Benefits Realisation: Planning & Management

Why do we need Benefits Realisation?

Business projects and programmes are undertaken to deliver benefits. However, they are frequently criticised for failing to deliver their objectives or benefits. Research shows that well over 60% of projects fail in delivering expected benefits, and even when they are achieved in part, often they are far from fully realised.

The reasons for this are varied, but a significant portion can be directly related to a lack of planning and allocation of responsibility for benefits, for example:

Projects poorly aligned to the business strategy
Business cases focused on target savings instead of expressing actual business benefits in a manner that can be commonly understood and implemented
Too much emphasis on deliverables - too little or none on benefits
No mechanisms or structures to manage the realisation of benefits

For benefits realisation to work it is critical to identify clear benefits that relate to unambiguous business objectives, and to assign ownership to those responsible for ensuring and managing benefit realisation.

Furthermore, projects are often considered to be finished when their deliverables are complete. However, the benefits of a project are typically realised over time - this may leave no one responsible for benefits realisation.

The challenge for organisations is in identifying clear benefits, assigning ownership, determining how they can be measured and then making sure they are delivered. Benefits Planning, Management and Realisation sets out to bring structure, accountability and discipline to to the delivery of the benefits inherent in business projects. Benefits realisation is therefore a key aspect of effective programme management and relates to other key business processes, such as portfolio management.

What is Benefits Realisation & Management?

It is the identification of target benefits, their definition, planning, structuring and actual realisation as a result of investing in business change.

Benefits identification and structuring must start in the early stages of the business case. While investment appraisal provides the justification for the investment, Benefits Realisation Planning enables organisations to understand, maximise and plan for the achievement of the benefits.

Benefits realisation planning must also address the changes that are necessary to realise benefits. These changes need to be managed carefully and also require good change management skills.

Improving Benefits Realisation

What are the things that typically have to improve most?

the way objectives and benefits are expressed and structured in business cases
differentiating between objectives, outcomes and benefits
differentiating between benefits and their end financial results
the whole benefits realisation planning and management process

Benefits Realisation Planning

For Benefits Realisation to be successful, it must be integral to the organisation's strategic planning and portfolio management processes. To be effective, it needs to become standard management practice throughout the business change lifecycle - particularly during programme and project definition.

The first step is to establish a benefits realisation framework that defines how benefits should be identified, structured, and realised. The framework will classify types of benefits in your business, for example:

service / process / quality/ productivity / efficiency
cost avoidance
staff morale / motivation
revenue generation / increased sales

The potential benefits identified must not simply exist as a list. It is important to identify dependencies to determine where the achievement of one benefit is dependent on the realisation of another.

Once they have been identified and structured thoroughly, the Benefits Management process then needs to create a benefits realisation plan. This will enable the organisation to identify the management actions required to realise the benefits.

Benefits Delivery Management

During the life of a project it may be necessary to modify the objectives, change priorities or redefine the desired outcomes in the light of changing circumstances. It is important that benefits planning continues throughout the life of the project and beyond, to ensure that those benefits of most value are realised at affordable cost and on schedule.

Benefits Realisation

Many of the anticipated benefits will not start to materialise until after the project has been delivered. It is therefore essential that the ownership of the benefits realisation plan is maintained beyond project delivery through to complete realisation. The Benefits Management process should also include a post implementation review, thereby allowing time for analysis of the management of benefits realisation and a proper comparison to the original business case.

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