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Benefits Realisation & Benefits Owners

Every project needs to be supported by a robust business case showing the benefits. In central government we have a five case model for business cases set by the HM Treasury Green Book. Each case sets out the benefits that we expect the project to deliver, and the expected costs. Projects only get approved if they are expected to deliver benefits that outweigh the cost.

Defining Benefits

Benefits are more than just money saved. For many public projects there are more social and political benefits than financial ones. The APM Body of Knowledge defines benefits as tangible or intangible, and also as quantifiable and unquantifiable in cash terms. Some examples are shown in the table below.

  Tangible Intangible
Quantifiable Reduced staffing

Cheaper contracts

Social benefit
Unquantifiable Ministerial commitments

Customer satisfaction

Capacity to Change

Reputation

Equally projects might have a disbenefit.  e.g. Transfer of costs from one party to another, or perhaps a cost to the public, businesses or the public sector. Overall one would expect there to be a net benefit. When writing your business case you need to account for all quantifiable (in cash terms) benefits, disbenefits and costs in the financial and economic cases. The unquantifiable (in cash terms) come into play in the Strategic and Management cases. The intangible and unquantifiable things ought to be minimised.

Benefits are Assumptions

The key point when working on business cases, or approving them, is that everything is speculative and uncertain. We’re making a forecast about a future we’d like to see. The one thing that we can be certain about is that our forecasts are wrong. The real question is to ask how wrong it is likely to be. We also need to look at what we can do to get the most positive outcome from this uncertainty. That’s where benefit owners and benefits realisation plans come in.

Identifying Benefit Owners

Benefit owners are those that have a vested interest in the project benefits. There may be one primary benefit owner, or there may be several. Who they are depends on the nature of the project in question, it’s possible that they aren’t within the department. For example, a project enabling Local Authorities to deliver their service better could have benefit owners from several Local Authorities.

The benefit owners should be identified as early as possible. As each benefit is identified the business case manager should be thinking about who could own it. Early identification allows benefit owners to agree assumptions around the scale and delivery of benefits.

The key criteria for identifying your benefit owners are:

  • The identified benefit sits within a business as usual (BAU) area that they are responsible for.
  • They have a measure of control over the delivery of the benefit.
  • They understand the context in which the benefit is likely to be delivered.

E.g. if your project will make an operational service more efficient, and therefore either save staff, or increase throughput. The benefit owner for that needs to be the person responsible for the operational service.

The Role of Benefit Owners

Above all else benefit owners are key stakeholders for the project. The primary benefit owner may well be the Senior Responsible Owner for the project. Benefit owners are essential to the accurate description, quantification and delivery of benefits. You should look for each benefit owner to:

  • Agree that there is a benefit/disbenefit and that they own it.
  • Ensure that assumptions around benefits are as realistic as possible (ideally slightly pessimistic).
  • Ensure that delivery plans maximise the speed and quantity of the benefit delivered.

Conclusion

  • Early identification of the benefits owner is the crucial step in developing a project business case.
  • NAO advice is that this is one of the critical factors in getting your business case right.
  • Someone with a vested interest in ensuring that the benefits are delivered tends to make us more realistic in identifying the benefits, and they also make us work in a way that actually delivers what is claimed.
  • With buy-in of benefit owners you not only get a good business case, but you also get a successful project.

Other References

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