Benefits Realization Management in the Context of Project Portfolio ManagementĪs we have covered in previous posts, portfolio management is a senior leadership discipline that drives strategic execution and maximizes business value delivery through the selection, optimization, and oversight of project investments which align to business goals and strategies. The reasons for implementing a benefits realization process listed above lead us to the heart of this post, value management in the context of project portfolio management.
Increases the likelihood that organizations receive the intended benefits from completed projects.Why is a Benefits Realization Plan Important?ĭeveloping a benefits realization plan with a benefits realization process is important for several reasons. No one does this with their own investments, but companies do it all the time with project investments. It would be like making an investment without ever being notified on the financial return on that investment. This is a false assumption based on hope (remember, hope is not a plan). Too often, the assumption is made that if we finish the project we will get the benefits that were identified at project initiation. Measuring project benefits also validates how well the portfolio governance team selected the right projects. financial benefits, operational benefits, etc.) so that senior leadership can answer the question “did we get the benefits from the project that we expected?” Projects have inherent value, and benefits realization is part of the accountability framework to increase the likelihood that organizations receive the intended benefits from completed projects. Benefits realization often involves tracking the quantitative benefits of the project (e.g. In short, benefits realization is about capturing the actual benefits (tangible and intangible) from a project (or program) following the completion of that work.
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In this post, we will cover what benefits realization is and how to manage project and portfolio value across the portfolio management lifecycle. Strictly speaking, benefits realization occurs at the project and program level, since these are the vehicles for delivering business value and executing strategy, but benefits realization must fit within an overarching value framework which is at the portfolio level. It is a hot topic among PMO leaders and regularly covered at events such as Project Management Institute’s PMO Symposium. Yet, in spite of the challenges, it gets the most buzz of any PPM process. Next to resource capacity planning, benefits realization is one of the hardest portfolio management processes to get right.
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