Benefits are defined as the measurable improvements from change, which are perceived as positive by one or more stakeholders, and which contribute to organisational (including strategic) objectives. This definition highlights four crucial points:

• Firstly, benefits represent a measurable improvement - benefits typically include: increasing revenue or reducing costs; meeting a legal or regulatory requirement; maintaining current systems and assets and so avoiding the negative consequences of their failure; and improving services or outcomes, or reducing risks to their achievement. In each case the improvement should be measurable – so we can assess whether it is worth investing taxpayers’ or shareholders’ funds to realise the benefits and in due course, determine whether the planned benefits were actually realised in practice.
• Secondly, someone receives the benefit – typically the organisation itself or its customers; and in the public sector, groups of citizens or wider society. This point is crucial as it means:
  • In determining the scale or value of a benefit, we need to engage not the project team, but rather the benefit recipient or benefit owner – more on this below; and
  • The emphasis in benefits management is less on passive backward tracking against forecast and more on active, forward-looking stakeholder engagement across the project lifecycle.
• Thirdly, benefits represent the measurable improvements that demonstrate organisational and strategic objectives have been achieved.  As the PMI says, “Project benefits can be considered synonymous with positive strategic impacts”.  This is of fundamental importance – we shouldn’t start with the project and explore what benefits might be realised; rather we should start by determining what benefits are required and then scope the project or programme to deliver those benefits.
• Fourthly, the definition above doesn’t refer to projects but to change. Indeed as the Praxis Framework states, “The realisation of benefits is the driving force behind any project, programme or portfolio.” To emphasize the point – benefits are the rationale for investment in projects, programmes and portfolios, not the means to justify a project or programme.

This process is illustrated in Figure 1 – noting that while the constituent practices are broadly sequential, their effective operation requires iterative feedback loops throughout.

Let’s examine these five practices in a little more detail.

Here we are concerned with approaches to identifying benefits (including via benefits mapping) as well as forecasting the scale of improvement anticipated. Unfortunately research indicates benefits are often overstated in order to obtain funding. Solutions include: starting with the end in mind; validating the benefits with benefit owners; and booking benefits in budgets, performance targets etc – more on these solutions below.

This encompasses options analysis, investment appraisal and portfolio prioritisation to ensure resources are allocated to those projects that individually and collectively represent best value for money/return on investment.

Having identified, quantified, valued and appraised the benefits to confirm the rationale for investment, we need to plan for their realisation.  This includes ensuring accountability and transparency for the realisation of identified benefits, the changes on which they are dependent, mitigation of any dis-benefits and identification and leveraging of emergent (unplanned) benefits. The key benefits planning documents are:

• Benefits Management Strategy – the document that describes how benefits will be managed on a project or programme;
• Benefit Profile - a short summary of the key data on a benefit: the benefit type/category, scale of impact, ramp up and tail off, benefit owner and relevant measure(s);
• Benefit Register – which brings the benefit profiles together in a single document); and
• Benefits Realisation Plan - showing the trajectory for benefits realisation from the project. This plan then provides the baseline against which benefits realisation will be tracked and monitored.

Optimising benefits realisation in practice by actively tracking and managing planned benefits through to their realisation; capturing and leveraging emergent (unplanned) benefits; and minimising and mitigating any dis-benefits. Tracking benefits realisation is something that many struggle with in practice, but it can be facilitated by:

• Transparency about what the benefit is, and how it will be measured;
• A dashboard report comparing benefits forecast with benefits realised; and
• Focusing on the top 3 benefits from each project (an application of the 80:20 rule or Pareto Principle).

Review across the project lifecycle, ensuring and assuring that:

• The benefits to be realised are achievable and continue to represent value for money;
• Appropriate arrangements have been made for benefits monitoring, management and evaluation;
• Benefits realisation is effectively managed; and
• Lessons are learned for both the current project and as a basis for more effective benefits management practices generally.

Defined practices are, however, no ‘silver bullet’ solution. Indeed, the Boston Consulting Group have reported that with regard to benefits management, “Interest is high but few are doing it well”. Addressing this depends on adherence to a series of principles which represent the foundations upon which successful benefits management is built.

The principles that underpin effective benefits management are shown in the columns of the model at Figure 2.

Let’s examine these seven principles in more detail.

We noted above that benefits are the measurable improvements from change which contribute to organisational (including strategic) objectives.

Understanding the contribution of projects to the organisation’s objectives is consequently at the very heart of benefits management. This is facilitated by the development of a portfolio-wide benefits categorisation framework that provides a ‘clear line of sight’ from strategic intent to project benefits and vice versa – what the IPA refers to as ‘two-way traceability’. But it is crucial to note that, as the PMI says, “There is no standard categorisation scheme for benefits. Each organisation needs to define and agree on the categories of benefits that are important for successful realisation.”

A common mistake is to start with a given project and then search for benefits that will result from that project. The result is typically wasted effort in managing benefits that are overstated in order to obtain funding.

The solution is to adopt benefits-led change initiatives that start with the end in mind, where the scope of the initiative is determined by the benefits required.  

As Flyvbjerg and Gardner say, “Projects are not goals in themselves. Projects are how goals are achieved.” So when completing a benefits map as part of the identify and quantify practice, start with the problem you are trying to solve or the opportunity to be exploited. Then ask what benefits would be realised if the problem was solved. Only then consider what the scope of the initiative should be – as illustrated in Figure 4.

If change initiatives are not delivered effectively, or if they are delivered late, there will inevitably be adverse impacts on benefits realisation. Consequently, disciplined and repeatable project and programme delivery methods are enablers for the realisation of benefits. Beyond this, attention also needs to be given to strategies such as:

• A rigorous start gate to set things up right from the beginning.
• Following Flyvbjerg and Gardner’s advice to ‘Build with Lego’- applying modular and incremental delivery approaches.
• Ensuring projects are what Cooper calls ‘front-end loaded’, with robust planning, design and development. The results are impressive – according to the IPA: “projects that have focused on front-end loading take time and cost out of a schedule. They are typically 20% lower cost and 10–15% faster than average projects and considerably faster and lower cost than poorly defined projects.”

Wherever possible, benefits and their measures should be integrated into the organisation’s operational and Human Resources (HR) performance management systems. This includes:

• Operational performance management
  • Linking benefits measures to the organisation’s key performance indicators (KPIs) and making use of data available from the management information system so minimising the additional costs of new measurement systems to track and report on benefits realisation; and
  • Building benefits into business plans and budgets. This is the technique of ‘booking the benefits’ where benefits are reflected in revised budgets, headcount targets, unit costs and performance plans and targets.
• HR performance management
  • Aligning responsibilities for benefits management with individuals’ performance objectives – so there is clarity about what people are responsible and accountable for, including implementing the changes upon which benefits realisation depends; and
  • Aligning responsibilities for benefits management with the reward and recognition processes. Financial rewards are not always the best way to motivate people, but inconsistencies between desired behaviours and the organisation’s reward and recognition systems can be a real obstacle to progress because they send mixed messages about what is regarded as important.

Developing a portfolio approach to benefits management helps to ensure:

• Consistent alignment of projects with the portfolio objectives.
• Good practice is repeatable across all projects.
• Double counting where the same benefits are claimed by, and used to justify, more than one initiative, is minimised.
• Lessons are learned and applied more widely.
• Benefits realisation is optimised.

A portfolio-based approach to benefits management encompasses six main elements:

• Consistent benefits eligibility rules on how benefits are categorised, quantified, valued and validated, so facilitating level-playing field investment appraisal, portfolio prioritisation, and tracking benefits realisation.
• A portfolio-level benefits realisation plan showing the benefits to be realised over the coming planning period analysed by: benefit category; the stakeholders/business unit who will receive them; and impact analysed by month or by quarter.
• Reappraisal of the project benefits at regular stage/phase gates - good practice is to apply the technique of ‘staged release of funding’ where funding for each project phase is only confirmed when the relevant gate review is successfully passed – and funding is limited to that required to take the initiative to the next review.
• Effective arrangements to manage benefits post-initiative closure – in many cases benefits are only realised after the project is completed. A portfolio approach can help to address this by ensuring appropriate handover of responsibility to the appropriate benefit owner (supported by the portfolio benefits manager), and by including benefits from closed initiatives in the portfolio benefits realisation plan and benefits dashboard/progress report.
• Benefits tracking and reporting at a portfolio level - by the use of a portfolio benefits dashboard/progress report, which enables effective senior management oversight of benefits realisation against plan and determining when remedial action is required.
• Robust post-implementation reviews - enabling lessons learned to be identified and applied, as well as capturing reference class data to inform forecasting on new initiatives.

Effective benefits management requires project, programme and portfolio boards to focus not just on delivery, but on benefits realisation. Beyond board oversight, from a benefits management and realisation perspective, the key roles involved are:

• Initiative Sponsor - the individual accountable for a project meeting its objectives and optimising benefits realisation.
• Benefit Owners – who are responsible for the realisation of individual benefits.  Examples of benefit owners are shown in Table 1.
• Benefits Managers - usually embedded within the project, programme and/or portfolio management office who provide a benefits realisation support service to sponsors and benefit owners.

Table 1 Examples of benefit owners

The Enterprise Portfolio Management Office (EPMO) also has a crucial role to play – Iain Fraser, past Chair of the PMI Board of Directors says they, “can be the champions of benefits on behalf of every organisation. Embracing the constructing, comparing, confirming, and concluding of benefits from each investment can assist greatly in bringing integrated performance data to the level of the organisational structure that’s appropriate. The EPMO is ideally placed to be the conduit for BRM deployment and its sustainability.” 

Managing benefits effectively requires a shift from a delivery-centric culture, where the focus is on delivering capability to time, cost and quality standards, to a value-centric culture, where the primary focus is on optimising benefits realisation and return on investment from the available resources.

This can be facilitated by first recognising that successful implementation of benefits management is a business change programme in its own right. Second, don’t be too impatient. New behaviour won’t happen overnight, but if benefits management processes are applied consistently, supported by a governance focus on benefits realisation, then behavioural change will follow.

Comprehensive guidance is provided in the latest and fully updated 3rd edition of Managing Benefits (2024).

APMG also offers a certification scheme which enables project professionals to demonstrate their understanding and ability to apply the principles, practices and techniques of benefits management.

• Benefits are not just one dimension of portfolio, programme and project management; rather, they are the rationale for the investment of taxpayers’ and shareholders’ funds in change initiatives.
• Benefits are the link between portfolio objectives and individual projects – as such they represent consistent and tailored measures of strategic contribution.
• Benefits Management is an active forward-looking stakeholder engagement practice, not a backward-looking passive exercise focused on justifying the project.