 2006

Primary Source: : IDC, September 2008September 7, 2016 © Nonsuch Consulting 2016 Slide 21

Benefits of getting it RIGHT

• Potential savings of 20% of portfolio value in Year 1

• 30% improvement in time to market for revenue-generating initiatives

• 5% reduction in overall costs

• 59% reduction in project failures

• 78% reduction in redundant projects

• 37% decrease in cost per project

• 35% increase in number of projects under management

The benefit in managing benefits…

50%Value

Achieved

50%Value Lost

100%

66%

0%75% 100%

PortfolioManagement

Pro

ject

Mg

t


Eff

ect

ive

Se

lect

ion

–‘D

oin

g t

he

Rig

ht

Th

ing

s’Id

en

tify

ing

Po

ten

tia

l Bu

sin

ess

Va

lue

Effective Execution – ‘Doing Things Right ’Realising Business Value

Source: Standish Group, ‘Chaos Report’ 2006

Primary Source: : IDC, September 2008

Value of Benefits Management?

• Some include:• Achievement of maximum benefits delivery.• Clear understanding of the source and nature of each benefit.• Minimisation of dis-benefits.• Single point accountability for delivery of each benefit during and beyond the life of

a project/programme.• Clear benefits delivery timescales which are agreed.• Alignment of project benefits to strategic goals.• Ability to measure performance of a project/programme against its initial

justification.• Ability to assess the impact of agreed changes on planned benefits.• Enable decisions to be made around portfolio prioritisation and management.


Human AlchemyHow does Benefits Management work?

Knowledge


Types of Benefits

• Benefits can normally be categorised into one of two broad categories:• Direct financial• Non-direct financial

• Non-Direct financial benefits can then be split again into four broad types:• Efficiency• Effectiveness• Enabling• Soft


Direct Financial Benefits

• Direct financial benefits are hard, tangible benefits that can be measured and assessed for their direct effect on the bottom line. They tend to be easier to identify and quantify.

• Some examples of direct financial benefits include:• Cost reduction

• Revenue growth


Non-Direct Financial Benefits

• Non-direct financial benefits are tangible benefits that can be measured and assessed but do not have a direct correlation to the bottom line. They often require an investment that then delivers the hoped for benefits. Examples of non-direct financial benefits include:• Safety compliance

• Process efficiency

• Brand awareness

• Legislation compliance

• Cost avoidance

• Revenue Protection



Effectiveness Benefits• Effective benefits are those that accrue

to an organisation for doing the right things and doing them right.

• These are important factors when considering non-direct financial benefits like ‘corporate citizenship’ or excellence in delivery

• Examples of effective benefits include:• Accurate customer data• Delivering quality outputs• Best in class results

Efficiency Benefits• Efficiency benefits are those that accrue

which are related to doing more, achieving more or earning more with the same amount or fewer resources or costs

• These are an important factor when influencing investment decisions. It’s important to quantify the Do Nothing options to provide a baseline for any potential efficiency savings.

• Examples of efficiency benefits include:• Revenue protection• Business Process Improvement• Cost Avoidance• Efficient systems – Master Data



Enabling Benefits• Enabling benefits enable other

projects/programmes or the organisation’s resources to deliver benefits. It is important to remember that there is potential for ‘double counting’ benefits when enabling benefits are considered. Examples of enabling benefits include:• Implemented IT systems• Improved skills and competencies• Acquisition of Specialist equipment

Soft Benefits• Soft Benefits are factors that

improve business without delivering a direct financial impact. They are largely intangible and sometimes cannot be measured in a meaningful way. Examples of soft benefits include:• Staff satisfaction• Empowerment in role• Product awareness• Team interaction• Brand reputation• Staff Morale


Other Considerations: Disbenefits

• In addition to benefits, a project/programme can also deliver dis-benefits. A dis-benefit refers to the unintended negative consequences of a project like a project /programme outcome that is perceived as negative by one or more stakeholders.

• Dis-benefits are actual consequences of an activity, as opposed to a risk which has some uncertainty about whether it will materialise. Where possible, dis-benefits should be avoided but if there is a risk of dis-benefits, then as with benefits, they too need to be quantified and tracked. Examples of dis-benefits include:

• The cancellation of another project’s benefits; Drop in productivity; Damage to organisation reputation; Increased cost.


Other Considerations: Net Benefits

• The net benefit is the sum of the project benefits minus the dis-benefits (negative consequences).

• For financial benefits the net benefit of the project is the sum of the present value of benefits minus the present project costs.


Net Benefits = Benefits –Disbenefits

Some Gotchas…

Double Counting• Double counting of benefits occurs when the same benefit is included twice

or more through different measures. Care should be taken to ensure that benefits are not double counted at the Portfolio, Programme and Project level.

Cannabilisation• Cannibilisation of benefits occurs when a project, unintendedly, is consuming

the benefits that are being achieved within a BAU or operational environment or from another project elsewhere in the organisation


Human AlchemyAdopting Benefits Management

Ability


Benefits Management - Application

• There is no other more important factor associated with a project, programme and portfolio than establishing and understanding the benefits associated with their delivery.

• Benefits should form the basis for making decisions related to developing and approving the Business Case, defining the scope, accepting or rejecting change requests, deciding to continue with the delivery and how the final deliverables are accepted.

• Keep it lean and adopt right practice for your organisation rather than light or best practice


Benefits Management Lifecycle

• What is the vision or opportunity?

• Are there regulatory requirements?

• What high level risks exist?

• Progress Reporting• Test the Business

Case• Prepared for

Handover

• Outputs delivered• Realise the Benefits• Lessons Learned


• Are the stated benefits feasible and realistic?

• How long is the payback time?• What systems need to be

modified to track the realisation of the benefits

Benefits Management Lifecycle

Benefits Identify• In the Benefits Identify phase, the key activity is to conduct a Benefits Identification

Workshop. The purpose of this workshop is to bring all key stakeholders of a programme together to define how the programme’s goals align to the organisation’s strategic goals and the associated benefits.

• The ultimate deliverable for the Benefits Identification Phase is an agreement by key stakeholders of the project/programme’s expected benefits. This is outlined in a Benefits Map, which is created by the Project/Programme Manager during the workshop.

Benefits Quantify• The key purpose of the Benefits Quantify Phase is to reliably define and prove all

identified benefits. In this step the objective measures to be used for measuring and realising benefits and collecting the baseline data are defined.

• The ultimate deliverable from the Benefits Quantify Phase is an updated Business Case to include all relevant benefits details.


Benefits Management Life Cycle

Benefits Tracking• The purpose of this phase is to identify and document specifically what

needs to be done in order to deliver the identified project/programme benefits and then execute the resulting plan.

• The ultimate deliverable for the Benefits Track Phase is the Benefits Realisation Plan, used to facilitate the achievement of benefits.

Benefits Realisation• The key purpose of the Benefits Realisation Phase is to ensure that all

benefits measurement and monitoring activities continue through to the full realisation of each documented benefit.

• The ultimate deliverable for the Benefits Realisation phase is the realisation of benefits.


P3M (Project, Programme, Portfolio Management)Triangle


Strategic

PortfolioManagement

ProjectManagement

ProgrammeManagement

Setting of Strategic Goals

Prioritising delivery of Portfolio

Integrated Delivery

Optimise investment decisions based on strategy, objectives, capability and constraints

Manage benefits, change, integration, project inter-dependencies & resources

Manage time, resource, quality & scope

Define objectives from strategic goalsStrategy

Vision

Benefits Management & Portfolios

• What is a Portfolio?• PMI: “A portfolio is a collection of projects and Programmes and other work

grouped to facilitate the effective management of that work to meet strategic business objectives. The components of a portfolio are quantifiable – they can be measured, ranked and prioritised”

• Axelos: “An organisation’s portfolio is the totality of its investment (or segment thereof) in the changes required to achieve its strategic objectives, particularly change delivered via formalised project and Programme management methodologies”


Benefits Mgt. within Portfolio Mgt. Cycle (an example)

Plan & Prioritise Optimise Realise

Identify Quantify Track Realise & Review

Business Objectives & Strategy

Port

folio

M

gmt.

Be

nef

its

Mgm

t.

Gate 4Gate 3Gate 2Gate 1Gate 0 QA GateGate -1


Benefits Management & Programmes

• What is a Programme?• A temporary flexible organisation created to coordinate, direct and oversee

the implementation of a set of related projects and activities. The focus is on Benefits, Change, Dependency and Resource Management.

• Why do we have Programmes?• In order to deliver outcomes and benefits related to the organisation’s

strategic objectives. These outcomes and benefits are greater in size than had the projects been run separately



• The Benefits Management process works well with programmes by:• Ensuring the benefits identified and quantified are key inputs into deciding

whether a programme is worth investing in or otherwise; and

• Once a programme has been authorised, ensuring benefits continue to drive the decision making around the mobilisation of projects as required within the programme.




Programme

ManagementIdentify the Programme

Define the Programme

Close the Programme

Deliver the Programme

Deliver the

Capability

Realising the

Benefits

Managing

the

Tranches

Review and Prepare

Establish

Benefits

Management

Benefits

IdentificationBenefits

Quantification

Benefits

Tracking

Benefits

Realisation

Benefits Management & Projects

• The Benefits Management process also works well with projects by ensuring:• The benefits identified and quantified are key inputs into deciding whether a

project is worth investing in or otherwise and ensuring the tracking of benefits helps ensure correct decisions are made on a project related to scope definition, change requests and project handover.

• Promoting the primary importance of benefits management helps ensure a project’s focus is not just on the deliverable (or the output) of the project, but rather on the desired business outcome (or result). This helps keep the focus on ensuring the project outputs helps delivers an organisation’s strategy successfully.


Benefits Management & Projects


Project

Management

Initiate Phase

Plan PhaseClose Phase

Benefits

Management

Benefits

IdentificationBenefits

Quantification

Benefits

Tracking

Benefits

Realisation

Deliver Phase

Project, Benefits & Change Management – the union.

Unfreeze Move Refreeze

Project Manager

Project Sponsor

Output/s

Benefits RealisationBenefits Identified and Quantified

Change Management Project Management

Outcomes

Benefits Management

Benefits Tracking


Benefits Management Process

Benefits Status Reporting

Benefits Realisation


Benefits TrackingBenefits QuantificationBenefits Identification

Create Benefit Map

Programme Director

· Benefits Map

Update Business Case

Programme Director

· Programme Business Case

Collect Baseline Data and Populate Benefits

Worksheets

Programme Manager

Business Change Owner

Financial Team

· Benefits Worksheet


Create Benefits Realisation Plan

Programme Manager


· Benefits Realisation Plan

Benefit Identification

Workshop

Programme Manager


Key Stakeholders

· Benefit Identification Workshop Presentation and Guidelines

· Workshop Agenda/Minutes

Review and Approve Benefits Realisation Plan

Senior Responsible

Owner

Update Benefits Register

Programme Manager

· Benefits Register

Execute Benefits Realisation Plan

Programme Manager


Handover to BAU

Programme Manager

Project Manager(s)



Programme Manager

· Programme Status Report

Complete Benefits

Realisation Review(s)

Programme Manager

· Programme Review Report

Update Benefits Register


· Benefits Register (updated)

The diagram below depicts the steps, the resources and outputs involved in Benefits Management and how they function within the high-level Benefits Management process.


Benefits Management – Benefits Identification

• Project deliverables lead to measureable programme/project Benefits. • Not all Benefits resulting from an individual project will be immediately

realised, a project must be able to demonstrate how value or return will be delivered by identifying the specific programme Benefits that will be realised through making the investment and change.

• All projects should be able to show a clear contribution to an organisation’s strategic goals. If a project cannot show any alignment to at least one, then it should not be considered for the organisation’s portfolio of projects and change initiatives.

• In addition to exploring all potential Benefits of a project, any potential dis-Benefits should also be identified at this stage.


Benefits Management – Benefits Identification

• The below diagram displays the link between the project objectives and the strategic organisational goals. That is; the project deliverables are identified from the project objectives, which lead to project outcomes that deliver the project Benefits that will ultimately assist in realising key organisational outcomes and goals.

Project Objectives

Project Outputs

Project Outcomes

Project Benefits

KeyOrganisational

Outcomes

Strategic Organisational

Goals


Benefits Management – Benefits Quantification

• Once expected Benefits for a project have been identified, each must then be further investigated and a Benefits Worksheet completed outlining in detail:• Description of the Benefits.• Alignment to strategic goals.• Timeframe – when is it likely to occur and over what period of time?• Calculation and measurement - how the Benefits will be calculated, measured,

tracked, the target and the baseline from which it will be measured.• The Benefits owner.• Business actions required.• Assumptions made.• Associated cost of measurement and realisation.



Change Management

Change Management forms a key part of managing and realising Benefits.

• The level of support or resistance from the main stakeholder groups should be assessed at this time in order to understand any potential impacts to benefits realisation and be able to address any issues surrounding proposed changes.

• A Business Impact Assessment must be completed and approved by the key stakeholders; the information from this assessment will also form part of the project/programme Business Case.



Once the benefits have been identified and quantified, they must be included in the Business Case.

A business case is a key document because it determines:

a) Why we are doing a project

b) The benefits of doing the project

c) The investment required to achieve benefits

d) The payback period

e) How and by whom the benefits will be delivered and controlled


Business Case - Options Analysis

This summary provides the Project Board and Stakeholders with sufficient information to judge which option presents best value. It should provide answers as to whether the anticipated benefits to the desired option are more desirable, viable and achievable than the other options available.

• Do nothing (should always be the starting option to act as basis for quantifying the other options)

• Do the minimum

• Do something


Business Case – Documenting Benefits

Considering both positive and negative (dis) benefits:1. Current status of each benefit in quantifiable terms so that measurable

improvements can be assessed after the project is complete.2. How the improvements can be made.3. When the improvements can be made.Ensure these are :• Aligned to corporate objectives and strategy• Mapped from outputs and outcomes provided by the project• Quantified & Measurable • Assigned


Business Case – Cash and Benefits flow

• Over what period of time will the project costs be incurred?

• Over what period of time will the project benefits be accrued?

• What’s the payback period?


Benefits Management – Checking in


We have a history of checking in on the costs of a project each month or each quarter. This is financially responsible. However, most organisations do not have a history of checking in on the latest forecast benefits amount. This is irresponsible from an investment-minded point of view.

What happens if our project costs go up to $1.2m and our benefits value drops to $3m from their respective start values?What happens if our project costs then go up to $1.6m and our benefits value rises to $12m?What sort of discussions take place at A? What discussions are had at B?

B

A

Who tracks the project output’s costs? The Project ManagerWho should track the project outcome’s benefits? The Project Sponsor

Benefits Management – Tracking

Benefits Realisation Plan

• The purpose of this step is to identify specifically what has to be done in order to deliver the Benefits and to update, execute and report on the Benefits Realisation Plan, which can be used to facilitate the realisation of Benefits.

• This stage should identify the full implications of the changes which have to take place in order to achieve the expected Benefits.

• Once it is time to execute the actions detailed in the Benefits Realisation Plan, progress should be reviewed and reported frequently in order to measure and monitor success to date and revise the plan if necessary.




• The Plan should identify:• All Benefits related activities, their associated timings and those who carry

responsibility for them.• The baseline or activities required for establishing the baseline.• Monitoring activities required to record the onset of each Benefits, including

checkpoints and reviews to ensure that effective actions have been taken at the right time to enable Benefits delivery and how many are required.

• The business change required to realise Benefits and any impacts on the organisation.

• Details of any hand over and embedding activities required beyond project delivery and closure.




• Consideration should be given to risks that may either reduce / enhance the benefits or reduce / increase the cost of the project.

• A summary of the aggregate risks and the major risks should be included so that the Project Board has a clear understanding of how the proposed benefits may be affected throughtout the project.

• Benefits should be reviewed and validated throughout the project and once the project outputs are transitioned to BAU.


Benefits Management – Realisation

Benefits Realisation Plan• The Benefits Realisation Plan should be reviewed and tracked each month

in the reporting cycle. • Regular meetings should be held with the Project Manager and Business

Owner to confirm the benefits, review how they are tracking and identify any new actions against the benefits.

• Benefits should be quantified at the end of each project phase and agreed by the Business Owner before entering the next project phase.

• If the identified benefits are no longer achievable, a decision must be made to stop the project. Subsequently, if the benefits are attainable earlier than first thought, the project timeframes should be revised in accordance.



Handover Plan

• Often not all Benefits are realised during the life of a project and it becomes the responsibility of the impacted business area to deliver this.

• Ensuring that Benefits realisation is successfully embedded with BAU is an integral part of Benefits management.

• Benefits realisation review(s) should be carried out as identified in the Business Realisation Plan.



Post Implementation Benefits Review

• It is important to review the benefits after the project outputs have been implemented into the BAU operations. Some benefits may be realised soon after implementation and others will have longer timeframes – these should be included initially in the Benefits Realisation Plan and reviewed in the Benefits Realisation Phase and re-documented in the Benefits Transition Plan.


Human AlchemyEmbedding Benefits Management

Reinforce


Embedding Benefits Management

• Four key ingredients• Principles of Benefits Management

• Lean approach – right sizing

• Proper & structured Governance

• Defined Roles & Responsibilities


Benefits Management Principles

• Foundation upon which successful Benefits Management practices are based on:• Align Benefits with Strategy

• Manage Benefits from a portfolio perspective

• Start with the end in mind

• Utilise successful delivery methods

• Integrate Benefits management with performance management

• Apply effective governance

• Develop an investment minded culture


Start now!

• Make a start now. You can sophisticate it over time.


Adopt a lean approach – right sizing

• Consider ‘On a Page’ collateral

• Lighten up the Governance• Adopt a multi-modal approach to delivery but enforce a uniform light

governance• Promote a common set of ‘On a Page’ collateral as compulsory but allow

freedom within the framework


Proposal on a Page (POAP) Options on a Page (OAP) Handover on a Page (HOAP)

Outline Business Case on a Page (oBCOAP) Plan on a Page (PLOAP) Close on a Page (COAP)

Detailed Business Case on a Page (dBCOAP) Status Report on a Page (SROAP) Review on a Page (ROAP)

On a Page sneak preview…

• I’m happy to share a POAP and a BCOAP with you. Please connect with me on Twitter on @YoussefMourra


https://twitter.com/YoussefMourra

Benefits Management Governance


Jane Smith

Chair

Vacant PositionPortfolio ManagerJohn Doe

Chair

CEO

Kate Black

IQA Senior Supplier/s Sponsor Senior User/s

Executive Management Team

Portfolio Governance Group

Delegations (to be defined)

Portfolio Advisory Group

Advice &Recommendation

s

Portfolio Office

Support

Endorsement

VisibilityAdvice

Approval/Direction

[Pj/Pg] Steering Committee/s

Benefits Management - Roles & Responsibilities

Abbreviation Definition

C – Consulted or Counsel

People whose opinions are sought to provide advice or input into the process or decision

A – Accountable The one person who is ultimately answerable for the delivery of the project or initiative and the realisation of the benefits. The Accountable Person authorises the delegation of work to those who are Responsible. There can only be one Accountable Person on any project, group or initiative.

I – Informed Those who are kept in the loop and up to date with progress or decisions being made.

R – Responsible Those who do the activities involved with the task or tasks. There can be more than one Responsible Person on a project.

O – Out of the Loop Those who are consciously kept uninformed with progress or decisions for one of two reasons.· The information is of no relevance to these people and will add no value to the quality

or timeliness of the work being conducted or· The information is likely to create hostility at this point of the progress of the project or

taskS – Support Resources allocated to support those who are Responsible. Unlike Consulted, Support

actually help complete the task for those who are Responsible.


Benefits Management - Ownership

• The Portfolio Governance Group is accountable for realisation of the benefits from the portfolio as a whole. This includes agreeing any trade-off between benefits, any early benefits realisation and how the ‘benefits story’ is told to stakeholders.

• Project Executives/Senior Responsible Owners/Project Sponsors/Programme Sponsors are accountable for benefits for assigned projects/programmes and have to show how the returns will occur during the life of the project or programme. The Senior User/Business Change Manager is responsible for the definition of business need and value before a project or programme is agreed and for benefits realisation after a project or programme completes.



• Successful Benefits Management relies on a partnership approach between a programme / project and representatives from the affected business areas.

• Key roles and their functions in the benefits management lifecycle are outlined below.• Group 1 - Senior Responsible Owner (SRO), Programme Sponsor, Project

Executive, Project Sponsor

• Group 2 - Business Change Owner

• Group 3 - Programme Manager, Project Manager

• Group 4 - Finance Team



• Group 1 - Senior Responsible Owner (SRO), Programme Sponsor, Project Executive, Project Sponsor• This group is fully accountable to the Sponsoring Group and/or the Executive

for the programme meeting its objectives and stewardship of the expected benefits.



• Group 2 - Business Change Owner• The Business Change Owner is accountable for benefits realisation via the adoption and

usage of the new capability and transition to the desired state. • The key responsibilities of the Business Change Owner in the Benefits Management lifecycle

include:• Identify, define and track the benefits and outcomes required of the programme/project and

ensure they are adequately defined and owned• Establishing the measurement method, target and current baseline for benefits.• Ensure development and business ownership of the Benefits Realisation Plan• Ensuring benefits are achieved post programme/project delivery.• Advise Group 1 whether the outputs of the programme/project will deliver the planned

benefits• Assist the Programme Manager and the Senior Responsible Owner in the development of

the Benefits Management Strategy• Implement the mechanisms by which benefits can be realised and measured



• Group 3 - Programme Manager• The Programme Manager is responsible for the programme producing a result capable of

achieving the benefits described in the Business Case. The Programme Manager’s role is to facilitate the Business Change Owner through the Benefits Management lifecycle and process.

• The key responsibilities of the Programme Manager in the programme benefits management lifecycle include:

• Facilitating the Business Change Owner to identify, define and measure proposed benefits.• Defining benefits and populating a Benefits Worksheet for each.• Populating and updating the Benefits Register tab within the Programme Register with

expected project benefits.• Creating and maintaining the Programme Business Case and Benefits Realisation Plan.• Conducting any activities required to ensure benefits are realised.• Reporting on benefits progress during and after the life of the project.

© Nonsuch Consulting 2016 Slide 75September 7, 2016


• Group 3 - Project Manager• The Project Manager is responsible for the successful delivery of the project and its

agreed deliverables through a set of managed project documents.• The key responsibilities of the Project Manager in the benefits management

lifecycle include:• Working with the Project Sponsor to ensure that proposed benefits are identified,

defined and measured and included in the Business Case and/or PMP.• Maintaining the Project Management Plan (PMP) against time, cost, quality,

benefits and scope.• Reporting on benefits progress during the project and highlighting any issues in

achieving the agreed benefits.• Managing the benefits tracking register• Preparing a Transition Plan to hand the benefits management and tracking back to

the business once the project concludes.

September 7, 2016 Slide 76© Nonsuch Consulting 2016


• Group 4 - Finance Team• An organisations’ Finance Team are the key subject matter experts when it

comes to quantifying expected benefits and their realisation.

• The key responsibilities of the Finance Team in the project Benefits Management lifecycle include: • Supporting the development of business cases

• Establising and maintaining Business Case standards

• Providing assistance and advice in completing Benefits Worksheets, where required.

• Reviewing and approving Benefits Worksheets.

• Net Present Value (NPV) calculations and any other financial analysis calculations (IRR, ROI etc.) used by the organisation.


Other Resources


Business Case – Best Practice

Five Case ModelThe Five Cases Model is the best practice standard thinking framework recommended by HM Treasury (OGC) for preparing business cases.

1. Strategic case – Provides a compelling case for change and determines the holistic fit with the organisational strategy

2. Economic case – Represents the best value for money

3. Commercial case – Determines if the potential deal is attractive to the market place and is commercially viable

4.Financial case – Determines if the investment is financially affordable whole of life

5. Management case – Determines what is required from all parties and that it is achievable.


http://www.hm-treasury.gov.uk/home.htm

Business Case – Best PracticeInvestment Management Standard

The State of Victoria Department of Treasury and Finance Investment Management Standard provides a set of practices that support a range of functions that an organisation undertakes to improve the way they operate and manage new investments:

1. Develop the strongest case for an individual investment

2. Ensure an investment delivers the expected benefits

3. Enable decision makers to prioritise competing investments

4. Evaluate the effectiveness of a program of investment

5. Create policy that best responds to the major challenges

6. Define an organisation’s role and improve its effectiveness

It includes the Investment Logic Map tool to support the development of business cases


Business Case – Best Practice

Investment Logic Map

An Investment Logic Map tells the logical story of a proposed investment.

It clearly articulates the problem that is causing us to consider a new investment, the best strategic responses to address the problems and the strategic value to be gained by addressing it.

As such it provides a strong foundation for a value-focussed business case and optimum realisation of value form investments in change.


Business Case – Best PracticeBetter Business Case Guidelines

New Zealand Treasury and State Services Commission adopted Better Business Cases guidance in 2010 to improve the quality of business cases that inform decisions.

Better Business Cases is based on the Five Cases Model and the Investment Management Standard

Adherence to the Better Business Case guidelines is mandatory for the state sector when the proposed investment is:

• Accessing new Crown funding

• $25 million whole of life costs (Departments only)

• ‘High risk’ as indicated by the Gateway Risk Profile Assessment (Departments and Crown Agents only)

• A Public Private Partnership (excluding other Crown Entities)

• Asset disposals with significant policy decisions.

And: expectation that entire Public Sector adopts the guidelines over time


Benefits Management – Best Practice


Management of ValueAxelos

Any Questions?Are you Interested in adopting Benefits Management?• Please visit http://www.nonsuch.co for

more information.

• Please contact me on:[email protected] or 021 423 620Follow me on twitter: @youssefmourra

• Please contact Tanya Palmer on:[email protected] or 027 423 620

• Project Delivery & Resourcing• Project & Programme Services

(Mobilisation, Rescue, Healthchecks, IQAs, Post Implementation Reviews)

• Portfolio Management Services (Prioritisation & Optimisation)

• Project Office (PMO, PgMO & EPO) Mobilisations & Reviews

• Project, Programme & Portfolio Frameworks

• P3M Maturity Assessments• Training, Coaching & Mentoring• Microsoft PPM Solutions (Microsoft

Project & Project Server)


Head of Business Development & Partnering

mailto:[email protected]

mailto:[email protected]

human alchemy - turning people and projects into gold - why adopting benefits management isn't...

Leadership & Management