Matakuliah
Tahun
: M0734-Business Process Reenginering
: 2010
The Implementation of BPR
Pertemuan 9
Monitor and Benefit Realization Phase :
Why ?
How ?
Critical Success Factors
Outputs
Risks
Monitor and Benefit
Realization Phase
3
Why ?
Projects are not finished after it has successfully gone live and
the users are happy
Often there’s a transition period, where operational costs
actually increase after deployment and then the benefits start to
be realized and the operational costs decrease
“If it is discovered during a project that
the expected business value cannot be
realized, or has gone away, the project
should be stopped. If the business case
is maintained and updated throughout
the project (at each phase), this will
become apparent”
Many business change projects fail to
deliver the benefits on which the
investment was originally justified. An
estimated 30 – 40 percent of systems to
support business change deliver no
benefits whatsoever
(www.ogc.gov.uk, 2005)
4
How ?
5
Step 1 :
Benefits Management Framework – Foundation Phases
Establish a framework to manage project business benefits to
approach target, measure and realize them
• How the organization identifies benefits and links them to the organization
foundation
• How the organization identifies and measures benefits
• Benefit roles, responsibility and ownership
• Benefit planning procedures – milestones/benefits network matrices, delivery,
assessment and review points, dependencies, risks, business impact
• What, when, by whom
• How to deal with unplanned benefits
• Identification of dis-benefits
• Baselining – responsibility, how, who signs off on it
• Benefits Realization Register – what is the benefit? How much? Who is
accountable for delivery? When? Where will it impact business?
Regular benefits management meetings
• Lessons learned
• Benefits realized
• Benefits not realized
6
Step 2 :
Potential Benefits and Plan – BPM Foundation Phases
Use Benefits Realization Register to record details about
•
•
•
•
•
The benefit
Who is responsible for the delivery (realization) of the benefits
The expected value
When the benefit will start to accrue and end
Any dependencies and risks associated with the benefit
Document and plan for the management of benefits to be
monitored throughout the life of the project, so they can be
compared against the business case
Prepare a comprehensive plan of action and register of benefits
Have the plan accepted by the responsible business manager
(benefit owners) and approved by the project sponsor
7
Step 2 :
Potential Benefits and Plan – BPM Foundation Phases
Benefit Summary Plan
8
Step 3 :
Baseline and Comparative Measurement – Elaboration Phase
Collect metrics during the Elaboration Phase, use
these metrics as Baseline
Ensure the baseline is solid and it is aligned with the
business case
9
Step 4 :
Refine and Optimize – Improvement Phases
Have metrics calculated for new redesigned processes to
estimate the impacts on increased process efficiencies
Compare the new Improvement phase metrics with the
baseline, select and finalize the improvement option that yields
maximum benefits with minimum costs
Benefit
10
Milestone Matrix
Step 5 :
Benefit Details – People and Technology Development & Deployment Phases
Benefit Delivery Matrix
Monitoring of progress against benefits realization milestones should be an
integral part of project reporting, and incorporated as a segment in the
regular reports to the project sponsor and Project Steering Committee
11
Step 6 :
Benefits Delivery and Monitoring – Monitoring and Benefit Realization Phase
Benefits owner needs to make sure that
• All activities identified in the benefits summary plan are realized
• The appropriate control structures necessary for benefits realization
are in place
Once benefits are realized, obtain a formal sign-off,
put them in the register and ‘tell people’ (celebrate!)
12
Step 7 :
Value Maximization – Continuous Improvement Phase
Post implementation reviews to check that the benefits are
being realized and continue to be realized
Full report on achievement of benefits will record benefits
which were fully achieved or benefits that failed to reach
targets. These reports need to be followed up with the
responsible managers to validate findings and identify areas
for remedial action
Organization should be confident that it has achieved the
maximum possible benefit from the BPM investment, if it’s not,
there should be at least and understanding of the causes and
plan for future remedies
13
Step 8 :
Project Result
Compare initial business case with actual project
results/outcomes
Comparison determines:
•
•
•
•
•
•
•
How much faster the processes are executed
By how much errors, rework and backlogs have been reduced
How efficient the processes being performed are
How much customer satisfaction has improved
How much employee satisfaction has improved
The overall cost-benefit analysis for this project
Whether the benefits have started to flow as expected
Comparison purpose:
• To make the necessary change to the current environment to correct any shortcomings
• To include lessons learned from the project in the relevant aspects of the foundation
phases for later projects
14
Step 9 :
Performance Management
Processes need to be measured in terms of performance
Process Performance measurement is done against:
• Stakeholder visions and expectations
• Management expectations
• Comparative measurements within the organization’s industry, competitors, and outside
the industry
• Ensuring that the process owners understand their role in detail and have accepted it
• Ensuring that the people change management process has empowered the people for
change
• Centrally monitoring that this continuous improvement is working
• Adjusting the approach from the lessons learned
• Continually re-evaluating the applicability of the performance measures established
Benchmarking
• How an organization compares across business units within itself organization or with
competitors
• Benchmarking can be related to throughput times, processing times, costs, quality,
customer satisfaction, and profitability
• Benchmarking can also be completed ad different levels, such as product level, process
15
level, business unit level and organization level
Step 10 :
Feedback Loops
16
Step 10 :
Feedback Loops
Combination of Feedforward and Feedback to enable anticipation,
monitoring, managing and correction
Feedforward
• At the beginning of the process
• Can anticipate for changes in business
Monitor
• Process owner monitors the flow of process and ensure it flows as planned
• Any issues need to be addressed
Feedback
• At the end of the process
• Corrective measures if targets or objectives are not met
Feedback can be in the form of
• Personal Feedback
• Management Feedback
• Process Feedback
17
Critical Success Factors towards Benefit Realization
An understanding that the realization of value needs to be intricately intertwined
with, and a critical part of, the project and organization culture
It is necessary to plan benefit delivery-timeframes and costs
There must be agreement of the roles, responsibilities and accountabilities
associated with the realization of benefits
There must be complete identification of the risks associated with the nondelivery of the benefits, and appropriate remediation strategies
The staff involved in the realization of the value must be trained in benefits
identification, analysis and review
Relevant measures and management must be in place to track and act on the
results
Unexpected benefits must be recognized and recorded
If it is possible to benchmark against other organizations within your industry, or
appropriate others industries, then do so
Never underestimate the importance of the people change management aspect of
the project on realizing value
18
Outputs
 A benefits summary plan
 A benefits milestone network
matrix
 A benefits delivery matrix
 A benefits realization register
19
Risks
Risks
Mitigation Strategy
Business may not commit to the
the benefits
Hold the project manager. Process foundation team and project
benefits management system
Lack of business benefit
Project manager, process foundation team and project sponsor
Unrealistic benefit expectations,
realize
Only record realistic benefits in business case and reporting matrix
Lack of structured approach to
business benefits
Establish and stick to benefits management framework
20