Life after project completion: Is a project complete without benefits realization?
In our day-to-day project management and PMO activities, the easiest and the most important thing to miss is plan for ahead what happens AFTER we cross the finish line. So technically speaking, once project managers hand over the reins of the completed project to the business owner, their job is just half done. For a project to be considered complete, project managers must focus on the other half, which is “Benefits Realization”.
Benefit realization is the confirmation that the value a project was expected to generate really does get delivered. In our everyday project management lives it is easy to get buried in details around task management, risk mitigation, resource capacity, balancing budgets and all the other moving parts. We often forget why we set out to do the project in the first place: the delivery of a product or service, an enhancement or improvement, or a capability. For example to meet some new regulation, standard or market demand. But what if, after we deliver the goods, and did exactly what the customer asked for, we realize that all the effort and resources we used to deliver the project don’t amount to what they were supposed to? That’s exactly what benefits realization is all about.
We’ve all heard of ROI – return on investment. It is the concept of an investment of some combination of resources (people, money, equipment, etc.) yielding a benefit to the investor. A high ROI means the investment gains compare favorably to investment cost. As a performance measure, it is one of the best methods to evaluate the efficiency of an investment. ROI does not exclusively have to be in financial terms. It can easily be an operational advantage, an improvement in position, or other positive change. In order to compare the efficiency of a number of different investments we need to compare like measures, which is why a financial ROI is one of the most commonly used. Unfortunately, without benefits realization, our ROI is simply a guess. And that is why benefits realization is so important.
I’ve discussed with many of our clients about this and have found out that there is a need for a wide degree of maturity around the realization process. This is an indication that while the concept of realization is gaining interest, it is still far from a mature practice. Which presents a great opportunity for those organizations that are not doing it – now is a great time to implement this practice.
How to launch a benefits realization initiative?
One of the best approaches involves setting goals, tracking against those goals and including a ‘hand-off’ step, similar to the passing of the baton in an Olympic relay race. Tactical steps you can take include:
One last point is that it isn’t always about the money. Sometimes projects generate other value, such as an improvement in customer satisfaction, or increase market share by launching a game changing product. It is important to be able to quantify the value of these types of projects even if they do not generate direct revenue or cost improvements. Many organizations call these ‘Level 2” or “Indirect Benefits”.
Finally, is a project complete without benefits realization? To the project manager who’s already run their marathon and marked the project as complete, I expect their answer to be ‘yes’, but common sense tells us otherwise. As a best practice, one of the most important factors in a projects success isn’t “how we did it” – coming in under schedule or under budget – but “what we did” – that the project delivered what it set out to do.
How Important is Adoption for a PMO?
Project Portfolio Management
What makes a successful PMO? A great deal of hard work? Definitely. But there are some other ingredients in that “special sauce” that enables a PMO to succeed. Let’s explore.
A few years ago Jack Welsh of GE fame lead a keynote speech on large programs. He was presenting to the business leaders of some of the largest enterprises in the world. The speech began something like this:
“If you can’t get top management to support your program, don’t even bother. Don’t even waste your time.”
Why did Jack say that? Because to him, adoption is so important that a program is doomed to fail without it – all the way from the top to the bottom. You can spend an extraordinary amount of time, effort and financial resources around setting up a program, developing a methodology and implementing a solution but without the team being ‘on board’ with your program you will have a very difficult time succeeding.
Once we can secure an executive sponsor, and have them attend the kick-off, and elaborate why the initiative is so important, what’s next? The next step is making sure everyone is listening. Does everyone in the program understand what the sponsor just elaborated? Are they clear with what the objectives are? Do they understand their role in helping achieve success? One of the best examples that come to mind comes from the early 1960’s, before man landed on the moon, where President John F. Kennedy was touring the NASA Manned Spacecraft Center. A humble and down to earth leader, JFK encountered a janitor as he was being guided through the facility. He stopped the entourage and approached the janitor and asked him what he does there. The janitor replied: “I’m putting a man on the moon.” Surely he knew he wasn’t directly flying an astronaut to the moon, nor did the director of the space agency tell him to answer that way if the president asks. No. The mission of the center was so clear from the very top to the very bottom that every single person knew what their contributions were working towards.
Next idea has to do with appreciation for the stakeholders and user community. A program is most successful when everyone is able to contribute to its design and change. Capturing end user feedback and letting the PMO evolve and grow is essential. Why is this so essential? Simply because when we set out to design the program, we may not have taken everyone’s perspective into account. We may also not have thought about how each role would interact. But more importantly, you increase the chances of success by casting your feedback “net” as broadly as possible. There’s an old story that helps demonstrate this idea. On some highway, a trucker is driving his semi. He approaches a bridge with a sign that warns of 13’ of clearance. Thinking he can fit, he continues onward only to hear the sound of crushing metal and his truck quickly stopped. He gets out of his rig and finds his trailer wedged under the overpass with no easy way to get out. The state police are called followed by the civil engineer. Bridge plans are reviewed and a crowd starts to gather. A little girl walks up to the engineer and says “mister, why don’t you just take the air out of the truck’s tires?” The truck is lowered and is now able to roll out. Sometimes the best ideas come from the strangest places. But even more important, one of the people in the community was able to share an idea that had a direct impact on solving a problem, enhancing a positive framework across the entire community.
Of course, there are many other aspects to user adoption, but getting the support from the entire organization, from the top to the bottom, is essential to your PMO’s success.
Why is team collaboration not enough?
Expanding beyond team/social collaboration to business collaboration
The term “collaboration” has become one of the primary hot topics for businesses and analysts throughout the industry lately. At its most basic level, “collaboration” simply means “working with others in a coordinated fashion toward a common goal.” But few actually attempt to define what it really means in the context of business and PPM.
If you ask most people what capabilities define collaboration in the workplace, they generally talk about the sharing of information within a given team: document management, threaded discussions, activity feeds, instant messaging, shared calendars, task assignments, facilitation of problem solving and idea development, communication of decisions and meeting minutes, etc. This is all good, and certainly helps a team move forward in coordinated fashion toward the common goal of completing a project or specific unit of work. Nearly all PPM solutions provide functionality to address each of these needs within the scope of a project. SaaS PPM solutions are particularly well-suited to providing this level of team collaboration since, by their very nature, they are accessible to all team members regardless of geographic diversity and the information they contain is always available in near real-time.
I would argue, however, that this limited view of collaboration is incomplete. Looked at from a broader perspective, an entire organization can be viewed as a collection of units which must all work together in a coordinated fashion toward the common goal of alignment and execution against the business’ corporate vision and strategic objectives. Thus, business-level collaboration is necessary to establish the direction for an entire organization. “Business Direction” includes the definition for the organization’s Vision, Goals and Strategies. By sharing and collaborating on the Business Direction, the business teams will be better prepared to drive the various work efforts. True business-level collaboration therefore depends on the free flow of information between the project teams and the outside world – management, other departments, executives, stakeholders, etc. – to facilitate proper alignment and effective decision-making throughout the entire organization. It is this level of “business collaboration”, as opposed to individual “team collaboration”, which is often missing from a company’s collaboration strategy. All too often, anyone not on the core project team is actually excluded from access to the system of record for project performance and must therefore depend upon periodic status updates or word-of-mouth communications to understand, participate, or make critical business decisions on project information.
Business collaboration provides a level of transparency and visibility to project details throughout an organization. At its heart, business collaboration makes heavy use of enhanced dashboarding and powerful reporting capabilities to expose appropriate project information to those who are outside the core project team. Ideally, facilitation of business collaboration also provides processes and methods for these external resources to submit inquiries and participate in discussions, access project documentation, and all of the other traditional collaboration capabilities as well.
When examining the collaboration strategy within your organization, be sure to keep the big picture in mind. Team-level collaboration is certainly important. But enabling collaboration across departments and across levels within a larger organization can often be even more critical to the success of the entire business.
Principles of Scoring Models
When I was running the IT-PMO at PeopleSoft we faced an interesting dilemma. As we finished work on the integration of JD Edwards there was a ton of unmet demand for IT work from all corners of the enterprise. This ranged from tweaks to the purchasing system to an all-new global training environment. We quickly realized even our ability to analyze the demand would be swamped by the incoming flood of work.
So, we devised a scoring system. Why? There were three main reasons, all of which really comprise some fundamental principles when creating a scoring model.
First was the need to analyze and separate the wheat from the chaff quickly. Our primary driver was to be able to make an initial cut from 120+ requests to something more manageable for more in-depth analysis. So we needed a way to make quick judgment calls to find the top 20-30 project requests with the most merit.
We further realized that any analysis that came up with a specific number (like $300K for changing the purchasing program), even with a caveat of +/- 100%, would become sticky. That is to say, if the $300K estimate was later revised to $400K - well within the +/- 100-% - the executives would still want to hold us to the $300K! "I thought you said $300K 2 months ago - what changed!" was a familiar refrain. Scoring models, on the other hand, place estimates in ranges. So as long as you don't exceed the top range it’s all good.
Many project-driven organizations today face this same dilemma on an ongoing basis. Scoring models meet this challenge well. So, to create a scoring model that will quickly find the projects with the most merit without being nailed down to estimates too early, keep these key principles in mind:
Once requests are reviewed and sorted using a scoring model, decisions can be made about which should proceed for further analysis. Those that pass muster then pass into the more traditional initiation process for projects, ensuring that valuable analysis time is not wasted while allowing the focus necessary to properly present the best projects for funding.
Educause 2012 Takeaways
Project Management Office,
The Educause annual conference is the nation’s largest gathering for higher education IT professionals and Daptiv was present for the well attended 2012 conference in Denver. Issues that attendees were concerned about were diverse but several interesting themes emerged over the course of attending sessions and having one-on-one conversations with end users and CIOs. One particularly well attended discussion on Project Management was intriguing, many pain points seemed common across education IT departments and Project Management Offices. Here are some of our takeaways from the conference:
Increasing Demand Placed on IT: Demands placed on IT departments are becoming large and disparate with multiple university departments demanding conflicting projects from an increasingly resource strained IT staff. With this increased pressure, CIOs and managers are looking for a way to streamline and manage their suite of projects.
Prioritization: Many attendees were seeking best practices and methodologies for prioritizing their portfolio of projects. Several attendees shared their successes and failures but several threads were common though all successful processes: easy to communicate and simple to deploy. Many attendees sought visualizations and reporting that would allow them to quickly judge the size of a project vs. its projected benefit. The easier it is to demonstrate relative importance and prioritize one project over another, the easier it is to communicate with and receive buy in from competing university departments.
Communication: Ensuring everyone is in the loop on project decisions is critical. Lacking a single source of truth for project management, implementing an effective communication plan can be difficult. Project Managers and IT needs to communicate early and often with stakeholders. Schools and universities which emphasized their success in communication reiterated this point. Every stakeholder needs to feel that they are part of the dialogue.
Flexibility vs. Standards: Project Management Offices, once built to solve the above issues often face their own hurdles. Being flexible enough to maintain engagement with stakeholders while ensuring accountability with standards is itself a challenge. Flexibility needs to be built into the DNA of the PMO and IT Department early and must be matched in any tool used to manage their projects. It should be up to the department to develop the processes, not have an outside process thrust upon them. In the words of one attendee, “The tool used should be process agnostic”.