Strategy Best Practices Series, #1
In the first of our series, we highlight the key takeaways from a report Boston Consulting Group did in partnership with the Project Management institute on Benefits Realization Management (BRM). Read the original report here.
TL;DR – Report Conclusion
Companies can be good at developing strategy and be good at project management, but until they link the two, they will consistently fall short of their goals. Those with mature BRM practices consistently and explicitly align individual project outcomes to larger strategic objectives.
The key to BRM is understanding the difference between a project’s output from its outcome. When you understand their outcome, you can tie projects to strategy.
Output is defined as the target result when a project is concluded. This could be the development of a new product, the construction of a new facility, or an IT conversion. Outputs, in and of themselves, don’t achieve strategic intent.
In contrast, a business outcome is defined as the value, benefit, or utility created as a result of the successful completion of a project, or set of projects, which changes the business in a meaningful way. It’s easy to tie outcomes to strategic intent and therefore projects to strategy.
BRM has real value. Based on analysis from PMI, The Economist Intelligence Unit (EIU), and BCG, companies that have mature BRM practices in place are 1.6 times more likely to realize project objectives and 3 times more likely to meet or exceed their target ROI on individual projects.
Improving the maturity of BRM processes requires focusing on several priorities:
- Managing the portfolio of projects
based on real strategic outcomes—and, specifically, value creation for the organization.
- Creating dedicated space for dialogue
among C-suite executives, business owners, and project managers right from the start of each project, to secure alignment, assess projects, and course-correct as needed.
- Establishing the right conditions for success
including setting expectations regarding required behaviors, having the right project managers in place, and senior-level sponsorship.
Improving an organization’s level of BRM maturity is a continuous process, and companies often fall short because they don’t commit to making fundamental changes in how they work.
The report makes several recommendations for quick wins and medium to longer-term actions. Many of them were heavily focused on project management best practices and not strategy, our focus. They did highlight the following:
- Develop approaches that hardwire the link between strategy and projects
We couldn’t agree more with the general assessment of the benefits of BRM. We developed Omnistrat as a practical way to link project management to strategy.
Omnistrat does not impact the quality of the project management resources put on projects.
The report stresses the need to start small and build institutional expertise over time, i.e. be cautious. Doing a pilot makes sense, but many of the implementation challenges are eliminated with Omnistrat:
- A portfolio of projects are automatically linked to strategic objectives
- Dedicated space for dialog is built-in, connecting everyone
- Right conditions are inherent and reinforced
Adopting BRM is a lot easier when you have a holistic solution to support it.
Read the next in our Strategy Best Practices Series here.