How Business Cases Support Benefits Management and Realization
Despite the vast amount of knowledge in this area, business cases and benefits management are still something many organizations struggle with. Benefits management and realization are essential parts of any successful change project. For those engaging in innovation and transformation, the ability to track, manage, and capture insights that demonstrate your investment brought the expected returns is crucial for continued and sustainable success.
Symptoms of Poor Business Cases and Benefits Management
Before we look at business cases and benefits management, let’s explore some of the symptoms you may experience if they’re not done right:
- Unexpected, negative project outcomes.
- Failing to meet the requirements for the project.
- Failure to achieve expected benefits or a lack of confidence in the measures.
- Loss of credibility and support within the business.
- Difficulty in getting funding for other proposals.
What is a Business Case?
A business case is a fundamental part of the process that allows organizations to put a plan in place to manage value. So why is it that so many people either don’t do it or do it poorly? Want a quick reminder on what is a business case, and why you should care about them? Look no further!
Identifying value
Start by defining the value and benefits of the proposal. What is the goal of this proposal? Next, get a benchmark in place. Given your known issue, what is the current state? How is the problem quantified? Examples could include:
- Poor quality
- Lots of risks
- High cost
- Inefficient delivery
- Poor customer feedback
Then, agree on metrics that should be tracked through execution. Small “chunks” of benefit are useful if you work in a complex organization and need to quantify things like process efficiency.
Example: Training Management Platform
You are working to improve how you train your staff by introducing a new training management platform. It would help if you understood why this is currently a problem:
- Takes too long for users to book training
- Not easy to navigate
- Lots of administrative overhead for the business to manage
- Unacceptable level of training compliance as a result
Quantify these challenges. How much time does it take to book a training course? How many clicks to book a course? How much effort is invested into managing the platform on a weekly basis? Go to the Gemba! Follow the process along, measure and quantify the current state, and speak to the people involved. Finally, agree on key value metrics that will highlight success and value realization:
- Time-saving per course booking (hours)
- Time-saving to administer the platform on a weekly/monthly basis
- Cost-saving, increase in training compliance
Benefits management
Once the business case is approved, your business will have a comprehensive framework to follow through to execution. This will give your project managers clear insight into the expected outcomes, along with guidance on how they must be measured. From the very beginning of the project, it is essential that mechanisms exist to allow the ongoing tracking and management of benefits.
Common mistakes to avoid
- Overcomplicating the Process: “If you can’t measure it, you can’t manage it” – Peter Drucker. Complex benefits management processes are no use to anyone if they’re too challenging to execute.
- Execution: Those responsible for implementing your proposal need to understand the criticality of value measurement and management. This is a core component of the project initiation and planning documentation.
- Lack of Accountability: If people aren’t directly responsible for tracking the status of a benefit, they won’t do it. Assign clear accountability for ongoing measurements, set clear targets and expectations, and meet with the team regularly to review progress.
- Alignment: The value that you are preparing to manage and realize should ultimately contribute to the overall strategy of your department and organization. Without this alignment, you may find it hard to get support where you need it from key decision-makers.
- Celebration: Failure to highlight the actual value derived from any project means failure to capitalize on the support and input to get to this point. Recognize people, teams, and sponsors for their input to keep momentum and prevent disillusionment.
Business Case vs. Benefits Management Plan
Defining the Roles
- Business Case: A business case is an organic source of information that succinctly defines the problem statement, the proposed solution, and the expected benefits. It provides a roadmap for project managers to follow, enabling them to initiate and execute the project with the necessary controls in place to track value.
- Benefits Management Plan: A benefits management plan outlines how the benefits outlined in the business case will be managed and realized. It provides detailed guidelines on tracking, measuring, and reporting the benefits throughout the project lifecycle.
Comparison and Integration
While the business case sets the stage for the project by justifying the investment and outlining the benefits, the benefits management plan makes sure these benefits are realized. Both play a crucial role in developing a project successfully. Here’s how they integrate:
- Business Case: Defines the “what” and “why”.
- Benefits Management Plan: Defines the “how”.
Conclusion – business cases and benefits management
Business cases are an organic source of information that should succinctly define the problem statement, the proposed solution, and importantly, expected benefits. Details on the expected benefits provide a roadmap for project managers to follow, enabling them to initiate and execute the project with the necessary controls in place to track value. In turn, this provides high confidence insight into all forms of realized value – making it much easier to maintain support, obtain more funding for future proposals, and demonstrate alignment to organizational strategy.
