Benefits and Outcomes
Both the OGC’s “Managing Successful Programmes” (MSP) approach and TOP are focused on ‘benefits’. However, the two approaches have different definitions of what a benefit is and different ways of ensuring they are delivered. Not surprising, we find TOP's much easier, clearer and practical.
A Difference in Definitions
MSP has two key points of measurement – the delivery of project outputs and the realization of the business benefits (financials).
Note that the word missing is ‘outcomes’. In MSP ‘outcomes’ exist as the half way house between the project delivered capabilities and the business financial benefits – but are not a primary focus. They are a means to an end – the realization of the benefits’ value. This can make fuzzy the points of handover between the program and the business as the program is delivering ‘capabilities’ not outcomes. These 'capabilities' create yet another intermediate element. (MSP’s ‘outcomes’ are what TOP calls ‘benefits’.)
Delivery of the benefits is deemed to prove that the outcomes have been delivered - so, the benefits measurement process is also the outcomes achievement measurement process, and hence the primary MSP focus on benefits realization measurement, not outcomes delivery management.
MSP’s definition of 'benefits' is what TOP usually refers to as ‘value’ – the quantified value of a benefit. However, these financial values are the least stable element of an overall Value Equation™ and therefore are not a good basis for measuring delivery ‘success’.
The Consequences of Output Thinking
MSP’s strong value/benefits-focused thinking fundamentally changes the dynamics of benefits delivery.
MSP requires processes to be put in place to measure the eventual output – the benefits/value. Then, once a benefit has been achieved, the intermediate business outcome is assumed to have been achieved, so work on this benefit’s realization is stopped and any remaining, undelivered available value is foregone.
This outcome delivery assumption is dangerous, as MSP appears to have no formal mechanism for tracking the financial benefits’ financial value drivers (the bases and assumptions used to compute the value of the benefit). As a result, a benefit’s value can be achieved through changes in external factors alone (e.g. a change in exchange rates) allowing ‘success’ to be claimed without the project delivering its promised or available value. Alternatively, value that is no longer existent may be pursued and, when not delivered, the program be seen to have failed.
The Consequences of Input Thinking
TOP takes the opposite approach by tracking and measuring the inputs to a benefit’s realization —measuring the progressive delivery of the project changes, the project outcomes, the business changes, the business outcomes and then the business benefits and their value – while, simultaneously, tracking any changes to the financial benefits’ value to ensure the full available financial value is known at any time.
TOP’s ‘input’ measurement approach makes it easy to see at any time exactly where you are in terms of your progress towards realizing your outcomes, benefits and their value. Importantly it also embeds the benefits realization process into the projects and program, as the program’s progress is also able to be measured in terms of progress towards the delivery of the benefits – no separate, parallel stream of activities or reporting.