Benefits vs. Disbenefits

Read Eric Beckingers post on why this car shouldnt exist...

Click to read Eric Beckinger's post on why this car shouldn't exist...

As we build the value management components of the next generation of SAP methodologies, I’ve dug in to the program management standards of PMI and OGC.  One of our first principles is to ensure alignment with industry standards; however, for programs and value management we’ll need to mix and match.

One example of a concept not in both standards is the idea of “disbenefits” in OGC’s Managing Successful Programmes (benefits profile outline here).  The concept is illustrated in my comment below about a Dodge Caliber rental…

I still can’t get over how bad the Dodge Caliber was to drive…however, a short test drive could fool the unwary.  Only a bean-counter would think it was a good idea to keep building Calibers. What is more valuable: the additional amortization of the Caliber tooling you get by selling more cars or the lasting emnity of the folks who buy them?

And that’s why considering disbenefits makes all the difference…

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7 Responses

  1. Surely a disbenefits is simply a cost?

  2. That was my first take as well, and disbenefits do cost (additional resources or forgone revenue). Maybe I’ll create a couple of posts elaborating the concept and how disbenefits affect total project/program value.

  3. Disbeneifts are not always quantifiable costs. Within the context of MSP, a disbenefit is any undesirable outcome resulting from the program’s execution. Here are a few examples: For instance, the perception of a company as not being “green” in today’s environment may negate a perfectly sound economic solution and benefit to a program. Another example might be that a company can easily achieve a reduction is costs be reducing staff, but the talent lost and the ability of the company to grow later would be the disbenefit that must be managed, or if a company wants to retain as part of it’s brand image that it is has a reputation for caring for it’s employees, frequent reductions may tarnish that image. The business case of a program then tends to balance benefits against costs, risks and disbenefits. While we would prefer to quantify the costs of the disbenefit, in some cases, even though it isn’t easily measured, it is well know that we must avoid and/or manage it.

  4. [...] term over the last few weeks has been “Dodge Caliber”, which brings folks to my “Benefits vs. Disbenefits” post. Probably not quite the take that most link followers expected, but the image does [...]

  5. It should be explained in relation to benefit-cost analysis

  6. The concept of disbenefits should be explained in relation to benefit-cost analysis

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