Risk and governance

Benefits are difficult to interpret

• Benefits to be defined clearly – benefits should be identifiable, recognisable and measurable
• Benefits to be considered comprehensively in the ILM process and Business Case process
• Only benefits that are clearly measurable should be identified. The Project Team and the chosen governance entity should discuss and document the ways in which benefits can be measured in the Business Case and within the BRP

Lack of availability of baseline data or project data for selected measures

• Data should be sought early in the development of the BRP, at the time of the development of the Business Case
• Where data for ongoing monitoring of benefits and economic costs is not available, the Project Team should consider other measures (with the possibility of creating new data sources)
• New data collection techniques may be possible and should be discussed with senior leadership

Insufficient stakeholder buy-in, particularly in relation to Benefit Owners

• Ensure a broad understanding of the importance and value of benefits realisation as part of the Capital Framework
• Agree with Benefit Owners their responsibilities and meet regularly to review progress and reinforce commitment
• Establish governance arrangements that are linked clearly to realising benefits and tracking economic costs

Benefits forecasts are incorrect or overestimated

• Identify the intended outcomes and benefits in the ILM process, before selecting the project option
• Determine the baseline measure prior to agreeing the target improvement measure
• Establish clear mechanisms to collect and measure data for the Base Case and Project Case that are agreed by all stakeholders
• Use robust quantification and monitoring techniques
• Consider and document the reliability of the forecasts

Economic costs of the project are greater than expected

• Establish clear mechanisms to collect and measure data for the Base Case and Project Case that are agreed by all stakeholders
• Use robust quantification and monitoring techniques
• Consider and document the reliability of the forecasts

Agencies do not have the capability or capacity to support benefits realisation

• Select appropriate and achievable measures for benefits and economic costs so that the process does not impose excessive time or cost burdens on Benefit Owners
• Ensure benefits realisation is a key objective of the Project Team and Project Director
• Update responsibilities within Agencies to reflect the new process and ensure governing arrangements are clear
• Facilitate training

Failure to deliver benefits monitoring and reporting according to the BRP

• The BRP sets clear expectations with regard to timing, requirements and responsibilities
• Consider deliverability of the BRP, including the resources and capabilities of Benefit Owners

The focus on benefits realisation is not maintained throughout the full Infrastructure Investment Lifecycle

• Have a clear governance structure within which benefits and economic costs are managed, with defined roles and responsibilities
• Ensure a broad understanding of the importance and value of benefits realisation as part of the Capital Framework
• Once benefits realisation reporting commences, benefits realisation should be a standing agenda item at periodic meetings of the chosen governance entity (e.g. bi-annual board meetings), where relevant
• Facilitate training

The benefits realised are not applicable to the project

• The BRP should be clearly structured based on benefits, economic costs and data included in the Business Case and Economic Appraisal
• Record the benefits and economic costs assumed in the Base Case and Project Case at key milestones and ensure that any changes are subject to a formal change control process

Uncertainty around the future state of the project and its environment, and the impact this will have on the relevance of the selected benefits

• Benefits and economic costs identified across a broad range of stakeholders with various expertise
• Uncertainties clearly documented in the BRP
• Baseline the benefits and economic costs at key milestones and ensure that any changes are subject to a formal change control process

Uncertainty around the policy measures needed to enable the project to realise the benefits

• Ensure that all key stakeholders from the perspective of key policy measures are included in the Business Case and BRP processes (e.g. for land use planning)
• Implement clear governance arrangements

Governance entity overseeing benefits realisation

The chosen governance entity should include all major stakeholders and responsible Agencies relating to the BRP to perform a cross-Government governance function, including consideration of project benefits and economic costs progress on a regular basis.

This entity may be the Project Board, the Executive Steering Committee or another entity set up specifically to look after the benefits realisation process. Refer to the detailed Project Governance Guidelines for further information.

Benefits Manager

The Benefits Manager is the individual with overall responsibility for ensuring that the project meets its objectives and delivers the projected benefits. This may be the Project Director. The Benefits Manager:

• Verifies the categorisation of benefits and economic costs
• Oversees measurement activities to track economic costs and determine whether or not a relevant benefit is on track to be realised
• Ensures all Benefit Owners undertake benefits measurement in a broadly consistent manner across all benefits and economic costs, noting that the varying nature of benefits and economic costs may require varying measurement approaches
• Collates reports on benefits realisation for the chosen governance entity
• Provides feedback to the Benefit Owners on the outcomes of the chosen governance entity’s consideration of the reports
• Provides quality assurance

Benefit Owners

Benefit Owners are responsible for a specific benefit or economic cost, its tracking and realisation. Benefit Owners:

• Sponsor and provide business context to benefits and economic costs
• Approve benefits, economic costs and measures
• Accept shared responsibility with the Benefit Manager for realising assigned benefits and tracking assigned economic costs
• Collect and report data to evidence the realisation of benefits
• Encourage workplace behaviour to support benefits realisation and additional benefits
• Receive and review Benefits Realisation Reports