PMI has released a new Pulse of the Profession® report specifically about benefits identification. There is a lot of interesting stuff in the report including these headlines from their research:
· When benefits are identified before the start of a project, 56% more projects meet or exceed forecasted ROI.
· 38% of respondents said that project managers are responsible for the identification of benefits.
· Only 20% of steering committees take accountability for making sure benefits align to strategic objectives.
Figures like these have led to PMI identifying 3 broad lessons that organizations can draw on to improve their maturity when it comes to project benefits management.
These are:
1. Link benefits identification to formal project management.
2. Establish the work of identifying benefits as a joint effort between stakeholders.
3. Align benefits to the organization’s strategic goals.
Let’s look at each of those in turn.
1. Link Project Benefits and Project Management
When formal project management is used to address the benefits identification process, 76% more projects meet or exceed forecast ROI.
Linking benefits into the project management lifecycle has advantages from the start. From the outset you can see if the project or programme you are proposing will deliver something of value. When it’s tied into the project lifecycle you can be sure that the work required to map out and measure benefits will be done, because it’s part of the project plan and an expected, ‘in scope’ activity.
Pro Tip: Schedule time in your project plan to do benefits identification work. Share your schedule with the team with tools like ScheduleReader so that everyone can see that the work to identify and achieve benefits is considered a priority.
The report says that when organizations look at benefits identification as a part of the project management process, they get better project performance overall too. “They see 48% more projects meeting goals and business intent,” the authors write.
They conclude that this uptick in performance is due to the fact that people on the team have a better idea of how their work aligns to the big picture and they are clearer about how what they are doing is going to deliver something of value to the wider business.
2. Make Benefits Identification A Shared Responsibility
When only 27% of C-suite executives put their hands up to say they are accountable for making sure project and programme objectives align adequately to strategy you have to question whether the right people are being involved in the process.
The trouble with benefits identification and realization as a project-related task is that we’ve never really been clear on where the responsibility fits. Is it with the project manager? But the customer has responsibility for using the deliverables and therefore ‘making’ the benefit. Who is tracking the benefit? The project team has to create the mechanism for tracking the benefit as an output of the project, perhaps, say, through the creation of new dashboards. The way each business and team is set up is different, and the way hierarchies and ongoing responsibilities work is also different.
This lack of clarity is hard to manage and what tends to happen is that no one is identified as responsible and therefore everyone skips around the subject. Overall, that leads to poor benefits identification, inadequate measures identified to track benefits and then the inability to measure at the end (even if you do have someone whose responsibility it now is to do the measuring).
This all goes away if you make benefits identification and management a shared responsibility. Get the right people involved, talk to lots of people about what they want and how it can be measured and get people to sign up for their role in the process by making it clear.
3. Align Benefits To Strategic Goals
When the identified benefits are aligned with an organisation’s strategic goals, 80% more projects meet or exceed forecasted ROI.
The report authors spend a bit of time on this area because ‘strategic alignment’ has become a bit of a buzzword in recent years. Despite that, your own experience managing projects will tell you that it’s true. The effort involved in defining a strategy for your business is wasted if all you do is leave it in a drawer. It’s the project teams that work on projects to turn that strategy into reality who really help you realize your goals. That’s why it is important that project effort is managed effectively and your teams work on projects that are going to move the business in the right direction.
The report says that “The value of aligning identified project benefits with strategic goals cannot be overemphasised.” They give statistics based on their survey of over 1000 project managers and conclude that project outcomes improve significantly when strategic alignment exists. Specifically, they report:
· 57% more meet goals and business intent,
· 45% more are within budget
· 50% more are on time
when compared to projects where the identified benefits don’t align very well with the strategy.
Together, these 3 broad lessons don’t sound that revolutionary, but with the topic of benefits management still being one of the most underutilized tools for businesses, and having such clear results, isn’t it time you took another look at how you manage benefits on your projects?
Read the whole report here: http://www.pmi.org/learning/pulse.aspx