Transcript Unisys - 19 December 2001 - British Computer Society

BCS – North London Branch
Benefits Realisation Management
Ensuring IT and change adds value and delivers
planned business benefits
Gerald Bradley
Ann Watts
19th March 2007
© Sigma (Bookham) Ltd
1
Achieving the expected or potential benefits
is not the norm
OASIG Survey Results:
•
•
•
•
•
•
80-90% do not meet their performance goals
~80% of systems delivered late or over budget
~40% of developments fail or are abandoned
<40% fully address training and skill requirements
<25% properly integrate business and technology objectives
10-20% meet all their success criteria
sigma’s View:
•
Most companies achieve between 10% and 25% of potential benefits
from their IT Investments and change programmes
Recent survey on Benefits from IT Projects:
•
•
© Sigma (Bookham) Ltd
Only 25% of organisations are measuring benefits
Of these 25% only 25% are observing benefits in line with expectations
2
sm260
Who are we (sigma)?
• Pioneer of the leading methodology for Benefit Realisation
Management (BRM)
• Established 1986
• Specialist provider of Benefit Realisation Management
consultancy, education and software
• Partner to many leading private and public sector organisations
© Sigma (Bookham) Ltd
3
sigma’s clients include:
Healthcare and Pharmaceuticals
• Amersham Health
• AstraZeneca
• GlaxoSmithkline
Oil and Gas
• BP
• Canadian Natural Resources Limited
• Shell
Banking and Financial Services
• Abbey National
• AXA Insurance
• Barclays Bank
• Bradford & Bingley
• Cornhill Insurance
• Friends Provident
• Hewitt Bacon & Woodrow
• Lloyds TSB
• Mellon Bank
• NatWest Bank
• UnumProvident
© Sigma (Bookham) Ltd
Central Government and other Public Sector
• Department for Transport
• Foreign & Commonwealth Office
• Highways Agency
• Home Office
• MOD
• National Air Traffic Services
• Office of National Statistics
• OGC
Police
• Over 30 Police Forces
• Police IT Organisation (PITO)
• Scottish Police IS Group (SPIS)
Miscellaneous Private Sector
• Associated British Foods
• BT
• General Motors
• Lloyd's Register of Shipping
• Orange
• United Utilities
4
Successful Benefit Realisation
 Benefits – why consider them? what are they?
 Foundations for success
 Be serious about realising benefits
 Don’t neglect ‘business change’
 Begin with the vision or end goal
 Some proven tools and techniques




Strategy Maps
Benefits Maps
Benefit Dependency Maps
Investment Assessment Matrices
 Process, roles & responsibilities, available support
© Sigma (Bookham) Ltd
5
Benefits – why? how? and what?
The only valid reason for investment in change is the realisation of
benefits
So change should always start with benefits and end with benefits
In fact benefits should be the core of any change project – the
central theme – not an afterthought
But what is a benefit – ‘an outcome of change perceived as
positive by a stakeholder’
So success is the timely realisation of the expected benefits
•
This is not automatic, it doesn’t just happen, it must be managed –
Benefit Management
© Sigma (Bookham) Ltd
6
What is success? - the purpose of programmes/projects
Purpose: To improve the ROI from change
Return
More
benefits
Sustained
benefits
Earlier
benefits
Time
Fewer wasted
investments
© Sigma (Bookham) Ltd
7
Why consider benefits?
To justify?
In UK
until
1990
To measure?
To harvest?
In UK in
the
1990s
In UK in the
new
millennium
Measurement
Measurement
Justification
Justification
Justification
Emphasis shift
Justifying
© Sigma (Bookham) Ltd
Measuring
Achievement
Harvesting
8
Process:
Focus on the real goal - Objectives & Benefits
As is
External
Drivers
Enablers
Stakeholders
Cultural
Factors
BRM
Business
Change
Benefits
Can be
© Sigma (Bookham) Ltd
Objectives
9
Bridging between enablers and objectives
Projects delivering
Capabilities
Corporate or Programme
Objectives
To increase
effectiveness
To Improve
deployment
To speed up
responses
The bridges may
consist of
processes or
changes or
intermediate
benefits
© Sigma (Bookham) Ltd
To reduce costs
10
Building a programme around its benefits
Corporate or Programme
Objectives
Top level control
Projects delivering
Capabilities
Centralised delivery
To increase
effectiveness
Business unit delivery
To Improve
deployment
Enablers
Enabling
Changes
Intermediate
Benefits
Business
Changes
Business change
change activities
Business
activities
Programme level work streams
End
Benefits
Vision
End Goal
Drivers
To speed
up responses
To reduce costs
Benefit Realisation Plan
Project(s)
© Sigma (Bookham) Ltd
Business Case
11
An example of a ‘bridge’ which distinguishes
between Features, Changes and Benefits
Change in Working Practice
Feature
Technology
Electronic
communication
Meetings
Management
Improved
succession
planning
Interactive
working with
Country Mgrs.
Information
sharing
Benefits
Improved
launch
planning
Faster
resolution
of pricing
issues
Document
Management
© Sigma (Bookham) Ltd
Increased
sales
More
focused
selling
Shared
‘best
practices’
Co-authoring
documents
Search
facilities
Maximised
launch
impact
Cross-fertilisation
between Countries
Captured
learning
Electronic
discussion
Improved
performance of
Country Mgrs.
Business
Objective
Improved
pricing
To
Increase
profit
Increased
margin
Increased
effectiveness
Increased
efficiency
More focused
sales force
Reduced
costs
12
Change Process with Review Points
R6
1.
Set vision
and
objectives
R1
2.
Identify
benefits and
changes
6.
Manage
performance
Strategy
R5
Engage
stakeholders
© Sigma (Bookham) Ltd
Delivery
3.
Define
initiatives
5.
Manage
initiatives
R4
R2
4.
Optimise
initiatives
R3
13
Use drivers to determine objectives for the change
From a representative set of stakeholders gather answers to the why
question - why do we want to undertake this change?
Group these answers and determine group headings expressed as
objectives
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© Sigma (Bookham) Ltd
14
Confirming Programme Objectives
For a programme to roll-out Benefit Realisation Management (BRM) within an organisation,
clustering and linkage resulted in the following Objectives Linkage Diagram (Strategy Map).
What would you choose as a set of key objectives for the programme?
To
produce better
quality business
cases
To
improve project
prioritisation
and selection
To improve
stakeholder
management
To introduce a
standard Benefit
Management
Methodology
To increase
awareness and
understanding of
benefit realisation
issues
© Sigma (Bookham) Ltd
To improve
benefit tracking
and reporting
To change to a
more benefit
focused culture
To maximise
benefit delivery
from each
programme
To increase
shareholder
value
To improve
business
strategy
15
Confirming Programme Objectives
For a programme to roll-out Benefit Realisation Management (BRM) within an organisation,
clustering and linkage resulted in the following Objectives Linkage Diagram (Strategy Map).
These objectives are key and bound the programme.
To
produce better
quality business
cases
To
improve project
prioritisation
and selection
To improve
stakeholder
management
To introduce a
standard Benefit
Management
Methodology
To increase
awareness and
understanding of
benefit realisation
issues
© Sigma (Bookham) Ltd
To improve
benefit tracking
and reporting
To change to a
more benefit
focused culture
To maximise
benefit delivery
from each
programme
To increase
shareholder
value
To improve
business
strategy
16
Creating a Benefits Map for each of the
bounding objectives
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
© Sigma (Bookham) Ltd
2. Improved
management of
investment process
1. Improved
understanding
of requirements
To improve
project
prioritisation
and selection
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
3. Improved
awareness
of options
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
17
Creating the Benefit Dependency Map from the
Benefits Map
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1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
1. Improved
understanding
of requirements
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2. Improved
management of
investment process
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1. Improved
understanding
of requirements
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To improve
project
prioritisation
and selection
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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3. Improved
awareness
of options
1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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1. Improved
understanding
of requirements
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© Sigma (Bookham) Ltd
18
Creating a Benefits Map starts with the identification
of ‘end benefits’ which equate to the objective
Fewer crimes
by re-offenders
To reduce the
number of crimes
Fewer crimes
by first time
criminals
© Sigma (Bookham) Ltd
19
Continuing the development of the Benefits Map
Less
propensity to
commit crime
Fewer crimes
by re-offenders
Less
opportunity to
commit crime
To reduce the
number of crimes
Fewer crimes
by first time
criminals
Increased
deterrent to
commit crime
© Sigma (Bookham) Ltd
20
Completing the Benefits Map
Less drug
availability
Greater
collaboration
between local
agencies
Improved
vocational
training in
prisons
Fewer drug
users
Better offender
management
Reduced
criminogenics
Less
propensity to
commit crime
Fewer crimes
by re-offenders
Greater awareness
of drug issues
amongst the
community
Improved
awareness of
crime issues
More community
crime prevention
initiatives
Improved
scheduling of
police
Less
bureaucracy in
police
Improved
personal crime
prevention
Improved
community
crime
prevention
Increased
police
presence on
streets
Improved law
enforcement
resource usage
© Sigma (Bookham) Ltd
Increased
effectiveness in
fighting crime
To reduce the
number of crimes
Fewer crimes
by first time
criminals
Lighter streets
Improved
detection
Improved skills
Less
opportunity to
commit crime
Increased
deterrent to
commit crime
Increased
clear-up rates
of targetted
crimes
21
A weighted Benefits Map
Less drug
availability
50%
Improved
vocational
training in
prisons
20%
Fewer drug
users
30%
30%
25%
Better offender
management
Greater
collaboration
between local
agencies
45%
Reduced
criminogenics
70%
50%
Fewer crimes
by re-offenders
40%
Greater awareness
of drug issues
amongst the
community
35%
Improved
awareness of
crime issues
30%
60%
Improved
personal crime
prevention
25%
20%
30%
25%
More community
crime prevention
initiatives
Improved
scheduling of
police
60%
Less
bureaucracy in
police
Improved
community
crime
prevention
25%
Less
opportunity to
commit crime
To reduce the
number of crimes
50%
40%
Fewer crimes
by first time
criminals
Increased
police
presence on
streets
100%
50%
30%
40%
Improved
detection
50%
Improved skills
35%
20%
Lighter streets
Improved law
enforcement
resource usage
65%
80%
20%
45%
Increased
effectiveness in
fighting crime
35%
Increased
deterrent to
commit crime
100%
100%
© Sigma (Bookham) Ltd
Less
propensity to
commit crime
Increased
clear-up rates
of targetted
crimes
15%
23
A Benefit Dependency Map (BDM) with weighted paths
Less drug
availability
Drug treatment
progs.
Implement
vocational progs.
Vocational
Programmes
50%
Improved
vocational
training in prisons
Survey offenders
20%
Fewer drug
users
30%
30%
NOMS System
25%
Community
Education
Programme
Co-ordintate
agenecies (incl.
voluntary)
"Meet the victim"
scheme
Media campaigns
Greater collaboration
between local agencies
Greater awareness of
drug issues amongst the
community
35%
Better
offender
management
30%
Improved
awareness of
crime issues
45%
60%
Reduced
criminogenics
70%
Improved
personal crime
prevention
25%
25%
20%
MI on hot spots
Review
scheduling
practices
More community
crime prevention
initiatives
25%
More street
lighting
Improved
scheduling of
police
60%
40%
Recruit and train
specials
Increased
effectiveness in
fighting crime
101 Cross border
communications
20%
100%
30%
Increased
deterrent to
commit crime
Benefit
Objective
Enabler
Business
Change
15%
100%
National IT
System
© Sigma (Bookham) Ltd
50%
Improved
detection
35%
Fewer first
time criminals
40%
Focus resources on
higher value
activities
50%
Improved
skills
50%
20%
100%
Improved law
enforcement
resource usage
65%
O5 To reduce the
number of crimes
80%
Increased police
presence on
streets
Lighter streets
45%
Case & Custody
Less
opportunity to
commit crime
20%
Prompt
replacement of
bulbs
Less
bureaucracy
in police
Improved
community crime
prevention
50%
Fewer reoffenders
30%
Crime Prevention
Officer meetings
Less
propensity to
commit crime
Increased clearup rates of
targetted crimes
24
A Benefit Dependency Map (BDM)
with weighted paths and scores
Key
Less drug
availability
Drug treatment
progs.
Implement
vocational
progs.
75
Survey offenders
Improved
vocational training
in prisons
Vocational
Programmes
Benefit
Objective
0
0
Enabler
0
Business
Change
0
50%
20%
118
Fewer drug
users
150
30%
30%
NOMS System
25%
Community
Education
Programme
Media
campaigns
Better
offender
management
203
"Meet the
victim" scheme
45%
Reduced
criminogenics
70%
Less
propensity to
commit crime
500
50%
Fewer reoffenders
350
650
Co-ordintate
agenecies (incl.
voluntary)
Greater collaboration
between local
agencies
Greater awareness of
drug issues amongst
the community
35%
32
30%
42
30%
MI on hot spots
Review
scheduling
practices
Crime Prevention
Officer meetings
25%
More street
lighting
Improved
scheduling of
police
69
Improved
awareness of
crime issues
28
More community
crime prevention
initiatives
112
Less
bureaucracy
in police
61
Lighter
streets
Prompt
replacement of
bulbs
Recruit and
train specials
40%
Improved
skills
© Sigma (Bookham) Ltd
20%
80%
Improved law
enforcement
resource usage
153
50%
50%
101 Cross
border
communications
100%
05 To reduce
crime
35%
Fewer CJ first
time criminals
350
30%
40%
Improved
detection
100%
1,000
50%
20%
Focus resources
on higher value
activities
Increased
effectiveness in
fighting crime
93
65%
25%
Less
opportunity to
commit crime
232
Increased police
presence on
streets
107
37
46
National IT
System
60%
Improved
community crime
prevention
186
25%
20%
45%
Case &
Custody
60%
Improved
personal crime
prevention
46
20%
53
Increased
deterrent to
commit crime
267
15%
100%
Increased clearup rates of
targetted crimes
40
25
Benefit Classification
Benefits can be usefully classified in a number of ways.
Some frequently used classifications are:
•
Beneficiary
-
Stakeholders who will feel they receive the benefit
•
Benefit category
-
generic or family grouping
•
Boston Grid
-
Business impact
• sigma Value Type
-
value expectation
•
-
degree of change required for benefit achievement
Change Type
Classification frameworks may be used as an aid to benefit identification or to classify benefits already
identified in order to aid analysis and the management of expectations
© Sigma (Bookham) Ltd
26
Finance Function
Programme Team
IS Function
Business Users
Business
Management
Key benefits and
disbenefits by
stakeholder
Executive
Management
A Programme to roll-out BM within an organisation
Key Benefits
More effective project portfolio
Earlier recognition of ineffective projects
More financial benefits realised
More non-financial benefits realised
Improved management of risk
Reduced IS/IT costs
Improved image of IS/IT
Key disbenefits
Extra effort by business
Slower start to programme
IS Project Targets threatened
© Sigma (Bookham) Ltd
27
sigma value types
Value type
Definition
Example
Financial
T
a
n
g
i
b
l
e
Definite
Expected
Logical
Intangible
© Sigma (Bookham) Ltd
Value may be predicted
with confidence or
certainty – not effected
by external drivers
Non-financial
Reduced costs
Fewer steps in
a process
Value may be predicted on
the basis of someone
else’s experience or based
on historic trends
Increased sales
Quicker
performance of
tasks
Logically a benefit may be
anticipated whose value
may be measured but not
predicted
Improved
management of
insurance risk
Greater
customer
satisfaction
May be anticipated, but
difficult to substantiate
Improved
image
28
Value benefits in the way they are described
If the benefit is “fewer steps in a process”, the measure, which is also the value of the benefit is the number of
steps in the process – the baseline may be 72 and the target 55 and the value at any point is the current number of
steps in the process.
It is important not to try to give this a financial value, as of itself it is not a financial benefit. It may lead to a financial
benefit, which would be shown on the Benefits Map, but this depends on the intention.
4. More time
spent with
customers
2. Faster
response to
customers
1. Fewer steps in
a process
8. Increased
sales revenue
5. More coffee
breaks
9. Improved
networking
6. Shorter
working day
10. Improved
staff morale
7. Fewer staff
11. Reduced
salary costs
3. Improved
productivity
Based on the above map, reduced salary costs is only one of four possible end benefits, it may occur several
months after fewer steps has been achieved and additional changes (e.g. making staff redundant) may be
required in order to achieve this later benefit.
© Sigma (Bookham) Ltd
29
Benefit linkage chart for the whole investment
Case Example
Major Bank
Improved
customer
service
Improved
image
Fewer
complaints
Fewer
errors
Customer
database and
sales processing
system
Easier
sales
processing
Less
unpaid
overtime
Increased
productivity
Better information on
customers and sales
profitability
© Sigma (Bookham) Ltd
Improved
staff
morale
More high
value
customers
More quality
time with
customers
More high
value
sales
More
focused
selling
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Four reasons for tracking all / most of the benefits
in the Benefit Linkage Chart
• To know that a change in the end benefit can be attributed
to the project/programme
• To know that all paths in the linkage chart are operating in
order to generate the maximum improvement in the end
benefit
• To satisfy the needs of different stakeholders - e.g. sales
processing; customer relations; HR
• To have some interim milestones, rather then waiting two
years to see whether the sales had improved
© Sigma (Bookham) Ltd
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Predictive model
Value of
the
measure
Target
M2
M1
Baseline
Target
Baseline
T1
T2
T3
T4
Time
Don’t try and be more sophisticated than this in your predictions and use
months (or preferably quarters) as your minimum time interval
© Sigma (Bookham) Ltd
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Tracking the benefits
Measure
No. of errors per 100 sales
No. of written complaints per week
No. of phone complaints per week
Customer service rating (%)
No. of sales processed pp phr
Value of sales processed pp phr
Total overtime worked per week (hr)
Staff morale rating (%)
Time spent with customers (hr/wk)
No. of new HV customers/period
No. of HV Customers lost/period
Lead conversion rate (%)
Value of HV Sales/period
© Sigma (Bookham) Ltd
Baseline
value
7.5
9
55
8.5
£480
85
68
45
3
5
27
£300,000
Start
Period
End
Period
1
2
2
3
2
2
2
3
3
4
4
4
4
3
4
4
6
4
4
4
6
6
7
7
8
9
Target
value
Period 1
Period 2
Period 3
Period 4
2
2
5
80
12
£750
15
80
100
10
2
40
£1m
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Software supports RAG Status
(including on Benefit Linkage Charts)
Case Example
Major Bank
Improved
customer
service
Improved
image
Fewer
complaints
Fewer
errors
Customer
database and
sales processing
system
Easier
sales
processing
Less
unpaid
overtime
Increased
productivity
Better information on
customers and sales
profitability
© Sigma (Bookham) Ltd
Improved
staff
morale
More high
value
customers
More quality
time with
customers
More high
value
sales
More
focused
selling
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Obtaining further help
The book gives a very full and
comprehensive treatment of
benefit realisation with
application to projects,
programmes and portfolios.
The book, published in June by
Gower @ £55, is available from
Sigma’s stand today @ £48.
© Sigma (Bookham) Ltd
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Complete toolkit:
Methodology
A consistent, comprehensive, flexible and scaleable process
A circular process which can be entered at any point
A proven process tested in many different environments
A bag of many different techniques to suit a wide variety of situations
Education
Education to change mindset
War stories from a diverse variety of organisations
Consultancy
To embed the approach in the behaviours and culture of the organisation
Workshop facilitation to engage stakeholders and secure commitment
Partnership consultancy to transfer skills through whole life-cycle
To advise and mentor in unusual and complex situations
Training
To introduce an extensive set of techniques.
To give guidance as to their use - why? when? how?
Software
To manage the data, in order to:
•
Improve the quality and consistency of information
•
Analyse and prioritise solution options
•
Manage cross-programme dependencies
•
Monitor programme and portfolio performance
© Sigma (Bookham) Ltd
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Some good news
Benefit Realisation Management (BRM)
can and does make a difference
Instead of 20% of potential benefits you
could be enjoying at least 80% of
potential benefits
© Sigma (Bookham) Ltd
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© Sigma (Bookham) Ltd
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