How to Select a Benefits Measure?

Posted by Kevin Brady on Mon 17th November 2008 at 02:30 AM, Filed in Programme ManagementBenefits Realisation Management

Before we can start discussing the “How” we need to first workout the “What”. In the context of Benefits Realisation Management (BRM) what do we mean by the word “Measure” :-

A measure is a metric whose change in the desired direction helps to confirm that the related benefit or dis-benefit is being realised.

In other words a measure is the thing which will be tracked and monitored in order to establish when a benefit has been realised (for example the production cost value). It is not:-

  • The actual value i.e. £ 3million
  • The Target Improvement i.e. – 30%
  • The means of measurement i.e. financial review
  • The benefit i.e. reduced production costs.

I find all too often in my travels that implementers of BRM get the above confused, which could be a key factor leading to the unsuccessful implementation of BRM.

Now that we understand the meaning of a benefit measure we need to explore and understand its key attributes and categories. If you take a look at our benefit profile template LINK you will see most of these attributes and categories listed. All of them require completion to allow effective monitoring and tracking of a benefits realisation to take place. These include:-

  • Unit of measurement.
  • Frequency measurement is required to be captured
  • Measurement Method.
  • Baseline Value (value before benefit realisation has begun
  • Target Value.
  • Beneficiary of the expected improvement.
  • Person responsible for monitoring the measure.
  • Improvement timescale i.e Qtr 1 or 2 etc.
  • Owner of the benefit and accountable for its realisation.

Armed with the understanding of the features of a benefits measure and its common attributes and categories, we are now in a position to understand what constitutes a good benefits measure. At the highest level three key criteria need to be achieved before selecting an appropriate measure:-

  • It must motivate behaviours in those responsible for realising and enabling benefits which will contribute to success.
  • It must meet the needs of relevant stakeholders. They must agree!
  • It must support and not hinder the benefit improvements goal.

In addition to these three high level criteria a good benefits measure needs to have the following additional low level features present :-

    Relevance – Would the change in the benefits value be of interest to identified stakeholders or assist in the prediction of change in another related benefit measure? In appropriate format – Would a ratio, fraction, percentage be a better indicator than an absolute value Targetable – The benefit measure must be able to be used to set a target value which relevant stakeholders can use to agree a point at which a benefit has been fully realised. Low Cost – A measure which is already tracked by the organisation or could be suitable for automated measurement via a computer. Data Integrity – The measure needs to be as free as possible from intentional data corruption with the aim of spinning or corrupting the values. Frequency – Will the measure be able to generate values in accordance with a frequency judged to be sufficient to determine progress and resultant trend. Consistency – The data will be collected in a consistent way following an agreed and repeatable process of collection for a period valid in relation to the target date for benefit realisation. Unambiguous – The measurement results need to be displayed in such a way that anyone can clearly understand what they mean and have the minimum potential for spin or misunderstanding.

Having an understanding of the common attributes /categories and features of a good benefits measure means you can then start the process of measure identification. The starting point of this process is the Benefits Map (please click for FREE Benefits Map Template). I normally build these in the first instance using Post-it notes as part of number iterative brainstorming workshops with key stakeholders. Participants must be educated beforehand about what benefits maps are, their importance and how they are constructed; which naturally involves an appreciation of what constitutes a good measure. Measure identification is intellectually demanding and time-consuming with each workshop typically taking half a day to complete.

At the end of each workshop one compiles a network of identified benefits and changes linked together in a number of cause and effect chains starting with quick wins (inter-mediate benefits) on the left through to the end benefits on the right which must all link back to the identified programme objectives and these, in turn, must relate to the agreed vision. This can be seen in the example detailed below:-

One chain from a potential Benefits Map for the 2012 Olympic Stadium Programme

As each benefit map takes shape during these iterative workshops benefit profiles need to be completed for each intermediate and end benefit identified. Completing each benefit profile involves the specification of a measure or measures for each benefit along with further attributes and categories mentioned earlier in this post. The completion of benefits profiles usually generates two key challenges:-

    a) How many benefits should we measure? b) How many measures per benefit?

In answer to the first question, many organisations consider it impractical to measure more than three to six benefits per map, or change initiative. In my view this is not the best approach /attitude to take if you want BRM to deliver meaningful added value results. All benefits should be tracked if they are to be realised but sometimes benefits may be just too costly or difficult to measure and the best compromise is to measure benefits either side of the difficult ones.

The number of measures per benefit is likely to vary and will depend on the wording of the benefit. Although it would be convenient if there were a single measure for each benefit, the wording often implies several aspects of improvement and therefore the potential of multipal benefit measures. For example, the benefit “increased sales” suggests both increased volume and value of sales so at least two measures are required with baselines and targets needing to be set for both. Sometimes this need for two measures indicates that the intermediate benefit is in fact two benefits and should be split. However, if the benefits so split are dependent on the same change or prior benefits it is often simpler for the benefits to remain combined. This also makes sure the benefit map is less cluttered and easy to read.

Quite apart from benefit wording another determinate of the number of benefit measures could be specific needs of stakeholders and the balancing of measures so that they are complementary or opposing.

Consider the benefit “improving our email response to product complaint”

    a) Number of emails sent before a response per complainant b) Time elapsed in answering the mail c) Time elapsed before satisfactory conclusion of the complaint d) Friendliness of the response e) Quality of the written responses f) The number of mails never answered g) Average number of mails waiting to be answered h) Number of mails responded to each day i) Number of successfully concluded complaints per day

Which measure you chose depends on which stakeholder. The complainant is interested in (a) to (e) whilst the complaints manager would be more interested in (f) to (i).

Therefore, once the benefit owner has been identified this is the stakeholder view you adopt in terms of measures to be used which should help reduce the number of possible measures of 9 in the above example to 4 or less if the benefit owner is the Complaints Manager. Benefit ownership is one of the best ways of reducing the number of measures down to a sensible and manageable level of 1 to 4. If this fails to achieve a reduction then further filtering out of candidate measures could be achieved on the basis of ease and cost of measurement.

It is important to note that this whole process of benefit mapping and benefit profiling is best handled through carefully structured and well facilitated workshops whose participants must include key stakeholders. It is important to note that these workshops are part of an iterative BRM process of constantly revising /rationalising benefits maps and associated profiles until they correctly represent the views of the stakeholders. Much of this revision process often centres on the wording of each benefit which, as mentioned earlier, can cause a benefit to be split in two or remain as one. Either way wording changes often impact the identification of an appropriate benefit measure and the ownership of the benefit once defined.
Good luck with your next BRM workshop wink

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Of course the problem with stakeholders is the fact that there are normally more than one and they typically have competing goals. This makes it more difficult to decide on the correct measures.

Another approach is to first agree the overall strategy of the organisation (or programme) and then to “measure” each measure against those agreed priorities.

Posted by Bruce  on Thu 20th November 2008 at 08:27 AM | #

Thanks for the comment Bruce.
Your first comment is a real problem, but my suggestion is to make sure BRM process is embedded and use process to get round this kind of issue.

I use Benefit Mapping to derive a proper set of Benefit Profiles (template available on this blog) and through workshops assign one benefit owner to each benefit profile. It must be understood that their heads are on the line if the benefit fails to be realised. This arrangement sorts out the competing stakeholder issue in my view.

However, I am sure your response to this answer might be. “Chicken and Egg”. “I can’t get round this problem if I don’t have good process in the first place”. “How do I get the process embedded?”

-Depending on the size of the change programme get a BRM manager engaged to be the process owner /police as part of your programmes PMO.

-Deliver a BRM Strategy for sign-off to the SRO (Senior Responsible Owner) for the change programme you are responsible for. Make sure benefit ownership is covered in the document and communicate the documents intentions and outcomes to all identified stakeholders so they understand what is expected of them in the BRM lifecycle for your programme.  I am aiming to produce one of the first high grade templates for this kind of document on my site for free download in the coming months. Keep checking out the site.

Your last point is “in the ball park but not on quite on the pitch” in my view. I will be writing a post about the whole challenge of establishing a programme vision and related programme objectives. However these objectives once set just feed into the Benefit Mapping process explained in the post. I always use post –it-notes and put the programme objectives on the right hand side of the board and map back the benefits /intermediate benefits /changes and the enablers required to deliver the changes. Once I have the map I complete the Benefit Profiles and assign measures and owners etc. This is how you do it if you want a high probability of success in delivering benefits through BRM. I will be writing a post on a simplified BRM framework of which this first stage explained hear will be a part.

Hope I have been helpful. I look forward to further comment on this cutting edge subject.

Posted by Kevin Brady  on Fri 21st November 2008 at 06:15 PM | #

Even with the process in place I experienced that it is a lot about compromises when different stakeholders have different goals. This is especially true in larger organisations where different departments are competing for budget and resources.

We have implemented a product at that allows you to capture the benefits maps (after the workshop you described in your post and everybody agreed smile ) and to track the progress toward achieving those benefits. This allows everybody to see in real-time how you are tracking, even external stakeholders.

Posted by Bruce  on Fri 21st November 2008 at 10:41 PM | #

Difficult Stakeholders are a reality and compromising with them is certainly common and something I have to do all the time. As a Programme Director these days you are responsible for everything but have little power to change anything. Sad but true! However, getting things to work all seems to happen if the SOR or Programme Sponsor is senior enough and shows real leadership over the other stakeholders. This is the lubricant that makes the process work. Without this you can’t make process work and the whole thing becomes like stapling Jelly to a wall and compromise turns into opportunities to spin disintermediation and prevent bad news passing up the programme organisation and eventually leading to lack of benefits delivery and a sense of ownership and accountability for benefits delivery.
The BP mapping product is very interesting as not many people are adopting these at present. What’s your view on its Pros and Cons. I am sure my numerous readers would really appreciate this if you could comment!!

Posted by Kevin Brady  on Fri 28th November 2008 at 11:42 PM | #


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