BENEFITS REALIZATION

www.pmi-neic.org

Mike Krouse

• Medical Informatics Engineering, CSO

• STAR Financial Bank, ISO

• Lincoln Financial Group, IT Audit Manager

• PMI-NEIC Treasurer, President, Past-President

and Region 2 Liaison

Let’s have a collaborative discussion about Benefits Realization

Don’t present, persuade!

Agenda

Background

Blasphemy

Benefits

"January is cold, BR…

Agenda

Background

Blasphemy

Benefits

"January is cold, BR… Benefits Realization is HOT"

Business Value

Business value is a concept that is unique to each

organization

Value may be created through the effective

management of ongoing operations

However, through the use of PPPM, organizations

will possess the ability to employ reliable,

established processes to meet strategic objectives

and obtain greater business value from project

investments

©2013 Project Management Institute: A Guide to the Project Management Body of

Knowledge (PMBOK® Guide) – Fifth Edition, Page 15

Success by Component

©2013 Project Management Institute: A Guide to the Project Management Body of

Knowledge (PMBOK® Guide) – Fifth Edition, Page 8

Table 1-1. Comparative Overview of Project, Program, and Portfolio Management

Business Value Creation

Realiz

ed B

ene

fits

Mission & Vision

Strategic Objectives

Portfolios, Programs &

Projects

Mission and Vision Statements

“To be one of the world’s leading producers and providers of entertainment and information. Using our portfolio of brands to differentiate our content, services and consumer products, we seek to develop the most creative, innovative and profitable entertainment experiences and related products in the world.“

“To Make People Happy”

Mission and Vision Statements

"We take pride in making a perfect pizza and

providing courteous and helpful service on time,

all the time.

Every customer says, "I'll be back!“

“To improve the well being of our customers,

community and people connected to our

enterprise. Run-Great-Restaurants.”

Mission Statements

“Helping Northeast Indiana Manage Projects”

Strategic Objectives

A broadly defined objective that an organization

must achieve to make its strategy succeed.

Strategic objectives are used to operationalize the

mission statement and keep the organization on the

path towards the vision statement.

Strategic Objectives - Examples

Increase Market Share

Strengthen Financial Resources

Productivity

Innovation

Community Involvement

Blasphemy

Blasphemy

Blasphemy

https://www.youtube.com/watch?v=sd9OW4sAlIE

https://www.youtube.com/watch?v=gpGHNkQT63

A

Stephen A. Smith – ESPN talk show host and analyst

Blasphemy

Realizing benefits is more important than the triple constraint

Benefits Realization

PM Network

Gary R Heerkens, MBA, CBM, PMP

Lasting Measures (July 2012)

Longer Lasting Measures (October 2012)

Generating Value (December 2014)

© Project Management Institute

Generating Value

Which is better:

A project that runs on time and budget and meets it

objectives

OR

A project that runs late and is over budget but

overachieves on cost savings that have a “change for

life” impact?

Lasting Measures

Imagine you just invested some of your own money

in a variety of personal investments based on

criteria you developed.

What is one of the first things you would do?

Longer Lasting Measures

1. What benefits should be measured and tracked?

2. Who shouldn’t – and should – do the measuring?

3. When should measurement take place?

4. What challenges exist in getting reliable data?

Process Groups

Initiating Planning

Monitoring

and

Controlling

Executing

Closing

Process Groups and Benefits

Initiating Planning

Monitoring

and

Controlling

Executing

Closing

Business

Case

Change

Request

BR

TemplateCBA

Time

Report

Invoices

BR Resources – During Project

Business Case

CBA

Change Request

Benefit Tracking Template

PPM Tool

Time Tracking

General Ledger

Expense Tracking (HW, SW, Materials)

Business Case

Benefits:

Should align with strategic initiatives

What are the expected benefits? For

example, increased market share, trained

employees, reduced headcount, competitive

advantage, regulatory compliance, etc.

The benefits must be stated so they can be

measured according to a realization schedule.

Change Request

Benefit Explain how this change request

augments, creates or destroys business value.

BR Template

We discussed the scenario of achieving outrageous

benefits, but violating the triple constraint. Let’s

look at the other side of the coin…

PM’s need to track internal organizational changes

and external influences that may erode expected

benefits. If benefits are diminishing, should the

project be shutdown even if complying with triple

constraint?

Process Groups and Benefit Feedback

Initiating Planning

Monitoring

and

Controlling

Executing

ClosingBenefits

Tracking

Improve

Benefit

Forecasts

BR Resources – After Project

Turnover to Independent Group

PMO, Finance - ?

General Ledger

Q&A