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Dr Richard BreeseSenior Lecturer
Sheffield Business SchoolSheffield Hallam University
Who is here tonight?
Explaining the title My background Benefits realisation management in
regeneration The nature of organisations, and the
implications for BRM Cause and effect relationships Some concluding thoughts Discussion
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People involved in any kind of performance management in organisations have been concerned with ‘brm’ for many years
‘BRM’ incorporates ‘brm’ into project, programme and portfolio management processes and proposes specific management approaches and tools for achieving ‘brm’ in practice
BRM arose out of dissatisfaction with investment appraisal techniques (APM Benefits Management SIG, 2009), particularly as applied to IT projects and programmes in the 1980’s (Bradley, 2010)
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‘the process of organising and managing, so that potential benefits, arising from investment in change, are actually achieved’, (Bradley, 2010:29)
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‘as one manager rather succinctly put it, BRM is the glue that binds everything together’ (Bradley, 2010:32)
BRM as a ‘strategic business skill for all seasons…centred on using benefits management to align the journey from business strategy to delivery to the embedding of change within organisations’ (APM Benefits Management SIG, 2009:1)
The promotion of ‘a different mindset, based on an approach that manages value on an active basis’ (Jenner, 2009:2). Benefits management and portfolio management as complementary to one another (Jenner, 2010). Establishment of two new APM SIG’s.
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Yet another management fad? ‘brm’ is common sense and we do it anyway.
BRM just adds layers of bureaucracy The illusion of progress Practical difficulties with the concepts involved The theory is all well and good, but it doesn’t
work out in practice Decision-makers don’t want detail BRM is part of the project and programme way
of organising, which isn’t right for all organisations
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Qualified as a Town Planner Managed urban regeneration programmes in
1990’s
Joined APM in 2000 Doctorate in Business Administration, Sheffield
Hallam University, 2001-2007, while working as sub-regional partnership coordinator
Brief period of self-employment Now Senior Lecturer, specialising in
organisational change management
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Make ‘Ztown’ a place where people want to live and work
Vision
Increase wealth in ‘Ztown’Objectives
Increase % econ. active in ‘Ztown’Outcomes
People in ‘Ztown’ obtaining a jobOutputs
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Vision Object-ives
Out-comes
Outputs Approach
1980’s * * Loose targeting
Early 1990’s
* * * Tight targeting
Late 1990’s
* * * * Neighbourhood Renewal
Mid 2000’s
* * * * Pool budgets, integrate public sector performance regimes
Evolution of Benefits Management in Regeneration
Bid for funds for a disadvantaged area, perhaps concentrating on particular themes, eg education, economic development, housing
Include relevant targets Programme approved or rejected Negotiation of detailed action plan Quarterly targets for core outputs, eg jobs
created, area of land reclaimed, numbers of people involved in particular activities, regeneration funds spent and other funds levered in. Penalties if quarterly targets not met.
Specific times for external evaluation, including higher level targets (outcomes, objectives, vision)
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Helped to ensure that ‘better’ programmes achieved priority over others
Provided a clear rationale for investment Provided a framework for ensuring that
benefits were achieved, because of the alignment with the programme life-cycle
Linked to the Audit process to account for the use of public funds
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Defining benefits Incorporating qualitative benefits Aligning benefits at different levels. Cause
and effect are sometimes highly contested Attribution of benefits, at higher levels Setting output and leverage targets that are
challenging but realistic is very difficult, because of a lack of knowledge/understanding on the part of those setting them, and a lack of control over delivery of outputs and leverage
Unintended effects of performance targetsSimilar to other sectors??
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Different stakeholders have different priorities amongst the range of benefits
Balancing short term disbenefits against long term benefits
Benefits information is used highly selectively, to meet the requirements of the dominant stakeholders
Achieving transformational change is extremely difficult, and aspirations are progressively watered down
The timescale for meaningful benefits realisation is way beyond the timescale for programme management
Similar to other sectors??
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Clockwork or
Everyone knows what the organisation is about
They are committed to the mission People are happy at work Anxiety is low People work together in mutually supportive
ways There are no managerial problems, except
technical ones which can be solved with the right skills
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Things are always falling apart People’s main concern is that they don’t get
the blame Nobody cares much what happens, but
knowledge is vital to protect your own interests
Anxiety and stress are constant Contact with colleagues is avoided unless it
is a means to use them to get your own way Managerial problems are intractable
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Snakepit model fitted the organisations his students knew BUT
The students wanted to study the techniques for managing 'clockwork' organisations
Schwartz' interpretation was that the clockwork organisation represented an ideal
Management techniques, such as BRM, are associated with the clockwork organisation, but what if an organisation has elements of the snakepit?
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Project sponsors put forward business cases which are at best guilty of optimism bias, and at worst of deception
The solution - subjecting investment proposals to independent
review, scrutiny and challenge Expensive, time-consuming
- validating benefits with the recipients, on an on-going basis Time consuming, bureaucratic
Using evidence–based forecasting Are past trends a guide to future performance?
Accountability mechanisms to hold people to account for results What about changes in personnel ? Changes in circumstances, against individual error? Timescale?
Governance to encourage robust and realisable forecasts Will it work?
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More efficient business routines
Higher productivity
Higher profits
New processes
New software package in small business Enabler
Change
Benefits
Business Objective
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This is one of the the simplest kinds of investment, but at every step there is ◦ A logical reason why the link should work◦ Certain assumptions which are made◦ Risks that the logical ‘cause and effect’ relationship
might not work, if the assumptions are not met. Dependent on the business context.
The complexity is magnified many times for major business decisions, eg out-sourcing decisions, expansion into new markets. Often the extent to which benefit realisation is within the control of the sponsor is over-estimated
Logical Framework (Project Cycle Management)
Realistic Evaluation Theories of Change Evidence-based Policy Network Theory Dimensional Analysis
Potential to integrate with approaches in Chapter 7 of ‘Managing Successful Programmes’, eg Benefits Maps, Benefits Profiles
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BRM is a management process – as such it only as good as the application to the specific context in which it is used, and the skills of those playing the various roles in the process
Organisational culture, previous experiences of BRM and the interplay between different stakeholders are key to its use and usefulness. It has to be integrated with the overall approach to strategy and change management
Developing strategic skills, changing mindsets is difficult, but worthwhile, to build a ‘Benefits realisation capability’ (Ashurst and Hodges, 2010)
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Ashurst, C. and Hodges, J. (2010) ‘Exploring Business Transformation: The Challenges of Developing a Benefits Realisation Capability’, Journal of Change Management, 10:2, 217-237
Association for Project Management Benefits Management Special Interest Group (2009) Benefits Management ‘A strategic business skill for all seasons’
Bradley G. (2010) Benefit Realisation Management (2nd Ed), Farnham: Gower
Jenner, S. (2009) Realising Benefits from Government ICT Investment – a fool’s errand?, Reading: Academic Publishing
Jenner, S. (2010) Transforming Government and Public Services, Farnham: Gower
Office of Government Commerce (2007) Managing Successful Programmes, London: TSO
Schwartz, H. (1990) Narcissistic Process and Corporate Decay: The theory of the organisation ideal, New York University Press
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