It is a self-evident truth that you commission projects to deliver the benefits.
Yet, most organizations only focus on the costs.
Most projects and their justifications are built based on:
- What has to be DONE, and
- What it is going to COST
Neither of these drivers are value driven.
What you should be focused on is:
- What you are trying to ACHIEVE (the outcomes)
- The VALUE of these outcomes (the benefits and value), and only then
- Their cost of delivery
The starting point for every project
needs to be identifying the desired business end states (outcomes) and the benefits and value that the project/program will deliver. This needs to be done BEFORE identifying the project workload and the cost of delivery.
Subsequently, once the project has commenced, you then need to track and monitor
- The progressive 100% complete delivery of the changes/activities/actions required to deliver each desired business outcome
- The up-to-date value of the major financial benefit value drivers – the bases and assumptions underlying the financial benefit calculations - as these can legitimately change during the project, increasing or decreasing the project’s net value
- The actual level of expenditure vis-à-vis the budget to ensure the value of the benefits is not lost due to cost (or time) overruns.
All of this is possible only IF you set your project up with a clear, specific, measurable Value Equation that spells out the project’s business value in trackable form.
Unfortunately, most projects are only set up with a ‘cost/benefit analysis’ that seeks to justify the project’s costs rather than spell out the business value.
That's why we created the TOP Value Equation™.
The TOP Value Equation™ transforms the results projects deliver
The Value Equation transforms the results projects deliver by a series of subtle changes which:
- Shifts the focus onto the business value, the business improvements to be delivered (as opposed to the project costs to be managed)
- Makes clear the business outcomes/end states to be delivered – the business’ primary measure of success. These outcomes are defined in clear, specific, measurable terms so their realization can be easily tracked and measured.
- Identifies separately the business end state outcomes, the benefits, the financial value and the financial value drivers—so that they can each be managed separately and their specific progressive realization tracked and measured.
- Enables the impacts of external-to-the-project forces, changes and events to be monitored and their impacts assessed so that the project’s business value is not unknowingly ‘lost’. The project investment’s viability can easily be continuously reconfirmed and any projects that become unviable can be stopped before they waste money.
Individually and cumulatively these changes
- Increase the value identified and targeted (making projects easier to justify)
- Reduce the project workload
- Eliminate much of the all-too-common rework and other wasted activities
- Increase the level of project control
- Improve the operation of the governance teams as they better understand the project’s outcomes and make better decisions
- While leveraging the orthodox project delivery tools, techniques and processes – no need to discard existing expertise.
We call the TOP Value Equation “the most powerful tool in the toolbox”.
Proven over 15 years of use across all industries, the Value Equation works for strategies, projects and programs of all sizes and complexity.
The Value Equation provides you with
- A set of clear, specific and measurable desired business outcomes which become your primary measure of success, the focal point for all project-related activities and the bases of measurement, control and decision making.
- A set of maximized business benefits attached to the specific outcome that will enable their delivery. These are your secondary measures of success and they can be realized as soon as their enabling outcome has been delivered. This simple linkage eliminates the need for a separate ‘benefits management process’.
- A set of financial benefits whose value drivers are known and able to be tracked and monitored so that the impacts of any changes can be computed to ensure the benefit is still worthwhile and the project investment is still viable.
- A set of change activities for each outcome that makes clear the size, scale and nature of the change workload required to deliver each business outcome. These activities can then used to compute the workload, resources and costs required.
- An outcomes dependency roadmap that illustrates the logical sequence of outcomes (and therefore benefits) delivery and their interdependencies.
Now - often for the first time - you can be in full control of your project, its business value and the delivery workload.
You can now direct, manage and control the downstream dimensions of projects:
- Define a subset of the business outcomes for the project to deliver—the ‘project outcomes’—defined as clear, specific and measurable statements.
- Allocate the benefits that will be immediately available when these project outcomes are delivered to ensure these benefits are realized as soon as the project outcomes are delivered.
- Track any changes to the financial benefits’ value drivers so that you always know the up-to-date value of your benefits and project overall.
- Allocate the required change activities between the project (to deliver the project outcomes) and the business (to subsequently deliver the business outcomes and remaining benefits) so that the workload involved to realize the benefits is known.
- Assess and control the impacts of decisions, deviations and externally caused changes on the desired business outcomes, their benefits and value.
- Easily measure and manage the ongoing relevance, viability and deliverability of the project throughout its duration – avoiding projects being ‘condemned to completion’.
- Identify when promised benefits become available or are no longer available due to either external events or delivery of compromised outcomes (so as to avoid wasting time and effort seeking to realize them). And more…
The Value Equation is simple, powerful and easy to adopt and use.
Ebook - "Understanding the TOP Value Equation™"
Ebook - "The Value of the TOP Value Equation™"
Product - The TOP Value Equation Module
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