How to overcome the barriers to benefit realisation

As a consequence, leaders continue to invest time, energy, and money into projects and programmes without maximising the outcomes and opportunities.

To explore this phenomenon, we set out to uncover current practice in Denmark across both the public and private sectors, drawing on the first-hand experiences of business leaders. We surveyed or spoke to over 50 respondents from large Danish private companies and public entities spanning life science, financial services, retail, transport, defence, and healthcare.

First, the good news. Benefit realisation is now largely on the senior leadership agenda; and the ability to identify, define, and align benefits as part of the business case now seems to be an almost fully anchored practice.

Yet we also found signs of concern. We found that executive interest in benefit realisation is no guarantee for organisational embedment, and there are often limited options for organisations to evolve based on their experiences, which leads to a high risk of repeating projects with costs outweighing their short and long-term benefits. In fact, just 10 percent of respondents told us that all benefits were realised in their latest project.

So, what can organisations do to ensure that they can truly realise the benefits of projects and programmes? Our research identified three key themes.

Behavioural change is crucial

What stood out the most was that the understanding of behavioural change as an integral part of BRM is almost non-existent. Almost nine out of ten people we surveyed told us they never or rarely focus on behavioural change as an integral part of realising benefits.

One respondent told us: “Yes, we work with behavioural change, but we do not see it as an integral part of BRM. We do it more on an ad hoc basis.”

In our view, this weak spot is the one that most commonly prevents the realisation of the greatest share of benefits. Keeping track of behavioural change helps determine if the expected benefits of a project or initiative are gradually being achieved. If there is no change in behaviour, it is unlikely that the expected benefits will be realised either. Projects may still generate short-term benefits, but these gains are unlikely to be sustained. Therefore, a continuous focus on monitoring changes in behaviour can help ensure that the project is on track and will help to identify any potential areas for improvement.

Executives need more than good intentions

Top management’s focus on the realisation of benefits throughout the entire project, as well as ownership and commitment of benefits, is critical to project success. Yet 38 percent of respondents told us that top management are not focused on BRM, or do not know whether or not it is on the agenda for their senior leadership. And when it comes to actual responsibility for the realisation of benefits, only 28 percent say they have clear lines of responsibility.

One respondent stated: “There is somewhat of a focus on [BRM] from a mid-management perspective, but not from the executive level. At best, they will write the benefits on a piece of paper at the beginning of a project and then they forget about it hereafter.”

Good intentions from the executive level are not enough. They need to clearly communicate and delegate ownership and accountability to specified members of the project team. Otherwise, the incentive to properly manage benefit realisation rapidly decreases.

Monitor, revisit, adjust

As executives translate intention to ownership and commitment, they then need to take a lifecycle view of benefits. Yet almost two thirds (62 percent) of organisations do not revisit or make use of the business case once a project is greenlighted, which makes it less realistic that the actual feasibility of realising the desired benefits is possible. It’s also disheartening to see that when benefits are measured, 62 percent base their response on a gut feeling rather than factual evidence.

According to one respondent, the use of BRM is used as an “admission ticket” for project approval, but then the focus shifts to managing costs, not benefits. Another said: “We tend to forget about the benefits after a while, which is curious as they should be fuelling the project.”

Without clear-cut proof of goal achievements, it’s virtually impossible to associate any penalties and rewards with benefit realisation. A further downside is that, without any proof of or consequences to the success or failure of benefits, incentives for creating new, realistic business cases with obtainable benefits are reduced.

Principles to success

These three themes all speak to one overarching opportunity: for more benefits to be realised from BRM. In particular, we’ve found from both our survey and our experience that it all starts with the people part. Behaviour change, ownership, and commitment are the guiding forces that can help organisations tap into the full opportunities of benefit realisation. Building on this, we’ve gone on to explore seven specific steps that leaders can take to make progress.