As the knowledge economy develops, the challenge of effectively managing technological change in organizations and indeed across entire industries is becoming acute. This is not primarily a technology issue, nor an issue of interest only to IT managers, it is an issue for all business managers. The traditional industrial-age approach to managing automation-focused projects has become a relic, leading to silver bullet thinking about the new generations of IT and how they can be applied to support advanced information management and enable business transformation. The end result is unacceptably high failure rates in applying new technologies. We need a new approach.
Our Benefits Realization approach is such an approach. It provides a new basis for using IT to deliver business results more consistently and predictably. It proposes two inter-related shifts: in mindsets about IT and in management methods. Silver bullet thinking is replaced with a new benefits mindset that focuses on integrating technology into the business system. Its central tenet is that IT alone, no matter how technically powerful, cannot deliver business results.
An Approach Developed In The Field
Our Benefits Realization approach is not just another academic theory. It is a practical approach, much of which was developed, tested in the field and successfully used since 1999 in organizations that include government (at all levels), telecommunications companies, energy utilities, banks, insurance companies and manufacturers. It has been used to meet a variety of business transformation challenges, such as:
Ensuring that benefits are understood and realized from large, complex and expensive software investments, including enterprise application packages, Internet related applications and Knowledge Management initiative
Understanding, managing and realizing benefits from major business process re-engineering programs
Providing a focus on results to guide major organizational change programs.
Cornerstones Of The Benefits Realization Approach
There are three fundamentals that define the core of the Benefits Realization approach. To implement it successfully, organizations must also meet three necessary conditions. These are outlined below.
Shift from stand-alone IT project management to business program management
Shift from free-for-all competition among projects to disciplined portfolio management
Shift from traditional project management cycles to full cycle governance.
Three necessary conditions:
Activist accountability in order to identify business sponsors with active, continuous ownership of investment programs
Relevant measurement systems to measure the things that count in the Benefits Realization process
Proactive management of change to give people ownership stakes in programs.
RGC's Benefits Realization approach incorporates several innovative components. These include:
The Results Chain Technique - generates a clear graphic display of the contribution of initiatives to expected business outcomes (or benefits)
The four "Ares" - four underlying questions that provide the framework for assessing business value (including risk) for an investment: Are 1: Are we doing the right things? Are 2: Are we doing them the right way? Are 3: Are we getting them done well? Are 4: Are we getting the benefits?
The Value Management Office (VMO) - supports an organization's management by actively managing the realization of value from investment programs.
Benefits Realization delivers a number of advantages:
The entire organization - from top executives to project teams - gains a better, shared understanding of the potential benefits of an investment and how to "get there"
Provides more effective sponsorship of IT and business change initiatives, based on better understanding of the changes required to generate benefits