Benefits Management and the PMO
We kicked off a series of sessions which allow us to explore some of the most challenging areas for PMOs today. Earlier in 2022, we asked PMO practitioners, what is the most challenging area for you today.
Four themes emerged – they were benefits management, resource management, low maturity and hybrid delivery.
We decided to feature all four of these at the PMO Conference in 2022 – using boards at the conference to try and get deeper into each one of them.
This is the template we used [you can download a PDF version here]
The Summer Series is designed to be interactive, to gather people’s insights and to help us build up the board.
The ultimate objective is to gain some actionable insights – things that the House of PMO can further work on – whether that be further sessions or something more tangible like a White Paper for example.
You can listen to the session here and also see where we are with the board.
What’s the Real Challenge?
There was a lot of different views as to what the real challenge is – what is it about benefits management that is actually the most challenging?
There were by and large two different perspectives:
- There are certain challenges around all the different components of benefits management and the different processes that are required.
- There are challenges specifically with sponsors – their own knowledge and accountability plus the senior executives who are relying on the sponsors to take responsibility.
If you and your PMO is experiencing something fundamentally different to these, please do let us know in the comments.
Benefits often not realised at point of delivery, only enabled. So project closes and no-one tracks/manages benefits afterwards
What didn’t work for us – not having sufficient amount of people (PMO) understanding how benefits are tracked to allow support for the PM’s / Accountable sponsors.
Looking deeper into those two perspectives:
The Benefits Management Process
Benefits management is deemed to be difficult to do and in the session these were the main areas:
- Being able to articulate what the benefits are is difficult
- Measuring benefits is hard
- Benefits estimating is complex
- Focus too much on financial benefits – non-financial benefits are tricky.
- It’s difficult to get traction with a benefits management process if its deemed to be too difficult.
- Benefits are not reviewed or monitored throughout
- No-one is interested when the project moves to business-as-usual.
The Sponsor Responsibilities
- Sponsors are often unknowledgeable about benefits management – sometimes even unaware its part of their responsibilities/accountabilities
- There are issues with terminology – the difference between outputs, outcomes and objectives – this applies to both sponsors and senior executives
- The business are often happy to go with the benefits management process but not to actually track the benefits.
- If the business is meeting all its strategic objectives and performing well – benefits tracking against business cases becomes irrelevant.
- There is a mismatch between business view or benefits and departmental view of benefits – it becomes very siloed.
- Benefits management language and process doesn’t align well with how the business works or how it is understood by the wider business.
The blockers highlighted included:
- Not enough funding to support education and learning in ensuring everyone involved in benefits management understands their role and what is required.
- Lack of support or buy-in from senior leadership and sponsors – and the benefit owners – on setting and embedding benefits management.
- There are no consequences when benefits are unrealistic and not realised – so why bother?
- The need for senior leadership to hold sponsors to account and make a difference in the projects they sponsor.
- Finally, just getting people to care about this kind of stuff feels like pushing a rock up a very steep hill.
When creating the business case, one of the key questions to ask is do you need to build something / implement something that will allowyou to capture / measure your benefits upon completion of the project
With some of these challenges it is easy to see why some of them don’t necessarily fit within the remit of the PMO to solve – however the PMO is not there to be a total solution provider, the PMO is there to support and aid – and there are many things the PMO can be doing to help the business to make benefits management, well, more beneficial to the business.
A difficulty of sometimes tracking benefits mid-way through project is that some benefits won’t be realised for years so get swept under the rug as ‘ah well, it’s too far away to worry about’
What would an ideal outcome look like? If we consider the different challenges, how can we switch those and start to find solutions.
There are a couple of things the PMO can consider (and there’s always more to consider!):
- The business needs to align business strategy to business risk – then the benefits management process will become more crucial
- Having the business understand the benefits of having a business case in the first place and then being able to track and realise what the project set out to do
- Ideally benefits scoring will be able to feed into the whole prioritisation scoring of which projects actually get delivered.
- A good working benefits management process will allow benefit-led decision making in steering committees.
- Finally, a dream outcome would be that everyone sees the value of benefits management and how it can lead to an increase in the right projects being delivered and those projects being delivered right.
I have found most success with asking project teams ‘what do you need to be able to do in the future that you can’t do today?’ as a way of getting them to think about Outcomes and then asking them what value that will bring to the business (benefits)
What Haven’t You Tried Yet
If we consider what is stopping PMOs from doing better with benefits management it comes down to three things.
- Senior executives – not having the right knowledge; having the right support; not using a simple approach which is easily understood; the PMO not being able to influence them in any way.
- The PMO itself does not have the right level of knowledge and sometimes credibility to challenge the business to do better.
- The sponsors, much like the senior executives plus having no consequences for stepping up for their responsibilities and accountabilities in benefits management and their project outcomes.
Any one member of the exec board would be a good powerful ally as they could rally the other board members who are on the fence. I use Finance business partners too.
From the session we were able to think about what the PMO could be trying next. The suggestions are very much aligned to the blockers:
- Training required for relevant senior executives, sponsors and the PMO – plus anyone else in the organsation with a vested interest in successful project outcomes.
- Influencing senior executives – even mentoring upwards. Find that powerful ally!
- Look again at the role of the sponsor in the organisation – is it well defined? What are the criteria for getting one onboard? What help and support is in place?
- Look at the different workshops that might help – rather than training courses which will turn off senior execs
- Think about different language use – how can the benefits management process be simplified, how can the terms be more business friendly?
- Think about some tweaks to the process; start from the ground up with some simple benefits mapping exercises – facilitate some simple logic maps – use confidence ratings on benefits management – always have a benefit start date.
- Advise benefits owners that they don’t need to be measuring everything – identify what needs to be measured on operational performance and/or strategic objectives and align benefits with that.
- The PMO needs to demonstrate how benefits management makes a difference – pull out the lessons learnt from previous successes – show how the project did against original benefits statements.
- You can also check out something Henny Portman put together – a quick reference card on benefits management (aligned to the course of the same name)
I have a benefits manager role in my Enterprise PMO but changing the culture to recognise its importance is the challenge
We will continue to collect insights from PMO practitioners on the different things they have tried to successfully put benefits management in place – or at least what kind of support they have offered which has made a bif difference.
It is not the role of the PMO to ‘own’ benefits management however we absolutely have a role in helping to pull together a useful, usable benefits management process and help people to adopt and use it.
In terms of next steps from this session there was a request to hear from other PMOs who have been spending a considerable time in this area and what they have learnt. We will be organising an event on this.
There was also a request to look deeper into ‘multi-criteria analysis’ which can be used to assess benefits for their effectiveness and also help to provide guidance for future project appraisal and selection. We will also be organising a session on this too.
For those just starting off, it took me 2 years to implement our Benefits process. we have just completed a lunch and learn with our PM’s and accountable sponsors and now have a best practice view of project documentation to show how the benefits can be show clearly