Benefits management approaches are most effective when they are embedded in your PMO.
This makes a lot of sense because the whole reason you do projects is to get the benefits. It seems like a natural fit that benefits management sits with your Project Management Office team.
When your PMO takes the lead on benefits, they can be considered alongside other project management activities. You can build in a focus on benefits and outcomes from the very beginning. You can make sure that project management teams understand the benefits on their projects and are creating ways to make sure these are delivered tracked.
The other benefit to managing benefits within the PMO (see what we did there?) is that decisions can be made about projects with strategic objectives in mind. Benefits are what lead to and support strategic objectives. So when you know exactly how benefits are going to be managed through the PMO, you can add that into your decision making.
You can map benefits to strategic objectives. That makes it a whole lot easier to prioritize work.
But what does it look like in practice to embed benefits into the PMO? Benefits management is often seen as difficult to do, because it involves a change of mindset and a focus on the long term.
Whole books have been written about benefits management, but we like to keep things simple and practical. In this article we will share a basic benefits framework that fits all kinds of businesses. If you’re not really sure where to start, you’re in the right place! Let’s look at the framework.
A 3-Step Basic Benefits Framework
A framework is a high level overview or outline: a structure on which to build out the detail. So we won’t be going into the detail in this article. However, by giving you the framework, you can easily see where you need to dig deeper into the operational issues for your business. This framework is only 3 steps, but there is something that you need to establish first.
Before you start, you need to have a high level view of what your business is all about. The executive management team will have this, but does everyone else? Do the people in the PMO really understand the challenges that your business seeks to resolve for its customers? Can you clearly see how this links back to the organization’s strategic objectives?
In other words, before you start thinking about how to deliver benefits, you need to be sure that you have a business strategy for the benefits to fit into.
The good news is that you probably already do. All it takes is getting this to the right people in a way that they can understand.
Step 1: Governance
Now you’ve got clarity on the organizational strategy, you can think about the governance approach (or approaches) that you are going to take for benefits management.
Read Next: How your PMO can support benefits delivery
Step 2: Standards
Next, agree on the standards and measures you will use for talking about benefits. This step makes sure that everyone involved in benefits realization uses common vocabulary. It helps with keeping everyone on the same page.
Step 3: Success
Finally, agree what success looks like. It could be always meeting targets set in the business case. It could be hitting a particular return on investment per project. It could be a set of success criteria that are common across all projects. Or criteria designed per project. A compromise position would be to have a common library of success criteria that projects can choose from, with the option to add bespoke criteria per project as required.
It’s important to document these, especially if you have criteria that only apply to one or two projects. When you know how you, your colleagues and management team define success, it’s easier to make difficult decisions. You can frame your decisions in light of what gets you closer to those success criteria.
That’s it – you’ve now got the basics. You’ll be able to see which of these steps is going to be the most time consuming work within your own teams.
However, there is one more thing to do before you’re finished.
If you’ve decided to go ahead and design a benefits management approach that works for your business, there is another step. You absolutely must engage stakeholders in the journey. It’s not enough to write the approach and then tell them it’s in place. You won’t get the same level of commitment this way, and you will almost certainly miss something that is important to someone.
Here are the 4 groups that you need to engage.
- Senior leadership. Get this group to define what success means for the business and for them personally. Then you can make sure project benefits link in to these.
- Benefit owners. This is a core role; the person who owns the delivery of the benefits. They need to fully understand what it means to be in this role. If you already have some projects working to deliver benefits, you can get your current benefit owners involved in planning what the role looks like and requires.
- Project managers. These are the people responsible for delivering the capability to achieve the benefits. These colleagues are the ones who lead the projects that result in the outputs that deliver the benefits. That’s a fancy way of saying the people who do the stuff that make the benefits happen. They need to know that benefits management is happening, and what they have to do to support it.
- The rest of the PMO. At some point, you’ll be looking to your PMO colleagues to support the benefits management framework and process you have implemented. It’s important that they have the background understanding of how you got to this point and what their role is going forward.
You don’t need to spend hours on working out how benefits become part of what your PMO delivers. A full and mature benefits realization management approach will take time to evolve, but you can take some quick steps to talk to people in the organization about benefits and start to think about how you want to manage benefits.
You may, of course, decide that benefits management is not for you. That’s OK – perhaps you have other priorities to focus on right now as a PMO. However, we’d recommend documenting that decision and reviewing it in the future. Organizations move on and it will be hard to justify a PMO that doesn’t at least ask projects what benefits they are going to deliver, and then hold other people to account to make sure that the company gets the benefits.