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Topics: Benefits Realization, Portfolio Management, Risk Management
Has a Project failed if the benefits are not realised?
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I just read an article "Disaster Recovery for Your Project" by Mark Mullaly which reminded me of an old question and many political debates with sponsors and stakeholders.

example of this: A product that was a must have for one of the sponsors did not come high enough on the priorities to be allocated a slot on the portfolio roadmap. After reviewing the priority levels for the roadmap and discussions at board level the case was resubmitted with 3 x the annual revenue over 3 years and 15% less cost, when questioned around this the statement was "we understated the original revenue forecast so that when we exceeded it, it would be deemed a bigger success". Hmmm! after more discussions the political landscape changed and we force fitted it into the roadmap but with the project budget supplying 60% of the cost and the department supplying the other 40% from within their budget.

To cut the punchline, after 18months the product had made a total profit of €96, well below the original and revised ROI targets. The Portfolio management was blamed for not delivering this earlier and they had missed the window for a successful product. The product was delivered on time and budget as per its place in the portfolio roadmap.

Whats your view: Did the project fail because the benefits were not realised?
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It cannot be said to pass or fail only looking profit from the project in terms of money. To say pass or fail, we have to look into three different aspects i.e. By doing any project if we increasing company credentials and assets, this may help to show the best result in future projects so if this the case then it cannot be said to be failed, 2nd the completed project is how much use to society and how much impact it can able to do in overall in social life/environment, so it matters a lot in deciding to fail or pass.3rdly some project can be done to build the relation without any profit which may give n number other projects from the same client or it may help to bring the new project in the same domain from other clients which may help to meet company goal, vision and strategy so by looking all aspect only sponsor can decide it is fial of pass.
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1 reply by Gordon Alexander
May 02, 2019 8:00 AM
Gordon Alexander
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Thanks Ramakant, I think there are different ways to judge the success of a project and your thinking in the right direction.
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Failure is subjective, what the one regards a success, the other might consider a failure.

In my view a project manager cannot be responsible for benefits. A PM is in charge of fulfilling the objectives as stated in the project charter, which are most often stated as schedule and cost constraints on a scope that includes a project product. The PM standards do not include benefits as a realm of a PM, PM's are not trained or certified to understand benefits, benefits management begins before (business case) and ends (transition into operations) after the project start and end dates, when the PM is not on Board. Contractor PMs will not accept responsibility for benefits in their contracts.

OK, since benefits are why we do projects, who then is in charge.
I think the best choice is a program manager. Benefits management is in traing and certifications, programs start with creating a business case, and end after benefits tracking is established by operations.

Often, I see portfolio management or the business sponsor in charge, unluckily both of them are not skilled and primarily charged with delivering individual benefits. If an organization is not clear who should be in charge of delivering their benefits, they might not get them. QED.
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1 reply by Gordon Alexander
May 02, 2019 8:09 AM
Gordon Alexander
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Thanks Thomas, Great answer, with benefits realisation being measured possibly years after a project has been delivered the PM and others will not be on board. A portfolio manager may have benefits tracking within the PMO but as you state is he responsible for achieving the benefits?. Since the Sponsor and stakeholders are responsible for the metrics being put into the business case, and around benefits realisation should this still be considered as part of the project? hence the initial question
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Dear Gordon,

The benefits of doing a project can't be measured only on its monetary benefits. Even if the product wasn't successful, but if it lead to learning of the project team, if it increased the skill set of the team and it taught you new ways of tackling problems, then the project is a success.
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1 reply by Gordon Alexander
May 02, 2019 8:13 AM
Gordon Alexander
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Thanks Savrabh, agreed the benefits of doing a project can be a zero sum game or even a loss making one (i.e. a loss leader).
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May 02, 2019 5:38 AM
Replying to Ramakant Beernally
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It cannot be said to pass or fail only looking profit from the project in terms of money. To say pass or fail, we have to look into three different aspects i.e. By doing any project if we increasing company credentials and assets, this may help to show the best result in future projects so if this the case then it cannot be said to be failed, 2nd the completed project is how much use to society and how much impact it can able to do in overall in social life/environment, so it matters a lot in deciding to fail or pass.3rdly some project can be done to build the relation without any profit which may give n number other projects from the same client or it may help to bring the new project in the same domain from other clients which may help to meet company goal, vision and strategy so by looking all aspect only sponsor can decide it is fial of pass.
Thanks Ramakant, I think there are different ways to judge the success of a project and your thinking in the right direction.
Network:161



May 02, 2019 6:50 AM
Replying to Thomas Walenta
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Failure is subjective, what the one regards a success, the other might consider a failure.

In my view a project manager cannot be responsible for benefits. A PM is in charge of fulfilling the objectives as stated in the project charter, which are most often stated as schedule and cost constraints on a scope that includes a project product. The PM standards do not include benefits as a realm of a PM, PM's are not trained or certified to understand benefits, benefits management begins before (business case) and ends (transition into operations) after the project start and end dates, when the PM is not on Board. Contractor PMs will not accept responsibility for benefits in their contracts.

OK, since benefits are why we do projects, who then is in charge.
I think the best choice is a program manager. Benefits management is in traing and certifications, programs start with creating a business case, and end after benefits tracking is established by operations.

Often, I see portfolio management or the business sponsor in charge, unluckily both of them are not skilled and primarily charged with delivering individual benefits. If an organization is not clear who should be in charge of delivering their benefits, they might not get them. QED.
Thanks Thomas, Great answer, with benefits realisation being measured possibly years after a project has been delivered the PM and others will not be on board. A portfolio manager may have benefits tracking within the PMO but as you state is he responsible for achieving the benefits?. Since the Sponsor and stakeholders are responsible for the metrics being put into the business case, and around benefits realisation should this still be considered as part of the project? hence the initial question
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1 reply by Thomas Walenta
May 02, 2019 9:17 AM
Thomas Walenta
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Gordon,
in my view, the business case is developed before the implementation project is approved (also by the portfolio board), and started. A project manager mostly is assigned then.
There might be a pre-project developing the business case, it often is led by another project manager or a business analyst. And there might be one or more post-projects like transition to operations, a organizational change and a benefits tracking system.

And voila, you have a bunch of projects for one purpose (delivering the benefits), that you can call that a program. If you assign a program manager, you have someone in charge
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well, it depends. the failure or success of a project has to do with its goals, products, and deliverables.
Network:161



May 02, 2019 7:31 AM
Replying to Savrabh Mishra
...
Dear Gordon,

The benefits of doing a project can't be measured only on its monetary benefits. Even if the product wasn't successful, but if it lead to learning of the project team, if it increased the skill set of the team and it taught you new ways of tackling problems, then the project is a success.
Thanks Savrabh, agreed the benefits of doing a project can be a zero sum game or even a loss making one (i.e. a loss leader).
Network:2244



May 02, 2019 8:09 AM
Replying to Gordon Alexander
...
Thanks Thomas, Great answer, with benefits realisation being measured possibly years after a project has been delivered the PM and others will not be on board. A portfolio manager may have benefits tracking within the PMO but as you state is he responsible for achieving the benefits?. Since the Sponsor and stakeholders are responsible for the metrics being put into the business case, and around benefits realisation should this still be considered as part of the project? hence the initial question
Gordon,
in my view, the business case is developed before the implementation project is approved (also by the portfolio board), and started. A project manager mostly is assigned then.
There might be a pre-project developing the business case, it often is led by another project manager or a business analyst. And there might be one or more post-projects like transition to operations, a organizational change and a benefits tracking system.

And voila, you have a bunch of projects for one purpose (delivering the benefits), that you can call that a program. If you assign a program manager, you have someone in charge
Network:241



The case you described is not a project failure. The project goal was to create a product, and that was done. There may have been an error in the organizational strategy. (I only say it "may have been an error" because we don't know the results of the other projects.)
This is not the fault of the project manager, and I doubt the problem is with the PMO- unless the PMO is making all the strategic decisions with no input, but I doubt that.

Let me slightly change the scenario to draw a contrast. Let's say our organization authorized a project to create a new product that was important to their strategy, with knowledge that a competitor was developing a similar product due to be released in the next year. In this scenario, the project manager spends months gathering project requirements, and no work begins until the project plan is complete and the schedule and budget baselined. (We can't use EVM metrics without a baseline, after all.) The competitor releases their product 6 weeks before ours- or alternatively, we rush to get our product out the door and sacrifice scope and quality. Consumers overwhelmingly choose the competition, and we fail to meet the projected ROI we had used to authorize the project.

In this alternate scenario, we have a failure of project management. But in the given scenario, project management realized the organizational goals as they were described; the error (if there was an error) was in the strategic prioritization of other projects.
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1 reply by Gordon Alexander
May 02, 2019 1:54 PM
Gordon Alexander
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Hi Wade, Thanks for he response and agreed! in the alternate scenario this has to be taken into account.

I think in the case which I listed which was just an example cites the issue around 1) Failure to identify (or disclose) a key constraint around the timing of when the product was required for release 2) The controlling board for the roadmap not kicking the tyres properly around the change in revenue generation both resulting in the benefits failing to appear.

As I said this was an example to kick off the discussion and the answers coming back are a great source of knowledge, experience and opinion.
Network:1794



Not at all. There is a big misunderstanding I have debated inside the PMI and today some things have been changed into documenation like PMBOK (not because of me. Other people said the same I said). Benefits are not achieved because the project. Benefits are achieved because the product/service/result created by the project. That is the solution to be created to address business problem (needs in fact). Project manager is not accountable for the product/service/result or solution definition. Project manager is accountable for creating the product/service/result or solution as defined as exactly as defined in the framework of time and cost needed due to time and cost have been defined taking into account the opportunity window. So, define project succes like this: "growth in market share 5% in the current year" is a big mistake. Organization will not growth because the project Organization will growth because the product/service/result create by the project. If that´s not happend then Business Analyst has the activity named "Solution Monitoring and Assessment" which meant to monitor if the solution is achieving the expected results. If not, the loop restart.
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2 replies by Gordon Alexander and Thomas Walenta
May 02, 2019 11:16 AM
Thomas Walenta
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Agree, Sergio
May 02, 2019 1:55 PM
Gordon Alexander
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Thanks Sergio, great response and as always, the voice of reason.
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