📖[PDF] Benefit Realisation Management by Gerald Bradley | Perlego (2023)

About This Book

The first edition of Gerald Bradley's Benefit Realisation Management quickly established itself as the definitive, practical guide to using measures to track performance throughout the life of a project or programme; enabling organisations to eliminate wasted investment, realise more benefits and realise them earlier. The second edition takes you step-by-step through the benefits realisation process, explaining along the way, how to: * define your projects and programmes by mapping the benefits * produce a convincing and accurate business case * communicate the benefits and get all your stakeholders on board * agree the measures you will use to encourage the desired behaviours, to monitor progress and to assess the ultimate success of the project or programme * use the benefits realisation approach to understand and address the human aspects of the project, including resistance to change, training needs and new ways of working * integrate this approach into your organisation's culture and systems The second edition includes expanded guidance on benefits realisation for portfolio management and includes revisions to the original text along with additional case study examples. The text of the latest edition is now printed in four-colour which make the detailed and varied benefit maps throughout the text immediately more striking and comprehensible. The benefits realisation management methodology fits closely with existing programme and project management approaches such as MSP and Prince 2, making it appropriate for both public and private sector environments. If you are investing heavily in change management, IT infrastructure or project working, then this book is a must-read that will justify its price many times over.

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Fundamentals and Foundations of Benefit Realisation

In seven chapters, Part I examines the fundamentals of benefit realisation, providing a good overview of Benefit Realisation Management (BRM). The chapters cover:

• Today’s Biggest Challenge

• Stakeholders

• Benefit Realisation

• Overview of BRM

• Project and programme fundamentals

• Key BRM roles and responsibilities

• Planning and preparing for success.

The remainder of the book expands this summary, providing elaboration and detail, especially in respect of some of the specific BRM techniques, such as:

• Mapping

• Identifying, classifying, validating and profiling benefits

• Measure identification

• Documentation

• Governance

• Process

• Portfolio Management

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Today’s Biggest Challenge

‘If you don’t know where you’re going, any path is as good as another… but you won’t realise you’re lost, you won’t know what time you’ll get there, you might unknowingly be going in circles, and others won’t understand how they can help. And, since you could pass right by without knowing it, you won’t get the satisfaction of having arrived!.’

(Lewis Carroll: Alice in Wonderland)

1.1 Recent Industry Performance

Each year, UK industry invests around £100bn on change, presumably in order to improve business performance. Individually, organisations are usually unsure how much return they receive from this investment. Collectively, if we measure the return based on Gross Domestic Product (GDP), the yield is negative, at around minus 6 per cent; based on shareholder value over a ten-year period, even before the impact of the 2009 credit crunch, the yield is still negative at around minus 4 per cent.

In terms of specifics, Professor Clegg of the University of Sheffield collected data drawing on the experiences of around 14,000 UK companies investing in new information and communications technologies. He found that performance goals were frequently not set and often not carefully evaluated. However, his conclusions were that around 10-20 per cent of such investments can be counted as outright successes – they met their objectives. About 40 per cent were outright failures and a waste of money, time and energy. A further 40 per cent were deemed as partial successes, meeting some but not all of their goals. These conclusions were consistent with other data, for example the report published by the Royal Academy of Engineering and the British Computer Society in 2004.

sigma’s1 experience indicates that only 10-25 per cent of potential benefits are usually achieved from investment in change. This shortfall, or waste (which is what it is), is estimated to cost the UK over £50bn per annum.

So it may seem surprising that organisations continue to invest in change. The dilemma is that change in the external environment will probably continue to accelerate, so without internal change many organisations will die. This is particularly true in periods of recession such as we experienced in 2009-2010. Like death and taxation, change is one of the certainties of life, or as Alvin Toffler put it: ‘Change is not merely necessary to life – it is life.’

1.2 So Why Endure the Pain of Change?

Avoiding change is not a viable option. The challenge is to develop an effective and timely method of determining the optimum set of proactive changes, and to manage them, so that stakeholder resistance is overcome and defined performance goals are achieved. Change can be a source of tremendous business potential. When the worldwide customer base was growing and the average demand from each customer was also growing and developing, change was necessary to meet demand in an efficient and competitive manner. When global demand is falling change becomes all the more important – it is in fact the life blood of survival. So effective management of this change becomes even more critical and involves doing the ‘right’ things and doing them ‘right’. Benefit Realisation Management (BRM) is a process that addresses both of these challenges – creating and maintaining a portfolio of the best change initiatives and then ensuring each one delivers maximum value. There is no doubt that the organisations that will survive and even thrive in a recession will be those that adapt, managing change innovatively and effectively.

A major hindrance to the achievement of potential is a dominant focus on delivering capability – brainwave solutions looking for problems. The real need is for solutions, carefully constructed as a response to clear objectives, which have been determined, owned and established by the organisation. Here it is useful to distinguish between the change which is acquiring and implementing a capability, and the change which embeds this capability into the working practices of the organisation.

I refer to the first change as enabling change, or simply an enabler, which is defined as ‘something that can be developed/built/acquired normally from outside the environment in which it will be embedded and where the benefits will be realised’, and the second as business change, which is defined as, ‘a change which occurs within the business/ operational environment, often a new way of working or a new business state, which may utilise a new enabler’. This distinction between the two types of change helps to:

• highlight the importance of both, including the need to cost, budget and plan for both;

• acknowledge that they may be funded and managed differently;

• ensure that business change is neither neglected nor squeezed, especially when budgets are tight or later reduced.

One reason why business change is often the poor relation in this pair is a prevalent myth that enablers, such as systems, technology and buildings, generate benefits of themselves and so have intrinsic value or even equate to value. This is evidenced by the technique named Earned Value. Earned Value is used in construction type activities in order that progress can be assessed against a time schedule or an expenditure schedule. So if a building, which is expected to cost £4m, is 25 per cent complete, then its earned value is £1m, whereas expenditure to date might be £1.3m. The merits of this analysis are clear – it is a useful technique; but the name2 is unfortunate though revealing, implying that an enabler such as a building, or even worse part of a building, equates to some value. Value is only achieved when the enabler is put to appropriate use and benefits are realised – which is certainly impossible if an enabler is still being built. In fact an enabler, complete or not, has no value – earned or otherwise.

We recently had a new kitchen, costing £8,000, which was scheduled to be installed in four days. At the end of the first day the installation was 30 per cent complete. The old kitchen had been removed, and in its place were partly assembled new cabinets, plenty of sawdust, exposed electric cables and piping and no running water. If the fitter had decided at that stage to quit, with a request for just £2,000 of the £2,400 earned value, I think I would have had great difficulty in getting my wife excited about the £400 we would then supposedly have just gained.

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Figure 1.1 Cart before the horse

1.3 Cart Before the Horse

I continue to be surprised at how often organisations ‘put the cart before the horse’ by focusing too early on enablers, without being clear about the end goal. The idea of a cart pulling a horse is almost too absurd to imagine, yet in reality this is what frequently happens with benefit realisation.

A cart with no horse is easier to imagine. But without a horse to pull it and steer it towards its intended destination, a cart will either not move at all or will start to drift, taking the easiest path – downhill – accelerating under its own momentum, completely out of control.

How often is change just like this? Is it because many managers find it more stimulating to generate the adrenaline rush from what seems like innovative and sometimes frenzied activity, rather than to increase shareholder value by a carefully planned and methodical approach to change, driven by a clearly defined and appropriately shared goal?

A classic illustration is the Millennium Dome, an impressive technological achievement, delivered within budget and on time, yet with unclear objectives and dubious benefits, especially for UK taxpayers. In December 1999, Tony Blair hailed it as a ‘triumph of confidence over cynicism’ yet only 4.5m of the predicted 12m visitors materialised, over £250m of lottery rescue grants were needed to keep the venture solvent, and five years on the Dome was still standing empty, costing the taxpayer almost £190,000 a month for maintenance and security.3 Is this another instance of a dominant focus on a sophisticated deliverable without any clear sense of purpose or end goal? Were initial construction costs budgeted, while whole life costs were not considered? Was there no overall long-term vision?

Perhaps the Dome’s rebranding as The O2 has at last put the horse before the cart?

1.4 What UK Managers Say

Groups of managers from over 200 of the UK’s larger public and private sector organisations4 have, over the past five years, invariably identified as the top three hindrances to successful investment in change:

• lack of commitment by senior managers;

• vision/objectives that are unclear;

• stakeholders who have not bought in to the change.

These are very similar to the top three independently identified by the National Audit Office (NAO) and the Office of Government Commerce (OGC). Without a clear vision and agreed objectives it is not surprising that senior managers show little commitment – worse still, that commitment may be wrongly focused and of limited duration.

1.5 The End in Mind

For success, organisations need clearly defined end goals and then a properly planned route to reach them, milestones along the way to mark progress, and criteria (for example, defined targets) against which to report success. Such goals may be defined in terms of a vision, a set of objectives or a group of end benefits and will be elaborated in Chapter 8.

In Stephen Covey’s widely acclaimed book The 7 Habits of Highly Effective People, which is recognised as having applicability for addressing personal and professional challenges, the second habit is ‘Begin with the end in mind’. This is not only required for effective living but also for effective benefit realisation and so I have taken this as a fundamental thread that you will see runs through the whole of the book.

It would be wrong to imply that organisations never know the destination they seek. Mostly they have some kind of vision or end goal, however this goal:

• is often expressed in terms of delivering or implementing capability, rather than fulfilling business objectives or realising benefits;

• is seldom adequately shared and owned;

• is frequently unrealistic with no d...

Citation styles for Benefit Realisation ManagementHow to cite Benefit Realisation Management for your reference list or bibliography: select your referencing style from the list below and hit 'copy' to generate a citation. If your style isn't in the list, you can start a free trial to access over 20 additional styles from the Perlego eReader.

APA 6 Citation

Bradley, G. (2016). Benefit Realisation Management (2nd ed.). Taylor and Francis. Retrieved from https://www.perlego.com/book/1570964/benefit-realisation-management-a-practical-guide-to-achieving-benefits-through-change-pdf (Original work published 2016)

Chicago Citation

Bradley, Gerald. (2016) 2016. Benefit Realisation Management. 2nd ed. Taylor and Francis. https://www.perlego.com/book/1570964/benefit-realisation-management-a-practical-guide-to-achieving-benefits-through-change-pdf.

Harvard Citation

Bradley, G. (2016) Benefit Realisation Management. 2nd edn. Taylor and Francis. Available at: https://www.perlego.com/book/1570964/benefit-realisation-management-a-practical-guide-to-achieving-benefits-through-change-pdf (Accessed: 14 October 2022).

MLA 7 Citation

Bradley, Gerald. Benefit Realisation Management. 2nd ed. Taylor and Francis, 2016. Web. 14 Oct. 2022.

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