Benefits Realization: An Introductory Guide for Beginners
What if a project methodology completely changed the way you think about and think about project management? What if a project was no longer considered a success when it was delivered on time and on budget, but rather when the customer's desired benefit was finally achieved?
Unfortunately, the majority of project teams consider a project to be complete as soon as the final product or service is delivered to the customer. The problem is that far too often, the product/service is never used or implemented by the customer, and the customer therefore never reaps the benefits. Why? Because the team in charge of the project closed the file upon delivery of the project and is already started on a new project. She therefore does not go through with the process and abandons the client before the client reaches its goals.
Are you tired of this situation? Discover the Benefits Realization method.
Definition
Called Benefits Realization Management (BRM) in English, Benefit Management or Benefits Realization Management in French, this method redefines what a successful project is. It provides organizations with a way to measure how projects add real value to the business.
For each project they are responsible for, the project manager and his team must identify, monitor and maintain the benefits. Because what is the point of a project, except to bring benefits to the company, a competitive advantage or to help achieve global strategic objectives? If, once completed, the product or service delivered is not used, the entire project will have been a waste of time and money.
The objective of the Benefits Realization approach is to align projects with the company's overall strategy so that they generate real value for the business.
In this context, it is important to distinguish between:
- A result : it is the value, the benefit resulting from the successful completion of a project and which changes the company's activity in a relevant way;
- An output data : it is a specific objective obtained once the project is completed, such as a new product, a new software or a new installation.
Realization of benefits (or BRM) is made possible by combining the results and output data of a project.
Origin of the Benefits Realization method
The BRM approach became popular in the United Kingdom in 1995 when Scottish Widows, the Scottish mutual life insurance company, integrated the method into its project management manual and distributed it throughout the company. Its development was then amplified when the British government introduced the Benefits Realization method into its standardized approach to programming called Managing Successful Programmes.
Finally little known outside the United Kingdom, the Benefits Realization method was the subject of research conducted by the Project Management Institute (PMI) during 2016 in order to help organizations realize and effectively manage the benefits of their projects.
How does it work?
This methodology provides a set of questions and best practices for use by project managers and their teams to help them identify, analyze, deliver, and maintain benefits that are in alignment with the company's strategic goals.
The aim is to:
- identify the benefits to find out if the project can deliver the expected results;
- Execute profit management in order to minimize risks for future profits and maximize the chances of obtaining additional benefits;
- perpetuate the realization of benefits to ensure that regardless of the results, the project will continue to create value.
Here are the different steps to set up profit management. Ideally, a “earnings champion” has been appointed. Its role is to pilot and monitor the entire process of achieving benefits.
1. Identify the benefits
You need to identify what benefits the company is looking for. Several methods can be used such as consulting previous projects, brainstorming sessions, interviews with the various stakeholders, focus groups, etc.
2. Classifying profits
There are four categories of benefits: financial, non-financial, tangible and intangible. Here are a few examples:
- financial and tangible benefits: an increase in turnover and/or profits, a reduction in costs, return on investment, the acquisition of new customers and/or new markets, etc.
- non-financial and intangible benefits: increased customer satisfaction or employee morale, the implementation of a customer-centric approach, etc.
3. Analyze the benefits and plan the implementation schedule
Benefit analysis is an ongoing process that useskey performance indicators (or KPI).
The schedule for the realization of the benefits will guide you in the realization of the benefits. To prepare it, involve stakeholders (such as the customer) because they are the ones who will be responsible for maintaining the benefits later.
4. Delivering the benefits
These are generally provided progressively according to the final product or service. Track the achievement of profits, their progress, and their status against strategic business goals using a roadmap.
5. Pass the baton
The project manager prepares a benefit transition schedule with the stakeholders who will take over. This stage is the conclusion of the project. However, the project manager must remain available, if necessary.
6. Maintaining profits
The objective of a project is for its benefits to last for years. The project manager should prepare a profit maintenance plan that indicates how to ensure that the benefits last over time. This may include a new project based on profit maintenance activities.
Conclusion
The Benefits Realization method is another way of seeing and thinking about project management, focusing on the benefits of the project. It makes it possible to create a link between the company's strategy and project management, and thus to ensure that the project (s) bring real benefits to the company, in line with its strategic objectives.
To learn more about the Benefits Realization method, you can consult the various PMI resources.
