Project Portfolio Management: A View From The Management Trenches

7.5. EPMC WORKING DOCUMENT ON BENEFITS REALIZATION

We invest in projects and programs to realize benefits in terms of increased revenue or sales; cost and time efficiency savings; adherence to regulatory and legal requirements; maintenance of business as usual; contributions to strategic priorities; and to achieve business performance improvements. But:

• In many cases these benefits don't just materialize automatically—realization is dependent on business change including staff training, business processes reengineering, and redeployment of resources.

• Organizations struggle to demonstrate achievement of the anticipated benefits and a positive return on their investment.

This is important because it undermines our portfolio prioritization processes (which rely upon accurate and reliable data) and means that we fail to optimize the return on our investment of shareholders' and taxpayers' funds.

Addressing this benefits puzzle requires that we use the Three Keys to Benefits Realization.

7.5.1. Key 1: Ensuring All Benefits Claimed Are Robust and Realizable

This is done so that the organization's portfolio management process has reliable data on which to select and prioritize potential investments, and to increase the probability that these benefits will be realized in practice. This requires that we:

• Establish a benefits framework—the set of rules about how benefits should be classified, quantified and valued, to provide a consistent approach for the preparation of investment cases ...