benefit management implementation at stm
DESCRIPTION
Francine Belzile & Sophie Rebello: experienced practitioners at the cutting edge of Benefits and Portfolio Management with the Société de Transport de Montreal (STM) presented to Benefits Management SIG on 24th March. STM is an organisation of more than 9000 employees, an annual operating budget of $1.2BN and in 2011 accounted for over 400M passenger trips. STM aims to increase this to 540M trips as part of their own 2020 strategy. In 2005 STM were faced with a familiar problem of having an increasing number of projects, limited financial and human resources and significant pressure on operations. They needed to make better project choices without jeopardising existing ones. The solution was to implement project portfolio management as an evolutionary approach, incorporating best practice and engaging employees so far as possible. STM had learned that you cannot achieve benefits management without change management. Both required teams of people. STM defines benefits as “An advantage / earning realized when the project is delivered and perceived as so by the stakeholders.” When they revisited activities specific to benefits management, such as identifying targets, approving projects and tracking benefits, they had realised that these should be integrated with existing information management. It didn’t make sense to create something different to what they already had. STM objectives for the next three years include sustainable operationalization of benefits management and improved integration between project management and operations. People need to be challenged and refocused, and as a result STM has now added the requirement to develop an action plan for all projects, which tend to arrive piece by piece - every project in itself, is a worthy project! When it comes to tracking planned benefits it was sometimes like a ‘game of ball’ with the ball being tossed between projects and operations. Both teams need to have accountability at the appropriate levels and the linkages between the need testing and it helps where a person responsible for the KPIs in a particular sector is made responsible for results and benefits. People feel that it is a challenge to find things that you can measure, or formulating benefits in a manner that it meaningful to the organisation. Another problem is people accepting accountability, which can be easily resolved by management – “it is part of your job!” A recommendation for clearer parameters and mechanisms has now been addressed as STM has now organised benefits categories by impact – e.g. growth, satisfaction, commitment, optimisation and sustainability, with clear targets and enhanced reporting for each. Clearer roles and responsibilities are being addressed by strengthening the role of the sponsor. The sponsor defines success factors and establishes benefits targets linked to project objectives for the project manager and, in turn, is accountable to the portfolio manager. http://bit.ly/apmstmTRANSCRIPT
Benefit Management Implementation atSTM
Francine Belzile & Sophie RebelloSociété de Transport de MontréalMontréal, Canada
Presentation to APM Benefit Management SIG
March 24, 2014
Agenda
STM is…
Implementation of Project Portfolio Management
Implementation of Benefits Management
2014 and beyond
Discussion
3
STM is…
History
STM FACTS
9,042 employees
In 2012, operating budget of $1 227 million and expenditures of $586 million
Asset replacement values: $14.5 billion
404.8 million trips in 2011 with an objective to reach 540 million trips in 2020
Corporate mission
The STM is a key driver of economic development in the Montréal area and contributes to sustainable development and overall quality of life. The STM is tasked with developing and operating an integrated bus and métro system, as well as paratransit service, in order to enable people to get around reliably, quickly, safely and comfortably. The STM’s customers and employees, as well as its institutional and business partners, are all proud to be associated with the company, which is well known as a provider of high quality service at a fair price.
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Implementation of Project Portfolio Management
Implementation ofProject Portfolio Management
Organizational context in 2005
Issues at STM:
Number of projects was growing
Limited financial and human resources
Pressure on operations
Risk not delivering service according to expectations
Implementation ofProject Portfolio Management
Vision
mission
Operations
Management of On-Going Operations
-
ProjectsWithin normal course of activities
FINANCIAL AND HUMAN RESOURCES
Project Portfolio
Management
•Metro•Autobus•Paratransit•Infrastructures
Management of Authorized Programs
and Projects
OrganizationalStrategy and Objectives
Vision
mission
Operations
Management of On-Going Operations
-
ProjectsWithin normal course of activities
FINANCIAL AND HUMAN RESOURCES
Project Portfolio
Management
•Metro•Autobus•Paratransit•Infrastructures
Management of Authorized Programs
and Projects
OrganizationalStrategy and Objectives
Implementation ofProject Portfolio Management
The implementation approach:
An evolutionary multi-phased approach
Inspired by industry best practices
Tailored to STM’s needs
Developed by a group of directors from different sectors
Implementation ofProject Portfolio Management
Audit 2010
5 changeboxing 3 changeboxing
2010 2011 20122005 2006
Audit 2006
2009
First PPM initiative
PPM Status Report
12
Implementation ofProject Portfolio Management 2010 Audit:
The approach
Interviews with 12 executives (chief executives and executive directors)
20 self-audits from pre-selected employees
Evaluation of processes and procedures in place by Qualiscope
Prerequesites according to Qualiscope
Two top expectations:
Project portfolio monitoring and accountability
Benefit management and impact on the organisation
Results from the 2010 audit
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Implementation ofProject Portfolio Management
Balanced choicess Portfolio status reportAlignment
Identification Preparation Implementation ClosingDefinition
1 2 3 4 5
Project management lifecycle
Portfolio management
Transfer to operations
Balanced choicess Portfolio status reportAlignment
Identification Preparation Implementation ClosingDefinition
1 2 3 4 5
Project management lifecycle
Portfolio management
Transfer to operations
Benefitrealizationmanagement
Project management lifecycle
Project portfolio process
Implementation ofProject Portfolio Management
Portfolio Committee:
5 members of the STM Executive
10 to 12, 2 hour meetings a year
Responsibilities:
Approve project business case
Analyse and autorize best projects
Optimize the project portfolio
Ensure coordination with CEP
Autorize project modification
Confirm project closing
ComplexityS
trat
egic
alig
nmen
tComplexity
Str
ateg
ical
ignm
ent
Implementation ofProject Portfolio Management
Maintain assets
Expand services
Improve customer experience
Attract, develop, mobilize talents
Further improve performance
Susta
inab
ility
72% 123 projects
26% 39 projects
2% 33 projects
10 G$
Portfolio categories
Implementation ofProject Portfolio Management
Value of PPM:
Clear indications that projects are in line with strategic directions;
Optimized resource allocation;
Better coordination and improved synergy between projects;
Standardization of project presentations.
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Implementation of Benefits Management
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Implementation of Benefits Management
Identification Pre paration Implementation ClosingDefinition
2 3 4 5
ProjectCharter Projet
ModificatonStatusReport
Project Report
1
BenefitsAnalysis
BenefitsRealisation Plan
Dashboard
Transfert to operation
Benefits Status Report
Strategy ofchange management
TransferCertificate
Certificate ofConformity
Business Opportunity
Stakeholders + ImpactAnalysis
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Implementation of Benefits Management
Objectives of benefit management:Optimize project contribution to strategic objectivesFacilitate benefit identification and measurementControl benefit tracking after the project
What is a benefit:
An advantage/earning realized when the project is delivered and perceived as so by the stakeholders
Implementation of Benefits Management
Government • Reduce GGE •- Measure before and after
City • Reduction of traffic congestion
• Modal share of public transport
STM • Bus clientele growth• Growth of commercial
revenues• Reduction of operating
costs
• Number of trips
• $
• $
Client • Reduction of travel time• Punctuality improvement• Cleanliness of metro
station
• Measure before and after• Satisfaction before and after %
Employee • Safe environment • Work accidents (frequency)• Satisfaction before and after %
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Stakeholders Benefits Indicators
Implementation of Benefits Management
Implementation of Benefits Management
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Integrated processes
The BRM essentials
Source: Jean-Marc Proulx (2014)
Result Chain System driver
25
2014 and beyond
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2010-2013 AUDIT RESULTS
Successes
Prioritization of projects and strategic alignment of portfolio
Project and portfolio tracking
Recognition of benefits management as a significant measure of project performance
Objectives 2014 – 2015
Sustainable operationalisation of benefits management
Improved integration between project management and operations
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BenefitsIdentification
Tracking of planned benefits
Strategic KPI’s
Project close
(Gate 5)
Action Plan 2020
INTEGRATION OF BENEFITS MANAGEMENT TO STM ORGANISATIONAL PROCESSES
Change management
Project authorization
(Gates 1 & 2)
Tracking of benefits realisation Operational transfer
IMPLEMENTATION DRAWBACKS
Perceived challenge to identify measurable and targeted benefits
Hesitation in formulating benefits in a manner that is meaningful to the organisation
Hesitation in accepting accountability
Perceived effort that is required to identify and track benefits
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SUSTAINABLE OPERATIONALISATIONRecommendation # 1: Clearer parameters and mechanisms
Improved benefits realisation plan
Enhanced reporting
To include analysis of existing operation processes and change requirements to fully realise benefits
Realistic and measurable indicators
Targets for the business unit rather than at the strategic plan level Categorisation of benefits based on impact (Growth, satisfaction, commitment, optimisation and sustainability)Targets linked to performance evaluation of the project
More precise qualitative data that could affect benefits realisation Use of available information and data to guide optimal project decisions that will support full realisation of benefits Implementation of reporting mechanism to track benefits realization (post-project)
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SUSTAINABLE OPERATIONALISATION
Recommendation # 2: Clearer roles and responsibilities
Strengthening of the sponsor role
Continuum between project and operation
For the project manager: sponsor = clientDefines success factorsEstablishes benefits targets linked to project objectives
For the portfolio manager: sponsor = accountable spokesperson Accountable for quality reporting and benefits tracking
Consideration of decisions of benefits realisationImplementation strategy for benefits realisation done concurrently with implementation for project deliverables
Benefits management as a business process rather than a project or portfolio activity
Benefits management at the business unit level rather than by project or portfolio level
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OUR CHALLENGESLarge organisation with different acceptance levels and varying capacity for change between business units
High number of non measurable benefits and benefits without financial value
YOUR WORD OF ADVICE?
OUR PLANNED INITIATIVES
Revised benefits realisation plan template & support toolsRepertoire of usual / available measures
Project re-evaluation at each gate of the projectChange requests driven by benefits realization – not only by project needs
Design of a dashboardCommunication plan
Review of the project strategic evaluation criteria to increase weight of project related benefits
To address soft issues pertaining to accountability, integration and business process
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