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Benefits Realisation

In RBBC projects

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Benefits in Projects

• We invest in projects because of the perceived Benefits they bring

• The Benefits justify the project– Linked to Corporate Objectives & Priorities– Can be wide-ranging

• Statutory, Social, Economic…

– Often financial (but not exclusively)– Sometimes hard to measure

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Financial Benefits

• Time saved, posts lost, costs avoided, costs reduced…– Calculate a £ figure– Work out timing (investment & saving)

• Payback (in years)– When Savings equal Investment

• NPV (Net Present Value)– A common measure of a project’s value– Cash flows adjusted for time they occur– Using a 5% discount rate

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Non-financial Benefits

• Is this a Corporate priority?• Look for a performance measure

– BVPI– Other PI

• Measure– Value at start of project– Predicted value at end of project– Actual value at end of project

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Organisation Development

• The four pillars of Change– Driven by the Customer– Improving our Performance– Learning & Developing– Optimising our Finances

• These describe the type of organisation we want to be

• Each project has to contribute

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Later Benefits

• Project puts a capability in place– To be exploited by a later project

• Must link these projects– Is funding in place for later project?– Are we committed to later project?– If not, investment in first project may be wasted

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Later Benefits

• Project delivers as expected– But Benefits only measurable later

• Need to link to process– What process?– The owner?– When and how to measure?

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Realising Benefits

• Financial saving– Remove £ from next year’s budget

– Saving included in formal budget setting process

– Clarity about what was saved where

• Posts lost– At risk register

• Identify the staff affected, communicate

– Process based on existing Council policies• Consultation, redeploy, retrain … redundancy• Minimise redundancy costs

– Affects timing of realisation of Benefits

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Tough decisions

• Cost envelope– We must stay within this

• Headcount and Budget– We need to manage both

• May require restructuring– New ways of working may mean changes to

some organisation structures

Periodic reporting to Members