What is benefits realization?
Listen, I’m not going to go into a bunch of technical methods for understanding what the benefits are and what benefits realization is, because that’s very much a project management thing and you can google the techie stuff. What I want to talk about is why understanding benefits to any change project is essential and why telling the truth about these benefits is critical.
Benefits realization, in its simplest form is determining ‘what we need to do in order to achieve the benefits of the project’. It’s as simple as that. We sometimes over glorify some of the processes of project management and change management, where I believe that if you can keep them as simple as possible, you’re more likely to have success.
So what are the benefits of a project?
Well, that’s determined project by project. Understanding the true benefits, not just the political spin benefits, is important so we can focus our attention, money and energy to achieve the benefits that are important.
I’m not talking about those smoking mirror benefits right now. What you need to understand for change to happen is the true benefits. Unfortunately, may times we commence a change program that we think people aren’t going to like very much. We want to do this dance around the real ‘why’ of the project. When you dance around the real why of any project, you’re never going to understand the true benefits to each person, to each group and to the organization.
I’m not sure what happens, but for some reason, when people get into a senior role, they forget that the people that they are leading are actually just like them. They’re not stupid. They are people working in the same environment as you used to
Dancing around the truth is not necessary, because your people are smart, they will work it out anyway.
They understand that businesses need to make money. They understand that business leaders have to make tough decisions. They get that sometimes those decisions even suck. But they will respect you more for the truth than a fancy creative lie. It doesn’t mean that they will like that you’re cutting their job or somebody else’s job, or that a project budget that they enjoy working on is being halved. True…they won’t enjoy that. But because people are smart, when you’re honest with them, they will understand.
Without being truly honest about the why behind the project, it’s very hard to understand the benefits. And if you can understand the benefits, getting to the “what’s in it for me” (WIIFM) that is necessary for every project and every person to adopt the change, then you’re missing a huge piece of the puzzle.
Here’s an example.
Let’s say that we need to cut costs in our budget. I’ve been in plenty of organizations where the notification has come down from the CFO and the executive team that we need to cut 10 to 15% out of the operating budget.
If you’re looking at short term cuts, then you think short term, and you don’t want to impact the direct cost and benefits to the client and the customer. What you’ll do is cut the back of house costs first. This generally means that people in positions that are not ‘front-line’ people, will have their budget cut first – think training, design, strategy, marketing and improvement projects.
Now, what actually happens when you cut back of house costs, you fix the short-term budget issue but create a long term effect on the sustainability of the business. If you cut training and development, in a couple of years, your people won’t be as skilled as the current people on the market. That’s a consequence of the decision.
This is a real consequence…. its just the facts. Sadly we avoid the facts when communicating to staff and instead we try to convince them that this short-term fix is for the long term benefit of the business, we need to cut 15% out so that we can get more efficient… Blah blah blah.
You use all these great words, that actually become meaningless, because people understand that cutting 15% out of the budget, this financial year, is only to balance the budget which is a short term solution – your people are not stupid. I know this because I’ve been on the spin team for over 20 years, and I have learned the hard way that the spin… even awesome spin… is never as effective as the truth. Yes, the truth is sometimes more painful for us and them, and of course we are ‘pain-avoiding/pleasure-seeking’ creatures so want to avoid this yucky truth place… but the consequence is that our people stop trusting us.
We would be better off telling the truth and saying something like:
“We need to cut 15% out of the budget to enable us to balance the budget this year, so that next year we are able to do the work that we really need to do. Yes, we’re thinking short term, we’re only thinking about this 12 months, but we have to do that right now. We understand that some of these costs are going to have a long term impact on our business. And we’re willing to take that consequence, because we need to make these short term decisions to fix the short term problems.”
That’s real. That’s honesty. People won’t like it. But at least they’ll respect you for telling them the truth.
If you want to realize the benefits of a project of a change that you are making, you need to be as honest with yourself and the people around you as possible. True benefits can be realized if everyone is working towards them. If the benefits that you’re trying to achieve are long term efficiency and sustainability, then you’ll need to choose sustainable and strategic methods, rather than short-term methods. Because just cutting a budget one year does not sustainability make. Plus your people will see through your lie immediately.
How do you realize benefits of a project?