Benefits Reasation

1. Introduction: The Critical, Overlooked Discipline This area is often overlooked once budgets have been established and delivery begins, leading to a dangerous “activity trap” where delivering outputs is mistaken for achieving outcomes. A Benefits Realisation Strategy ensures the transformation delivers measurable value, providing the ultimate return on investment and justifying the organisational disruption. This document outlines how benefits will be identified, tracked, and owned from inception to sustainable integration into business-as-usual (BAU) operations. 3. The Benefits Realisation Lifecycle Benefits management is not a one-time event but a continuous cycle. 5. Categorising Benefits: Tangible vs. Intangible Type Description Examples Tangible Benefits Quantifiable, measurable, and linked to financial performance. Can be validated objectively. • Increased revenue. • Reduced operational costs. • Headcount reduction (FTE). • Reduced error rates/rework. Intangible Benefits Qualitative, difficult to measure in direct financial terms, but contribute significantly to strategic objectives. • Improved customer satisfaction. • Enhanced employee engagement. • Better decision-making. • Increased agility. • Improved brand reputation. 6. Tools and Techniques for Measuring Benefits A. For Tangible Benefits (Direct Financial Measurement) Cost-Benefit Analysis (CBA) and ROI Calculation: ○ Tool: Financial model (e.g., Excel). ○ How: Compare the financial value of benefits against the programme costs. Calculate metrics like Return on Investment (ROI), Net Present Value (NPV), and Payback Period. ○ Example: A new CRM system is expected to increase sales revenue by 5%. The baseline is current annual sales of £50m. The target benefit is £2.5m annually. ROI = (£2.5m benefit - £1m cost) / £1m cost = 150%. Key Performance Indicator (KPI) Dashboards: ○ Tool: Business Intelligence platforms (e.g., Power BI, Tableau). ○ How: Link benefits directly to existing operational KPIs. Track the KPI before (baseline), during, and after implementation. ○ Example: Benefit: “Reduce customer onboarding time.” KPI: Average onboarding time (in days). Baseline: 10 days. Target: 2 days. B. For Intangible Benefits (Proxy and Qualitative Measurement) Structured Surveys and Sentiment Analysis: ○ Tool: Survey tools (e.g., SurveyMonkey, Qualtrics), sentiment analysis software. ○ How: Use pre- and post-implementation surveys with consistent, scaled questions (e.g., Likert scales: 1-5 on satisfaction) to measure change. However, these Surveys often find what we already know. It is worth talking to Rowan Jackson at Promising Outcomes for more sophisticated tools. Https://promisingoutcomes.com ○ Example: For “Improved Employee Engagement,” survey employees on statements like “I have the tools to do my job effectively” and track the change in average score. Leading and Lagging Indicator Proxies: ○ Tool: Benefits Register / Scorecard. ( Try Wovex if budgets allow: https://wovex.com ) ○ How: Identify a tangible metric that acts as a dependable proxy for the intangible benefit. ○ Example: ■ Intangible Benefit: Improved Customer Satisfaction. ■ Leading Indicator (Proxy): Net Promoter Score (NPS) or Customer Satisfaction (CSAT) score. ■ Lagging Indicator (Result): Customer retention/churn rate. Case Studies and Anecdotal Evidence: ○ Tool: Interviews, focus groups, storytelling. ○ How: Collect qualitative evidence of success through structured interviews with users and customers. This provides colour and context to quantitative data. ○ Example: After implementing a new collaboration tool, document a specific case study where a cross-functional team reduced their project timeline by 30% due to improved communication. 7. The Benefits Register and Benefits Profile Template The single source of truth is the Benefits Register, managed by the EPMO or Project Central) Each benefit should have a detailed Benefits Profile containing: 8. Reporting Regular benefits reporting is crucial: A robust Benefits Realisation Strategy transforms the programme from a cost centre to a strategic investment. By defining, measuring, and owning benefits with the same rigour applied to budget and schedule, we ensure the transformation delivers the promised value to the organisation. Thanks for reading! Subscribe for free to receive new posts and support my work.