projects and programmes a sure fire way to create business value
TRANSCRIPT
Executive Briefing: Agenda
Approx. Time What should be happening!
0800 Arrival & Breakfast0830 Welcome, Administration & Introduction0835 Matt Williams 0900 Introduction to speaker 20905 Phil Driver, New Zealand [live link] 0930 Q & A [Audience Voice]0945 Wrap up & Thank yous0950 Event close
Projects and programmes:A sure-fire way to creating business value?
Matt Williams
How can sponsors and SROs be sure that their projects or programmes willactually createbusiness value?
Benefits-led Portfolio Management: Maximise Capital Investment Returns
Matt Williams PMP, MAIPM
Managing Director
WHAT’S WRONG WITH THE STATUS QUO?
Strategic Alignment
38%of initiatives arenot helping to deliver strategy
Source: 4th Global Portfolio and Programme Management Survey, PwC, 2014
WHAT’S WRONG WITH THESTATUS QUO?
Our profession has traditionally focussed onproject and program delivery
butan initiative delivered well
which should never have started in the first place, is the ultimate waste of resources
therefore:Select the right initiatives
WHAT ARE THE BENEFITS?
Organisations that focus on strategic
alignment
deliver 50% more successful projects
Source: Pulse of the Profession, Project Management Institute, 2015
Strategic Focus No Strategic Focus
71%46%
Project Success Rate
PROJECT SELECTION
BenefitsProject
Benefits
Benefits
Benefits
Benefits
Project
Project
Project
Project
PROJECT SELECTION
BenefitsProject
Benefits
Benefits
Benefits
Benefits
Project
Project
Project
Project
WHERE IS VALUE CREATED?
Project
Enabling Project
Enabling Project Assumption
GoalBusiness Change
Outcomes
DESIRED ATTRIBUTES OF BUSINESS CASES
• Involve all stakeholders in their creation
• Identify all work (inc. change)
• Provide objective targets for performance measurement
• Clearly identify ownership for benefits
• Include Lead Indicators to provide early warning
EXAMPLES OF LEAD INDICATORS
• Goal – Reduce Smoking Related Deaths• Lead Indicator – Smoking Rates
• Goal – Reduce staff in call centre• Lead Indicator - % of self service transactions
PORTFOLIO REVIEWS
• Need to regularly review the components of each portfolio to determine:– Initiatives are still strategically aligned– Delivery Performance ($, time)– Benefits are likely to be realised
• If an initiative no longer fits, have the decency to kill it!
BENEFITS-LEDPORTFOLIO MANAGEMENT
Create Realistic, Measurable
Business Cases
Measure ASAP
Use Lead Indicators
Strategically Aligned
Balanced
Matt Williams PMP, MAIPM
Managing DirectorConnexion Systems Pty Ltd
M: +61 414 847 040W: www.connexion.com.au
QUESTIONS?
Merron Simpson
Merron is the UK’s Lead on OpenStrategies & a Certified Facilitator / Practitioner.
She uses OpenStrategies with organisations to improve their strategic planning, undertake service reviews & demonstrate their social impact.
Phil Driver
How can sponsors and SROs be sure that their projects or programmes will actually create business value?
Validating StrategiesLinking Projects and Results
to Uses and Benefits
Dr Phil DriverOpenStrategies Ltd
Key questions and messages
• What is ‘strategy’ and what’s it got to do with project management?• What do organisations (and project managers) actually do?• Can project managers ‘realise benefits’?• How do projects link through to benefits?• PRUB – linking Projects and Results to Uses and Benefits• The crucial importance of ‘Uses’, especially ‘compound Uses’• Validating project/programme/portfolio strategies
– Is it logical?– Will it definitely work?– Will it be worth it?
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‘Tired of Strategic Planning?’
From a 2007 survey of 30 top international companies, McKinsey’s conclusions about strategic planning were:
• “…the extraordinary reality is that few executives think this time-consuming process pays off…”
• “…there is an almost mystical hope that something good will come out of it”
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What is a strategy?• A strategy is “an action plan and rationale”
• “Rationale” means the reason for implementing the strategy i.e. confirmation that:
– It is logical
– It will definitely work
– It is worth it
• Projects/programmes/portfolios must be guided by rationale-based strategies
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What should strategies do?
Strategies should guide improvements in what organisations actually do
So what do organisations actually do?
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What organisations actually do
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Create assets (products, services, infrastructure) and enable customers/citizens to use them to create benefits
Inputs Benefits
External factors
Internal factors
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Create assets & enable people to Use assets to create Benefits
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P R U B
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Happy customers because they have done and achieved what they wanted to do and achieve
Sustainably manufacture, distribute and market our company’s new product
Our company’s new product available to customers together with relevant product marketing information
Customers buy and use our company’s new product to do & achieve what they want
Our company is sustainably profitable
Projects Results Uses Benefits
Build a sheltered, safe cycleway from the housing estate to the school
A sheltered, safe cycleway is in place from the housing estate to the school
Children ride to school and home again on the safe and sheltered cycleway
Children are safe when travelling
Two simple example SubStrategies
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Human cognitive limits
• There are limits to how much information humans can use at any one time:
– Humans can hold 7 +/- 2 ideas in their heads (Miller’s law)
– We believe that humans can understand just 15-20 inter-connected ideas when they are in a written or graphical format (Driver’s 1st law)
• So if strategies are to be understood by many people they must be easy to understand
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Research results suitable for incorporation into GIS
Incorporate R&D results into GIS products &
services
Other organisations incorporate GIS into
complementary products and services
Updated GIS products & services available
Products & services which are complementary to GIS
products & services
Farmers & other land owners manage land better guided by GIS & complementary products within regulatory guidelines• Dairy farmers for nitrate
management • Conservationists for
native plant management• Regional authorities for
river nutrient management
• Drinking water suppliers for water quality management
• •
Economic Benefits to farmers, land managers,
suppliers & others
Social Benefits to farmers, land managers, suppliers &
other stakeholders
Develop & Validate a GIS R&D Strategy
Conduct GIS research in line with the strategy
Validated GIS R&D strategy, widely supported by
stakeholders
Environmental Benefits to farmers, land managers,
suppliers & others
Cultural Benefits to farmers, land managers, suppliers &
other stakeholders
Sustainably viable organisations who created
GIS & complementary products & services
Regulators create and disseminate effective
regulations guided by GIS
Effective regulations in place & understood by end-
users
Projects Results Uses Benefits
PRUB is simple…. the world is complex
• The ‘Use’ as seen and valued by users is often quite different from the ‘Use’ as seen by project managers
• Very often the true and valued ‘Use’ as perceived by the user is many steps beyond the immediate ‘Use’ of a Result
• Most Uses are ‘Compound Uses’
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GIS hardware & software
GIS data
Land managers:• learn about using GIS systems & data,• purchase hardware/software,• download GI data,• collect their own GI data,• integrate data,• verify & analyse data,• draw conclusions from data,• make land management decisions,• train their staff to implement the decisions,• get permits to implement the decisions,• purchase equipment to implement the decisions,• manage the land better (i.e. implement the
decisions)
Results (Compound) Uses Benefits
Economic, environmental & social Benefits ‘realised’ by the
better land management
What is the ‘Benefit-realising’ Use? Who is it that ‘realises Benefits’?
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GIS hardware & software
GIS data
Land managers:• learn about using GIS systems & data,• purchase hardware/software,• download data,• collect their own data,• integrate data,• verify & analyse data,• draw conclusions from data,• make land management decisions,• train their staff to implement the decisions,• get permits to implement the decisions,• purchase equipment to implement the decisions,• manage the land better (i.e. implement the
decisions)
Results (Compound) Uses Benefits
Economic, environmental & social Benefits ‘realised’ by the
better land management
GIS data integration tools
GIS analysis & validation tools
Decision support tools/advisors
GIS/Management training
Land mgmnt tools
Permitting system New Results which are essential to enable ‘Benefits Realisation’ by users
Benefits realisation by Users/Uses
• Only Uses ‘realise Benefits’
• Almost all Uses are compound Uses
• So only the final Uses ‘realise Benefits’
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Benefits realisation by Users/Uses
• So if project managers are to ‘realise Benefits’ then they must ‘ensure’ that:
all the necessary & sufficient Results are in place…
to enable every single element of the inevitably compound Uses to happen…
to create the desired Benefits
• To achieve this, a project/programme/portfolio ‘Strategy’ must be ‘Validated’
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‘Validating’ strategies
• Almost anyone can write a document and call it a
project/programme/portfolio ‘strategy’
• It is not a strategy unless it has been ‘Validated’
• How do we develop and Validate strategies?
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Creating a Validated Strategy 1. PRUB Describe the idea as a simple PRUB
What’s the aspiration?
2. SubStrategy Describe the idea as a SubStrategy Is it logical?
3. Evidence Add compelling Evidence for the LinksWill it definitely work?
4. Value (V) VB must be greater than ($P + $U)Is it worth it?
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Step 1: High level PRUB
• Outline the project/programme/portfolio as the simplest possible sequence of Projects, Results, Uses and Benefits
• This defines the overall ‘Aspirations’
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Develop GIS products & services to help guide land
managers to manage land better
Farmers & other land owners
manage their land better, guided by GIS products and
services
Economic Benefits
Social Benefits
Environmental Benefits
Projects Results Uses Benefits
GIS products and services are
available to help guide land
managers with their land management
High level Aspirational SubStrategy for ‘GIS’ (Geographical Information Systems)
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Step 2: SubStrategy
• Expand the high level PRUB into a SubStrategy which identifies what we would like to happen
• This shows theoretically how Projects (inputs) Link through Results (outputs) and Uses to Benefits (outcomes)
• Ideally 15-20 ‘PRUBs’
• This answers the question: “Is it logical?”
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Copyright OpenStrategies Ltd 2015
Research results suitable for incorporation into GIS
GIS product developers incorporate R&D results into
GIS
Other organisations incorporate GIS into
complementary products and services
Updated GIS products and services available to end
users
Products & services which are complementary to GIS
products & services
Farmers & other land owners manage land better guided by GIS & complementary products within regulatory guidelines• Dairy farmers for nitrate
management • Conservationists for
native plant management• Regional authorities for
river nutrient management
• Drinking water suppliers for water quality management
• •
Economic Benefits to farmers, land managers,
suppliers & others
Social Benefits to farmers, land managers, suppliers &
other stakeholders
GIS stakeholders develop & Validate a GIS R&D
Strategy
Researchers conduct GIS research in line with the
strategy
Validated GIS R&D strategy, widely supported by
stakeholders
Environmental Benefits to farmers, land managers,
suppliers & others
Cultural Benefits to farmers, land managers, suppliers &
other stakeholders
Sustainably viable organisations who created
GIS & complementary products & services
Regulators create more effective regulations guided
by GIS
Effective regulations (guided by GIS) in place & understood by end-users
Projects Results Uses Benefits
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Step 3: Evidence
• A SubStrategy identifies what we would like to happen
• We need to add cause-and-effect Evidence (not just mere ‘data’) to be sure that it really will happen
• Evidence is information which ‘validates’ the Links between Projects, Results, Uses and Benefits
• ‘Evidence’ answers the question: “Will it work?”
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Evidence sits on the Links between Projects,
Results, Uses and Benefits
The strategically most important
Evidence sits on the Links
between Results and Uses
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GIS hardware & software
GIS data
Land managers:• learn about using GIS systems & data,• purchase hardware/software,• download data,• collect their own data,• integrate data,• verify & analyse data,• draw conclusions from data,• make land management decisions,• train their staff to implement the decisions,• get permits to implement the decisions,• purchase equipment to implement the decisions,• manage the land better (i.e. implement the
decisions) to ‘realise Benefits’
Results (Compound) Uses Benefits
Economic, environmental & social Benefits ‘realised’ by the
better land management
GIS data integration tools
GIS analysis & validation tools
Decision support tools/advisors
GIS/Management training
Land mgmnt tools
Permitting system A Validated strategy must having compelling Evidence that every element of a compound Use will happen
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Step 4: Value• Determine a ‘Value’ for Benefits (VB) (Ask the users)
• Identify costs of Projects ($P) plus costs of Uses ($U)
• To proceed with a Project….
VB must be greater than $P + $U
• This answers the question: “Is it worth it?”
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Benefits realisation?
• So who creates/delivers/ensures/realises Benefits?• Project managers cannot ‘create’ or ‘deliver’ or ‘ensure’ or
‘realise’ Benefits• Only Users create/realise Benefits via their compound Uses• Therefore for Benefits to be ‘realised’, project managers must
totally understand, and help enable, every element of compound Uses
• So project/programme/portfolio strategies must be Validated
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OpenStrategies is a comprehensive strategy management system based on PRUB
• Develop strategies• Validate strategies• Implement strategies/manage processes• Empower Users to create/realise Benefits as perceived and valued by
the users• Integrate levels of strategies (Portfolio/programme/project)• Integrate strategies on many topics, demographic groups and
geographical areas• Integrate strategies across organisations (collaboration)• Integrate sequential strategies• Performance measurement and management• Stakeholder engagement/consultation
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For more information/Master Classes
Dr Phil Driver, Visiting lecturer, Cologne University of Applied Sciences
Adjunct Senior Fellow, Canterbury University, New Zealand
CEO, OpenStrategies Ltd
Author, Validating Strategies
http://www.gowerpublishing.com/isbn/9781472427816
www.openstrategies.com
+64 (0)21 0236 5861
Merron Simpson [email protected]
07973 498603 or
0121 459 8795
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