Benefits Realization: Demonstrating Initiatives’ Value

Debbie Crawford just taught a refreshed version of our Benefits Realization class. The topic is one that bedevils PMOs, largely because it takes a while to figure out that it’s not a closing phase task. In other words, it has to be planned, executed, monitored, controlled, and delivered…just like any other initiative deliverable. Below is an overview of the class:

Benefits are not just another dimension of portfolio management, but are the basic rationale for any investment of funds.  As such, benefits should drive those investment or change decisions from initiation through implementation and beyond. It is the methodology needed by any organization intent on effectively demonstrating that desired benefits are achieved in practice.

This course, built on a wealth of real world experience and lessons learned, will engage the participants in achieving:

  1. Increased organizational ability to forecast benefits which are complete, realizable, and represent real value for the money. In other words, we are investing in the right things and getting them done.
  2. Realize forecasted benefits in practice by ensuring the required enabling, business, and behavioral change takes place; ensuring that the performance of the benefit matches the business case promise.
  3. Realize benefits as early as possible and sustain that realization for as long as possible.
  4. Capture and leverage emergent or unplanned benefits (and minimize any dis-benefits) to optimize the benefits realized and the value for money is achieved.
  5. The organization’s ability to demonstrate the above – not just as part of the framework of accountability but also so that we learn what works as a basis for continuous improvement.

High performing project management orgs are more agile — PMI

The Project Management Institute’s latest “Pulse of the Profession” report just came out, and it’s full of provoking findings. It clarifies the benefits of high-performing project management, and it highlights what the top organizations do differently. By the way, the “PMI Pulse” is a nice complement to the McKinsey report on building capabilities I wrote on last week.

So what does it mean to your organization if it’s a project management top performer? It means that you deliver more value and waste fewer resources:

…these organizations meet original goals and business intent two-and-a-half times more often than those in low performing organizations (90 percent vs. 36 percent). High-performing organizations also waste about 13 times less money than low performers. — PMI Pulse, page 6

Did you know that these top performers used agile techniques more often than other organizations? This use of agile, iterative, and incremental methods drove better organizational agility. In turn, this better agility allows for faster and more effective responses to competitive, technological, regulatory, or other external challenges. PMI found that the most agile delivered against business, cost, and schedule goals between 20 to 50 percent better than the least agile. Agile also means better top and bottom lines: the PMI Pulse report references a MIT study that found agile firms grew revenue 37 percent faster than non-agile firms, while generating 30 percent better profitability.

To that end, PM College has greatly expanded it’s agile curriculum, from the basics, to an Agile Bootcamp, to negotiating Agile vs. Waterfall, to PMI Agile and ScrumMaster certification prep.

Agile principles have a been a lifesaver on a number of my projects and programs. If nothing else, an agile education gets you and your organization thinking and working the agile way…even before you implement any methodology at all.

McKinsey: Simulation key to how effective organizations build staff capabilities

I’ve seen the impact of leadership development on organizations: it’s why I joined PM College. One of the challenges is to determine which methods work best to drive transformation, or accelerate improvements one has already reaped. Our firm has experience and research that pins this down, but it’s always nice to find a third-party that confirms what we know and believe.

McKinsey to the rescue, with a new survey on “Building Capabilities for Performance.” The survey refreshes data from a 2010 study, and found that:

… the responses to our latest survey on the topic suggest that organizations, to perform at their best, now focus on a different set of capabilities and different groups of employees to develop.

In other words, the best performers did personnel development differently.

What did they do? The first finding that struck me was the use — or disuse — of experiential learning: McKinsey model factories or simulations as examples. The most effective organizations used these methods more than four times more frequently than others. But even then, experiential learning was used sparingly, by just under a quarter of the top performers.

As long-time Crossderry readers know, I’m a big fan of simulations. We had great experience with them at SAP. As McKinsey notes, they are about the only way “to teach adults in an experimental, risk-free environment that fosters exploration and innovation.” To that end, several popular PM College offerings — Managing by Project, its construction-specific flavor, and Leadership in High Performance Teams — use simulations to bring project and leadership challenges alive…without risking real initiatives.

I’ll have more on other success factors — custom content and blended delivery — in following posts.

Why is digital transformation disruptive?

I’ve found that other functions struggle with innovative technology when:

  1. They don’t know their processes particularly well. In this scenario, discussions about a mere port to a new platform get stuck on basic process misunderstandings.
  2. They try to jam existing processes on a new platform without considering new opportunities the technology brings. It’s a reasonable implementation strategy to simply port processes, However, if one doesn’t account for new cases — e.g., using mobile form factors to present demos or quote and approve in real-time — one may inadvertently foreclose those opportunities via short-sighted design choices.
  3. They deploy new process cases without a organizational change strategy beyond training. Take my CRM example above: if one’s sales force is made up of “order takers”, will they be able to leverage the new capabilities without intervention? If nothing else, one must ensure that debriefs of the top performers in this new capability happen and are passed along (via training, coaching, etc.).

Adapted from a comment I made on LinkedIn on this ZDNet post by Sven Denecken, noting some concrete reasons why digital innovation is disruptive:

Asking vendors partnership-promoting questions

As I closed my Q&A with Gary Cohen, I asked about working with oursourced resources.   Service and technology providers are integral parts of many projects, but too often I see them treated like arms-length vendors rather than true partners. 

  • Crossderry: What kind of questions should we ask consultants and vendors to reinforce to them — and to other stakeholders — that we are all in this together?
  • Gary Cohen: To encourage partnership with consultants, I recommend asking the following questions:
    * What risks are there to you if the project fails?
    * What opportunity costs are you giving up in order for us to work together?
    * What would like to hear me say to you a month after the project has been completed? What praise, in other words, would signify the optimal outcome?
    * What might prevent you from hearing that praise?
    * What can I do to help you achieve the optimal outcome?

Help others answer “their” questions

Placing yourself in another’s shoes is one of the most effective ways to confront reality.  I particularly like  Gary Cohen‘s take on how you can use the right questions to not only express empathy, but to also increase accountability (from my Q&A with Gary, author of JUST ASK LEADERSHIP: Why Great Managers Always Ask the Right Questions.

  • Crossderry:  I like the distinction you’ve made between questions that answer “your” questions — i.e., questions where you own the decision — and asking questions that help others answer “their” questions.  Can you talk more about such questions and how they can be used to reinforce accountability?
  • Gary Cohen: One of the most important questions leaders can ask is, “Whose decision is it?” When leaders allow job descriptions to determine decision-makers, not rank, decisions are usually made by the most informed party, and everyone must take ownership of their work. Blame and credit are easy to assess, in these instances. If, on the other hand, leaders make others’ decisions, they take away accountability from coworkers. Blame and credit are harder to assess, and it takes longer for new leaders to emerge because there’s less incentive to take ownership of their work.

Whose “truth” are you after?

Continuing my Q&A with Gary Cohen, author of JUST ASK LEADERSHIP: Why Great Managers Always Ask the Right Questions

  • Crossderry: Coming from the other direction, how can senior leadership make it safe to ask and answer questions openly and honestly? Put another way, what distinguishes an organization that cultivates “approval-seeking” from an organization that rewards “truth-seeking”?
  • Gary Cohen: While leaders should seek to cultivate a “truth-seeking” culture over one that’s “approval-seeking,” they must be mindful of whose truth they’re after. Too often leaders express disapproval when their coworkers don’t arrive at the answers they hoped to get. This disapproval prompts coworkers to fish for the truth/answer their leaders prefer. In this way, “truth-seeking” becomes “approval-seeking” in disguise. Continue reading

Using questions “within” your personality

What in the wide world of sports is goin' on here?

The second topic in my Q&A with Gary Cohen, author of JUST ASK LEADERSHIP: Why Great Managers Always Ask the Right Questions, focused on personal transformation.  His answer was not quite what I expected, for he rejected my assumption that transformation would needed as  “a matter of course.”

  • Crossderry:  Of course, so many of us will be moving through different firms and roles that change will be a constant in our careers.  Any suggestions for making personal transformation a “core competence” that we leverage as a matter of course?
  • Gary Cohen: Well-designed questions will enable you to learn as much as you can about each firm, role, and set of coworkers, as quickly as possible. Questions signal a desire to learn from and work with others, not compete and contest. If you’re an exceptional question-asker, wholesale personal transformation may not be necessary to successfully navigate each and every career change.

HR and Commitment-phobia

Josh Liebner, Gershon Mader, and I ended up on an interesting tangent about the role of human resources in driving strategic commitment (previous posts here and here).  Both authors shared my frustration about HR’s inertia when it comes to transformation efforts.  In no small measure, this frustration comes from believing that HR should be in a unique position to drive change because they often know “what is really going on” or “what people really believe/think”.

We kept coming back to one question:  Does the human resources field attract people who can’t or don’t want to lead?  Our answer was “too often” and the discussion identified three drivers:

  1. The reputation of HR as a leadership backwater is an on-going barrier to attracting risk-taking leaders.  Many people recognize that HR could be more, but ultimately…
  2. The transactional nature of many core HR functions shapes its own org design.  What parts of HR must be done?  Well, they are the compliance, recruiting, and benefits administration functions.  Therefore, there is something about the work that attracts…
  3. Gatekeepers.  Compliance-heavy functions require formal and structured lines of authority, which are quite easy to hide behind or to substitute for business decisions.

This last point highlights the position that HR has gotten itself into: gatekeeping may give it formal authority, but strategic imperatives don’t respect formal authority.  Emergent and adaptive systems will almost always find workarounds.

To that end, Josh and Gershon both suggested that a coaching and mentoring model is the best way for HR to engage in strategy.  This approach leverages the strength of HR — knowing the lay of the land — with a softer, less rules-bound style.  Acknowledging and shaping emergent behavior will be more fruitful than trying to ban or control it.

Value of PM in Business Transformation

I forget to whom I should give the hat tip on this topic, but Here’s a study by Logica that highlights what makes change “Winners” successful (study here, may require registration).  As you can see, project management was a differentiator in business transformation, which of course I think is great.

My take is that being good at PM is necessary, but not sufficient, to be good at change.  That’s because being better at PM should mean that one is better at delivering initiatives of any type.  In other words, PM excellence should make change-heavy initiatives more successful — but that’s because PM helps when delivering all initiatives.

Remembered the source… hat tip to Michael Krigsman at IT Project Failures.

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