Buyers have a new obsession. It is called 'benefits realization', or alternatively 'benefits delivery'. They have lost faith that promises made before the sale will actually materialize and are determined to intervene to ensure that they do. But if buyers are focused on benefits realization, then sellers must be too. In this article we will show you how you can use this important concept to boost your sales success.

1. Retail Price: $29
The New Focus Of 'Promise-Weary' Buyers:
Benefits Realization
Why Promised Benefits No Longer Satisfy Buyers & What Sellers Can Do About It
Buyers have a new obsession. It is called 'benefits realization',
or alternatively 'benefits delivery'. They have lost faith that
promises made before the sale will actually materialize and are
determined to intervene to ensure that they do.
But if buyers are focused on benefits realization, then sellers must be
too. In this article we will show you how you can use this important
concept to boost your sales success.

2. Buyers Reach A New Level Of Benefits-Obsession
Unfortunately managing a project is not the same as managing its
benefits. All too often projects are delivered on time and within
budget, but without all the benefits being realized. In planning and
managing benefits realization it is important to integrate the two
however. That means setting out how key benefits will integrate with
the project plan, including its key dependencies, critical dates, review
points and so on.
It makes no sense for organizations to spend many months in planning
the right strategies, finding the optimum solutions and choosing the
best suppliers, simply to leave the most important element to chance “Managing a
– that is the realization of benefits. project is not
Managers have learned that benefits – just like anything else - must
the same as
be planned, tracked and managed. They are increasingly seeing managing its
benefits management as essential to the management of success. benefits.”
Buyers Focus On The Full Costs-Benefits Equation
Cutting costs has long been a key driver for procurement. But, what
happens when costs cannot be cut much further? Well, the focus
turns to the other side of the costs-benefits equation and ensuring
that benefits are fully realized. Managers have logically turned their
attention to benefits and performance.
Traditionally most attention was focused on cutting costs in respect of
suppliers and projects, with considerably less on maximising benefits.
However, that is very much a one dimensional view of the bottom
line. After all the price-value (or benefits) equation isn't just about
price negotiation, but performance management and most of all
benefits realization. Benefits realization is at the core of 'getting more
for less'.
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3. For purchases and projects that entail fixed costs or dedicated
resources (take for example in the public sector where there is less
room to manoeuvre) driving benefits has by necessity taken equal
priority to cutting costs. For sellers this may be good news as benefits,
rather than price, is where they would much prefer to compete.
Why Benefits Realization Is So Important
'Show me the money' is a popular movie-inspired catch-phrase that
has been discovered by buyers and reworded into 'show me the
benefits'.1 It is a new mantra for internal project management and
programme delivery. Moreover it is a taunt for suppliers who are
being increasingly measured upon the fulfilment of their promises.
The objectives of benefits realization are as follows:
1. The objective is not only to ensure that benefits are realized, but
that they are also verified. All too often cold water is thrown on
benefit claims of project sponsors, or suppliers. What is required is an
objective standard (to which all stakeholders ascribe) by which the
realization of benefits can be independently verified. That means
there is no confusion about what is and is not achieved and who can
and cannot take credit for it.
Given that 3rd parties are often involved in validating, or scrutinising
projects/purchases, clear evidence of benefits realization is essential
and this is something that the seller should facilitate. If it is a
monetized benefit then finance had better give its approval to the
methodology of calculation.
2. Benefits realization is aimed at ensuring that all benefits are
maximized. That means, in the words of one buyer, squeezing out
every last benefit. That includes the last 20% which can easily go
unexploited, but it does not stop there. It also includes going above
and beyond what was originally anticipated. In this context the
1
'Show Me The Money' was popularized by the 1996 movie 'Jerry Maguire'.
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4. supplier who suggests ways in which additional benefits can be
derived will certainly gain points from the buyer.
3. Benefits may read well on paper, but when it comes to the practical
realization there can be a host of factors upon which they depend.
They can include external variables such as internal, or market place
changes.
“It is essential
to measure,
Things change in the company and its marketplace that will impact communicate
on the project and its planned benefits. That means a dynamic and
proactive approach is required, on the part of both buyer and seller. and reinforce
benefits...”
4. Benefits realization is ongoing; it does not stop – at least not for
the lifetime of the project in question. It is aimed at ensuring that
benefits are achieved and sustained in a repeatable manner.
For the seller this means it is essential to measure, communicate and
reinforce benefits on an ongoing basis. It also
means that account reviews and client reports
should focus on benefits delivered and
underway.
5. Managers' reputations are on the line.
Increasingly they are being called to account
for the performance of their departments, as
well as their major projects and purchases. In
the past the temptation has been to over-
promise and under-deliver.
However, the focus on benefits realization
closes the loop as regards managers delivering
on their plans. Sellers therefore need to expect
to be in the spotlight well beyond the point of
the sale.
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5. 6. Managers are now required to adopt a 360 degree view of the
purchase. That is a full lifecycle view that extends from validating the
need to selecting a supplier and onwards past the purchase order to
managing the project and achieving the results.
This is a view that sellers must adopt both in terms of writing the
proposal and delivering the solution. It is at the core of benefits
realization.
7. Benefits realization is key to ensuring access to resources:
In this era of cost cutting the very life of a project, or programme may
depend on its sponsors being able to confidently lay claim to its
benefits and to defend them against the claim of competing projects.
The next time a manager, department or team goes looking for
funding they had better be able to demonstrate a track record in
realising benefits.
8. Benefits realization is key to managing stakeholders. In particular it
means:
Ensuring clarity on what all stakeholders require
Getting buy-in around the benefits
Managing expectations in terms of what is going to be
delivered
Being able to show stakeholders, including end customers what
has been achieved. To demonstrate that the promises made to
them have been met.
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6. A Framework For Benefits Realization
Ensuring the realization of benefits requires a plan. Such a benefits
plan, ideally summarized in the form of a spreadsheet table listing all
benefits, should include the following elements:
 A clear definition of the benefits
 A grading/prioritization of those benefits
 The KPIs or variables impacted upon
 How each benefit will be measured and tracked (ideally with a
before-after comparison)
 When each benefit will be realized (including progress along
the way)
 Who benefits from the benefit (impact on various
stakeholders)
 Independencies between benefits and projects
 Who will validate the project achievements/benefits and how “Benefits
 The risks that the planned benefits will not be achieved,
realization
including the dependencies and tradeoffs that may be required
 How progress towards the benefit will be tracked (including requires a
review points) and any problems or deviations managed plan.”
 Who is ultimately responsible for the achievement of the
benefit and the process of tracking and managing it
 The costs associated with benefits realization.
While the benefits plan is normally the buyer's concern, it is also a
powerful tool for the seller. It is a new way for the seller to tell the
buyer that 'we are obsessed with your benefits too'.
Elements of the benefits plan can be used in terms of the needs
analysis and solutions definition steps of the sales process, as well as
in the proposal writing and project planning or implementation stages.
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7. Your Sales Gauge: Benefits Realization
There are 8 items in the best practice checklist below. Use these to
gauge how effectively you are handling benefits realization and the
impact this could have on your sales success.
Tick the ones for which you can answer 'Yes' – that is those that are
presently being addressed, or covered by your sales approach. Pay
particular attention to those that you cannot Tick – they could be
limiting your success.
How Suppliers Can Realize The Benefits
It is no longer enough to simply promise benefits. You have to go one
step further and show how they will be realized. The introduction of
the concept of benefits realization into proposals and pitches can truly
distinguish a supplier. With this in mind here are some steps for
sellers to follow:
 Find out how customers approach the issue of benefits
realization and support them in this area by adapting your
information reporting, key account plans, account review
meetings, and so on to their needs.
 Provide the customer with the information and the framework
required for benefits management and planning. That means
applying some, or all of the principles of a benefits plan (as
outlined above).
 Get better at defining, and as much as possible quantifying;
benefits. Clarity around what will be delivered makes the
management of benefits realization much easier.
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8.  Integrate your project and account management around
benefits management. For example it should be possible to
review progress in benefit realization against key project
milestones.
 Agree a mechanism for tracking and measuring benefits and
use it to continually communicate cumulative benefits.
 Communicate your track record in realising benefits through
customer success stories and quotes. Let buyers know that you
deliver.
 The challenge for the seller is to make benefits realization
a key factor in supplier selection. That means broadening the
focus from competing seller promises, or claims, but the ability
to realize them.
 After all buyers would settle for the supplier who offers 90% of
the benefits but guarantees 100% realization – that is much
better than the supplier offering 100% of the benefits, but
reaching only 80% of the results. It is, in the words of one
buyer-manager a classic case of 'a benefit in the hand is worth
two in the bush'.
So, sellers set to it! Put benefits realization at the core of your selling
and see how it can boost your sales success.
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9. What Should You Do Next?
Use the checklist above to decide what you want to do next. In
particular, see how many items were you able to tick 'Yes'.
If you ticked most, or all of them then you have benefits realization
under control. So, you might like to navigate to some other aspect of
the Repeat Sales Stage, or elsewhere in the sales process.
If not, this area could be limiting your sales success. You can start
addressing it by tackling those items in the checklist that you could
not tick. For each make a note of specific actions you can take – you
will find space to write earlier in this paper.
The Science behind This Paper
These insights and tools are based on extensive research under 3
headings:
1. Buyer Research – our ground-breaking research into how modern
buying decisions are made and the implications for sellers.
2. Best Practice Research – Over 1 million pages of best practice sales
case studies, books and research.
3. Common Practice Research – Our peer comparison benchmark of
1,000s of your competitors and peers.
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