Section 10:

Implement
a Benefits
Realization
Framework

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 Roll Out Capabilities and Assess and Evolve the
Establish Buy-in and Objectives Lay the Foundations
Services PMO

Section 6: Define a
Demand Intake Process

Section 7: Define Project

Management Practices

Section 8: Create Effective

Portfolio Management and
Governance

Section 9: Design
Resource Capacity
Planning Processes

Section 10: Implement a Benefits Realization Framework

Section 10: Implement • 10.1 Plan Benefits Realization on Initiative Launch
a Benefits Realization • 10.2 Track Value Aligned Metrics
Framework

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10.1 Plan Benefits Realization on Initiative Launch
Types of Project Benefits to Identify

1
Communicate long term
benefits based on organization
priorities.

2
Identify mid-term cost or
revenue benefits to build into
the value story

3
Highlight any immediate cost
or efficiency benefits

Source: Gartner
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10.1 Plan Benefits Realization on Initiative Launch
Framework to Identify KPIs for Benefits Realization

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10.1 Plan Benefits Realization on Initiative Launch
Metrics Selection Process

Sample leading
Establish and socialize
Indicators an identification
• Timeliness of framework to ensure
deliverables that metrics that
• Communication on measure initiative
progress success are well defined
and help stakeholders
• Days available to evaluate their delivery
benefits realization performance.

Leading indicators are metrics

that can be used to anticipate
future performance, while
lagging indicators are metrics
that measure past performance.

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10.1 Plan Benefits Realization on Initiative Launch
Metrics Selection Compendium

Benefits Category Metrics Metrics Definition

Sales Growth Percentage sales growth achieved over the previous quarter/half year/year.
Revenue Retention A measure of the percent of total sales revenue that the company retains after incurring the direct costs associated
Gross Margin
with producing the goods.

Project NPV Difference between the net present value (NPV) of cash inflows and the present value of cash outflows.
Project ROI
Project IRR The internal rate of return (IRR) on a project is the rate of return at which the projects NPV equals zero.
Headcount Reduction A measure of savings generated from reduced headcount on payroll.
Cost Reduction
Materials Discount A measure of discounts from early payments/ supplier consolidation/ reverse action lower price.
Average Reserves Average inventory held that is currently not being utilized for production activities.
Time-to-Market The length of time it takes from a product being conceived until its being available for sale.
Increase Efficiency
Mean Service Total amount of time it takes to respond to a request for service. The services requested may be routine services or
Response Time triggered services.
Enhance Production Factory Uptime A measure of average functional time of the production facility as a percentage of total project duration.
Facility Availability Factory Downtime A measure of average out-of-service time for the factory as a percentage of total project duration.
Resource Utilization
Average amount of resources being utilized for actual production purposes.
Optimize Capacity Rate
Unused Capacity Average production capacity buffer that is not being utilized for productions.
A measure of the percentage of projects that are brought to completion correctly and to specifications without scrap
Yield
or rework.
Improve Quality
Percentage Quality
A measure of the percentage of outputs that do not satisfy the minimum quality criteria.
Check Rejects
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10.1 Plan Benefits Realization on Initiative Launch
Sample Division of Responsibilities to Enable Benefits Realization of an Initiative

Name of the
Role Sample Responsibilities
Individual
Shortlist projects for benefits tracking
Review the list of metrics to be used for benefits tracking
Executive Sponsor <Add Name>
Assess project benefits in review meetings
Help create a recovery plan for troubled projects
Shortlist and select metrics in the project business case
Steering Committee <Add Name> Determine the threshold limits for each metric based on expected project performance
Assess project benefits in review meetings
Track metrics to assess project performance
Include project benefits performance discussions in regular project review meetings
Track leading indicators and regularly communicate findings to avoid reactive posture to
Project Manager <Add Name>
deviations or challenges
Conduct post-project benefits assessment and communicate findings to senior stakeholders
Create handoff plan for operational sponsor to own post-project benefits tracking
Identify sources for data collection
Business Analyst <Add Name> Gather data for project benefits tracking
Structure the data to derive insights for benefits tracking
Provide inputs for tracking financial benefits
Finance Manager <Add Name>
Help project sponsors understand financial benefits
<Add Role> <Add Name> <Add Responsibility>
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10.1 Plan Benefits Realization on Initiative Launch
Urban Shopping’s Framework to Identify A Value Hypothesis

UrbanShopping creates value

hypothesis that are aligned to their
customer journey map. Their approach
can be used to identify and track the
right metrics based on potential value
stories and even identify the highest
priority initiative.

Value hypotheses are potential value

propositions that initiatives should align
to avoid over-assessment of technical
difficulties and internal organizational
politics. PMO leaders can then use
finalized value hypothesis to identify the
right KPIs for the initiative.
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10.2 Track Value Aligned Metrics
Baseline Calculation for Metrics to Identify Potential and Realized Benefits

Calculate expected
Metric How It Is Measured Who Measures It Current Level Expected
increase/ decrease by
(Calculation) Increase/Dec
rease taking worst- and best-
case scenarios for
New web (Number of new user The web analytics team <add> <add> execution into
traffic sessions/total user calculates the metric at consideration
sessions) *100 the end of every week.

For a set time period (daily,

weekly, etc.)
NPS Subtract the percentage of The customer insights <add> <add>
(Net Promoter promoters (satisfied team calculates NPS For every finalized
Score) customers) by the every month and shares metric, an important first
percentage of detractors report in the first week of step is to create a
(dissatisfied customers). the next month. baseline for the metric
by documenting it
before kicking off the
<Add>
initiative.

Source: Gartner
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10.2 Track Value-Aligned Metrics
Illustrative Single-Page Dashboard to Track and Communicate Benefits
This dashboard aligns benefit metrics of an initiative to benefit categories and tracks the confidence level of the anticipated benefits throughout the initiative life
cycle.
1
Product-Level Benefits Tracking

Strategic Product Benefit Category Benefit Metrics Target Target Value Actual
Priorities Description (Select Categories Aligned (Select Mix of Lagging and Leading Value Confidence Value
Supported With Strategic Priorities) Indicators Tracked per Category) Level
Increase Product Increase Client Number of New Accounts Opened 2 per client 1 per client
EMEA Phoenix Is Cross-Sales With Existing Clients (average) Low (average)
Regional Designed to
Profits Increase the Increased Spend per Customer $10,500 Medium $12,500
Profits Number of Daily Sales Calls by 50 65
Generated Salesperson High
From Existing
Clients Costs Saved by Serving Reduction in Service Costs $150,000 High $175,000
Existing Clients
Number of New Staff Hires to 20 18
Serve Clients Avoided High

2 3 4 5
Link Between Strategy Leading and Target In-Flight
and the Product Lagging Indicators Goals Product Health
Note: “Product” refers to the unit of work within product lines and denotes a level higher than projects
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10.2 Track Value Aligned Metrics
BMO Financial Group’s Approach to Track Metrics and Provide Ongoing Insight to Stakeholders

• BMO Financial Group’s PMO

provides regular and out-of-cycle
status updates on benefit (and cost)
variance to ensure timely corrective
action.

• They establish triggers for regular

and out-of-cycle reviews of the
leading indicators to facilitate
decisions on corrective action.

Source: Adopted from BMO Financial Group

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10.2 Track Value Aligned Metrics
PrimeLion’s* Live Project Charters to Continuously Update Value Aligned Metrics

By creating living project charters that

regularly update key progress metrics
and commitments, PrimeLion*
increases the likelihood that initiatives
will deliver the outcomes that
stakeholders expect.

Moreover, these live charters are used

to continuous update the expected
value of initiatives enabling easier
reprioritization.

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