What is a benefit?
A benefit can be defined as the positive consequences of change.
More formally, the former Office of Government Commerce defined a benefit as:
“A quantifiable and measurable improvement resulting from an outcome which is perceived as positive by a stakeholder and which will normally have a tangible value expressed in monetary or resource terms. Benefits are realised as a result of activities undertaken to affect change."
A dis-benefit can be described as the negative consequences of change.
What is benefits management?
Benefits management is an integral part of change management. It is aimed at increasing the successful delivery of quantifiable and meaningful business benefits to an organisation.
The focus of benefits management is on how business areas will benefit from change and it provides a framework for identifying, planning, measuring and actively managing these benefits.
Benefits management forms an important part of well established programme and project management methodologies like Managing Successful Programmes and PRINCE2.
Importantly, focusing on benefits and how they will be managed helps to provide focus for the programme or project and ensures that benefits continue to be realised throughout the change process - often beyond the actual life of the project delivering the new capability.
Benefits management provides the necessary link between project delivery and the achievement of business transformation.
Why is it important?
Too often, projects focus exclusively on delivering outputs on time, within budget and to an acceptable quality.
It is important to realise that project outputs (such as information technology systems, re-engineered processes or new buildings) are not benefits in their own right, nor do they necessarily deliver benefits to the business - indeed, projects may end up with results which are disadvantageous (dis-benefits).
The backdrop of public sector financial and resource pressures, the continuing drive towards efficiency, and growing public expectation mean it is increasingly important that investment in change is actively managed to produce measurable and beneficial outcomes.
Benefits management provides the structures to help achieve this goal. Its focus on actively assessing and managing the realisation of benefits allows for practical intervention throughout the change process, in effect, allowing for adjustments to be made along the way - including post project.
This is different from traditional post implementation reviews and post project evaluations which provide retrospective assessments. While these assessments are necessary and do highlight valuable lessons for future programmes and projects, they provide little opportunity for real time intervention.
Who is responsible?
Change is rarely successful without the involvement and commitment of those individuals affected or impacted by it.
As such, benefits management is centred around a partnership approach between the programme or project teams delivering the change, and those parts of the business affected by it.
Often the benefits associated with a particular programme or project begin to appear after it has completed and the new capability is in place.
While programme or project teams may facilitate and drive the benefits process initially, they do not own the benefits. Affected business areas always own the benefits and are responsible for ensuring they are managed and realised long after programmes and projects are complete and the structures are dismantled.
Where benefits are developed by a programme or project in isolation, without engaging those affected by the change, there is little chance that the business will accept ownership of the benefits.
The Senior Responsible Owner for the change programme or project is ultimately responsible for the management and delivery of business benefits.
Programmes or projects?
Benefits management should be undertaken by both programmes and projects. The actual process is largely the same for both, but often the context for meaningful benefit realisation as part of a large change initiative will be at the programme level.
The programme provides a framework within which its projects can be managed and aligned so that benefits realisation can be planned and realised at the optimum level.
In keeping with the general approach to best practice, the level of detail and time and effort expended should be commensurate with the overall cost and importance of the enterprise.
Additional work is often required at the outset, but this should mean that the longer term consequences of unresolved issues and deferred decisions can be kept to a minimum.
When to start?
Benefits management should start as soon as possible in a programme or project, usually long before any implementation work has been carried out.
If this is not possible, a reduced process may sometimes be undertaken at later stages providing there is still time to capture accurate pre-implementation benefit baselines.
What will I get from this approach?
A structured approach to benefits management can help to:
- build a robust business case
- maintain focus on final outcomes
- improve stakeholder awareness of, and engagement with, the programme or project
- improve communications - by providing an evidence based rationale for change
- increase the chances of successful business change
- identify, manage and mitigate the risks associated with change
- focus attention on the most important benefits
- provide a robust basis for post project review
- provide an important input to a Gateway 5 Review