Martin SierraContributing to add value to the PMO World| Aeromexico Mexico, Mexico
Hello everyone, hope this discussions find all of you very well.
I would like to get your input/feed back on the benefits analysis to approve initiatives. I understand that normally if they're are aligned with the strategic goals, should be approved, but big question here is. How we can analyze the benefits, establish metrics, tools to measure a benefit, etc.
Do you know if there is a guide, book or document describing some kind of this analysis.
I will appreciate your guide.
Warm regards Saving Changes...
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Shalamar LawrenceOwner| Shalamar SolutionsRaleigh, Nc, United States
Hi there Martin! That's an excellent question! While there are many different books that cover different approaches to benefits analysis, there is no "Pat formula" answer or template to go by as the PMBOK it's self is compromised of a community of individuals and they're opinions based on facts and experiences for best practices. Each project, program and portfolio has it's own special dynamics that require it to be uniquely tailored according to the requirements. From there the possibilities are almost endless as to how you tailor your benefits analysis and should specifically reflect strategic efforts to achieve maximum benefits. As you research data for your feasibility study and requirements, this quest should determine the inputs, tools and techniques that go into your benefits analysis. Page 33 in the 6th Edition PMBOK ( section 1.2.6.2) - PROJECT BENEFITS MANAGEMENT PLAN is a great place to start! Best of wishes! Saving Changes...
Sergio Luis ConteHelping to create solutions for everyone| Worldwide based OrganizationsBuenos Aires, Argentina
You can take a look to PMI´s Benefit Realization Management practice guide. Saving Changes...
1. Ensure the business case clearly articulates the metric(s) which will be used and how those metrics will be gathered.
2. Make sure there is an "owner" for benefits tracking over the life of the project and beyond its completion.
3. Make benefits erosion or increase a component of change analysis over the project life, and make sufficient erosion a criteria for project termination.
4. Hold sponsors or the leaders who "own" the business case personally accountable for the realization of expected benefits.
I'm not sure I can overemphasize Kiron's 3rd point. At the beginning of the project you have an idea of the benefits that might be possible, depending upon how much analysis you've done. By the end of the project, the product or service might have changed and the market most likely will have changed, introducing multiple variables which can impact the timing for and amount of benefits realization.
PMI's global standard for benefits realization management does a good job of explaining "what" - tangible vs intangible benefits, what to measure (table 3-1. Brief example of benefit measurements on pp 44-45), what should go into a business case... but it doesn't get into how to do a financial analysis to determine the benefits or how to quantify intangible benefits.
Elizabeth Harrin has a blog post on "5 common project financial measures" that might be helpful - https://www.projectmanagement.com/blog-pos...ncial-measures. If you search her blog, you'll find several posts on benefits identification and related topics.
We're not suppose to post external links, I think, but you can find an article titled "Cost-Benefit Analysis for Projects: A Step-by-Step Guide" on "projectmanager dot com".
Keep in mind that alignment with strategy should not guaranty that a project should be approved, especially if only one possible solution has been explored. There may be a different solution to the problem that provides better or faster benefits. There may be other projects that solve more important problems and require some of the same resources. Saving Changes...
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