According to research, 70% of digital transformation projects fail to deliver the projected benefits. A key problem, considering that benefit delivery is the main reason why businesses undertake change initiatives! The thing is, Benefits Realization Management (BRM) best practices are not always understood clearly and implemented effectively by PPM professionals.
This article aims to bridge that gap by showing how benefits realization can become a core enabler of a value-driven PMO. Effective BRM helps PMOs shift their focus from compliance and reporting to driving strategic outcomes and providing value to organizations.
Rethinking Benefits Realization: From Compliance to Value
Traditionally, PMOs have been seen as process enforcers tasked with tracking timelines, ensuring compliance, and managing scope. But a PMO can–and should–do much more. A value-driven PMO demonstrates its worth not just by successfully delivering projects, but by ensuring those projects drive measurable business results.
As such, successful benefits realization demonstrates the value of the PMO within the organization. When the PMO consistently delivers projects that realize their intended benefits, it reinforces its importance as a strategic asset.
To quote from our eBook Prove Your PMO’s Worth, “Value should be a key concern for PMOs. The reason why many PMOs are not as successful as they could be often boils down to their inability to communicate and demonstrate their value to the organization. Or even to assess and understand it themselves.”
In order to focus on value, PMOs must leverage benefits realization. Rather than treating BRM as a back-end checklist, value-focused PMOs integrate it across the project lifecycle.
What Is Benefits Realization?
Benefits realization — sometimes referred to as outcome management — is of utmost importance in project management. It is about ensuring that projects create value for the organization.
According to the PMI, “Benefits realization management provides organizations with a way to measure how projects and programs add true value to the enterprise.”
At its core, BRM is all about:
- Identifying and defining expected project benefits
- Aligning them with the overarching strategy and objectives
- Ensuring they are realized at delivery
- Ensuring the benefits are sustainable after project completion
It’s worth noting that not all benefits are immediate (for example, a boost in revenue) or easily quantifiable (e.g., better corporate reputation).
For instance, improving customer service will doubtless have positive business outcomes. But assessing the initiative’s contribution to the bottom line might prove a challenge. Still, it’s no less important for long-term success. That’s why a value-focused PMO should take a nuanced and tailored approach to measuring and tracking benefits.
Practical Benefits Realization Frameworks PMOs Can Use
There are many methods of formalizing and mapping benefits. However, most standard benefits realization frameworks will include processes to:
- Identify and understand benefits: Based on project and stakeholder requirements, PMOs should map the benefits expected from the achievement of outcomes. It is a good idea to document benefits, including information about priority, value, and ownership.
- Define a roadmap: Measuring the current performance and setting objectives enables PMOs to draft a clear plan for realizing benefits.
- Implement the plan and realize benefits: Upon completion, PMOs should ensure that the benefits are sustained and sustainable.
How Benefits Realization Elevates the PMO’s Strategic Role
A strong BRM process enables project management professionals to operate as strategic advisors, not just compliance gatekeepers. Let’s take a closer look at why:
Aligns Projects with Strategy
Benefits management ensures that projects and programs align with the strategic objectives of the organization. This alignment helps PMOs select and prioritize projects that contribute directly to the achievement of their company’s strategic goals.
When critical resources are focused on these high-value projects, PPM leaders can more efficiently utilize resources and budget allocation.
Improved Decision-Making
By focusing on benefits, the PMO can make more informed decisions throughout the project lifecycle. This includes making adjustments as needed to ensure benefits are realized.
Enhanced Accountability
Benefits realization requires clear ownership of the benefits and accountability for their delivery. The PMO can establish and monitor accountability mechanisms, ensuring that project teams are responsible for delivering the benefits they promised.
Improved Risk Management
Benefits management involves identifying and managing risks that could potentially hinder the achievement of benefits. The PMO can proactively address these risks, minimizing the chances of benefits not being realized.
Quick Tips for a More Value-Focused PMO
PMO leaders looking to make the shift from compliance-heavy to value-driven can use these high-impact starting points to get the ball rolling:
- Introduce a “Benefits at a Glance” dashboard. Use your PPM platform to visualize benefits across all active projects. Focus on key details, like strategic alignment, benefit owners, timelines, and progress. Make it simple for key stakeholders to see where value is being created.
- Pilot a benefits-led intake process. Before approving a project, require teams to submit a simple benefits profile. The profile should cover the value the project will deliver, its alignment with strategy, and how success will be measured.
Challenges and Requirements of Benefits Realization for the PMO
Benefits management is about measuring performance. The PMO should establish key performance indicators (KPIs) to track the progress of projects and the realization of benefits. This data-driven approach empowers PMOs to make timely interventions and adjustments. Software tools, such as Enterprise PPM platforms, can help ensure reliable and accurate performance tracking.
Another requirement for effective benefits realization is stakeholder engagement. The day-to-day responsibility for realizing benefits usually lies with several people and teams. The PMO can facilitate engagement to ensure that stakeholders understand the expected benefits and their role in achieving them.
Finally, benefits realization is an iterative process that involves learning from past projects. PMOs can use insights from previous projects to refine selection criteria and processes, for better outcomes in the future. Also, benefits-driven initiatives require proactive management throughout the whole project life cycle.
Final Thoughts: Driving Value Through Benefits Realization
In summary, benefits realization is a strategic approach that helps the PMO ensure that projects and programs contribute to the organization’s success by delivering tangible benefits. By focusing on benefits delivery, the PMO can drive better decision-making, resource allocation, risk management, and stakeholder engagement, ultimately demonstrating its worth to the organization through more value-focused PPM.
