Universities can improve the way that benefits realization is properly embedded at the planning stage of projects. So said Paul Wilson of Provelio in his recent post. Building on a study commissioned by Hefce, Paul now offers four key topics for consideration: evidence based decisions, critical challenge, zero investment thinking, and leadership not management.
1. Evidence based decisions
In our research for the ‘Guide to the Realisation of Strategic Change and Beneﬁts: A challenge to current thinking and practice 2011’, commissioned by Hefce, we made a few interesting observations about how data are used in project planning :
Data should be measured, reported AND managed
Too often in the sector data is collated to satisfy bureaucratic demands, rather than to be used for improving the quality of decision making. Whilst there is a requirement to satisfy governance, the real value in the data is how it is used for managing improvement. Measuring and reporting do not achieve any value to the organisation. Arguably you could save cost by only collating data that you actively use in management
Using data at the initiation stage of a programme or project is vital
The initiation stage was found to place a large reliance on political buy-in and cultural issues, rather than be informed by hard facts and reasoning. Programmes or projects that move quickly tend to be well supported by data and the need is clear. Those lacking rational non-politicised objectivity took much longer to launch and were particularly vulnerable to delay in the event of them exceeding budget or scope
Are the strategic goals and outcomes well articulated?
As the OU research found in 2005 there is an absence of outcomes thinking and measuring in the sector. Success was measured in terms of achieving hard outputs such as a completed IT purchase or a new building, rather than whether the change led to the realisation of wider benefits to the business such as increased student numbers or greater academic ranking
Big dashboard KPIs were hard to find
The data for strategic planning were hard to find. These are the big metrics that allow strategic thinking to occur. The one or two, no more than three, that give the senior management team the overall health of the organisation.
These data would allow senior management teams to move from a potentially passive position of receiving programme and project reports to an active challenging of the true need. Rather than save £1m of a £20m investment, it would be better to realise that you don’t need to spend £20m at all. This brings us to the topic of Critical Challenge.
2. Critical challenge
Positive challenge can generate new ideas and save money and should not be seen as a negative exercise. It is better to cancel a project after spending £2m than it is to carry on because you have spent £2m.
The success of academic research is determined by a process of anonymous and independent peer review. This critical review is accepted as a positive process and aims to ensure that the arguments or analysis proposed are rigorous and robust. It is a healthy exercise that provides assurance of the validity of the work.
The research we undertook found good evidence of formal gateway reviews in programmes and projects but there was a tendency to review the technical issues or tangible outputs (e.g. cost or programme), as opposed to the business cases objectives. This may be because those preparing the documents tend to be from the technical delivery teams, but this reduces the ability of the end client to positively challenge the suitability of the project to proceed.
There appears to be a reluctance to stop projects after they have met the initial feasibility approval i.e. one strong challenge at the outset and then carry on. We would contest that even statistically at least some projects should stop due to risks being realised such as budget overrun, technical innovations, change of personnel. Instead what appears to happen is that projects continue through each stage because a commitment was made at feasibility stage.
In our study, little evidence could be found of business case review after the project finishes i.e. are staff growth levels being achieved, and the same applied to information relating to benefits identification and subsequent realisation.
It would seem that the purpose of the business case is to satisfy the original capital demand, and the revenue risks are then passed to the school or department after project completion. The downside of this approach is that many benefits are not realised until years after a programme of project and without active management will prove impossible to realise.
We advocate using the evidence and data produced to critique and continually challenge the justification for major expenditure. Too often a project takes on a life of its own and there is a reluctance to check back on initial assumptions. Most people engaged in the process are looking to move things forward and solve problems on the way which are key skills; but not if they exclude the need to step back and critically challenge the main purpose of the exercise. Decisions makers should also ask planners for a ‘zero investment’ option.
3. Zero investment thinking
Decision makers should pose the question: ‘Suppose there just is no money, how would you deliver the desired outcomes then?’ This is a hard line to take, but this is how real change comes about, and can often spur innovative thinking.
It takes great discipline to identify a problem, opportunity or crisis that must be addressed without jumping to possible solutions. As soon as you engage technical professionals they will typically start to find solutions in their own discipline e.g. an architect would propose a building, an IT specialist would propose software.
We advocate to think in terms of the desired outcomes e.g. improved research rankings with a war-time rationing mentality of using all existing assets at your disposal before spending large sums.
The normal management process is to use Option Analysis but too often this can be a bureaucratic exercise undertaken to conclude the pre-conceived solution. By assuming you have zero investment it forces questions to be asked such as can the activities change, are the activities required, can the problem be solved another way or can the problem be ignored?
How often in a business case is the “do nothing” option a catastrophic failure outcome, but how often when those projects are rejected or delayed does that failure occur? Try instead to think of ‘do nothing’ as ‘do minimum’ if there is reluctance to take a major step in this direction.
The proposed approach (assuming a problem, opportunity or crisis has been properly articulated) is to assess what could be achieved if no funding was available (i.e. zero investment). The analysis is then developed whereby further funding is incrementally introduced and the additional benefits identified. So for every £10,000 increment what more is achieved? This continues until the organisation optimises funding and benefits and then ensures that competing investment projects can share the available investment resource.
With pre-conceived solutions the same analysis can be applied in reverse. Analysis can be extended in increments, up to a preliminary assessment of the cost of the business case. This encourages those within change programmes and projects to spend more time considering the changes that are needed to achieve the required outcomes; some of which will be achievable independently of financial investment.
The output from this process will be a much wider understanding of the nature of individual projects within an overall programme. As a result, the bodies tasked with approving projects are then better placed to achieve maximum added value for the institution’s total investment programme rather than being limited to simple cost and output measures.
4. Leadership not management
The terms are too often seen as the same thing which they absolutely are not. Leadership does the right things and management does things right. A management led project or programme versus a leadership led one will lead to poor project selection. The real challenge is not to install new software correctly or the build workmanship of a new facility, but instead to determine if the building or software are needed at all.
In most organisations there is greater emphasis on someone’s management ability rather than their leadership skills. People are rewarded for getting things done, solving existing problems or delivering what was asked of them. Management is a skill and needs to be done well, but leadership ensures that the right tasks are being managed. Why waste time doing something well that doesn’t need to be done at all.
Leadership is forward looking and focused upon outcomes rather than outputs. It is about the long term and the big picture. When everyone else is focused on the details and the weeds of a knotty problem, it takes leadership to challenge the team involved. How often have you been too close to the detail and then someone senior gets involved and helps the team to think more clearly.
Leadership is interested in the long term big picture outcomes and will want to know that a given investment has realized the intended benefits. Managers should involve themselves in the strategic direction of the organisation and will then naturally identify good solutions that do not necessarily mean big expenditure. It may upset the current direction but will ensure long term sustainable benefits.