As an organization, we are only now beginning to seriously align individual project objectives with the larger "business" outcomes. "All" projects now must show a direct relationship between project objectives with the desired "business" outcomes. In our case, those "business" outcomes are those of the government at large. If the project cannot show a direct relationship, it receives no notional funding, and essentially does not move forward until it can.
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2 replies by Aleksei Nikitin and Vincent Guerard
Jul 17, 2018 8:58 AM
Aleksei Nikitin
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The same thing to my organization. We are just beginnig to realize it. If a company has no more than 10 projects and they all are for external customers, the benefit is easily calculated and doesn't need any special proofing. But if the company has 100 projects and the same number of ideas, and all of them are internal, and all of them are considered as investments, than you undoubtfully need the very strong systematic connection between strategy, benefits and products. From this point of view the benefits are the connection link between the project's product and the company's strategy. Also from this point the benefits dont need to be necessarily monetary. We use the business analysts to define the benefits, and we involve the guys from quality management system department to establish the metrics and to validate them. Moreover we set that the PM's obligation is only product, not the benefits. Realizing the benefits is the obligation of the Sponsor and the Customer. Frankly this part is the most difficult to implement.
Jul 17, 2018 9:16 AM
Vincent Guerard
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Steve -
I have seen that in many organizations. Direct impact on organization gets higher priority.
You see a "hammock" and a "barbell" on either sides of the tree. Which one will you go for? :-D That depends, ain't that true?! More than benefits, satisfaction is a better benchmark IMHO. Cheers Vincent!
Realistically, it comes back to money as there would need to be an incentive and investment return, but can be felt in many tangible ways, such as efficiencies and opportunities.
Andrew -
I can think of benefits that are not financial? like you say efficiency or reduce line-out time would be one.
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1 reply by Drew Craig
Jul 17, 2018 8:55 AM
Drew Craig
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Please share. Would it not, in some way, shape, or form, tie back to financial? Efficiencies save cost by reducing time/effort does it not?
Saving Changes...
Drew CraigSr. Agile & Product Coach| VanguardPhiladelphia, Pa, United States
Jul 17, 2018 8:29 AM
Replying to Vincent Guerard
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Andrew -
I can think of benefits that are not financial? like you say efficiency or reduce line-out time would be one.
Please share. Would it not, in some way, shape, or form, tie back to financial? Efficiencies save cost by reducing time/effort does it not?
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1 reply by Vincent Guerard
Jul 17, 2018 9:28 AM
Vincent Guerard
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Andrew -
For example, if I reduce line-ups in a store/bank. I will increase customer satisfaction (0$), but the organization has more staff on site to achieve this, increased cost.
Some benefits could have no clear increase in profit/revenue. Still be positive for the organization.
Saving Changes...
Aleksei NikitinLead expert| Higher School of EconomicsSaint-Petersburg, Russian Federation
Jul 17, 2018 8:05 AM
Replying to Steve Ratkaj
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As an organization, we are only now beginning to seriously align individual project objectives with the larger "business" outcomes. "All" projects now must show a direct relationship between project objectives with the desired "business" outcomes. In our case, those "business" outcomes are those of the government at large. If the project cannot show a direct relationship, it receives no notional funding, and essentially does not move forward until it can.
The same thing to my organization. We are just beginnig to realize it. If a company has no more than 10 projects and they all are for external customers, the benefit is easily calculated and doesn't need any special proofing. But if the company has 100 projects and the same number of ideas, and all of them are internal, and all of them are considered as investments, than you undoubtfully need the very strong systematic connection between strategy, benefits and products. From this point of view the benefits are the connection link between the project's product and the company's strategy. Also from this point the benefits dont need to be necessarily monetary. We use the business analysts to define the benefits, and we involve the guys from quality management system department to establish the metrics and to validate them. Moreover we set that the PM's obligation is only product, not the benefits. Realizing the benefits is the obligation of the Sponsor and the Customer. Frankly this part is the most difficult to implement.
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1 reply by Vincent Guerard
Jul 17, 2018 9:18 AM
Vincent Guerard
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Aleksei -
For projects for the external customers, do you have an evaluation of your organization benefits besides potential profits?
As an organization, we are only now beginning to seriously align individual project objectives with the larger "business" outcomes. "All" projects now must show a direct relationship between project objectives with the desired "business" outcomes. In our case, those "business" outcomes are those of the government at large. If the project cannot show a direct relationship, it receives no notional funding, and essentially does not move forward until it can.
Steve -
I have seen that in many organizations. Direct impact on organization gets higher priority. Saving Changes...
The same thing to my organization. We are just beginnig to realize it. If a company has no more than 10 projects and they all are for external customers, the benefit is easily calculated and doesn't need any special proofing. But if the company has 100 projects and the same number of ideas, and all of them are internal, and all of them are considered as investments, than you undoubtfully need the very strong systematic connection between strategy, benefits and products. From this point of view the benefits are the connection link between the project's product and the company's strategy. Also from this point the benefits dont need to be necessarily monetary. We use the business analysts to define the benefits, and we involve the guys from quality management system department to establish the metrics and to validate them. Moreover we set that the PM's obligation is only product, not the benefits. Realizing the benefits is the obligation of the Sponsor and the Customer. Frankly this part is the most difficult to implement.
Aleksei -
For projects for the external customers, do you have an evaluation of your organization benefits besides potential profits?
Please share. Would it not, in some way, shape, or form, tie back to financial? Efficiencies save cost by reducing time/effort does it not?
Andrew -
For example, if I reduce line-ups in a store/bank. I will increase customer satisfaction (0$), but the organization has more staff on site to achieve this, increased cost.
Some benefits could have no clear increase in profit/revenue. Still be positive for the organization.
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1 reply by Drew Craig
Jul 17, 2018 9:43 AM
Drew Craig
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Increased customer satisfaction would increase the customer footprint, correct? Either through additional business or word of mouth. These combine for increasing revenue, from both increased existing customer business, new customers, and positive feedback from a market perspective (stocks).
So in your example, the cost of additional hires for handling increased business is simply just a further investment in the overall objective.
Again, in our case, the key "customer" is the "government" or the citizens. In most cases, there is no monetary value placed on the "benefit" realized as we are a "not for profit" entity.
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1 reply by Vincent Guerard
Jul 17, 2018 11:21 AM
Vincent Guerard
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Steve -
Might not be revenues, what about efficiency? reduce cost?
Saving Changes...
Drew CraigSr. Agile & Product Coach| VanguardPhiladelphia, Pa, United States
Jul 17, 2018 9:28 AM
Replying to Vincent Guerard
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Andrew -
For example, if I reduce line-ups in a store/bank. I will increase customer satisfaction (0$), but the organization has more staff on site to achieve this, increased cost.
Some benefits could have no clear increase in profit/revenue. Still be positive for the organization.
Increased customer satisfaction would increase the customer footprint, correct? Either through additional business or word of mouth. These combine for increasing revenue, from both increased existing customer business, new customers, and positive feedback from a market perspective (stocks).
So in your example, the cost of additional hires for handling increased business is simply just a further investment in the overall objective.
Good discussion, Vincent!
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1 reply by Vincent Guerard
Jul 17, 2018 11:21 AM
Vincent Guerard
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Andrew -
True it could increase revenues, it could stabilize revenues in other cases.
Just that in some case the link to revenue is a long road. :-)
