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Business Cases And Benefits Management

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Business Cases And Benefits Management

  1. 1. Business Cases and Benefits Management Alan McSweeney
  2. 2. Objectives <ul><li>Why is Benefits management an important competency for organisations? </li></ul><ul><li>What is a Business case, how do you write one? </li></ul><ul><li>How should the Business case and Benefits be measured and managed during the project’s delivery? </li></ul><ul><li>Some differing perspectives….. </li></ul>
  3. 3. Scope <ul><li>Draws on experience in providing services to Financial services and Corporate clients investing in Information Technology projects. </li></ul>
  4. 4. Hints and tips on Mountain Climbing, not a guide to Climbing Mountains…
  5. 5. Project Outcomes <ul><li>2004 Standish Group Report http://www.standishgroup.com/ </li></ul><ul><ul><li>29% projects succeeded (delivered on time, on budget, with required features and functions) </li></ul></ul><ul><ul><li>53% are challenged (late, over budget and /or with less than the required features and functions) </li></ul></ul><ul><ul><li>8% have failed (cancelled prior to completion or delivered and never used) </li></ul></ul><ul><ul><li>Failures cost an estimated US$145 billion </li></ul></ul>
  6. 6. Benefits Approach <ul><li>How do we pick the winning investments? </li></ul><ul><li>How do we ensure that we are getting value from these investments and know that we are doing so? </li></ul><ul><ul><li>Benefits do not just happen with delivery </li></ul></ul><ul><ul><li>Benefits rarely happen according to plan </li></ul></ul><ul><ul><li>Benefits realisation is a process that must be managed like any other business process </li></ul></ul>
  7. 7. Four Questions <ul><li>1. Are we doing the right thing? </li></ul><ul><ul><li>(Re)definition of business, program alignment </li></ul></ul><ul><li>2. Are we doing them the right way? </li></ul><ul><ul><li>Organisational structure, program integration </li></ul></ul><ul><li>3. Are we getting them done well? </li></ul><ul><ul><li>Organisational capability, support structure </li></ul></ul><ul><li>4. Are we getting the benefits? </li></ul><ul><ul><li>Proactive management of benefits realisation process as a whole </li></ul></ul>
  8. 8. Four Questions 2. Are we doing them the right way? 3. Are we getting them done well? 4. Are we getting the benefits? 1. Are we doing the right thing? Alignment Integration Capability/Efficiency Benefits
  9. 9. Benefits Management <ul><li>A process of organising and managing such that potential benefits are actually realised </li></ul><ul><li>Benefits Management means maximising the benefits from projects, changes and initiatives </li></ul>
  10. 10. What is a Benefit? <ul><li>Improve </li></ul><ul><li>Increase </li></ul><ul><li>Reduce </li></ul><ul><li>Eliminate </li></ul><ul><li>Stop </li></ul><ul><li>The value placed by a stakeholder on the performance improvement or new capability resulting from an outcome </li></ul><ul><li>Benefits are identified by asking stakeholders to articulate how they believe they (or the people they represent) will experience the value of the outcome, i.e. stakeholders answer the question “what’s in it for me?” </li></ul>
  11. 11. Benefits Analysis <ul><li>What benefits do we want / could we get? </li></ul><ul><li>Identify benefits </li></ul><ul><li>Link to business objectives </li></ul><ul><li>Link to enablers </li></ul><ul><li>For each benefit: </li></ul><ul><ul><li>How can you measure it </li></ul></ul><ul><ul><li>Can we quantify it </li></ul></ul><ul><ul><li>Is there a financial value? </li></ul></ul>
  12. 12. Benefits Realisation Planning for Programmes <ul><li>A set of activities to design and plan an integrated change programme to deliver quality and value benefits to patients, staff and local communities </li></ul><ul><li>Benefit realisation IS NOT only about whether the project delivered things on time to budget, etc. </li></ul><ul><li>Identifying benefits will not make them happen </li></ul><ul><ul><li>Preparation </li></ul></ul><ul><ul><li>Objectives and Outcomes </li></ul></ul><ul><ul><li>Benefits and Measures </li></ul></ul><ul><ul><li>Validation and Completion </li></ul></ul><ul><ul><li>Support, Manage and Update </li></ul></ul>
  13. 13. Benefits Realisation Management Process Develop/update business case; time-phased cost, benefit flows;plans Perform to plans Benefits being realised? Assumptions still valid? Determine corrective actions Yes Yes No No
  14. 14. Benefits Management Challenge <ul><li>Technology driven </li></ul><ul><li>Value for MONEY </li></ul><ul><li>Expenditure proposal </li></ul><ul><li>Loose linkage to business need </li></ul><ul><li>IT implementation plan </li></ul><ul><li>Business manager as on-looker </li></ul><ul><li>Large set of unfocussed functionality </li></ul><ul><li>Stakeholder “subject to” </li></ul><ul><li>Trained in technology </li></ul><ul><li>Do a technology project audit </li></ul><ul><li>Benefits driven </li></ul><ul><li>VALUE for money </li></ul><ul><li>Business case </li></ul><ul><li>Integration with business drivers </li></ul><ul><li>Change management plan </li></ul><ul><li>Business manager involved and in control </li></ul><ul><li>IT investment sufficient to do the job </li></ul><ul><li>Stakeholders “involved in” </li></ul><ul><li>Education in exploiting. </li></ul><ul><li>Obtain business benefit then review </li></ul>
  15. 15. A Benefits Driven Approach Will … <ul><li>… Allow you to: </li></ul><ul><ul><li>Build the case for your investment </li></ul></ul><ul><ul><li>Forecast benefits and business impact </li></ul></ul><ul><ul><li>Identify key business changes </li></ul></ul><ul><ul><li>Gain buy-in to the project from all participants </li></ul></ul><ul><ul><li>Identify early wins and prioritise the application portfolio </li></ul></ul><ul><ul><li>Reduce risk by having better understanding of expected outcomes and barriers to success </li></ul></ul>
  16. 16. Silver Bullets <ul><li>60-80% of projects do not deliver benefits </li></ul><ul><li>Success is usually measured in terms of delivery time and cost </li></ul><ul><li>Is the system in use or useful is rarely examined </li></ul><ul><li>Failure = Blame = Bad Press = Punishment </li></ul>
  17. 17. <ul><li>Lots of projects become disconnected from the business need, processes and people that created them </li></ul><ul><li>Benefits Management reconnects project to benefits </li></ul><ul><li>Structured approach that will </li></ul><ul><ul><li>Make the link between the enablers and the organisation’s strategic objectives </li></ul></ul><ul><ul><li>Build the case for investment </li></ul></ul><ul><ul><li>Gain buy-in to the project from all participants </li></ul></ul><ul><ul><li>Maximise the benefit from investment </li></ul></ul>
  18. 18. The Why: A Benefits Led Approach to Project Selection… <ul><li>Is a critical success factor for organisations who are seeking to obtain best in class performance </li></ul><ul><ul><li>Assuming that you assess/understand your market position relative to market… </li></ul></ul><ul><li>Aligns the delivery of change with business objectives and strategy </li></ul><ul><ul><li>Assuming there is an agreed strategy to align with… </li></ul></ul>
  19. 19. The Why: A Benefits Led Approach to Project Selection… <ul><li>Enables decisions to be made around portfolio management and prioritisation </li></ul><ul><ul><li>Not who shouts loudest… </li></ul></ul><ul><li>Creates a culture of accountability and measurement in service delivery. </li></ul><ul><ul><li>Or gives the Business back control over the portfolio of projects… </li></ul></ul>
  20. 20. <ul><li>High performing companies are 50% more likely to use analytic information strategically </li></ul>Best in Class Performance: the Evidence…. Source: Competing on Analytics, Thomas Davenport Low Performers High Performers Have significant decision-support/analytical capabilities Value Analytical insights to a very large extent Have above average analytical capability within industry Use analytics across their entire organization
  21. 21. Benefits in Projects <ul><li>We invest in projects because of the perceived Benefits they bring </li></ul><ul><li>The Benefits justify the project </li></ul><ul><ul><li>Linked to Corporate Objectives & Priorities </li></ul></ul><ul><ul><li>Can be wide-ranging </li></ul></ul><ul><ul><ul><li>Statutory, Social, Economic… </li></ul></ul></ul><ul><ul><li>Often financial (but not exclusively) </li></ul></ul><ul><ul><li>Sometimes hard to measure </li></ul></ul>
  22. 22. Financial Benefits <ul><li>Time saved, posts lost, costs avoided, costs reduced… </li></ul><ul><ul><li>Calculate a £ figure </li></ul></ul><ul><ul><li>Work out timing (investment & saving) </li></ul></ul><ul><li>Payback (in years) </li></ul><ul><ul><li>When Savings equal Investment </li></ul></ul><ul><li>NPV (Net Present Value) </li></ul><ul><ul><li>A common measure of a project’s value </li></ul></ul><ul><ul><li>Cash flows adjusted for time they occur </li></ul></ul><ul><ul><li>Using a 5% discount rate </li></ul></ul>
  23. 23. Non-financial Benefits <ul><li>Is this a Corporate priority? </li></ul><ul><li>Look for a performance measure </li></ul><ul><ul><li>BVPI </li></ul></ul><ul><ul><li>Other PI </li></ul></ul><ul><li>Measure </li></ul><ul><ul><li>Value at start of project </li></ul></ul><ul><ul><li>Predicted value at end of project </li></ul></ul><ul><ul><li>Actual value at end of project </li></ul></ul>
  24. 24. Organisation Development <ul><li>The four pillars of Change </li></ul><ul><ul><li>Driven by the Customer </li></ul></ul><ul><ul><li>Improving our Performance </li></ul></ul><ul><ul><li>Learning & Developing </li></ul></ul><ul><ul><li>Optimising our Finances </li></ul></ul><ul><li>These describe the type of organisation we want to be </li></ul><ul><li>Each project has to contribute </li></ul>
  25. 25. Later Benefits <ul><li>Project puts a capability in place </li></ul><ul><ul><li>To be exploited by a later project </li></ul></ul><ul><li>Must link these projects </li></ul><ul><ul><li>Is funding in place for later project? </li></ul></ul><ul><ul><li>Are we committed to later project? </li></ul></ul><ul><ul><li>If not, investment in first project may be wasted </li></ul></ul>
  26. 26. Later Benefits <ul><li>Project delivers as expected </li></ul><ul><ul><li>But Benefits only measurable later </li></ul></ul><ul><li>Need to link to process </li></ul><ul><ul><li>What process? </li></ul></ul><ul><ul><li>The owner? </li></ul></ul><ul><ul><li>When and how to measure? </li></ul></ul>
  27. 27. Realising Benefits <ul><li>Financial saving </li></ul><ul><ul><li>Remove £ from next year’s budget </li></ul></ul><ul><ul><li>Saving included in formal budget setting process </li></ul></ul><ul><ul><li>Clarity about what was saved where </li></ul></ul><ul><li>Posts lost </li></ul><ul><ul><li>At risk register </li></ul></ul><ul><ul><ul><li>Identify the staff affected, communicate </li></ul></ul></ul><ul><ul><li>Process based on existing Council policies </li></ul></ul><ul><ul><ul><li>Consultation, redeploy, retrain … redundancy </li></ul></ul></ul><ul><ul><ul><li>Minimise redundancy costs </li></ul></ul></ul><ul><ul><li>Affects timing of realisation of Benefits </li></ul></ul>
  28. 28. Tough Decisions <ul><li>Cost constraints </li></ul><ul><ul><li>We must stay within this </li></ul></ul><ul><li>Headcount and Budget </li></ul><ul><ul><li>We need to manage both </li></ul></ul><ul><li>May require restructuring </li></ul><ul><ul><li>New ways of working may mean changes to some organisation structures </li></ul></ul>
  29. 29. Strategy Alignment to Change Management <ul><li>Strategy </li></ul><ul><li>Business Vision </li></ul><ul><li>Strategy </li></ul><ul><li>Goals and Objectives in a 3-5 Year Investment Plan </li></ul><ul><li>Products and Services </li></ul><ul><li>Annual Budget </li></ul><ul><li>Change </li></ul><ul><li>Project and Programme Design </li></ul><ul><li>Business Case </li></ul><ul><li>Programmes and Portfolio Projects </li></ul><ul><li>Benefits Management and Realisation </li></ul>
  30. 30. Prioritisation: Follow the Money <ul><li>All Project investment decisions should be based on a Financial justification. </li></ul>
  31. 31. Benefits Realisation Principles <ul><li>Benefits realisation is the pre-planning for, and ongoing management of benefits promised to be enabled by the successful implementation of a project </li></ul><ul><li>Sound project management can only enable a business owner (program) to realize intended benefits </li></ul><ul><li>Accountability for the realisation of intended benefits must rest with the business function, not with the IT project </li></ul>
  32. 32. Outcome Management <ul><li>What is an outcome? </li></ul><ul><ul><li>An outcome (benefit) is the desired result of an initiative undertaken to meet a need or solve a problem </li></ul></ul><ul><ul><li>Outcomes are final results supported by intermediate outcomes (benefits milestones) </li></ul></ul><ul><li>Background </li></ul><ul><ul><li>Outcome Management is focused on the outcomes or results side of an initiative or program </li></ul></ul><ul><ul><li>Outcome Management methodology is based on internationally recognized project and risk management techniques that has been refined </li></ul></ul><ul><ul><li>Outcome Management is an evolving discipline </li></ul></ul><ul><li>Details </li></ul><ul><ul><li>Cost benefit analysis is a subset of Outcome Management </li></ul></ul><ul><ul><li>Outcome Management is the potential link to existing tools or other sources of performance indicators </li></ul></ul>
  33. 33. Portfolio Prioritisation <ul><li>“ One of the key contributors to poor IT investment performance is an unbalanced approach taken by executives at the project approval stage. </li></ul><ul><li>Too often, the overriding emphasis is on quick payback or demands for the return on investment (ROI) to be demonstrated in financial terms.” </li></ul><ul><ul><li>Gartner. </li></ul></ul>
  34. 34. Business Accountability and measurement <ul><li>The Business is responsible for ensuring that the Investment made yields the return calculated. </li></ul>
  35. 35. Recap: Why do we need Business cases <ul><li>A Critical Success Factor </li></ul><ul><li>Ensuring Strategy alignment </li></ul><ul><li>Prioritisation </li></ul><ul><li>Accountability and Measurement </li></ul>
  36. 36. What is a Business case, how do you write one? <ul><li>A Business case should describe the proposition in terms of:- </li></ul><ul><ul><li>Scope and out of scope </li></ul></ul><ul><ul><li>Objectives </li></ul></ul><ul><ul><li>Options </li></ul></ul><ul><ul><li>Schedule </li></ul></ul><ul><ul><li>Risk </li></ul></ul><ul><ul><li>Investment and return. </li></ul></ul><ul><li>In short, it should describe the reason and justification for initiating a project and explain how the organisation will get there. </li></ul>
  37. 37. Identifying Benefits <ul><li>Deliverables or outcomes </li></ul><ul><li>Cashable v non cashable </li></ul><ul><li>Efficiency </li></ul>
  38. 38. Business Case <ul><li>Features of a good business case </li></ul><ul><ul><li>Description of benefits – quantified </li></ul></ul><ul><ul><li>Cost benefit analysis </li></ul></ul><ul><ul><li>RoI </li></ul></ul><ul><li>The business case is a logical argument to spend money and Benefits Management creates a compelling reason for the Sponsor / Champion to act </li></ul>Is it worth spending this amount to achieve this result?
  39. 39. Benefits Management <ul><li>Assigning benefits </li></ul><ul><ul><li>Benefits manager </li></ul></ul><ul><ul><li>Service managers </li></ul></ul><ul><li>Metrics </li></ul><ul><ul><li>Financial </li></ul></ul><ul><ul><li>Non-financial </li></ul></ul><ul><ul><li>Proxies </li></ul></ul>
  40. 40. PMBOK: Project Initiation <ul><li>Product </li></ul><ul><li>description </li></ul><ul><li>2. Strategic Plan </li></ul><ul><li>3. Project selection </li></ul><ul><li>criteria </li></ul><ul><li>4. Historical </li></ul><ul><li>information </li></ul><ul><li>Project Selection </li></ul><ul><li>Methods </li></ul><ul><li>2. Expert Judgement </li></ul><ul><li>Project charter </li></ul><ul><li>Project Manager </li></ul><ul><li>identified/assigned </li></ul><ul><li>3.Constraints </li></ul><ul><li>4. Assumptions </li></ul>Inputs Tools and Techniques Outputs
  41. 41. Business Case Activities
  42. 42. Presenting a Business Case
  43. 43. Exec Summary Name of project Responsible Board Member Project owner Project manager Objective Value Drivers Market launch Estimated cumulated investments Present Value
  44. 44. Market Opportunity Region/maturity of market* <ul><li>Targeted region … </li></ul><ul><li>Description of maturity of market ... </li></ul>Competitors* <ul><li>Main competitors (incl. market shares) </li></ul>Customers/needs* <ul><li>Targeted customers and their key needs </li></ul><ul><li>... </li></ul><ul><li>Current market volume (as of …) </li></ul><ul><li>Future market volume (growth / market potential by ...) </li></ul>Products/substitutes* <ul><li>Description of products/services </li></ul><ul><li>Possible substitutes (existing / expected) </li></ul>*) Current status Opportunities ... Threats ...
  45. 45. Opportunities and Threats Threats <ul><li>... </li></ul><ul><li>… </li></ul>Opportunities <ul><li>… </li></ul><ul><li>... </li></ul>market
  46. 46. Description and Analysis of Proposed Offering/Sales Sources What are our products/ services? Who are our customers? What demand is met? How is the money earned (revenue driver, pricing) ? <ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul>Our offer
  47. 47. Strengths and Weaknesses of Proposed Offering Key Differentiation Factors Compared to Competitors’ Weaknesses <ul><li>... </li></ul><ul><li>… </li></ul>Strengths <ul><li>… </li></ul><ul><li>... </li></ul>Our offer
  48. 48. Key Success Factors of Product/Service Offering <Success factor 1> <Success factor 2> <Success factor 3> <Success factor x> <ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul>Our offer
  49. 49. Strategic Fit and Risk Assessment Corresponding strategic objectives ... … are reflected in initiative ... Potential strategic conflicts or risks ... … are mitigated by ... <ul><li>... </li></ul><ul><li>… </li></ul><ul><li>... </li></ul><ul><li>... </li></ul><ul><li>… </li></ul><ul><li>... </li></ul><ul><li>... </li></ul><ul><li>… </li></ul><ul><li>... </li></ul><ul><li>... </li></ul><ul><li>… </li></ul><ul><li>... </li></ul>Strategy/Risk
  50. 50. Sales drivers project/product/service <ul><ul><li>(a) Number of Customers* </li></ul></ul><ul><ul><li>(b) Average quantity per customer* </li></ul></ul><ul><ul><li>(c) Average price per unit* </li></ul></ul><ul><ul><li>(d) Sales volume (mn €) * </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2008 </li></ul></ul><ul><ul><li>Market share </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2009 </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2010 </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2011 </li></ul></ul><ul><ul><li>xxx </li></ul></ul><Bubble to add important remarks> *) Generally: (a)*(b)*(c)=(d); (c) in line with pricing model <ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2012 </li></ul></ul><ul><ul><li>xxx </li></ul></ul>Sales drivers
  51. 51. Cost drivers: N ame of project/product/service <ul><ul><li>FTE </li></ul></ul><ul><ul><li>... </li></ul></ul><ul><ul><li>... </li></ul></ul><ul><ul><li>... </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2008 </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2009 </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2010 </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2011 </li></ul></ul>Bubble to add important remarks <ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>xxx </li></ul></ul><ul><ul><li>2012 </li></ul></ul><ul><ul><li>Quantities or mn € </li></ul></ul>Cost drivers
  52. 52. Differentiation of project scope and handling of project risks Project Potential project risks and mitigation <ul><li><Risk 1> ... </li></ul><ul><ul><li>mitigated by … </li></ul></ul><ul><li><Risk 2> ... </li></ul><ul><ul><li>mitigated by … </li></ul></ul><ul><li><Risk 3> ... </li></ul><ul><ul><li>mitigated by ... </li></ul></ul>Aspects not in project scope <ul><li>… </li></ul><ul><li>... </li></ul>
  53. 53. Project phases, milestones and required budgets/resources Budget/resources (mn €, man days) Milestone (interim result) Responsibility Delivery date <ul><li>Project Phase 1 </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Project Phase 2 </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Project Phase 3 ... </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul>Depedencies <ul><li>Text </li></ul><ul><li>Text </li></ul><ul><li>Text </li></ul>Implementation
  54. 54. Summary of Strategic fit <ul><li>XXX </li></ul><ul><li>XXX </li></ul><ul><li>... </li></ul><ul><li>... </li></ul>Comments: Strategic Planning
  55. 55. How should the Business case and Benefits be measured and managed during the project’s delivery?
  56. 56. Project and Benefits Lifecycle
  57. 57. Change Management <ul><li>Change requests should assess Business case impact. </li></ul><ul><li>The approval of scope changes, budget changes, schedule changes should be mapped back to the Business case </li></ul><ul><li>For Larger projects and programmes, stage gate Business case reviews as part of key phase end milestone reviews </li></ul><ul><li>Consider changes in the wider Business environment (e.g. the current recession), as drivers to re-assess the in flight portfolio </li></ul><ul><li>Consider changes in products and solutions as drivers to re-assess the in flight portfolio </li></ul><ul><ul><li>E.g. Vendor consolidation, changes in Vendor product strategy </li></ul></ul><ul><ul><li>E.g. New products that might improve solutions/invalidate previous architectures </li></ul></ul><ul><ul><li>Changes in Organisation structure or composition (mergers/takeovers/sales/joint ventures) </li></ul></ul>
  58. 58. Benefit Realisation <ul><li>Most Business cases have a time horizon which extends over a period from 1 – 5 years. </li></ul><ul><li>So Benefits are often fully realised only after the project has been closed. </li></ul><ul><li>Who measures the effectiveness of the investment when the project is gone? </li></ul><ul><ul><li>Project Management Office </li></ul></ul><ul><ul><li>Business Management </li></ul></ul><ul><ul><li>IT Management </li></ul></ul><ul><ul><li>Project Manager </li></ul></ul>
  59. 59. Project Management Office and Benefits Management <ul><li>PMO’s are often located in IT, not embedded in the Business </li></ul><ul><li>Terms of reference for PMO are often quite narrow </li></ul><ul><ul><li>Focus often on methodology, resourcing, governance and reporting </li></ul></ul><ul><ul><li>Is there an appetite to extend the PMO into this role… </li></ul></ul>
  60. 60. Conclusion: Recap of Seminar Objectives <ul><li>Why is Benefits management an important competency for organisations? </li></ul><ul><li>What is a Business case, how do you write one? </li></ul><ul><li>How should the Business case and Benefits be measured and managed during the project’s delivery? </li></ul><ul><li>Some differing perspectives….. </li></ul>
  61. 61. Some Closing Thoughts <ul><li>What are the Critical Success Factors for Benefits Management? </li></ul><ul><ul><li>If they arent in place what does this mean? </li></ul></ul><ul><li>Should Benefits management be part of the PM’s remit? </li></ul><ul><ul><li>If not the PM then who? </li></ul></ul><ul><li>Should Benefits realisation be placed in a more general Management framework </li></ul><ul><ul><li>Cobit? </li></ul></ul><ul><ul><li>PMM Maturity assessment? </li></ul></ul>
  62. 62. The Success of Benefits Management in Organisation and projects is <ul><li>Linked to the ability of the organisation to </li></ul><ul><ul><li>Clearly define strategy and business goals </li></ul></ul><ul><ul><li>Determine priority of activities </li></ul></ul><ul><ul><li>Measure costs and success of implementation </li></ul></ul><ul><li>So to be truly successful Organisations must </li></ul><ul><ul><li>Understand their customers needs </li></ul></ul><ul><ul><li>Understand and quantify revenues by customer and product </li></ul></ul><ul><ul><li>Understand and quantify their cost base (activity costing/unit costing) </li></ul></ul><ul><ul><li>Understand their relative competitive position </li></ul></ul><ul><ul><li>Have processes and policies in place to support a Benefits led culture when introducing change </li></ul></ul>
  63. 63. Relationship to Other Management Disciplines …… ..Is Benefits Management a core competence of a Project Manager? ……… Should the PM be involved? PMBOK Application Area Knowledge and Practice General Management Knowledge and Practice
  64. 64. COBIT
  65. 65. Maturity Models
  66. 66. More Information <ul><ul><ul><li>Alan McSweeney </li></ul></ul></ul><ul><ul><ul><li>[email_address] </li></ul></ul></ul>

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