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Six Steps to Measure Benefits

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Author: Reetu Kansal     Source: APM
A lot of professionals do not necessarily take benefits measurement and realisation seriously. In my organisation, we had a meeting a few months ago on this topic, which turned out to be surprisingly popular. A lot of people said that they didn’t really know how to do it; they would work through the project, tick all the things off their to-do list, then pass ownership to the sponsor and stakeholders as part of business-as-usual. They haven’t looked at the benefits realised or the lessons learned, which are complementary to the benefits. Often, people feel that they don’t have time to do it, but it is very important if you want to be a successful project professional.

The benefits realised by your project should be a consideration from planning to completion. Here’s a list of best practice when it comes to measuring benefits.

Step one: identify your objectives and outcomes

What are the goals of your project? For example, let’s say you’re setting up a remote working network for all of your teams in the organisation – this is currently a big one for me, to help with business continuity planning. Once you know what your objectives and outcomes are, you can identify the benefits themselves.

Step two: identify tangible and intangible benefits

What do you get from achieving your objectives? These benefits could be tangible, such as financial savings or revenue increases. It could be about business continuity, which is a big benefit, particularly at the moment.

Some of your benefits could be intangible: improved customer service, improved quality of service delivery, improved reputation, improved employee engagement, to name a few. These are trickier to measure and you may have to be a bit more creative when it comes to measuring them.

For example, when it comes to improved customer service, should you be looking at a change in the number of customer complaints? Could you be looking at gathering customer feedback to see how the quality of service has improved? It could also be based on anecdotal evidence.

Step three: document your benefits

Write down your benefits and identify the priorities, timescales, ownerships, dependencies and any enablers.

The thing to note about ownership is that it’s not you, as the project manager, who owns the benefits and outcomes of your project. There has to be individual responsibility within departments to own the benefits and the implementation of those benefits. Communication is really important, so having a communications plan within the benefits document is extremely helpful.

Your stakeholders will be impacted by the benefits – that goes a little beyond your benefit owners. You’ve got your teams that sit underneath those owners, and it’s really important that you have them on board. Really communicate why you’re doing this work. Give somebody ownership of that communication as well.

The project sponsor, throughout all of this, will have overall project responsibility and accountability. This makes having open channels of communication with your project sponsor vitally important.

Step four: capture your baseline measurements

Work out how you can measure all of the benefits. Are you going to look at customer feedback? Balance sheets? Year-end yield or return on investment? Once you set your baseline measurements, agree targets for each with the relevant people. You might be looking for a five per cent increase on return on investment, or a 20 per cent reduction in customer complaints. It’s important that you be specific.

Set your targets based on SMART principles: specific, measurable, achievable, relevant and timely. Quantify your benefits as much as you can. Agree these with your sponsor and benefit owners. And communicate these to all stakeholders who are impacted.

Step five: realise your benefits

You embed the changes required to realise your benefits. Using the remote working example, you would get everybody VPN access and make sure everyone is trained to use it. You check with different teams and team leaders to ensure they’re comfortable with embedding that change within their teams and are in a position to answer questions. If people are not used to using technology, for example, those team leaders need to be able to support them.

Some benefits may be realised after the project is delivered, such as business continuity, increase in sales, etc – these may take time to manifest.

Step six: monitor your benefits

You hand over the project benefits to business-as-usual, but you need to ensure that you have some way of monitoring those benefits. It could be that it goes through governance – you may have a group that meets to discuss projects and their results, or it could go through senior leadership. It depends on what’s most appropriate for the project and the organisation.

What happens if benefits change?

Benefits can change at any point. You may notice that change occurring when it comes to the benefits realisation stage. Perhaps the reality is different to what you initially thought it would be, or certain factors on the project have changed. You may need to make a higher investment into the business continuity plan or, as we’re experiencing at the moment, maybe a pandemic happens and you can’t deliver certain parts of the project as a result.

In the event of a change to benefits, it’s really crucial to communicate clearly to your sponsor and all the stakeholders how the project is being impacted, and agree with everyone what the new benefits are and how you’ll measure them.

Above all, you shouldn’t take any unrealised benefits as a failure on your part. Accept that change will occur and the benefits you end up with may not match up with what you identified in the first place. You need to be pragmatic – things in the real world can look really different to your initial project plan, so you need to brace for the unknowns.
 

Want to brush up on your benefits management skills? You can find modules in APM Learning on benefits management and how to apply it to your projects.

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