New industry regulations and today's 'culture of austerity' are driving a number of fresh approaches that will reduce costs and modernise how the sector does business. All of which of course means big change.

So, how are sector leaders going to ensure their programmes deliver the benefits required? Recent research showed that 44% of change programmes simply don't do what they set out to achieve. 'The end goals weren't clear', 'We didn't have a clear route-map', 'The team was inexperienced'.

Concerning, given that the sole reason programmes are initiated in the first place is to deliver benefits. None of these excuses will wash in today's challenging market, and the sector needs to master benefits realisation so it can remain profitable.

How can organisations address benefits realisation in programmes?

To succeed at benefits realisation, leaders should take a structured approach that focuses on the fundamental gains the programme is seeking; defining and managing benefits throughout the programme.

This article discusses five tenets of such an approach:

1. Adopt a benefits-led approach to programme definition

A benefits-led approach begins with the organisation's strategic objectives and works backwards from the definition of business benefits realised through the change. The capabilities that the programme must deliver are used as the starting position to shape the programme.

With a merger or acquisition for example, the opportunities of service rationalisation creates tangible financial cost-saving benefits.

A change programme must also recognise the capabilities and technical enablers inherent in the business. In reality, shaping the programme considering both 'ends' ensures the programme operates within the art of the possible.

If a proposed programme element, or pet project, can't demonstrate a direct and meaningful link to the organisational strategic objectives, its existence should be questioned.

2. Use a clear 'routemap' to track the realisation of benefits

The adoption of a clear process structured around capturing, defining and tracking benefits throughout the programme lifecycle tracks when benefits will be delivered, and their impact to the organisation.

Even for programmes initiated due to necessary changes, such as regulatory reform, understanding when benefits will be realised during the programme is essential to embedding the change within the organisation.

3. Use tools and techniques to embed benefits realisation

There exist an array of supporting tools which programme managers can use to aid benefits definition and tracking. Three key tools are:

Benefits Maps - define the 'line of sight' from the organisation's strategic objectives through to individual programme activities, helping to ensure that the programme logic is sound and that project outputs are contributing to the realisation of planned business benefits.

Benefits Profiles - capture benefit descriptions, owners, derivations, changes to current processes required to enable realisation benefit and the financial value of the proposed benefit. Documenting the benefit profile forces a rigorous consideration of the changes required and the expected added value. Where the adage 'if you can't measure it, you can't manage it', comes into effect.

Benefits Registers - act as a repository for all defined benefits. The register is owned by the Business Change Manager and captures changes required to realise the benefits, timescales for realisation and consolidated benefit values into a central tool for management reporting.

There are countless examples of ERM systems introduced to organisations at considerable cost only for the customer to state that benefits have fallen woefully short of their expectation. The use of a benefits map matches expectations of users, funders and providers from the outset ensuring all parties understand their roles within the programme.

4. Appoint a Business Change Manager

Benefits are only realised once they are adopted by the organisation. The Business Change Manager role takes responsibility for the definition and realisation of the benefits delivered by a programme and requires careful transition with all areas of the business affected by the programme and across all affected stakeholders.

Communication in this role is essential to its success. 'Top-down' messaging from Board level plays a key role, but in order to create lasting change the Business Change Manager must also provide 'on the ground' delivery. Oftentimes the role of the Business Change Manager is under-utilised and Board-level engagement is not sustained throughout the life of the programme.

Research undertaken by Moorhouse identified that 37% of leaders believed their organisations regularly delivered benefits from change, compared to only 5% of middle management.

5. Recognise the importance of psychology

The use of clear approaches, supporting frameworks and proactive stakeholder engagement are critical enablers, but in themselves will not provide the means to ensure success. The human factors, beyond those discussed already, play a key role in the realisation of programme benefits.

Cultural pressure can play an important part. Where demonstration of expected gains through solid business cases is an important financial hurdle to overcome prior to programme agreement, there is an inevitable pressure on Programme Managers and Senior Responsible Owners to over-sell the benefits of the programme they are responsible for, creating an uphill battle from day one.

Summary

In today's climate of cost-reduction and fiscal economising, driving the maximum tangible benefits from change initiatives is as salient as ever. Organisations taking a concerted benefits-led approach to the delivery of change initiatives stand a better chance of succeeding.

The approach starts as simply as 'beginning with the end in mind' - understanding the tangible business value a programme will develop before commencing.

Supported by a routemap defining the approach to quantifying and tracking benefits and the appointment of a Business Change Manager, this provides the focus and accountability to drive material, sustainable business benefits from the outset.