6
Stage E: Benefits Review and Transition
6.1 Purpose of stage
At the point at which the deliverables of a programme are considered by the programme manager (PrgM) and programme sponsor (PrgS) to be achieved, a review is undertaken by the business change manager (BCM) to assess if the required outputs and final outcome have been realised. This review also considers the success of transition of programme outputs into the final permanent state of the new undertaking. This review will confirm whether a programme can be shut down or if further activity needs to be carried out. It is possible that any further activity can be executed without the need to retain the programme management structure.
6.2 Stage outline
This stage (see Figure 6.1) establishes whether the programme has been successful in delivering the desired outcome or whether further deliverables will be needed in order to realise the overall objectives of the enterprise. During the stage the tasks discussed next need to be addressed.
Figure 6.1 Stage E. Benefits review and transition.
Benefits review
The PrgS, PrgM, BCM and the BRM review the outcomes to ensure that what the programme has delivered is what was stipulated in the programme brief, business case and programme delivery plan (PDP). An assessment is made by the PrgS and BCM as to whether the outcomes delivered by the programme will achieve the benefits required. Their assessment is referred to the PrgSB for ratification.
There is now an opportunity to make any final adjustments to what has been delivered in the light of greater knowledge and any changing circumstances.
If the PrgSB confirm the programme has delivered what is required, then they instruct the closure of the programme.
Benefits realisation
Realisation of benefits may occur over an extended period as projects become completed, and in some instances the full realisation of the benefits arising from the programme may take months or years beyond the completion of the programme. The situation may therefore arise where it is possible to consider partial completion of a programme and to disband part of the programme team. In these circumstances the BCM will need to maintain an ongoing measurement of the benefits. Also, in some instances this may require the PrgSB to be in place until full and final realisation is achieved.
Transition
Transition from the programme to the new enterprise can be progressive, as elements of the new undertaking are handed over as projects complete, or be a total handover that occurs at the completion of the programme. The new permanent operational state of the undertaking requires a management structure and resources to be mobilised ready to receive and commission it. The transition arrangements are overseen by the BCM.
Training and induction
When the outputs from projects are physical facilities, arrangements must be made for the staff of the new enterprise to receive induction training in the running and maintenance of the new facility. In support of maintaining the new facilities, there should be a transfer of project information, such as design details, building information modelling information, operation and maintenance manuals, legal agreements and design warranties.
6.3 Stage organisation structure
6.3.1 Stage structure and relationships
This stage principally involves the PrgS, BCM, BRM and PrgM (see Figure 6.2) who will establish whether the expected state of the new capability has been achieved. This is done by carrying out the tasks as outline in the next section.
Figure 6.2 Stage E: Benefits review and transition – organisation structure.
6.3.2 Roles of key participants
Programme sponsor
- In conjunction with the PrgM, initiates the benefit realisation review
- Confirm with the BCM and PrgM that the programme has achieved its objective and can be closed
- Determine if further works are required
- Determine the scope of any further works
- Determine how any additional works will be carried out
- Review with the BCM progress of transition arrangements
- Report to PrgSB on completeness of programme
Business change manager
- Together with the BRM carry out the final benefits realisation review
- Advise PrgS that the programme outcomes which have been delivered will achieve the required benefits
- Advise PrgS of any additional works required to create further benefits
- Manage the transition arrangements for the new capability/enterprise
- Liaise with the client body to ensure their readiness to receive the new capability/enterprise
Benefits realisation manager
- Together with the BCM, carry out the final benefits realisation review
- Determine if there is any benefits shortfall in the programme outcomes delivered
Programme manager
- Assist the PrgS/BCM in the final benefits review
- Assist the PrgS in scoping any additional works required
Programme financial manager
- Advise the PrgS and PrgM on the financial implications of carrying any additional works
Programme management office
- Advise the PrgS and PrgM of the schedule and cost implications of carrying out any additional works
Programme sponsors’ board
- Review with PrgS the conclusion of the final benefits realisation review
- Formally confirm the programme has achieved its objectives and can be closed
- Verify any additional works that need to be carried out
6.4 Programme management practices
6.4.1 Benefits management
Benefits management is a critical activity in any programme regardless of its type, objectives and duration. There have been many programmes that delivered great outputs and capabilities but failed to realise benefits due to insufficient or inappropriate arrangements being made to ensure that benefits are realised.
Managing and realising benefits – overview
Benefits management and realisation is a core element of programme (and change) management. It provides a systematic approach to identifying, defining, tracking, realising, optimising, reviewing and communicating benefits, during and beyond a programme.
It is essential that, from the onset, the PrgS takes ownership of the benefits agenda and throughout the life of the programme provides a strong leadership, particularly in terms of prioritising benefits, with support from BCM. Many programmes give in to the temptation of producing a long list of anticipated benefits in the business case in order to maximise the chances of securing funding. Once the funding is achieved, the willingness and commitment to take ownership of all the promised benefits diminishes – the PrgS and BCM should be aware of this and must examine and prioritise the benefits, including assigning individual ownership and seeking commitment from individual benefit owners where appropriate so that benefits realisation is monitored and delivered as anticipated.
The objectives of putting in place processes to manage and realise benefits in a structured way include the following:
- Identification of benefits
- Defining the benefits
- Alignment of the benefits to the strategic objectives, programme vision and outcomes
- Assigning appropriate ownership of benefits, including their realisation
- Aligning project outputs to support the benefits realisation
- Identifying and undertaking business changes that will be necessary to deliver the benefits
- Monitoring and evaluating the benefits and their realisation
By having a structured approach to benefits management, an organisation can ensure that the programme objectives contribute to the organisation’s strategic objectives. In addition, it enables the capture of benefits not anticipated at the outset of the programme and provides an ongoing focus, after the programme, on sustaining benefits.
The work to define the programme benefits, develop the PDP and define the project outputs needs to be integrated (see Figure 6.3). Work should start with gaining a better understanding of the benefits outlined in the programme brief and the business changes needed to deliver the benefits. This in turn provides the basis for the scope and the PDP and dictates what the projects need to produce as outputs. The process becomes iterative, as more details about benefits emerge in developing the programme definitions and the project outputs.
Figure 6.3 Managing and realising benefits.
6.4.2 Benefits and dis-benefits
Benefits
A benefit is a (directly or indirectly) measurable improvement delivered by a programme which is seen by a stakeholder to be positive and worthwhile, for example, creating more green spaces in a particular borough or a perception via a residents’ survey that the crime rate has gone down.
Types of benefits
Benefits can be classified in a number of ways. A distinction is made between financial benefits, which are measured in monetary terms, and non-financial benefits, which cannot be measured in monetary terms.
Financial benefits are further categorised as ‘revenue’, those benefits that give rise to immediate bankable returns, for example, capital receipts from the disposal of property, or ‘non-revenue’, for example, an efficiency gain leading to less time to complete a required task, which is a gain that cannot be converted into a reduction in staffing or cost.
Non-financial benefits include improvements across services and corporate functions (e.g. human resources, information and communication technologies and legal services) that can be measured using national and local non-financial performance indicators and the results of citizen and staff surveys.
Dis-benefits
Dis-benefits are the outcomes from a programme which are perceived by one or more stakeholders as negative, for example, new operational costs or loss of green space in an area due to the building of a new school. The same change can be seen by different stakeholders as both a benefit (net cost reduction through fewer staff) and a dis-benefit (job losses). These dis-benefits can be classified, managed and measured in the same way as benefits.
Dis-benefits can be confused with risks, but whereas risks may be avoided, dis-benefits will certainly be created by the programme and their impact must be managed. It is important to understand which stakeholder will lose out so that this can be managed. Furthermore, with proactive management, some dis-benefits can be potentially turned into opportunities or, indeed, new benefits (for example creation of a new school may result in loss of green space but extended community use facilities may compensate for the loss).
Benefits identification and mapping
Often, a benefits map is created in a visual form to capture and communicate the benefits. The map can be used throughout the life of the programme to analyse any impacts on benefits caused by changes in programme direction or changes to the strategy as a whole.
There are many ways to map benefits. It is useful to build benefits maps in stages (e.g. start with a session to agree on the programme objectives) because the relationships between the various components can be complex, and it can be better to work on this outside sessions with stakeholders.
The steps outlined below provide an example of how this can be done – the example used in the illustrations considers a leisure facility transformation programme (Figure 6.4a – Figure 6.4e)*.
Figure 6.4a Benefits map (leisure facility transformation programme): Step 1 – mapping programme objectives to strategic objectives.
Step 1: Mapping programme objectives to strategic objectives
At the beginning it will be necessary to agree on the programme’s objectives if these are not already clear from the programme mandate (see Figure 6.4a). The programme objectives are statements that explain what the programme sets out to deliver at the highest level in the context of strategic objectives.
It is important to ensure that the programme objectives are within the scope and power of the programme.
Step 2: Identifying and mapping benefits to programme objectives
In this step the process involves identifying benefits and dis-benefits. If a programme brief has been created, some benefits and dis-benefits will have already been identified. In addition, more potential benefits may have come to light since the creation of the programme brief.
The identified benefits should then be mapped to the programme objectives (see Figure 6.4b).
Figure 6.4b Benefits map (leisure facility transformation programme): Step 2 – Identifying and mapping benefits to programme objectives.
Dis-benefits are shown also to the right of programme objectives. It is also useful to indicate if there are any relationships between benefits and/or dis-benefits by placing them adjacent to each other on the benefits map.
Benefits are often intertwined – if relationships between benefits start to become too complex, grouping can be used to identify the related benefits together, and the complexity can be captured in the benefit profiles. In scenarios where there are numerous links between the elements, links can be prioritised in order to maintain visual clarity of the benefits map.
Step 3: Identifying business changes
The next step in the process is the identification of business changes that are needed in order to achieve the benefits (see Figure 6.4c). Business changes are those made to the current ways of working that need to be implemented in the business areas affected by the programme. They can include process and behavioural changes and changes to operational procedures. For example, a new clear-desk policy to support desk sharing will only deliver benefits if staff changes their habits and adequate storage is provided to staff.
Figure 6.4c Benefits map (leisure facility transformation programme): Step 3 – Identifying business changes.
Typically, the main business changes are noted on the map. A more detailed list of all business changes and how they will be implemented should be developed following the development of the benefit profiles. Business changes are numerous, and it would be difficult to try to fit them all on the map. It is, however, very valuable to use the map to consider all the major business changes required to deliver the benefits.
The activities needed to deliver the business changes should be included in the PDP (or separate benefits realisation plan) or where appropriate within the individual project plans.
Step 4: Mapping project outputs to benefits
The next step is to show the project outputs (enablers) that will create the capability to realise the benefits through the identified business changes (see Figure 6.4d).
Figure 6.4d Benefits map (leisure facility transformation programme): Step 4 – Mapping project outputs to benefits.
In the process of confirming, amending or adding benefits, the project outputs are reviewed to ensure that everything that needs to be created to enable the benefits is listed.
Once the map has been populated with project outputs, business changes, benefits and programme objectives, it can be used as a tool to consider the following:
- Do the programme benefits strongly align with the strategic objectives of the organisation through the programme objectives?
- Will the proposed projects deliver the benefits sought?
It is important to recognise that the benefits map does not indicate when things happen in time, that is, sequence. It is simply a representation of how things are connected to each other.
Step 5: Mapping the links between programme objectives, benefits, business changes and project outputs
Once all elements of the map have been captured, links are identified between the enablers, business changes, benefits/dis-benefits and programme objectives. The number of links can give an indication of the relevant importance of each element on the map and assist with benefit prioritisation (see Figure 6.4e).
Figure 6.4e Benefits map (leisure facility transformation programme): Step 5 – Mapping the links between programme objectives, benefits, business changes and project outputs.
Prioritising benefits and business changes
It would not be appropriate or practical to track/measure all benefits. The benefits should be prioritised according to those that are critical to realising the programme objectives, those with the important financial values and also those that are practical to measure (i.e. there is an existing baseline). In practice, this means that only a subset of the benefits are taken forward to the profiling benefits stage.
Profiling benefits
Benefits profiles describe benefits in more detail and record important information. A benefit profile should be prepared for each benefit. This helps to:
- Define the extent of the improvement that the benefit will deliver
- Ensure an appropriate person is accountable for the delivery of the benefit
- Prioritise benefits
- Clarify the project outputs that are needed to enable the benefit to be realised
The detail of benefit profiles will be refined and become clearer as the programme progresses.
See Appendix T7 for a benefits profile template.
Realising benefits
Many programmes fail to deliver their full potential because the responsibility and support is not put in place to deliver all the benefits. The biggest challenge is often to change the way people work.
There are two critical aspects to successful benefits realisation:
- establishing operational benefit owners, that is, people in the service/business who will be accountable for the achievement of the benefits
- implementing the business changes required to embed the new ways of working to deliver the benefits
The BCM role has been developed in programme management to own and lead the realisation of benefits on a day-to-day basis. It is advisable to have an overall BCM who is supported by the benefits owners in the service or business areas involved.
The BCM should plan benefits realisation activities in conjunction with the benefits owners and service areas affected. The following activities should be considered:
- Business change activities, including decommissioning of old ways of doing things, for example, processes, systems, buildings, posts, and implementing new ways of doing things, for example, new processes and training for the same
- Checkpoints for reviewing the changes and resultant benefits
- Responsibilities within the business change area
- Interdependencies and resources required
- Achievement of benefits that are ‘early wins’ and ways of maintaining focus on benefits that will take longer to achieve
The activities identified should be included in the PDP or included in a separate benefits realisation plan or, where appropriate, they may be included in individual project plans.
Reviewing and embedding
The BCM is responsible for collecting information on the achievements of benefits, and where benefits are not on track, taking the necessary action to ensure they are realised.
There are many ways to do this: See Appendix T8 for an example of a template that can be used to record and track information on all the programme benefits. If required, the financial benefits information can be used for calculating overall financial benefits to date.
The information in a template such as this can also be aggregated with similar templates for other programmes to give a portfolio or strategic view of benefits realisation.
The purpose of tracking is to focus operational business units on achieving, sustaining and improving the benefits. This may mean using existing measures and reports (e.g. from the finance section). It may mean implementing new key performance indicators (e.g. number of lost calls in a call centre operation). In both cases, the measures need to be integrated into the operational management processes and systems, for example, reporting systems, management meetings, personal performance targets, and so on.
By integrating benefits tracking into the existing reporting and management processes, benefits owners have the basis for refining and optimising benefits. This involves looking at the trade-offs between benefits and the impact the operational environment is having on the level of achievement. For example, increasing the number of people working from home by introducing smart-working facilities may reduce office accommodation costs but also reduce effective communication and collaboration between team members.
It is also important to embed and reinforce the new ways of working and discourage the old.
During the life of the programme, benefits should be reviewed by the PrgSB. Structures and mechanisms should also be established, which will continue the process of monitoring and reviewing achievements of benefits beyond the programme closure. The approach, as outlined in pages 100–106, primarily relates to programing a public sector environment (see Public Sector Programme Management Approach – detailed in Bibliography), but can be tailored to suit the specific context of private sector programme as well.
Communications
The communication of the achievement of benefits is an obvious but often overlooked activity. It is important to communicate to stakeholders the success of the programme as it starts to achieve key benefits. Positive feedback and reinforcement is a powerful way to help people transition and adopt new ways of working.
A way of ensuring that the communication of success is not overlooked is to include in the communications and stakeholder plan actions around publicising benefits. Target dates for the achievement of benefits can be taken from the benefit profiles and used to identify when the communications activities should occur.
Sign-off
The key outputs from the benefit management and realisation activities are the benefits map and profiles and the benefits realisation plan (either a separate plan or included as part of the PDP).
The benefits map and profiles and programme plan are signed off by the PrgS during the definition phase.
The benefit profiles and the benefits realisation activities should first be agreed upon by the BCMs (and benefits owners if possible) before they are submitted for sign-off.
The benefit profiles and benefit realisation activities (and plan) need to be kept in alignment with the PDP, project outputs and changes to the objectives of the programme. These documents should be reviewed and changes signed off:
- Before starting a new part of the programme
- When there are major changes to the scope
- When there are developments that impact the attainment of the planned benefits
- Before transitioning to the new state (measure the performance of the current state)
- After transitioning to the new state (measure the performance of the altered state)
- At programme closure to ensure that benefits ownership and realisation continues in business as usual to achieve the benefit targets set out by the programme
6.4.3 Transition strategy and management
Managing the transition strategy should be addressed from (i) an operational, (ii) programme organisation and (iii) business as usual point of view as described below:
- Operations: Programme close-out/operational readiness
- Assets and facilities ready for operations on time
- All facilities are fit for purpose
- Facilities operate the first time with no critical failures
- Recognised legal, contractual and critical schedule requirements
- Comprehensive operations philosophy and plan in place
- Clear roles and responsibilities pre and post transfer
- Facilities easy to operate and maintain
- Staff to receive timely training to operate and maintain facilities
- Capture of lessons learned for knowledge dissemination
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Organisation: Programme exit strategy
A key challenge is the management of resources to ensure that key staff remains for the life of the wind-up in critical functional areas to ensure that corporate knowledge is retained and there is clear accountability for any associated exit tasks. An interim resource plan using third-party resources could help to shore up unexpected staff losses and provide continuity.
A programme needs to consider how the transition to operations will impact the organisation and the implementation of an exit strategy, as it reaches the end of its life (see Figure 6.5).
Key areas to consider and address:
- Governance: Opportunity to formalise an exit strategy as a formal project/programme
- Resource management: Key staff leaves unexpectedly creating gaps in expertise and loss of corporate knowledge
- Commercial management: Clear visibility of potential contractual issues and tracking of any resulting claims/disputes using a formal system will help to make the exit as efficient as possible
- Legal: Developing a legal risk map will help highlight business requirements for organisational exit
- Stakeholder management and communications: Exit strategy would benefit from the development of a stakeholder map
- Risk management: capturing and formalising will consider all exit strategy risks
- Information technology: Information technology expertise may be required to help support legacy bodies
- Benefit realisation post close-out
- Handover to BCM to monitor benefit delivery post transition
- Capture of lessons learned for knowledge dissemination
Figure 6.5 Organisation size over time for programme delivery.