When benefits don't stack up

by Ron Rosenhead

Project Manager (PM): I have had a look at this project we talked about last week and I wanted to take about 10 minutes discussing it with you.

Project Sponsor (PS): What’s to discuss? I thought it was all going OK.

PM: Well, I’m not sure that there is a project to work on. Let me explain.

PS: Yes, you better had.

PM: You have asked me to look at making some changes to the software. You suggested these changes will produce a real benefits; speeding up the processing time of each application. You suggested by about 5 minutes per application, and a cost saving around £8 per application. We have looked at this and found that:

  • the software changes will cost £23,000

  • it will involve us investing an estimated 36 staff days to specify and manage the consultants who will develop and amend the software

  • testing will take 1 week and cost around £10,000 (staff and consultant time)

  • the company who developed the software suggest that the changes will speed up processing by no more than 1.5 minutes

If we add all the above together we see the cost saving per application as no more than £1.10 with a 1.5 minute saving. This compares with your estimate of £8 per application and 5 minutes time saved.

The recommendation from me: no project as business benefits low.

We feel that to carry out this project will have no business benefits or rather; the business benefits are very low. When we tried to map the benefits we had real problems so our suggestion; ditch this piece of work

PS: Mmmmm, let me look at these figures again – I have taken a note of them. Thanks you for this and let me say, you certainly put your head above the parapet on this one. I’m glad you did. I will be back to you by the end of the week.


Project Agency




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