Let’s Send Benefits Realization to Gilligan’s Island

 

Fresh off my piece about celebrating International Talk Like A Pirate Day, I thought I’d do some pirate-like blogging. As most people are probably aware, pirate ships couldn’t  demote or dismiss crew members in a way that allowed them to simply disembark at the next port, since that meant that they could inform on their former comrades-in-crime to the Royal Navy. Should a member of the pirate crew show himself to be incompetent or a little too treacherous, the nominal remedy would be to either have that detractor walk the plank, or, if everyone was in a particularly good mood, they could simply strand the unwanted person on an island somewhere where the target would be unlikely to be rescued any time soon. 

As I was doing my research for ProjectManagement.com’s October theme, Benefits Realization, I found myself becoming frustrated with trying to figure out exactly what it is. It has been my experience that, whenever a concept proves to be difficult to articulate clearly, in a few sentences at the summary level, there’s probably a deficiency in the underlying evidence, and hypotheses in the management sciences are certainly no exception. ProjectManagement.com actually has a blog with this theme, written by David Davis, so I read some of his stuff. The one piece that raised the red pennants with me was from last year. Here’s the main pull-quote: “The final litmus test of the benefit delivery is to ensure the results are properly accounted in the company Profit and Loss (P&L) applications (or as they are ‘booked’).” (1)

There are some problems with this sentence, assuming (as I do) that it accurately reflects the benefit delivery piece of the Benefits Realization cycle. The most glaring has to be that, if the “litmus test” for benefits delivery is whether or not it’s “properly accounted “ for in the profit and loss statement, then there can be no question: Benefits Realization has nothing to do with Project Management. As I have pointed out multiple times in my previous writings, Project Management is all about delivering the customer’s scope demands, on a schedule and budget that the customer either stipulated or approved. PM is a completely different animal than Asset Management, which is measured by such things as return on investment (ROI), and the profit and loss statement. Need more evidence that Benefits Realization doesn’t belong in the set of management science theories that make up modern Project Management? Search the writings on Benefit Realization at length, and you won’t come across a single supported assertion that Benefits Realization will help bring projects in on-time, on-budget. Heck, even PMI®’s definition describes it as beneficial to the company or organization, with nary a mention of how it’s supposed to help achieve project success.

So, if BR is supposed to help the organization, how does it do that, exactly? Remove the trendy terms, and it appears to boil down to an act of quantifying the beneficial aspects of an organization’s activities that would not normally show up in the accounting system – hence Mr. Davis’ assertion that it’s necessary “to ensure the results are properly accounted in the company Profit and Loss (P&L) applications (or as they are ‘booked’).”(2)  This represents another problem with BR: absent malfeasance, all transactions are correctly “booked” once money (or some other precisely quantifiable thing of value) has changed hands. Benefits Realization seems to wish to capture these previously unrecognized benefits in the General Ledger, which is all fine and dandy until someone points out that adding such fuzzy, non-monetized assets (BR isn’t being sold as a good way to add liability) to the General Ledger will result in greater tax liability.

So, Benefit Realization isn’t a real Project Management tool, and I’m willing to wager a keg of rum that it would be rejected outright as a proposed modification to Generally Accepted Accounting Principles. Having this BR concept walk the epistemological plank appears to be rather harsh – avast! Over there! A perfectly acceptable, out-of-the way island! It even appears to have about seven people on it already, living rather comfortably. We should send it there. Arrrrr.

  (1) Davis, David, “Benefits Realization PMI Model,” blog posted on September 29, 2014, retrieved from http://www.projectmanagement.com/blog/Benefits-Realization/10732/ on October 10, 2015 14:12 MDT.
 (2) Ibid.