Employing a Systems Approach to improve Benefits Realisation. White Paper
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1 Employing a Systems Approach to improve Benefits Realisation White Paper Matt Williams, Connexion Systems November 2012
2 White Paper Employing a Systems Approach to improve Benefits Realisation Introduction In these challenging times, organisations cannot afford to stand still. They must continually evolve to survive and grow, and to meet the demands of a changing environment i. Transforming an organisation to thrive in a changing environment requires careful planning and execution. Organisational change must be carefully managed to deliver the benefits we seek, while minimising side-effects and unintentional consequences of change. Managing the realisation of benefits organisations require to evolve involves many parts: there are numerous people involved, as well as numerous processes in delivering and embedding the changes into business as usual. Employing a systems approach to this process emphasises the interdependent and interactive nature of benefits realisation, both within and external to an organisation. Figure 1: Maximiser approach to improve Benefits Realisation Identify The first step is Benefit Identification. Ideally, this should occur before the establishment of an initiative, not after. This is because we should Start with the end in mind ii, and identify the benefits first, followed by identifying the initiatives required to achieve the benefits. That said, we need to recognise that in many cases the initiative will have been established prior to detailed Benefits Identification work commencing. A Benefits Identification workshop should be held, and attended by all affected stakeholders, including the business sponsor, business change manager, project/programme manager, and others affected by the proposed change.
3 A useful technique to assist in the Benefits Identification Workshop is the Three Column Analysis iii. This technique involves asking 3 simple questions, and using the answers to graphically develop a benefits pathway in one page, providing a representation of how current business problems can be addressed to achieve the desired benefits. Figure 2: Three Column Analysis technique helps understand the changes needed to achieve the desired benefits Plan Once the benefits have been identified, it is time to prepare a Benefit Map, which is a road map to support understanding and management of the complexity inherent in the benefits realisation process iv. A Benefit Map is normally created from Right to Left (Starting with the end in mind), however in emerging programmes (where the initiatives already exist), it is possible to start from both sides. The Benefits identified in the Identification workshop should be placed on the right of the map. Notice that the map reads from left to right (initiatives contribute to benefits (called Intermediate Benefits), which combined with additional Initiatives, lead to the End Benefits. The Benefits identified in this map are very important, as they become the measurement points for tracking benefits realisation.
4 Figure 3: a sample Benefit Map. The key elements of this Benefit Map are: Benefits (green), Initiatives (orange) and Assumptions (Grey) Realise The Cabinet Office (UK) defines a benefit as a measurable improvement resulting from an outcome perceived as an advantage by one or more stakeholders. The ability to measure these improvements is vital to achieve the goal of improving Benefits Realisation. Measures allow us to set a target benefit value, against which we can track the improvement over time. Maximiser uses the SMART technique to help create high quality measures. SMART stands for: Specific Meaningful Agreed Realistic Time Bound
5 Figure 4: Successful Benefits Realisation requires accurate, high quality measurements Measures can be grouped into one of the following categories: Financial benefits those benefits that can be quantified and valued in financial terms e.g. cost savings, revenue generation, cost reductions etc. Non-financial benefits those that can be quantified cannot be valued in financial terms e.g. fewer customer complaints, productivity gains, greater accuracy, lower staff turnover, increased response times etc. Indirect benefits - can be identified, but cannot be easily quantified e.g. end user satisfaction, better access to information, organisational image, customer service, better morale, better perceptions etc. Questionnaires and surveys are often used to quantify these benefits. Evaluate The question that often arises when a combination of financial and non-financial benefits have been identified is how to compare and prioritise their realisation? Claire Dellar from the UK s National Health Service suggests the use of a normalised scale to weight each measure, which then allows aggregation to an overall performance score v. Figure 5 shows a sample dashboard for an initiative with multiple benefits. The 92% realisation status is summarising multiple benefits using weighted measures.
6 Figure 5: A Maximiser initiative dashboard showing the current realisation status, delivery date, and Net Financial benefit Conclusion By employing a systems approach to Benefits Realisation, it is possible to create measureable improvements in both the number and level of benefits achieved. This is made possible by ensuring that stakeholders are involved in the identification of the benefits, as well as the planning of the initiatives required to achieve the outcomes. Tracking the realisation of benefits using a combination of financial and non-financial measures allows for accurate reporting of actual benefits achieved, compared to the baseline targets. An enterprise Benefits Realisation Management system like Maximiser ensures a consistent application of an organisation s benefits management process across all initiatives, and provides role-based dashboards and tools for all people involved in benefits realisation. i OGC, Managing Successful Programmes, 2011 ii Jenner, Stephen Managing Benefits, APMG-International, 2012 iii NSW Department of Finance and Services, Benefits Realisation Guideline 2011 iv Thorpe, John The Information Paradox, 1998 v Dellar, Claire Fuzzy on the Non-Financials?,
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