Projects and programmes a sure fire way to create business value

Projects and programmes: a sure-

fire way to creating business value?

Executive Briefing

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

BENEFITS-LEDPORTFOLIO MANAGEMENT

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

NEED TO ALIGN EXECUTION WITH

STRATEGY

CASE STUDY: NZ ENERGY COMPANY

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

VALUE CREATION PITFALLS

Value Exaggeration

Value DecayValue Destruction

Value exaggeration

PROJECT SELECTION

PROJECT SELECTION

PROJECT SELECTION

BenefitsProject

Benefits

Benefits

Benefits

Benefits

Project

Project

Project

Project

PROJECT SELECTION

BenefitsProject

Benefits

Benefits

Benefits

Benefits

Project

Project

Project

Project

Value Destruction

WHERE IS VALUE CREATED?

Project

Enabling Project

Enabling Project Assumption

GoalBusiness Change

Outcomes

PORTFOLIO BALANCE

GROW

TRANSFORM

Value Decay

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!

NO MORE ZOMBIE PROJECTS!

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

E: [email protected]

M: +61 414 847 040W: www.connexion.com.au

QUESTIONS?

mailto:[email protected]

http://www.connexion.com.au/

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?

The Audience Voice …

#apmbmsummit

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?

Copyright OpenStrategies Ltd 2015

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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


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


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


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 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)




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


GIS products and services are

available to help guide land

managers with their land management

High level Aspirational SubStrategy for ‘GIS’ (Geographical Information Systems)


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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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



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 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’




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


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

[email protected]

+64 (0)21 0236 5861

Merron Simpson [email protected]

07973 498603 or

0121 459 8795


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http://www.gowerpublishing.com/isbn/9781472427816

http://www.openstrategies.com/



Projects and programmes: a sure-

fire way to creating business value?

Executive Briefing