What vs. When?

It never fails to amaze me how many hours are spent trying to wordsmith terms and schedules in order to meet rules of political correctness.   I have spent hours of my career pretending we are developing a project plan focused on including a suite of capabilities to be delivered together, when in reality – there is an imposed constraint (due date) that must be met.  So therefore the question needs to be asked:  Is it a case of WHEN we can deliver all the capabilities, or is it a question of WHAT can we deliver by a certain date.  I’m not arguing one over the other, my argument is that time is much better spent using the Benefits model when there is a dictated delivery date.  The scope needs to be focused on WHAT can be delivered in the timebox.

This is where a well-defined benefits hierarchy helps the program manager.  The benefits hierarchy of benefit, outcome, and capability is a foundation for creating the roadmap and eventually the project deliverables.  Focusing on what provides the biggest benefits – rather than the contents of the "what in this timeframe can be defined" should drive the best decision within the defined constraints. (Let’s assume that all capabilities have the same cost/quality as this information may be implied within the benefit definition and associated attributes).  In the simplest sense, the scope of the project in the given time box can be determined by doing a binary check of each capability and what it contributes to the benefit.   Can we deliver this benefit in this timeframe? 

I know this assumes a logical quantitative world in which there are no pet projects and all people are rational – but it’s nice to dream.   However; in the imperfect world in which we live the capabilities should be prioritized first as high, medium, and low.  I imagine at that point all the lows are crossed off the list and ice boxed and the mediums are put on hold.  Then you should take the high benefit contributing capabilities and rank those as high medium and low.  (High is the same as mandatory).  Then ask the question:  Can all these be delivered in the timebox?  If the answer is no – you must move the time constraint!!!. 

If the answer is yes, you then ask, can it include any more capabilities?  If that answer is yes, you then need to independently rank the mediums and then go down one by one and ask the question: can we do the highs plus this one?  If yes – add it to the list, if no – it gets put into the icebox.

Now somebody will bring up the idea of well if I can have 2 and 5 but not 1, then I want to do that.  This exercise is one of those that sounds nice in theory, but becomes very expensive in practice.  The program manager really needs to make sure that the benefit/capabilities stand on their own.  And if they want to combine them – then the combined benefit is what must be evaluated against the line.  It really doesn’t make sense to spend lots of cycles piecing together different scenarios in order to see WHAT CAPABILITIES  we can get delivered, we should focus on WHAT BENEFITS can we start to realize.  This game leads to the bad practice of putting in low value capabilities just because we can get them in by a date as opposed to looking at the high value capabilities that will drive real benefits.

My daydream is over.  The politics of organizations will drive the game.  Unless a complete OCM project has been implemented that drives the decision model driven by benefits is in place – the games of how many things can I fit in the time box will continue.    But keep the faith program managers – by forcing benefits to be evaluated while these decisions are being made will be worth it when the icebox is opened for the next timebox.

The 2015 PMI Pulse of the profession continues to stress that mature benefits management practices distinguish high performing organizations from less successful ones.  Besides obtaining higher success rate at meeting project objectives, organizations with mature Benefits Realization maturity have better on-time and on-budget results.  The text below is extracted from PMI’s annual Pulse of the Profession.

Benefits realization illustrates—and measures—precisely how projects and programs add true value to the enterprise. Organizations that implement benefits realization programs understand this value, because they are capturing the hard facts needed to showcase the return on their project management investments.

But far too few organizations have effective benefits realization programs in place—in fact, many have no program at all—so they are missing an opportunity to understand what would help them increase the rate of project success. We need to continue studying the challenges of benefits realization to gain insight into ways organizations can meet those challenges.

Our 2015 Pulse research indicates that only one in five organizations reports having a high level of benefits realization maturity. While low, this still represents an increase of 63 percent since 2013, indicating a high level of interest in this topic, even while organizations struggle to become adept at it. High performers are over four times more likely to report high benefits realization maturity (39 percent compared to 9 percent of low performers), because they recognize it as a business imperative.

In addition, organizations that report high benefits-realization maturity have significantly better project outcomes, as noted in the chart. Benefits realization is challenging, but when executed well, it helps ensure that the outcome of a project produces the desired benefits, as projected in the business case. This is achieved by establishing, measuring, and communicating the results of an organization’s initiatives. Such insight into performance is also an essential planning tool for future projects and resource allocation, including talent.

“What we are realizing now is your performance in the job today is what is actually going to dictate work that you get tomorrow,” said Mark Childers, PMI-ACP, PMP, Project Manager III, DOD & State, FLUOR Government Group.

While we have seen a significant increase in the number of organizations that are highly mature with this competency, we still see a lower-than-ideal percentage of organizations investing in benefits realization, considering the return.

Organizations with mature benefits realization processes can benefit from:

•        Clearly identifying the strategic rewards prior to starting a project

•        Effectively assessing and monitoring risks to project success

•        Proactively planning for making necessary changes in the organization

•        Explicitly defining accountability for project success

•        Routinely extending responsibility for integration to the project team

A combination of Organizational Agility and compliance to mature Benefits Realization Practices will help an organization achieve superior results andtranslate into a competitive advantage.

Benefit Realization and Analytics

One of the most compelling reasons for benefit realization the ability for the program manager to report back to the business that the investment value is being realized. In order to perform this task properly the program manager is going to apply many of the principles of analytics. This blog wants to give high-level definition of analytics and how they will apply to program management and benefits realization.

As the image shows analytics have a couple major components to them that are right in line with the entire benefits realization concept. First analytics is a higher-level of looking at your data and communicating results visually as well as tactically. Analytics is looking at patterns in the data, it may be trends in maybe cause-and-effect it may be direct or indirect relationships. So the first step is understanding the data in the enablers to create. Second analytics relies on statistical disciplines, this includes using tools to extract data in the appropriate research in business intelligence in order to quantify the performance of that data.  Finally analytics does favorite data visualization to communicate the inside of the knowledge that has been obtained by the program manager that is reporting the actual results of the benefits realization.

In some ways the use of analytics expands the role of the program manager into a couple different areas both the delivery of the solution as well is running of the business. Analytics falls mainly under a business analysis skill set, and PMI now has a certification in business analysis, as well as performance analysis of the different components with in the program itself.  The program manager will need to be able to look at production data and be able to identify the patterns and communicate those and how they relate to the program itself. Analytics will require the current state the future state of the KPIs and how the benefits are going to be able to measure is associated KPIs. The other area that analytics will expand the program manager skill set is on analyzing a series of data points as opposed to just a snapshot in time traditionally project managers are able to give a readout of the current earned value, with respect to schedule and cost and project be earned value to completion. Analytics, as applied to the program, will also need to look at past performance and project future performance across multiple components and the people aspect of implementing these components.

What analytics will drive is a new means of communicating for the program manager. As mentioned in the definition above analytics resonate with the visual explanation. The program manager will be expected to provide that visual explanation interrelationship between expected results in actual results and the approach to close the gap is the variance is about tolerance level. This is not to be dependent on good data which will drive the program deliverables to ensure the proper hand also milestones are defined. It will also require the program manager to be able to map out the relationships between project results and business performance.

This is an exciting growth area for program managers and a great opportunity for a strategic project management office to be able to deliver more value to the business. This is another step in the journey to aligning the strategy of the company with the investment is being made. The program manager be looked at to be able to explain the journey and demonstrate where the organization is on that journey. And be able to do so in a visual data proven presentation that will transcend all components of the value chain.

This is a small video regarding how many organizations fund their programs for a year.  I am working on a new software package to start sharing knowledge via "whiteboard" snippets.

http://youtu.be/HiqO0EiivpI

We're All in This Together !!!

Dave

The Project Management Institute® (PMI) has defined a Benefits Realization model for a Program Manager to use to help the company capture the expectations of an investment.  The concept of the model is to provide a structure from the initial planning through to actual realization (or booking) of the benefits into a new Business As Usual change.  The five steps are loosely structures to be hierarchical in flow, but allows for a progressive elaboration approach as more information becomes available during program implementation.

Benefits Identification

This is the initial step of capturing the potential benefits that can be realized by the program.  This step is analogous to a brain storming session and will result in a canonical listing of potential benefits.  There are many sources for gathering this information including business documents, brainstorming sessions, extraction from a business plan, external factor analysis, organizational strategic objectives, and expert knowledge.  Many organizations will group the list into various categories to assist in analysis and eventual ownership.   The outcome of this step should be a list of potential benefits in a benefits register.

Benefits Analysis and Planning

This is the means of qualifying and quantifying benefits.  If the benefits Identification step produces a canonical list of benefits, then each benefit needs to pass a “test” to see if it truly qualifies as a benefit, or to help prioritize benefits.  The benefits register should contain the associated algorithms and business rules/logic required to define the value of the benefit.   The analysis will also include setting an expectation for the value of the benefit and a relationship of the benefits against sequence, time, and dependencies.  A significant portion of this step is to align company performance metrics (KPI) to be able to measure, demonstrate, the results of the implementation.  The end result of this step should be the Benefits Realization Plan (BRP) which formally documents the activities required for achieving the program’s planned objective.  Included in the Benefits Realization Plan is a program roadmap which documents the expected delivery of the value of the benefit against time.   The BRP will also define how the benefits will be transition to operations at the end of component deliver and the sustainability expectations.  The Benefits Realization Plan is a control document and needs to be baselined and managed under strict change control throughout the life of the program.

Benefits Delivery

This is the means of actually placing the changes into the business and the start of seeing the expected benefits in the business reporting infrastructure.  Since Programs will include multiple components, the delivery will be an iterative process and will span from the first project completion through to Program Closure.  Using the baselined BRP, the program resources will conduct monitor and control activities to analyze the results and prescribe corrective action.   Part of this prescriptive corrective action is to ensure the Benefits Register is aligned with the monitor and control activities.  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  they are “booked”).

Benefits Transition

This is the means of recognizing the programs have defined ends and that benefits might be realized long past the closure of the program.  The Benefits Owner will eventually assign benefits realization to an operations function where it measures the benefits as part of a “Business As Usual” process.  This implies that monitor and control and associated prescriptive action is no longer the responsibility of the Program manager, but not the operations manager.

Another important aspect of the Benefits Transition is that operations team will often view a suite of benefits as one item.  For example there may be six benefits included in a project software enhancement, the operations team will most likely look at that as one enhancement.  Therefore, the benefits transition process, and associated artifacts, will consolidate coordinated benefits into the package to east transition.  The outcome of this phase will be the standardized reporting of benefits to associated benefit and business owners.

Benefits Sustainment

Finally, benefits need to be sustained over the lifecycle of the change initiative.  Many times the benefits will be forecasts over time, as defined in the benefits roadmap, and the time frames will expand past the life of the program.  After benefits are transitions, they need to be sustained.

Monitor and control and taking corrective action is a portion of the sustainment steps, but it can include much more.  It is possible that during the lifecycle of the change that previously unidentified benefits are realized, these “emergent” benefits should be documented and through the use of structured change control, incorporated into the benefits reporting models. 

Conclusion

The PMI Benefits realization model defines a structured set of phased to support the identification of, analysis of, monitoring and control of, the transition of, and the sustainment of benefits throughout the lifecycle of the change.  The model also encompasses the “care and feeding” of benefits after transition to operations and helps to validate the true return on investment to the organization.  Benefits Management needs to be incorporated into an organizations knitting and be considered in all aspects of the program.

Sources

Letavec, Craig J. Strategic Benefits Realization: Optimizing Value through Programs, Portfolios and Organizational Change Management. Plantation, Fl.: J. Ross, 2014. Print.

The Standard for Program Management. Vol. 3. Newtown Square, Pa: Project Management Institute, 2013.

We're All In This Together !!!

Dave