Benefits Management contd: Benefits Roadmap

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In my previous entry I explained how single initiatives can spark a chain events which ultimately can be linked to benefits of different hierarchy levels leading up to the strategic / organizational ones and how important it is to understand the correlation and impact of each of those on those of higher or similar level.

As mentioned earlier, the process of identifying, analysing, assigning tracking and measuring this impact is called Benefits Management.

Benefits Management  helps identifying, rationalizing and facilitating actualization of  benefits of the program. Along with appropriate management of stakeholders it help identify key groups the said benefits are accrued to thus addressing, through effective communications the primordial question: “What’s in it for Me?”

Benefits management comprises the following steps:

  • Ensure benefits are identified, defined clearly and linked to strategic outcomes;
  • Identify the benefits that lead to the business changes
  • Consider the overall benefits to the organisation as well as to the individual departments
  • Ensure business areas are committed to the identified benefits;
  • Proactively manage the process of benefits realisation;
    • Match the total set of benefits to the required outcomes of the program;
    • Engage the relevant stakeholders to the development of the strategy;
    • Integrate the benefit planning with the other plans related to the program;
  • Keep benefits within realistic boundaries of scope and value, to identify their wider impact;
  • Use the benefits to direct the program and provide a focus for delivering change, to realize benefits in line with overall business direction and strategy;
  • Ensure benefits realization is tracked and recorded, and ensure achievements are properly identified and recognized

 The two techniques are used for the Benefits Realization are Benefits Dependency Network (BDN) and Benefits Roadmap (BRM). BDN is particularly good at highlighting interdependencies between components of a program or project and confirming that all the components in one part of the network are individually necessary and collectively sufficient to cause the components in the next part of the network.

 Benefits Roadmap, which I would like to focus on at the moment, is used to understand the hierarchy of benefits. It consists of a network of Initiatives, enablers and benefits leading to one another. Tracking benefits realization in accordance with Benefits Network helps to ensure realization of each of the strategic benefits of the program. In case of those not being achieved, tracking backwards helps to understand what actions have not been fully executed in order to achieved desired state.

The various steps that help to create a Benefits Roadmap are:

  • Benefits Identification;
  • Benefits Prioritization;
  • Benefits Planning;
  • Benefits Measurement; and
  • Benefits Reviews

Below I presented an example of a holistic Benefits Map prepared for a Go-To-Market strategy for a global IT company. It is not the point of this post to educate the audience about the strategy, but rather to present the complexity of analyzing benefits and tracking independencies between them.

Importance of Managing Benefits along Project Lifecycle (and beyond)

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While managing consulting project, companies focus usually on meeting customer’s demands. Obviously, this is what they are paid for, this is the key activity of every for-profit organization.

Sometimes, however, such superficial chase after customer’s satisfaction can have detrimental impact on transformation project, as those most of the time create value after vendor’s engagement are over.

This is why, Program Benefits Management school of thoughts is gaining increasing importance among all managers interested in sustainable value for their transformation programs.

Benefits management ensures that projects and programs deliver what they promise. It provides focus, demonstrates value-for-money, reduces the risk of failure and maximizes benefits achieved by evaluating project results against the defined measures and objectives. It also helps in:

  • Comprehensive identification and accurate definition of Benefits
  • Measuring to which extent, where and when Benefits have been realized by identifying the measurements needed to manage the realization of Benefits
  • Planning for development and implementation of the programme
  • Comparing the outcomes of the program with the strategy and measuring  performance and taking corrective actions
  • Establishing chain of benefits that measures the impact of one Benefit on another and helps to optimize the selection of benefits for the achievement of targets
  • Expressing requirements in a relatively simple picture that can be used to facilitate consensus with associates and sponsors

 Apart from identifying key benefits and connecting them vertically, important task is to establish metrics for their measurement. Along project lifecycle, measuring Benefits helps in:

  • Ensuring that the Program is implemented and managed with a sustained focus on Benefits Realisation
  • Tracking  the progress of Benefit Realisation
  • Communicating progress to management, so that corrective action is taken and the benefits maximized
  • Motivating Stakeholders and sustaining their buy-in for the Project
  • Identifying reasons why a higher level Benefit has not been reached and proposing corrective actions
  • Enabling better decision making
  • Comparing the outcomes with the strategy and measure how Programme contributes to the company’s vision and goals.

The chart below presents generic relationship between enablers, initiatives and benefits leading into realization of strategic goals. The example presents everyday struggle of an MBA Student.

Connecting enablers with initiatives and benefits of different levels helps project managers keep track of the progress of delivering value alongside project lifecycle.

Below graph depicts impact that a single initiative (I used sales and marketing example) can have on benefits of different importance and, ultimately, on company’s strategic performance tracked by BSC.

Management Consulting in a Pill

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It’s close to impossible to describe what consulting is about. Prior to my MBA, I spent over 5 years working as a Transformation Consultant, expert in Organizational Change Management, but if anybody asked me what consulting is all about, I would still struggle giving a consistent answer. Is IT a part of management consulting? Or perhaps we should follow the logic of various outsourcing companies and consider call center an integral part of the industry as well?

Leaving the terminology nuances aside, management consulting is a fascinating area. It offers exciting job, extremely fast learning curve and chances to work with global top players from different industries. Probably it’s this flexibility and mobility, along with the pressure for growth that kept the industry afloat throughout the global crisis between 2008 and 2011. What’s hard to believe, managerial consulting industry still grew over those years by 0.8% per annum*.

Although often people speak about the Top 4 consulting firms, the reality could not be further from the truth. The market is highly fragmented, separated between specialized strategy players (McKinsey, AT Kearney or BoozAllenHamilton) global big brands (E&Y, Deloitte, Accenture), fast growing by acquisition Indian firms (Infosys, Tata Consultancy Services) and thousands of niche, independent firms constituting majority of the market.

For years, Management Consulting has been known for its high competition – both at personal level and corporate level. Niche firms try to steal small chunks of the services cake focusing their competitive advantage on function, industry or local market and cultural awareness, while big players compete against each other over multi-million dollar deals for global market leaders. As a result, clients become more results-oriented and demanding, often basing their decision on signing up another contract with the vendor not only based on the quoted price, but mostly the ultimate benefits from previous engagements.

The industry has a bright future. With emerging number of Business Schools around and world, increased number of young professionals and recovering global economy, Management Consulting industry is expected to grow by 3.8% a year, exceeding the global GDP to the total of over $403 billion*.

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*) Source: IBISWorld Global Management Consulting Report

Forward to the Past of Indian Economy

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The biggest chapter of my professional career has been written in India. I lived and worked in the Subcontinent for several years between 2006 and 2011. According to western numerology, that’s just 5 years, but for Indian economy it means something around a half a century.

I had a chance to see the country growing at a frightening pace. Meadows I used to cross to reach my office in Gurgaon, within a year or two started turning into India’s biggest business and outsourcing center operating in modern, twenty stories high glass buildings. India was sure on a rise.

In those busy days, people overwhelmed with the growth and potential of the economy seemed to completely have forgotten about the big crisis of 1991 when federal reserves depleted, Rupee depreciated against the dollar by over 30% within a year and country had to be bailed out by International Monetary Fund. Ironically, reforms introduced at that moment became the spark for the country’s boom in later years.

Over 20 years later, the author of those reforms is forced to face a similar situation. This time as a Prime Minister, Manmohan Singh is a captain of a ship which is dangerously heading towards the rocks of a serious economic slowdown. Rupee has depreciated by 16% since May and hit historical rock bottom against the dollar. Foreign investors, sensitive to even small hesitations in emerging markets and unsure of the condition and future of the economy, withdraw their funds which only increases the unpredictability at Mumbai Stock Exchange.

Indian government officials keep their poker faces on, but their somehow desperate actions suggest they very well realize the situation calls for drastic actions – restrictions on the money that can be transferred out of the country have been introduced, Indian Central Bank put a cap on daily borrowings and increased the interest rate at which it borrows money in an attempt to support the currency.

 

Hang on. According to which economy principles is this going to bring any positive results to the markets? Instead of opening up and remove barriers, India is telling the world that they are not only ‘not that welcome’ but once, tempted by much lower costs, decide to invest, they may face serious problems on their way out. Would you enter a budget restaurant knowing you may not be able to leave whenever you want?

Furthermore, the government does not seem to be noticing the burning problem of increased current deficit which gives right to ask serious questions about the health of the economy. In recent years, world have seen plenty of examples what can happen if national finances are imbalanced.

Lack of reforms, inability to take a strong and sometimes unpopular decisions, economical apathy over the recent fat years created a hiccup. Although nobody talks about crisis, with only 5% GDP growth in the last year, India may indeed be on the edge of a slowdown.

India doesn’t seem to have a realistic long term plan. No one can say if the country is heading towards self-sustainable, closed economy or rather a true member of open global trade. Society’s growing wealth also caused people’s ambition to demand certain rights and politicians, held on voter’s leash, don’t have a good history of assertive actions.

Feign actions will not bring any results. The country needs economical long term strategy followed with unpopular actions. “She” needs billions of dollars to keep the economy growing, needs its markets and industries open for foreign investors. After decades of protective approach, it’s not only an option but a necessity to let the fresh air of global players to enter the closed industries such as retail or airline markets. Regardless of local oligarchs’ protests, Indians should have the right to shop cheap at Wallmart or Tesco or pay less than $100 for 1 hour long domestic flight.

Bureaucracy and administrative barriers also play the trick – India ranks #136 out of 200 in ease of making business by the World Bank. According to Ravi Venkatesan, former Microsoft India CEO, the whole governance system of India is broken and need immediate actions to keep the growth from breaking (source: Fareed Zakaria GPS, CNN World).

PM Singh claims the situation is under control, yet gives no explanation to the cause or a possible solution to the scenario faced. Government believes there is no thread of the 1991 scenario to repeat; however seems to be forgetting the capital markets and foreign investors may have their own analyses and prediction and, in the long run, they can’t be stopped from hiding their money back in their pockets, packing their bags and leaving to a more sunny and less polluted destinations.

Country’s foreign exchange reserves can indeed be much higher than back in 1991, but this time, the collapsing Indian economy may also cause a much louder ramble to the entire business world.

…from the World, into Vancouver

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I think I’m… quite ready for another adventure!

                                                                                                  – Bilbo Baggins

 

I’m wondering if any of my classmates expected 10 years ago where would they find themselves on 23rd of August 2013. Perhaps some of us plan in details that much ahead and knew they would study MBA at Sauder School of Business one day, but for me it was a long chain of coincidences which ultimately took me where I am.

When I was 19 year old boy living in a small town in Southwest Poland, I applied to one of the most prestigious schools in the country. Remember one of my friends saying people over there are somehow weird, they wear fleas jackets and sign up for students organizations which even the names are impossible to pronounce.

Few months later, on my way home those words came back to be while passing by the office of AIESEC – world’s largest youth led organization. I decided to knock on to find out what is it all about.

Years later, around the end of my education I have performed leadership roles at the national level of AIESEC and thanks to the network I built, I had secured an internship with Tata Consultancy Services in New Delhi, India.

After a year spent mostly on learning and executing local projects, I was ready to go back home. During one of last meetings with my supervisor, he asked if I was interested in staying with the company. It was a tough call – on one hand, I really enjoyed the job and the country, on the other, I was missing Europe and wanted to try something else. Asked for some time to think about it.

Next day, when all my stuff were pretty much packed, my manager informed me that there is a vacancy at a project in Frankfurt, Germany and if I was interested in taking it. Considering this new circumstance, my choice was limited to either going back to Europe and looking for a job, or going back to Europe with a job. I thought only for the sake of professional experience, it made sense to execute that ‘one last project’.

One last project turned into another and another and over the next 5 years I worked as a Management Consultant delivering and then leading assignments around the world. From New Delhi to New York, from London to Singapore.

Let’s move forward to 2011. My project manager was Canadian and as we had a very good rapport, we spoke about plans and ambitions. I mentioned about my intention of applying for MBA studies. He was kind enough to give me a brief perspective of various schools, also got me in touch with Sauder Alumni.

Months passed by, I shortlisted Sauder as one of the few Business Schools to apply to, finally compared all the ones I have been admitted to and this way in the afternoon of August 6th I landed at YVR airport, excited and anxious to start another fascinating experience.

 

Could my life take a completely different turn? Definitely.

A better one? It’s hard to say.

Would I change it, if I could? Not a single thing!