Benefit realization management

Developed by Maria Bakali

Overview

Benefit Realization Management (BRM) constitutes a method that is used in various organizations for the purpose of measuring and assessing the added value to their enterprise by specifics projects and programs.

The three main steps to this process are the identification, the execution and the sustainment of the project and program benefits. In the first step the expected benefits are identified; it is determined whether the project is achievable and what results it will yield. The project’s stakeholders must ensure that the benefits are of relevance to the organization’s strategies and goals. Secondly, once the intended benefits are determined, an execution plan must be formed to achieve the expected results. This plan contains all the necessary steps needed for the project’s success. Namely, it includes the benefits, assumptions, tasks, and changes that must take place coupled with metrics, roles and responsibilities that are to be carried out by employees, as well as a communication strategy for the report of progress to the stakeholders. Lastly, it must be ensured that the benefits achieved in the previous step, will remain effective.

Once the project is finished, an evaluation must occur where the deliverables are discussed, and improvements of existing strategies might be formed. This step is crucial, as it must be ensured that the project benefits will remain into effect.

Benefit Realization Management tools, such as benefit maps are essential and quite helpful as well. Benefit Dependency Maps (BDM) and Benefit Dependency Networks (BDN) serve the purpose of visualizing the necessary steps to the planning, execution, and sustainment process. The end goal is included, as well as the change factors that led to the realization of the project or program.

Purpose, Scope and Method of Benefit Realization Management

The purpose, scope and the method behind Benefit Realization Management includes a detailed explanation of the steps that are necessary for its success.

Purpose and Scope

The creation and implementation of a Benefit Realization Plan is a very useful method when managing the integration of a project or program in a company or organization.

BRM might appear as a well-defined process, it is however not in the least automated and requires a number of tasks to be completed. Firstly, the most important factor is major commitment in all managerial levels and especially from senior managers. Additionally, adequate financing, assets and personnel with experience are essential for the project or program’s success. This plan is important as the benefits to be gained are communicated through it and the probability of their realization grows significantly. Additionally, the development of the case is enhanced, securing the increase of successful projects contained in the company’s portfolio. Benefit realization management is mostly performed on a project and program level, given that on that the expected value and strategic decisions are mostly done for projects and programs. However, it must be ensured that benefits realization belongs to the general framework of a company’s or organization’s portfolio.

However, BRM is a tool that can be applied on different levels, as well. This plan can be used on a portfolio or strategic level, but as well on smaller scale programs or projects. The implementation of detailed and well thought benefit realization plan is powerful. First of all, the current situation of the organization is determined and the need for change or unexploited opportunities are identified through this process. Essentially, the organization transitions from the current ‘status quo’ to the desired prospect in quantifiable and planned manner. Furthermore, the change and the delivered value is sustained.

During the planning process of the programs, certain projections and assumptions are drawn, which can be verified with the benefits realization plan.

In case the project implementation proves to be a failure, having developed a plan can be very useful for future reference. The actions taken for the project can be properly evaluated and feedback can be given for future improvement of the entirety of the process that was followed. This is achieved with ensuring that the formulated steps, and processes have been put into effect to achieve the desired benefits.

The steps to the plan are three. The first step is to identify the potential benefits, followed by the creation of an execution plan regarding the identified benefits of step one. Lastly, it must be ensured that the benefits that were gained during this process will remain into effect, hence a sustainment action plan must be part of the whole process. In the next chapters, the methodology on how a benefits realization plan will be described and thoroughly analyzed.

Identification of benefits

The first step in creating and implementing a BRM plan is the identification of benefits a proposed project or program would give to the respective organization or company.

During this process, various key aspects of the project are identified and assessed. First, it must be determined whether said benefits are in compliance with the overall strategic goals of the company/organization. A project that is not aligned with these goals, probably would not be a wise choice, since the added value would amount to zero.

It is important that the benefits be adequately defined. Information in regards of the time frame and tangibility must be given. Whether these benefits will be realized in the short or long-term has to be clearly stated and the tangibility must be assured for the process to continue.

Other aspects of importance are the quantification of the benefits and the way they could be measured, as well as the prediction of when they will be delivered. The development of appropriate metrics and key performance indicators (KPI) for the aforementioned purpose is essential, as there must be a tool to assess the planned benefits compared to the actual deliverables.

The stakeholders of the project need to be informed on the entirety of the benefits realization plan, too. It is highly important they are kept in the loop to a certain extent in regards of their relevance, as they play a certain role in the realization of the project. Their approval must be ensured, and a communication plan must be put into effect for future updates.

Lastly, the team working towards achieving the benefits of the project or program have to take into account benefits management and have to include various acceptance standards. Furthermore, the selection and funding decisions have to be evaluated and it must be determined whether they are based on the benefit effects.

The plan continues on the next step which is the execution of the proposed benefits that were formed in the first step.

Execution of benefits

Following the identification of the proposed project or program an execution plan is essential, in order to gain the desired benefits.

Firstly, the team executing the plan, or the manager has to ensure that the stakeholders have been informed on the expected benefits the plan will deliver. The alignment of the project’s goals and the strategic goals of the company is important and during the process, this issue must not be overlooked.

Furthermore, the intended benefits must be very well understood by the team and the progress of the project has to be monitored for ensuring it is still following the benefits realization plan. The factor of change must be always considered, and the benefits accordingly altered to reflect the current situation. The establishment of whether the practice of effective change control is utilized to minimize the gaps between the expected and the actual benefits, is essential.,

The roles and the key responsibilities that have to be carried out must be identified and given to the most capable person.

Other questions must be answered as well, such as whether there is a formal method of finding new benefit prospects and most importantly if the project remains of relevance based on possible unpredictable changes.

During the execution of the expected benefits, the potential risks must be evaluated as well as Key Performance Indicators (KPI) in relation to the financial aspect. The quality, safety and stakeholder satisfaction must always be ensured. The communication plan formed in the first step must be followed and the key stakeholders have to be properly informed. For achieving that, several communication processes have to be used, where it is ensured that the benefits are reviewed, understood and the plan of action is approved.

These practices are: the use of exact terminology, where it is confirmed that everyone involved in the realization process can be well understood. Another important factor is the utilization of diagrams, pictures, tables etc. to describe better the course of action taken by the governance team.

Various identified factors such as the added value elements and project needs have to be included in the current process of delivering the benefits. Risk and issue management is important, as well as change control practices.

Generally, the supervision of the project and the ensured functionality constitutes a good practice for the execution process. The correct execution plan will ensure that the expected value and benefits will be realized.

Sustainability of benefits

The governance team of the project must make sure that the benefits it delivered will remain effective when it is completed. Essentially, the continuous delivered value of the benefits and the general outcomes must be ensured. All in all, project and program benefits must be sustained. Additionally, the execution of the plan is evaluated to identify potential mistakes and prevent their recurrence in the future. ,

A performance assessment of the acquired value is important. For the purpose of this, a formal verification of the realized and delivered benefits must be executed. The desired targets must be compared to the achieved benefits for ensuring that they remain aligned.

During the sustaining process, monitoring the continuous benefit performance is key. Various changes in regard to operation, behavioral or financial aspects might occur and the identification and attendance from the governance team is important.

The implementation of said change has to be controlled and any required procedures to alter the course of action have to occur. One of the main questions that have to be answered is whether the benefits, which can be short or long-term, tangible or not, have been optimized to the desired level. The expected benefits and the course of action, as mentioned above, have to be approved by the project’s stakeholders. During this last step, the approval must be verified.

Additionally, the outcome of the project and whether the benefits were adequately realized is evaluated. The quantified benefits are also compared to the business and sustainment plans, as they should align with them. It is of essence, as well, that the timeframe of the delivered benefits was followed. If not, the team should identify the reasons behind the delays for future reference and take notes for what should be done better next time. Unexpected benefits that might have or could have occurred during the execution have to be studied and it must be checked whether they can be implemented. Practices of knowledge sharing/transfer play a major role during this process. ,

As aforementioned, the stakeholder of the project/program must be kept in loop and properly informed throughout the process. Their involvement must continue even after the realization of the expected benefits. Customer input in regard to the added value is essential and the governance team must be of assistance in case potential improving changes occur. Feedback is desired and must be encouraged.

Generally, although the main aspects of the project or program have been delivered, the ability of maintaining the added value is key while implementing a benefit realization plan. Change is an inevitable aspect of business and life in general, hence it must be considered and the manner it affects the delivered benefits must not be overlooked. Learning from one’s mistake serves a great role in improving future ventures. This last step ensures exactly that.

All in all, Benefit Realization Management serves the purpose of helping a company or organization grow.

Benefit Maps and Methods

The creation of benefit maps is a good way of visualizing the plan and the proposed course of action. The objective and the strategic outcomes are outlined starting from the current situation and continuing on the next intermediate steps with the end goal being to reach the point where the project is realized and the actions of sustaining the gained benefits will take place. Benefit maps follow a certain direction from right to left.

Benefits Dependency Map (BDM)

The relation between the project and the strategic objectives of the company or organization are demonstrated through the map. This type of map contains five different sections, namely the:

• Objective

• Ultimate benefit

• Intermediate benefit

• Changes and outcomes

• Enabler

The map starts out with the identification of the objective. The end goal of the project is stated, which must be aligned with the company’s goals and vision. The second section of the map contains the ultimate benefit that has to be communicated to the stakeholders, in order to gain their approval.

The intermediate benefit section serves the purpose of identifying the required in between steps for the final goal to be realized. Essentially, it represents the smaller milestones that will lead to the completion of the project.

The changes that need to take place in the project’s deliverables or objective constitutes the fourth section of the map. It helps the team achieve the desired benefit in a dynamic business environment.

Lastly, the enabler represents the support mechanisms behind the potential changes that will take place. It demonstrates what needs to be done for the company to achieve the addition of value through the realization of the project.

Benefit Dependency Network (BDN)

The Benefit Dependency Network is similar to the BDM with the main difference being that BDN focuses mostly on digital investments. The network can be divided in six sections, which are the:

• Objective

• Business Drivers

• Expected Benefits

• Organizational changes

• Enabling of organizational changes

• IS/IT enablers

The Objective is the end goal that must be met when the project is concluded. The Business Drivers embody the force of change present in the organization or company, that has created the need for the realization of the project. Furthermore, the expected benefits are the added value to the company after the project or program is finished.

The organizational changes include the identification of actions needed to be done for the realization of the expected benefits and the enabling of the organizational changes represent the manner of which said benefits and actions must be completed.

Lastly, the Information System/Information Technology enablers include all the digital support that is necessary for the completion of the project. Essentially, the first four sections represent the reason behind the change and what needs to be altered and the last two sections give information on how this change is possible. All in all, benefit maps are a great tool to demonstrate the benefit realization management process. It serves the purpose of making it more concise and understandable, rendering the whole process smoother for everyone involved.

Annotated Bibliography

[1] Best Management Practice. (2010). Fundamentals of Benefit Realization. The Stationery Office.

[2]Ospina Avendano, D. (2021). Benefits Realisation Management (BRM). Retrieved [20/02/2022] from toolshero: https://www.toolshero.com/project-management/benefits-realisation-management/

[3]PMI (2016). Benefits Realization Management Framework.

[4] Project Management Institution. (2019). Benefit Realization Management: A Practice Guide. GLOBAL STANDARD. https://www.pmi.org/pmbok-guide-standards/practice-guides/benefits-realization