Benefits Depend on Perspective

13th December 2020

With a fast-moving and uncertain business environment, there’s an increasing need for organisations to adapt.  Look inside just about any organisation and there will be a range of ongoing change initiatives in progress spanning teams and organisations.  Whether those are programme, project or product-led; and whether they are agile, waterfall or hybrid, they will generally have one thing in commonThey’ll be seeking a defined set of outcomes and benefits. 

It’s easy to fall into the trap of thinking that there are a single, unified set of outcomes and benefits that everyone involved or affected by a change initiative is seeking.  In some cases, particularly small projects with an easily defined and fixed scope this may be the case.  However, move to a larger and ‘messier’ situation where the stakeholder landscape is complex and disagreement is rife and it’s a very different story.  Different stakeholders will have very different perspectives, and it may be impossible to get true consensus 

A common mantra has emerged that encourages us to ‘maximise business value’.  At a surface level, this is hard to criticise—I mean, who wouldn’t want to enable value for the organisation—yet if these ideas aren’t elaborated on and discussed, inadvertent misunderstandings can ensue.  Let’s deconstruct that mantra, zoom in on just one word and ask what different stakeholders would value.  On the surface, ‘value’ sounds like it should be obvious, but in reality it’s quite likely different stakeholders will be seeking different (and sometimes conflicting) things. 

Let’s imagine a situation where a national chain of petrol stations notices a reduction in revenue and they want to create customer loyalty.  They explore the idea of introducing a loyalty card system.  There would be a range of stakeholders, which would probably include the following: 

 

Who 

Stakeholder 

Perspective on Improvement 

What improvement, if delivered, would I value? 

Sponsor  

  • Increased revenue & profit (nationally) 
  • Increased customer loyalty 

Regional Manager 

  • Increased revenue & profit (regionally) 
  • Enhanced ability to monitor/track repeat customers 

Store Manager 

  • Increased revenue & profit (localyl) 
  • Quicker point-of-sale process (get people through quicker) 
  • Ability to pre-empt stock required (reduce waste/maximise sales) 

Store worker 

  • Easy to use point of sale system 
  • Have products with barcodes that actually scan first time! 

Retail Customer 

  • I just want to get my petrol, as quickly as possible, and get on with my journey.  I don’t want to have hundreds of loyalty cards. 

Business Customer 

  • I want to be able to quickly get a VAT receipt and track my spending as my employer needs a VAT receipt to claim back the fuel cost. I often lose receipts which is a pain. 

 

I’m sure there would be others too, but this gives us a point to start from. 

A pertinent point here is that we have expanded the scope of our discussion beyond ‘business value’.  After all, other than incremental efficiency savings, its very unlikely (in most cases) that we are going to enable the creation of value for the organisation without creating a ‘win’ for other stakeholders too.  Surely the sweet-spot is where value is enabled for a range of different stakeholder types?  We create something that a particular segment of customers love, which increases revenue and drives repeat sales… 

We also need to define and deliver something that will actually work for the people within the organisation.  Whilst those at the top of the organisation might define ‘business value’ as revenue and profits, it’s those who are sitting behind the tills that actually handle the sales that make those revenues and profits.  If the process is hard, slow or frustrating then their job is harder.   

When laying out desired outcomes and benefits in this way, conflicts in perspectives become clearer.  Not only this, but different (and sometimes unexpected) threads emerge.  For example, we see in the example above that business customers want VAT receipts. So maybe there’s a different way of achieving the top-level outcome (increase profits) by targeting them.  They might value the ability to track their transactions and get downloadable copies of receipts more than a traditional loyalty card scheme. Understanding what they value will help the organisation to achieve what it values.    

So, whilst the mantra of ‘maximise business value’ might be a useful one, we really ought to ask ‘whose business?’ and ‘what do they value?’. 

 

by Adrian Reed, Business Analysis Expert

 

Further reading 

This article draws generally on some of the ideas of Soft Systems Methodology. There are many resources that describe this more formally, including: 

Checkland, P. & Poulter, J. (2006). Learning for action : a short definitive account of soft systems methodology and its use for practitioner, teachers and students, Chichester, Wiley 

Soft Systems at Open Learn (Open University)