When looking to upgrade your benefits realisation capacity, one of the first places to start will be producing a benefits realisation plan. A benefits realisation plan will align your team’s efforts, giving clarity over what matters strategically, and how to measure that.
In this article, we’re going to explain how to define a benefits realisation plan for your organisation. We’ll explain the first steps on getting started, key areas to consider, and further improvements to explore in the future.
Before we jump into defining the plan, it’s important to first explain what we mean by benefit realisation.
Benefit Realisation Management is an approach to managing how resources and time are invested in projects or activities to achieve desirable changes.
The approach can be applied in different forms.
It can be applied as a business process. The goal here is successful: identification, definition, planning, tracking and realisation of business benefits across an organisation.
It can also be applied on a project level. Here we are identifying, planning, assessing and controlling the benefits derived from the execution of projects.
We can also apply benefits realisation at a strategic level; aligning operational projects and activities with overarching organisational goals.
Benefits realisation originally emerged in the 1990’s, after being defined in publications by Scottish Widows and the UK Government. Since gaining traction, techniques have become more formalised, and the discipline has become more widely acknowledged.
When writing the plan, these established concepts can provide the foundations for a rigorous plan, maximising the chances of successful execution.
When writing a business realisation plan, we need to first establish roles and responsibilities.
Without this, people may be unsure of who is doing what, and who stands to gain. A strong benefit realisation plan will therefore look to outline the roles and responsibilities of each person.
Some key roles that must be defined are:
Once you’ve established who fits into these categories, we can move on to defining our BRM process.
The BRM process should seek to complete the following steps:
By following the general 10 step approach outlined above, we are ensuring a reliable BRM approach. This aligns business activity with realisation metrics that are representative of the desired outcomes.
It also serves to ensure adequate planning is in place, so that the activity is delivered efficiently, reducing waste and staying focused on the desired outcomes.
The process then goes one step further. After the activity is complete, the benefits realisation is maintained within the organisations, continuing to add value.
As part of the benefits realisation plan, you will want to consider building benefits dependency networks.
A benefits dependency network is a tool for easily visualising the cause and effect relationship between benefits and activities. An example of a benefits dependency network can be seen below:
The objective of benefits dependency networks is to quickly communicate to stakeholders the who, what, how and why of an activity. It looks at the desired outcomes on the right, working left to explain the necessary steps to achieve said benefit.
The tool can be highly effective in the management of stakeholders, as it brings everyone onto the same page, allowing benefits and the process to achieve them to be easily visualised.
When gathering stakeholder feedback, and aligning stakeholder needs (as would be completed throughout the plan), the benefits dependency network can be modified and adjusted in a collaborative environment, until a network that satisfies all stakeholder can be agreed upon.
Another important part of the benefits realisation plan is the benefits realization metrics.
Defining the right benefits realisation metrics that capture the desired outcomes is critical to an effective BRM process.
Benefits realization metrics may also look to quantify previously qualitative impacts. This brings with it various advantages. These include the ability to benchmark previous results, allowing for comparative conclusions to be drawn. It can also be a more rigorous and objective way of measuring impact, which is less reliant on subjective measures.
To choose effective benefits realization metrics, we suggest the following:
By considering a wide range of different data sources and mediums, it means you’re getting the full picture, working to avoid biases in data.
Gathering data from different sources can be complex and doesn’t make for easy reading, which can disengage stakeholders. We would therefore suggest weighting and aggregating data sources by following a balanced scorecard approach. This can then produce a ‘north star metric’, that’s easily understood.
Operationalizing benefits as a financial figure makes them easier to understand and more ‘tangible’ to stakeholders who are primarily concerned with finances. It therefore may be useful to extrapolate what the hypothetical financial impact of a specific benefit is before reporting to these particular stakeholders.
Building upon the last point, you should always strive to deliver metrics in a way that most resonates with the stakeholder group that is being reported to. You can achieve this by choosing metrics most relevant to their job role, and those that they’re most familiar with.
The benefit metrics that you eventually decide upon will hopefully be relevant for all your stakeholders. However, as time goes on, the needs of stakeholders and the organisation may evolve. It is therefore good practice to continually review metrics, to make sure that they’re always up-to-date and relevant, making adjustments where necessary.
With different benefits realization metrics being generated across a variety of mediums, you may wish to consider consolidating all the data into an easy-to-use and accessible dashboard.
When designing a benefits realisation dashboard, your aim is to present a portfolio level overview of benefits. Ideally, it should be easily accessible by stakeholders (benefits owners) and adjustable by the administrator (business change owner). To really optimise your process, different stakeholders should be able to access dashboards specific to them.
Here, technology is your friend. Here at Intuitix we specialise in automating the reporting benefits, particularly when it comes to data visualisation through benefits realisation dashboards.
For more on how we can help you do this, contact us here, and one of our team will be happy to help.
When piloting a project, you may be considering how to best measure impact of a project.
There are a variety of reasons as to why as project managers, we may wish to measure a project’s impact. But with so many variables to consider, where do we start on our journey?
This article will provide you with this guidance, detailing actionable next steps for measuring the impact of your projects.
Before jumping into what we wish to measure, it’s first important to explore why we are measuring our projects.
The intention behind measuring projects will dictate what needs to be measured, and to what extent those factors are considered. It’s important therefore to consider from the outset, why you wish to measure your projects.
Some reasons for measuring projects could include:
You may have your own reasons for measuring projects not included in the list. Whatever they are, we would suggest compiling them, and ranking them in order of importance.
By doing this, we understand the motivations (and significance) behind measuring projects. This ensures the metrics we end up using best reflect the real drivers behind impact measurement.
The second thing to consider is who will be receiving the impact data.
Understanding ‘who’ is a natural follow-on to understanding ‘why’. It will guide you in defining the most appropriate metrics. Those that will resonate with your audience, and help them understand the information most relevant to them.
In knowing your audience, we suggest utilizing stakeholder management techniques to ensure everyone's needs are accounted for in the most effective way. This usually starts through a process of ‘stakeholder mapping’, which we’ve discussed in other blogs.
The idea behind this is to identify all the potential interested parties who may be interested in receiving your project impact data. Like the motivations, they are then ranked in order of importance.
From here, we can then explore the profiles of our stakeholders, identifying what parts of the project they’re most interested in. We can also explore things such as what medium they would like to receive project data, what frequency and what level of detail is required.
Once we have all this information to hand, we can then go about combining it with the motivational drivers that we originally explored. This provides us with a clear picture of what areas we wish to measure, and to whom this information will be important to. Using this, we can go about creating our Impact Measurement Framework.
Using the motivations and stakeholder interested, we can now go about defining the areas of project impact measurements.
It’s important to consider from the outset that projects (especially larger ones) will have far flung consequences. Measuring every impact area is not only difficult and time consuming, but will most likely be of little interest to stakeholders. It’s therefore crucial to focus on the most important areas to you and your stakeholders.
Some areas that you may wish to consider include:
These of course are broad areas for exploration. We would suggest choosing more specific areas within each of those, that most represent your stakeholder interests and your own motivations behind project impact measurement.
Once these specific areas of measurement, we would suggest gaining feedback from stakeholders as to whether they are most accurately fulfilling their purpose.
During the entire process, we want to be seeking continued feedback and validation. This prevents us from going off course, investing large amounts of resources in the incorrect avenue.
We recommend employing the PDCA cycle throughout, so that this does not occur.
Once we have defined the key areas that need to be measured, it is time to start defining metrics that measure project impact.
It should be noted at this stage that not all impacts will be quantifiable with metrics. For example, customer feedback may be better suited to be left as descriptive (or qualitative) data, as this can provide a much more useful and actionable data.
Having said this, data that can be quantified should be, as it has several advantages.
For one, quantified data can be seen as more objective than opinion based - and therefore subjective, qualitative data. Secondly, quantified data can provide a ‘measuring stick’, so that comparisons can be made and progress is more accurately represented.
When choosing data, we need to now decide how we will quantify our impact measurement areas of interest.
For some, it will be obvious. Revenue for a new marketing campaign for example can easily be attributed in your local currency to a digital advertisement using online tools. For some however, we are going to need to be more creative.
Try and think of what KPIs would be suited for each area. Some things such as employee welfare, for example, may not be obviously quantifiable from the outset. However when considering things such as: surveys, absence days due to stress, employee retention rates, etc. are all quantifiable, we can start building a ‘balanced scorecard’ which captures these factors in a single metric.
For others, you may look to measure related factors which are more easily obtained. An example of employee time wasted may be difficult to measure, however device usage or time spent traveling between jobs will potentially be easier to quantifiably measure, and give an indication of the total time wasted.
After choosing what data is going to be the source of our desired metrics, we should now consider how to actually gather this data on projects.
When measuring the impact of a project, we need to think about what methods would be best for gathering said data. This will entirely depend on the nature of the project, as there is no one-size-fits-all strategy. Nevertheless, we have made some suggestions to get you started.
One simple way of measuring the impact of a project, is to ‘pilot test’ it on an area of the business, and compare it to a control group. This control group may be a comparable area of the business, or it may be a previous state of the pilot tested area.
Whichever we choose, it’s important to bear in mind that a business is not a laboratory, and so not all variables will ever be fully in your control.
Other projects will require more of a long-term approach, especially where the benefits of the project are not likely to be realized for some time. To achieve this, we would suggest putting in a feedback loop into the project itself. For example: a 10 year project may include reviews of the results thus far every 2 years, a building may be constructed with performance sensors in it, or a product may be launched with information to submit reviews.
Something that should be addressed is the concept of extrapolating data. Most of the data that is gathered on projects will not be in the form that your stakeholders will need, and therefore will require some extrapolation.
The easiest way to do this in volume is by using ‘calculation frameworks’. These are essentially sets of rules that can be applied to easily gatherable data to produce useful data. A good example of this is the GHG Protocol, for calculating Greenhouse Gasses.
Intuitix was designed to automatically apply these calculation frameworks on projects, without the need for human intervention. This reduces time wasted and human error, allowing you to focus on managing your projects. For more information, book a demo with our team.
On this blog we’ve already talked about examples of Product Innovation and Workplace Innovation. Now, it's time to turn our attention to “the least sexy form of innovation” – Process Innovation, and look at a few examples of process innovation that seriously changed the game.
“Process” means the technologies, skills, labour, supply chains, and facilities that go into the production, delivery and support of a good or service. Process Innovation can mean updates to the technology and equipment used in manufacturing. It can mean improvements to the tools, techniques and software used in the supply chain and delivery system. It can also mean changing the way you sell your product to customers, to make that process more streamlined and effective. Process is the engine under the hood of your value-adding vehicle. And Process Innovation means tuning that engine, replacing parts to make it run faster and smoother.
While we’re on the subject of engines and vehicles, it feels like a good time to mention the “father” of process innovation – Henry Ford. In the 1910s, Ford had the goal of bringing the automobile to the multitudes. He achieved this through a combination of Product and Process Innovation. First, he made his product, the Model T, robust and affordable. Then, Mr Ford was inspired by conveyor belt systems used in grain warehouses. He implemented a gradual series of innovations that culminated in the assembly line.
The new assembly line cut production time for each car from about 12 hours to 1 ½ hours. It also allowed Ford’s workers to work shorter shifts for more pay. This became the central paradigm of industrial manufacture. As ThoughtCo observe, “this 100-year old innovation by a car manufacturer in Michigan changed the way we live and work forever.”
This is the classical example of Process Innovation, and it is a good one. Ford utterly transformed the production element of his business process. This in turn had dramatic effects on the whole of society.
How about a more modern example of a car company with a charismatic tycoon at the helm? Each Tesla electric vehicle requires huge EV batteries, made of thousands of lithium-ion cells. When electric cars were new on the market, the manufacturing capacity for these batteries was limited. Companies had not invested in battery technology development, and the high cost of batteries was making the final Tesla product expensive. To reduce costs and meet their projected demand, Tesla began construction of the Gigafactory in 2014. Already, it is the highest- volume battery plant in the world. The Gigafactory is proving so effective due to economies of scale, innovative manufacturing processes, reduction of waste, and the simple optimization of locating most manufacturing processes under one roof.
This is a great example of process innovation within the supply chain – by taking control of battery production and concentrating it in one place, Tesla is able to work towards affordable vehicles, a transition to sustainable energy, and profit.
In an ideal world, once a product has reached the end of it’s lifespan, valuable raw materials used in its construction are extracted and used in the creation of something new, with minimal waste and emissions. This is easily done with metals, as its simple to separate copper from steel from magnesium – they have different densities. Plastic presents a much greater challenge, as polymers have very similar densities, and very similar electrical and magnetic properties. This makes separating them difficult. So, used plastics end up in landfills and heaps in third world countries, and more fossil fuels are used to create more new plastic.
But, by applying technological recycling innovations, Mike Biddle and MBA polymers are challenging the Procurement and Processing steps of the plastic production paradigm. (that’s a lot of Ps!).
Currently, procurement involves large scale oil extraction, and as we all know, that has to go. So MBA mine from landfills instead, where there is a plentiful and growing supply of raw materials. Their processing plants involve lower capital outlay, use 80-90% less energy, and can produce whatever type of plastic they are fed, in contrast with traditional plants that only produce one or two polymers. At an MBA plant, waste is shredded into very small bits, non-plastic waste is extracted, the remainder is sieved, magnets are used, air classification is applied. Biddle likens this stage of the process to “Willy Wonka’s factory”. This produces a mixed plastic composite of many different types and grades. Then comes the more sophisticated part. Plastic is ground down to the size of a small fingernail. Then a highly complex process sorts the plastic into flakes. This process is the innovation that supports the larger paradigmatic shift. Optical sorting is used, its blended in 50,000 lb blending silos, melted and extruded into plastic spaghetti strands, and cut into small pellets. These pellets are the same material that you would get from oil.
By innovating to improve the efficacy of the plastic recycling process, MBA polymers have been able to move towards a circular economy. This is a superlative example of process innovation because it challenges the wider processes of which it is a part.
Process Innovation does not have to mean changing the way a product is manufactured, as in those examples. It can also mean changing the way a product is delivered to the consumer, or innovating market processes:
· AliExpress: One of the world’s largest eCommerce sites, AliExpress along with others applied a disruptive innovation to the process of online selling – dropshipping. Vendors are able to set up their own online storefront and sell the products of a manufacturer. The manufacturer sends the product to the customer. The product never goes through the hands of the vendor.
· Amazon: Way back, a new company called Amazon introduced an innovation to the process of buying books. Instead of visiting a bricks-and-mortar retailer, the consumer could buy literature from the comfort of their home. A few more process innovations later, Amazon became the dystopian behemoth we know and love today.
· eBay: eBay did not invent the auctioneering process. Their innovation was to present the auction in an intuitive online marketplace. This attracted buyers and sellers to the platform. And eBay introduced a new several-day purchasing process dynamic to millions of consumers.