Critical.
Authoritative.
Strategic.
Subscribe to CIO Magazine »

Refocusing Projects onto Business Value, Part 9: Benefits

It is important to understand the nature of benefits — what they are and what they are not

Less than 30 percent of organizations actively try to measure their projects' benefits and value. And many that do use the simplistic 'put it in the budget' approach. However, internal and external events during the project can cause the value of the benefits to legitimately increase or decrease, and this dynamic interaction between benefits and their value should be recognized, tracked, and measured.

Value management's question for the end of a project is not so much "Did we deliver the business-case promised value?" as much as "Did we deliver the maximum available-at-the-time value?" (This at-the-time value could be higher than that originally promised).

Critical to benefits management is that all benefits-related dimensions are known and measurable.

  • Has the project delivered its agreed outputs? Each project output should be measurable with a 'true/false' statement measure.
  • Has the business delivered the agreed desired business outcomes that will deliver the benefits? Each shortfall in the delivery of a business outcome directly diminishes the value that can be realized.
  • Have the benefits been delivered and to what degree?
  • Have the value drivers or assumptions that determine a benefits' value changed and, therefore, have they changed the value available?
  • What value has been realized and what caused any variances to the originally expected value?
Ensuring that all of these dimensions are measurable is the role of the benefits management process — a key value delivery process. When everything is measurable, it is possible to track the progressive delivery and realisation of value (and identify the root causes of any value loss).

Benefits management is not something you do at the end or after the project, but instead throughout the project. After all, realization of the benefits and value is why you do projects in the first place.

Value delivery management requires the realization of the business outcomes, benefits and value to be the focal point of the project. If the project delivers these outcomes they, in turn, will deliver or enable the benefits that will ultimately contain the value.

So it is important to understand the nature of benefits — what they are and are not, how they need to be stated in such a way as to be measurable, and how they need to be tracked, managed, and measured both during and after the project to ensure maximized value and ensure that the project remains viable at all times.

In most organizations, value measurement processes need to be introduced.

Comment on our blog at valuedeliverymanagement.com


Click here for the eighth article in this the series "Refocusing Projects onto Business Value, Part 8: Business Case"

Click here for the first article in this the series "Refocusing Projects onto Business Value, Part I: The Need".

Jed Simms is CIO magazine's weekly project management columnist. Simms, founder of projects and benefits delivery research firm Capability Management, is also the developer of specialized project management and project governance Web site www.project-sponsor.com

Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.

More about: SIMMS, Simms International
References show all

Comments

Post new comment

The content of this field is kept private and will not be shown publicly.
Users posting comments agree to the CIO comments policy.
Login or register to link comments to your user profile, or you may also post a comment without being logged in.
Related Whitepapers
Latest Stories
Community Comments
Latest Blog Posts
Whitepapers
  • Enterprise Buyers Guide for Printers
    Every enterprise owns, and regularly replaces, printers, copiers, multifunctional products and fax machines. The problem most face is not too few choices, but too many. How do you even begin to select the right one? Here is the Computerworld guide to buying a printer for the enterprise.
    Learn more »
  • Oracle SOA Suite – Oracle BPEL Process Manager
    Changing markets, increasing competitive pressures and evolving customer needs are placing greater pressure on IT to deliver greater flexibility and speed. In response to these challenges, leading companies are adopting Service-Oriented Architecture (SOA) as a means of delivering on these requirements by overcoming the complexity of their application and IT environments. Read on.
    Learn more »
  • Protecting Generation Web
    From data privacy to personal safety issues, cyber-bullying, inappropriate content and malware, schools are facing an increasingly difficult task when it comes to allowing young people to spread their online wings without compromising their safety and personal development. The reality that most schools are catering to the needs of mixed age groups and abilities, and it’s easy to understand why a simple stop and block approach won’t work. Learning environments are, by nature, flexible. It stands to reason that the IT resources used in them should be flexible too. Read on.
    Learn more »
All whitepapers
rhs_login_lockGet exclusive access to Invitation only events CIO, reports & analysis.