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International Journal of Project Management 36 (2018) 650 – 658

Project benefit management: Setting effective target benefits

Ofer Zwikael a,⁎, Ying-Yi Chih a , Jack R. Meredith b
Research School of Management, College of Business and Economics, The Australian National University, 26 Kingsley St., Acton, Canberra, ACT 2601, Australia
Broyhill Distinguished Scholar and Chair in Operations, Emeritus, School of Business, Wake Forest University, PO Box 7897, Winston-Salem, NC 27109, USA

Received 3 October 2017; received in revised form 9 December 2017; accepted 11 January 2018


Target benefits such as “reduced operational costs” are project goals that can contribute to the long-term improvement of organizational
performance following project completion. Setting effective target benefits is critical because it supports project investment decisions, clear project
management direction, and thereby enhanced project and organizational performance. Based on goal setting theory, we present three studies to
develop and validate a scale to measure effective target benefits. The proposed scale is comprised of three dimensions - specificity (e.g., specific
target values), attainability (e.g., the capacity to realize the target benefits), and comprehensiveness (e.g., reflect the views of key stakeholders).
This scale can be used by senior managers to assess proposed projects' target benefits, contributing to more informed project investment decision-
making and the subsequent benefit management process. Theoretically, it can also be used as an instrument to facilitate theory development in the
fields of project benefit management, strategy implementation, and organizational performance.
© 2018 Elsevier Ltd, APM and IPMA. All rights reserved.

Keywords: Project benefit management; Return on investment (ROI); Goal setting theory; Project investment decisions; Benefit realization

1. Introduction Failing to realize benefits from such endeavors will result in

significant loss to project funders and project management
Project management practice has improved in delivering as a profession.
projects according to the iron triangle measures (i.e., scope, Project benefits can be classified into two groups: (1)
cost, and time), but much less so in terms of meeting the “target benefits”, those benefits set prior to project com-
projects' desired benefits (Zwikael and Meredith, 2018). mencement which the project funder seeks thorough an
This represents a lost opportunity for project funders to investment in a project; and, (2) “fortuitous benefits”, which
ensure benefits are realized from their investments to may emerge during the project (Zwikael and Smyrk, 2011).
support their organizational strategic goals (Samset and As fortuitous benefits are emergent, the project benefit
Volden, 2016). Recognizing this gap, the project manage- management process we discuss here is focused on setting
ment discipline has increased its emphasis on project target benefits only (Musawir et al., 2017; Bradley, 2010). In
benefit management (Zwikael, 2016). This emphasis is this paper we define “target benefits” as “strategic project
particularly important now with an increased number of goals that following project completion will enhance
larger, complex, inter-organizational, and mega projects. organizational performance”. Target benefits are also referred
to in the literature as project business objectives, as they are
“what the project owner expects to obtain from using the
⁎ Corresponding author. project results after the project has been handed over to them
E-mail addresses: (O. Zwikael), from the project organization” (Rolstadås et al., 2014, (Y.-Y. Chih), (J.R. Meredith). p. 639).
0263-7863/00/ © 2018 Elsevier Ltd, APM and IPMA. All rights reserved.
O. Zwikael et al. / International Journal of Project Management 36 (2018) 650–658 651

Therefore, target benefits can be viewed as a sub-set of 2. Literature review

project goals, alongside other tactical short-term goals such as
completing a project on time and on budget. Target benefits are 2.1. Project goal setting
set during a project's initiation phase and then documented in
the project business case for approval by the project funder Goal-setting literature has established the positive relationship
(Zwikael and Smyrk, 2012; Doherty, 2014; Breese, 2015; between well-defined goals and performance at the individual,
Laursen and Svejvig, 2016; Zwikael and Meredith, 2018). group, and organizational levels (Linderman et al., 2006; Latham,
They are then used as a baseline for ongoing monitoring and et al., 2007). One can explain this goal-performance link through
control, as well as the later project performance evaluation. the motivational and goal-oriented, effort-directed mechanisms.
The importance of setting effective target benefits is illustrated As such, we anticipate that setting goals effectively will improve
by the fact that 74% of the organizations that identify target project performance. For example, a review by the World Bank
benefits in their business cases meet their project goals, found that 80% of projects with satisfactory “quality-at-entry”
compared with only 48% of the organizations that do not (PMI, were successful, whereas only 35% of those with unsatisfactory
2016). quality-at-entry achieved success (World Bank, 1996).
Although research acknowledges the importance of setting Managers make better decisions when high-quality informa-
target benefits, it is still unclear what constitutes “effective tion is available for them. In this regard, clear project goals
target benefits.” Managing Successful Projects (MSP), a can contribute to more informed project funding decisions
leading benefit management approach developed by the UK (Raghunathan, 1999; Mihm, 2010; Paese and Sniezek, 1991).
government (OGC, 2009), requires project target benefits to be Clear goals justify a proposed project's contributions to
measurable. Similarly, Aubry et al. (2017) identify measur- organizational strategic goals and serve as the basis for the
ability as one of the four benefit management themes (together subsequent project-planning effort. Project goals discussed in a
with evaluation process, organizational change, and perfor- business case often include monetary measures, such as return on
mance). Further, Jenner (2009) suggests project target benefits investment (ROI) or net present value (NPV) (e.g., Jørgensen
should be “robust” and “realizable”. However, the literature et al., 2012). However, many projects also have non-monetary
falls short of defining what “robust and realizable” target goals that are more difficult to capture with measures. Examples
benefits are. Indeed, Chih and Zwikael (2015) conclude that of such goals from a service improvement project may include
little is known in the literature about setting effective target “reduced customer complaints” and “increased service quality”.
benefits. Literature and practice agree that such project goals are often
Given these gaps in the literature and the importance of vaguely defined (Norris, 1996; Lin and Pervan, 2003), optimis-
setting project target benefits, we aim to answer the tically biased, and deliberately inflated to increase the chance of
following research question: “What are effective project project approval (Jenner, 2009; Flyvbjerg, 2007). Therefore,
target benefits?” In particular, this paper is the first to researchers have called for more research on setting effective
develop and validate a scale to allow the measurement and project goals (Scott-Young and Samson, 2008; Won and Lee,
evaluation of “Effective Target Benefits” (ETB). In this 2016).
research, we define ETB as “strategic project goals that are
set in a manner that will allow their successful measure- 2.2. Effective target benefits
ment, management, and realization.” Such a scale is
expected to contribute significantly to both practice and Target benefits specifications and characteristics, as well as
theory. Practically, this scale can be used to ensure well- the process of setting target benefits have been discussed in the
defined target benefits for projects. This in turn will enable literature. Managing Successful Projects (MSP) outlines four
organizations to make better informed project investment steps in setting effective project target benefits: (1) identify the
and portfolio selection decisions. Further, effective target benefits, (2) select objective measures that will reliably prove
benefits will support the benefit management process the benefits; (3) collect the baseline measure, and (4) decide
throughout project execution and enhance the likelihood of how, when and by whom the benefit measures will be collected
benefit realization following project completion. Theoreti- (OGC, 2009). Goal setting theory argues that “specific hard
cally, this scale can be used to further develop and test goals produce a higher level of outputs than a goal of ‘do your
theory in the area of project benefit management. This best’” (Locke, 1968, p. 157). Similarly, Goldstein and Naor
research also extends the goal-setting literature and models (2005) found that Six Sigma projects employing explicit
such as management by objectives (Drucker, 1954) and challenging goals resulted in a greater magnitude of improve-
balanced scorecard (Kaplan and Norton, 1996) to the project ment than projects lacking such goals. Others have suggested
benefit management context. goals should be “specific and challenging” (Chesney and
The paper employs the following structure. In the next section, Locke, 1991) and “robust and realizable” (Jenner, 2009). Doran
we review the literature and define the new ETB construct, (1981) suggested a “SMART” approach for setting effective goals;
followed by a detailed description of three studies to develop and namely, goals should be Specific, Measurable, Attainable,
validate a scale to measure effective target benefits. Last, we Relevant, and Time targeted. Chih and Zwikael (2015) suggested
discuss the results of the studies, their implications for theory and adding two project-specific dimensions to the five SMART goal
practice, and conclude the paper. setting ones: accountability and comprehensiveness. Even though
652 O. Zwikael et al. / International Journal of Project Management 36 (2018) 650–658

these research enhance our understanding on the importance 4.2. Results

and process of setting project goals in general and effective
target benefits in particular, there is still a lack of a clear and Our interviews confirmed the five SMART dimensions
comprehensive understanding of what constitutes “effective target derived from goal-setting theory, which suggests that ETB can
benefits”. be appraised based on whether the benefits: (1) are specific,
(2) have clearly defined target values and are measurable,
(3) are attainable given organizational constraints, (4) are
3. Methods relevant to the organization's strategic goals, and (5) have
target dates. In addition to confirming the five proposed
The objective of this research is to develop and validate an dimensions, our participants mentioned two additional ones:
Effective Target Benefits (ETB) scale. Research has discussed “accountability” and “comprehensiveness.” To reduce the large
the advantages of using positivism and interpretivism research number of dimensions, we consolidated them (Zikmund,
approaches. Whereas positivism reduces phenomena to simple Babin, Carr and Griffin, 2010) into three overall dimensions.
elements representing general laws, interpretivism “takes a The “Measurable” dimension was integrated into the similar
broad and total view of phenomena to detect explanations dimension of “Specific”, which created a new dimension called
beyond current knowledge” (Blumberg et al., 2005, p. 23). To “Specificity”, defined as “the extent to which target benefits are
capture the advantages of both approaches we designed a multi- clearly defined and measurable.” “Accountability” and “Time-
study research process that involves interviews with project targeted” were integrated into the “Attainability” dimension,
practitioners (interpretivism), and surveys of both experts and defined as “the extent to which target benefits are realistic,
project practitioners (positivism). In particular, we followed given the context in where the organization is managing the
Churchill's three steps for new scale development (Churchill, benefit realization process and the constraints it has.” Finally,
1979; Hinkin, 1998): (1) item generation, (2) content validity, “Relevant” was integrated into the “Comprehensiveness”
(3) scale dimensionality and internal consistency. Table 1 dimension, defined as “the extent to which target benefits
describes our three multi-method studies to address each of reflect organizational strategies and the objectives of various
these steps (Zwikael and Chih, 2014, 2015). stakeholder groups.” The proposed three goal-setting dimen-
sions are discussed in more detail below.

4. Study 1: Item generation (1) Specificity – specific goals result in higher levels of
performance than vague non-quantitative ones (Locke,
The first step in developing a new scale is to generate potential 1968; Linderman et al., 2006). Therefore, a vague statement
dimensions and measurement items. of project target benefits can lead to a firm's poor allocation
of resources and responsibilities (Norris, 1996; Scott-Young
and Samson, 2008). To meet this specificity requirement
4.1. Participants and procedures and prevent different interpretations by various stake-
holders, the literature suggests project target benefits should
We derive an initial list of dimensions and their items for an have a clear benefit title and description (Zwikael and
ETB scale from project benefit management and goal setting Smyrk, 2012). They should also be explicitly defined
literatures; and interviews with 15 senior managers from eight (Breese, 2015; Ward and Daniel, 2006) with a current
Australian Government agencies with strong emphasis on baseline and target value that can be in absolute terms (e.g.,
project benefit management practices (e.g., Australian Depart- achieve a customer satisfaction score of eight on a ten-point
ment of Finance and Deregulation, 2012; Gershon, 2008). We scale) or relative terms (e.g., reduce operations costs by
asked participants to describe how their agencies set and evaluate 10%). Goals should also be measurable to allow organiza-
project goals. We then raised follow-up questions in response to tions to determine whether they have achieved them
participants' answers to clarify information and explore further following project completion (Locke and Latham, 2002).
details. Sample interview questions were: “How do you identify Agreed-upon measures (Ashurst et al., 2008), clear and
and define target benefits for projects?” and “How do you relevant units of measurement (Melnyk et al., 2004;
determine the quality of target benefits?”. We recorded the Heinrich, 2002), a clear source of data (Zwikael and
interviews (which lasted 40 min on average) and later tran- Smyrk, 2012), and consistency across the organization
scribed them for analysis. (Nicholson-Crotty et al., 2006) allow managers to later
determine whether the project has met its target benefits
Table 1 (Ward and Daniel, 2006).
Research overview. (2) Attainability – goals should be challenging, yet attainable
Scale development study Method and sample (Locke and Latham, 2002; Linderman et al., 2006), to
1: Item generation Interviews with 15 senior managers in Australia support the commitment and action undertaken to
2: Content validity A survey of 21 international experts achieve them (Maier and Brunstein, 2001). Similarly,
3: Scale dimensionality and A survey of 132 managers in China project target benefits should be “realizable” (Jenner,
internal consistency
2009) in the sense that they should be “realistic given the
O. Zwikael et al. / International Journal of Project Management 36 (2018) 650–658 653

context in which the organization is operating and the presented in Table 2 and were validated in our additional
constraints it has” (Ward and Daniel, 2006, p.29). Goals studies, which are discussed next.
should have an explicit expected time for completion
(Locke and Latham, 2002). Having such an explicit time 5. Study 2: Content validity
for completion also plays a critical role in developing and
realizing intermediate strategic objectives (Schmidt and The objective of this study is to test the content validity of
DeShon, 2007). Consequently, firms should set target the initial pool of items and their corresponding dimensions
dates to realize project benefits (Breese, 2012; Ward and (Anderson and Gerbing, 1991).
Daniel, 2006) so they can continuously monitor and
evaluate them. 5.1. Participants and procedure
(3) Comprehensiveness – This is defined here as the extent to
which target benefits fully reflect the organization's In this study, we asked experts to sort the 17 items listed in
strategies, as well as the objectives of the key project Table 2 into one of the three dimensions where they fit best,
stakeholder groups. Research has emphasized the impor- and provide feedback on the clarity and readability of each item
tance of goal relevance at various levels (e.g., individual, (Hinkin, 1998). Participants were provided with a definition for
team, and organizational) and across various disciplines each of the three proposed dimensions and the list of items
(e.g., education, healthcare, and management). For example, (presented in random order), but were not given any indication
Veld et al. (2010) suggest that when employees understand as to which dimension we expected the items to fall into.
the relevance of their work to supporting organizational Prior to the main study, a pilot study was conducted involving
strategic goals, they typically align their actions with these one senior academic in the area of management and one research
goals. We adopt Hong et al.'s (2011) approach and suggest assistant to ensure the clarity and readability of the questionnaire.
that comprehensive project target benefits should be Participants for the full study were experts from both academia and
consistent with the organization's long-term vision and industry. A total of 24 requests for participation were sent. Twenty-
current strategies, and follow information gathering from the one experts (88%)—16 senior academics with a PhD in project
external environment, especially key project stakeholders management or a related area with project-related practical
(Ward and Daniel, 2006; Lederer and Mirani, 1995). experience from leading universities, and five senior practitioners
in project management—returned complete questionnaires.
The interviews and literature analysis also suggested 17 Among these responses, nine were received from Australia,
potential items to be included in the three suggested ETB seven from the United States, three from Israel, and two from
dimensions. These items (and their literature source) are New Zealand. This number of respondents falls within the

Table 2
Proposed ETB dimensions and items.
Dimension Item Reference
Specificity S1. Target benefits were assigned a target value (e.g., 10% decrease in road fatalities) Breese (2012), Ward and Daniel (2006), Zwikael and Smyrk
S2. Target benefits were explicitly defined to leave no other interpretation (e.g., Breese (2012), Ward and Daniel (2006), Zwikael and Smyrk
clear title and description) (2012)
S3. Target benefits were assigned a quantitative and/or qualitative measure that Melnyk et al. (2004)
will enable the evaluation of their realization
S4. Target benefits were assigned measures that are consistent with those Nicholson-Crotty et al. (2006)
measuring similar benefits across the organization
S5. Target benefits had a clear unit of measurement Melnyk et al. (2004), Heinrich (2002)
S6. The source of data to measure the target benefits was clear Zwikael and Smyrk (2011)
Attainability A1. Target benefits were achievable given the context of the organization Ward and Daniel (2006)
A2. The organization had the capacity to realize the target benefits Ward and Daniel (2006)
A3. Target benefits were assigned a specific timeframe for their realization Breese (2012), Ward and Daniel (2006)
A4. Target benefits were assigned a dedicated benefit owner who was accountable Zwikael and Smyrk (2012)
for ensuring their realization
Comprehensiveness C1. The metrics were relevant to the measurement of the target benefit Melnyk et al. (2004), Heinrich (2002)
C2. Target benefits were consistent with the organization's current strategy Hong et al. (2011)
C3. The realization of target benefits was important in achieving the organizational Ward and Daniel (2006); Lederer and Mirani (1995)
C4. Target benefits were relevant to the organization's vision Hong et al. (2011)
C5. Target benefits were comprehensive (e.g., comprised of both monetary and Henderson and Ruikar (2010); Irani and Love (2001)
non-monetary benefits, or at operational, tactical and strategic levels)
C6. The team worked intensively in identifying target benefits Breese (2012); Jenner (2009)
C7. Target benefits reflected the views of all stakeholders Doherty (2014)
654 O. Zwikael et al. / International Journal of Project Management 36 (2018) 650–658

recommended 12 to 30 experts suggested by Anderson and 6. Study 3: Scale dimensionality and internal consistency
Gerbing (1991) and Sendjaya et al. (2008).
The objective of Study 3 was to conduct an exploratory
5.2. Data analysis factor analysis (EFA) and internal consistency analysis to
validate the three ETB dimensions and 15 items proposed at the
We used two criteria to analyze the level of agreement of the end of Study 2.
participants with the three dimensions (Anderson and Gerbing,
1991; Linderbaum and Levy, 2010): 1) substantive agreement 6.1. Participants and procedure
(SA), which means the proportion of experts who assign an
item to its theorized dimension (threshold value is .7); and This study involved a cross-sectional survey of senior
2) substantive validity coefficient (SVC), which means the extent managers who were engaged in setting and appraising target
to which experts assign an item to its theorized dimension rather benefits as part of their regular organizational duties. Partici-
than another dimension (threshold value is .5). pants of this study consisted of Master of Management part-
time students at Tsinghua University in China. All students
5.3. Results held full-time management positions with project related
experience, as project managers, funders, sponsors and owners
On average, 77% of the experts' responses fit with our proposed in various industries, such as finance, manufacturing, services,
ETB dimensions. In other words, experts marked an item to fit our and engineering. Survey questionnaires were distributed and
theorized dimension for 13 items (ranged between nine and the collected by the researchers, who also conducted a briefing on
maximum of 17 “correct” items). We also received 48 comments to the questionnaire at the start of the session and addressed
improve the wording of our proposed items. individual questions throughout the data collection process. 132
The results in Table 3 show that thirteen items met the cut- participants in three classes of the same program completed the
off values and hence endorsed their suggested dimensions with questionnaires. All three classes were analyzed as one sample,
changes made to the other four items. In particular, the following a confirmation that participants from the various
proposed Specificity dimension was confirmed for all items, groups shared similar gender, age, and work experience
with SA values higher than .80 and SVCs greater than .60. For characteristics, as well as working in organizations of similar
Attainability items, items A1 and A2 were confirmed with SA types and sizes. Seventy-one percent of the participants were
above .85 and SVCs greater than .70. However, items A3 and male, 29% were under 30 years old, 39% were between 30 and
A4 scored low on both measures, whereas C4 satisfied only the 40 years old, 30% were between 40 and 50 years old, and 2%
SA threshold value. Following the experts' suggestions, we were between 50 and 60 years old. The majority of participants
rephrased items A3, A4, and C4 and moved item A4 to the held managerial organizational positions (8% were non-
Specificity dimension. In the Comprehensiveness dimension supervisory staff, 6% were junior managers, 63% were middle
five of the seven items scored above the threshold levels in managers, and 23% were top managers), with an average work
both measures, but due to low scores on both measures and experience of 13.2 years. Participants held positions in both
overlapping with other items, we removed items C1 and C3. private (36%) and government (64%) organizations, with an
We then used this revised 15-item scale in the following study. average organization size of 2667 employees.

Table 3
Content validity.
Item number b Substantive agreement (SA) Substantive validity coefficient (SVC) Outcome
S1 .85 a .85 a Proposed dimension confirmed
S2 .95 a .89 a Proposed dimension confirmed
S3 .85 a .70 a Proposed dimension confirmed
S4 .83 a .67 a Proposed dimension confirmed
S5 .80 a .60 a Proposed dimension confirmed
S6 .85 a .70 a Proposed dimension confirmed
A1 1.00 a 1.00 a Proposed dimension confirmed
A2 .85 a .70 a Proposed dimension confirmed
A3 .50 .00 –Item's wording rephrased
A4 .37 .00 –Suggested better fit with “Specificity”
C1 .10 −.70 –Item removed
C2 .75 a .55 a Proposed dimension confirmed
C3 .42 −.16 –Item removed
C4 .70 a .45 –Item's wording rephrased
C5 .84 a .74 a Proposed dimension confirmed
C6 .78 a .61 a Proposed dimension confirmed
C7 .84 a .79 a Proposed dimension confirmed
Item meets minimum required value for this test: .7 for SA and .5 for SVC.
Dimensions: S-Specificity; A-Attainability; C-Comprehensiveness.
O. Zwikael et al. / International Journal of Project Management 36 (2018) 650–658 655

To assure equivalence between the questionnaire in Chinese additional 22% to the cumulative explained variance with all
and the original English version, a standard translation and loadings between .52 and .73. Items C2 and C4 fell into this
back-translation procedure was performed (Brislin, 1980). dimension with C4 also having cross loadings (.42) with its
First, an English version of the questionnaire was translated original dimension. The final Comprehensiveness dimension
into Chinese by a bi-lingual Chinese-English researcher. Then, contributed an additional 17% to the cumulative explained
an additional person proficient in both languages compared the variance with all loadings between .67 and .84. Last, we
original questionnaire with the translated questionnaire. This clarified and simplified the wording of the three items in
process was repeated until satisfactory results were reached. question and ensured the allocations of items were in alignment
Participants were asked to recall a recent project proposal they with the very logical and robust suggestions received from the
had proposed or reviewed, and mark their level of agreement experts of study 2.
according to the 15 ETB items derived from Study 2 for that Following the implementations of these changes, the internal
proposal (the unit of analysis). Proposed items (presented in reliability of the scale and each of its dimensions were
random order) were phrased in the form of statements to be marked calculated and the ETB items were finalized. The full scale's
by participants on seven-point Likert scales, from “Strongly Cronbach's Alpha was .904, which suggests all scale items are
disagree” (1) to “Strongly agree” (7). Such a technique is widely closely related. The Cronbach's Alpha values for each
regarded as appropriate for measuring attitudes (Nunnally, 1978). dimension are presented in Table 4, together with the final
ETB scale (Zwikael and Chih, 2015).
6.2. Data analysis
7. Discussion
As suggested by Churchill (1979), we purified the proposed
measure by conducting an Exploratory Factor Analysis (EFA) This research is set to address the research question: “What are
to determine the dimensional structure of the ETB scale. To effective project target benefits?” Whereas some target benefits are
examine whether the items load onto the specified dimensions, easier to set and measure effectively (e.g., reduced operational
we performed a rotated Varimax factor analysis with Kaiser costs), others are more difficult to quantify (e.g., an advanced
Normalization to maximize the sum of the variances of the organizational culture following a transformational change pro-
squared loadings. Internal consistency was analyzed by ject). This paper found that a proposed project's target benefits are
calculating Cronbach's alpha values for the entire ETB scale, effective when they are comprehensive (e.g., reflect the views of
as well as for each dimension separately. key external stakeholders), specific (e.g., use measures defined
consistently across the organization), and attainable (e.g., achiev-
6.3. Results able given the organization's context and constraints). The
proposed Effective Target Benefits (ETB) scale can guide:
The factor analysis with Kaiser normalization supported a managers in setting goals for their proposed projects, senior
three-factor model, which explained 63% of the ETB variance. executives in evaluating project business cases for funding, and
The Specificity dimension contributed 24% to the cumulative project managers in making project decisions that are aligned with
explained variance with all loadings between .50 and .82 and the project's strategic goals.
only one item (S2) having a cross loading with the Attainability As an illustrative example for an effective target benefit we
dimension, though lower (.50) than the loading in its origin consider a project of building a bridge over a busy road next to
dimension (.57). The Attainability dimension contributed an a school. In this project, the target benefit is to “reduce the

Table 4
The final Effective Target Benefits (ETB) scale.
Dimension Item title
Specificity (7 items; α = .874) Target benefits are assigned a specific target value (e.g. 10% increase in market share)
Target benefits are explicitly defined to leave no other interpretation (e.g. clear title and description)
Target benefits are assigned specific measures that will enable the evaluation of their realization
Target benefits are assigned measures that are defined consistently
Target benefits have clear units of measurement
The source of data to measure the target benefits is clear
Target benefits have a dedicated person accountable for their realization
Attainability (3 items; α = .734) Target benefits are achievable given the context of the organization
The organization has the capacity to realize the target benefits
Timeframes set for target benefit realization are realistic
Comprehensiveness (5 items; α = .787) Target benefits are aligned with the organization's current strategy
Target benefits are relevant to the organization's long-term vision
Target benefits comprise multiple categories (e.g. both monetary and non-monetary benefits)
Target benefits are the result of intensive consultation with various stakeholders
Target benefits reflect the views of key stakeholders
656 O. Zwikael et al. / International Journal of Project Management 36 (2018) 650–658

number of accidents on this particular road by 25 percent within 8. Conclusions

one year from project approval”. The education department
head in the local government will be accountable for its Projects aim to realize their target benefits and enhance
realization as a representative of the project funding entity. This organizational performance (Zwikael and Meredith, 2018).
target benefit can be considered “specific” as it has a clear Whereas “fortuitous benefits” are unexpected and emerge
description, measurement unit, target value, and accountable during the project (Zwikael and Smyrk, 2011), “target benefits”
person. It can also be considered “comprehensive” because it is are intentionally sought by project funders and strategically set
aligned with the strategy of the education department to before project commencement. We developed and validated a
increase the safety of schoolchildren, and was set following new scale to help set target benefits more effectively. We found
consultation with diverse groups of stakeholders (e.g., parents, substantial support for a 15-item scale that comprised three
teachers, and road engineers). Finally, this target benefit would dimensions. The first two ETB dimensions confirm established
be considered “attainable” if the target value and time frame set goal setting characteristics - specificity (e.g., target benefits
for this target benefit are realistic (e.g., benchmarking against have a specific target value) and attainability (e.g., the
other similar projects). organization has the capacity to realize the target benefits).
The practical value of the ETB scale can be further However, this paper contributes to goal setting theory by
strengthened if organizations develop threshold scores for adding the additional dimension of “comprehensiveness” and
project proposals under review. Specifically, organizations may its associated items in the project context. The comprehensive
set a cut-off score for the complete ETB scale; and introduce a dimension of the ETB scale encourages the use of an “outside
gate-keeping system to ensure that only project proposals that view”, which is based on previous actual objective and
have met this threshold score are advanced to project funding comparable data from similar actions already completed, rather
decision-making. Such organizational threshold levels could be than relying on the “inside view”, which focuses on the
determined from a benchmarking exercise within the organiza- constituents of the specific planned action (Kahneman and
tion (internal benchmarking), or by comparison to a top- Tversky, 1979; Flyvbjerg, 2013).
achieving outside organization (external benchmarking) Even though the challenges in setting measurable non-
(Meredith and Shafer, 2016). financial target benefits are well documented in the literature,
As an initial baseline for comparison, findings from our studies organizations still need to identify measures and proxies to
suggest an average ETB score of 5.8 on a seven-point scale. allow project benefits to be set, managed, and evaluated. One of
Therefore, if a proposed project's target benefits receive an the most valuable uses of ETB is the discussion it forces among
average score of five, they cannot not be considered as “effective” senior managers about each of the 15 items in the scale and the
and need to be revised further (until a threshold score is obtained). project strategic questions such discussion may raise. That
Organizations may also set threshold levels for each ETB discussion inevitably produces a better project choice because
dimension, as well as weights to reflect their relative importance. all the managers are then on the same page and agree with, or at
By developing organization-wide threshold levels for an ETB least understand, the final decision. The followings are example
scale, senior managers can ensure a certain level of uniformity in questions that likely to arise in such discussions: “Can we really
the assessment of new proposed projects, leading to more get this done by the time it is needed?”, and “Have we checked
informed and justifiable funding decisions. This thorough with outside stakeholders like government regulators about this
assessment of project proposals can also assist with increased project?” Thus, in actual practice, the ETB scale can reduce or
levels of transparency in decision making (Mihm, 2010). As a eliminate common problems such as those stemming from
result, organizations can reduce instances in project investment unclear or conflicting project objectives (Lin and Pervan, 2003;
decision making of Type II errors (funding for over-promising but Norris, 1996) and misunderstood or ignored users' needs. As a
unreliable project proposals, a common result of the well-known result, evaluating project proposals using the ETB scale as a
“planning fallacy” (Kahneman, 2011)) and Type I errors (rejecting checklist can improve funding decisions which should thereby
solid project proposals due to overly restrictive or irrelevant increase their project success rates.
requirements or simply lack of funding already spent on Type II Senior managers can also develop a better understanding of
errors) (Christensen and Knudsen, 2010). what target benefits are expected at a project's completion, how
The ETB scale can also offer important theoretical value for these benefits should be measured, and who is accountable for
research. In particular, scale development is considered a their realization. This understanding can not only reduce
critical step towards future research in a new area (Hinkin, “planning fallacy” errors but also increase executives' confi-
1998). Thus, the new ETB scale can be used to empirically dence in their funding decisions (Gimbert et al., 2010). Finally,
study the relationships between project target benefits and other organizations commit considerable financial and human
related constructs in areas such as decision making, strategy, resources on appraising projects and making investment
and project benefit management and performance. For exam- decisions. For example, the promoters of the EuroTunnel
ple, in decision making, the ETB scale can be used to project spent US$1 million before the project even started
investigate how the formulation of effective target benefits (Mohamed and McCowan, 2001). Senior executives can use
affects the project funding decisions. Another example is to the new scale to appraise and rank proposals in a transparent
empirically test whether and to what extent effective target way to better allocate resources among their many projects.
benefits support project performance. Project managers can also benefit from effective target benefits,
O. Zwikael et al. / International Journal of Project Management 36 (2018) 650–658 657

as clear project goals support them throughout project Flyvbjerg, B., 2007. Policy and planning for large-infrastructure projects:
execution in making better strategic and long-term decisions problems, causes, cures. Environ. Plann. B. Plann. Des. 34, 578–597.
Flyvbjerg, B., 2013. Quality control and due diligence in project management:
that are in alignment with the expectations of the project funder getting decisions right by taking the outside view. Int. J. Proj. Manag. 31,
and owner. 760–774.
Our paper has some limitations that could be addressed in Gershon, P., 2008. Review of Australian Government’s Use of Information and
future studies. First, we did not attempt to determine the relative Communication Technology. Department of Finance and Deregulation,
Australian Government, Parkes.
importance of the three ETB dimensions. Future studies could
Gimbert, X., Bisbe, J., Mendoza, X., 2010. The role of performance
consider alternative weighting schemes, which could vary, for measurement systems in strategy formulation processes. Long Range Plan.
example, by organization size or culture. Similarly, we did not 43 (4), 477–497.
weight the factors within each of the dimensions and rely on Goldstein, S.M., Naor, M., 2005. Linking publicness to operations management
data from a limited number of countries. Future research can practices: a study of quality management practices in hospitals. J. Oper.
Manag. 23 (2), 209–228.
explore whether different weighting schemes are required for
Heinrich, C.J., 2002. Outcomes-based performance management in the public
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Hinkin, T.R., 1998. A brief tutorial on the development of measures for use in
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