Back to Benefits Realization Management

Benefits Identification

5 minutes 5 Questions

Benefits Identification involves the process of defining the expected tangible and intangible values from the project. It begins during the project initiation phase where key stakeholders express their expectations. Then these expectations are elaborated, clarified, and documented as benefits in the business case document of the project. Effective benefits identification requires understanding the business strategy, stakeholder values, and how the project can potentially cater to these aspects.

Benefits Identification Guide and Exam Tips

What is Benefits Identification?
Benefits Identification is a detailed process in Benefits Realization Management, focusing on the identification and documentation of benefits linked with an investment or project. These benefits can be monetary or non-monitory like improvement in product quality, improved customer service, etc.

Why is it Important?
The importance of Benefits Identification lies in providing clarity about the potential value of a project. It aids in decision-making, aligning projects with strategic objectives, and estimating project ROI.

How it Works?
The first step is identifying potential benefits. Next, these benefits are documented with all relevant details. The focus is on transparency and traceability of benefits. Then these benefits are categorized for easy governance. Then comes the validation of benefits.

Exam Tips: Answering Questions on Benefits Identification
1. Understand the Concept: Have a thorough understanding of the entire lifecycle of benefits realization management. Conceptual clarity will help you answer applications based questions.
2. Study Past Papers and Mock Tests: Provide exposure to the types of questions that could be asked.
3. Use Practical Examples: For descriptive answers, it is beneficial to highlight your answer with real or hypothetical examples to reinforce your understanding of the concept. Real-life industry examples can also earn you extra points.
4. Be Concise and Clear: Often, questions on Benefits Identification require clear and concise answers. Stick to the point and do not add unnecessary information.
5. Use Defined Terminologies: Usage of defined terminologies related to benefits realization management demonstrates your in-depth understanding of the concept.

Note: Remember that the rigor and applicability of Benefits Identification could change based on organizational practice and the nature, scale, and complexity of the investment or project. So, your answers may need to reflect that understanding.

Test mode:
Start practice test
CAPM - Benefits Realization Management Example Questions

Test your knowledge of Amazon Simple Storage Service (S3)

Question 1

During a benefits identification session for a new project, a stakeholder suggests a benefit that conflicts with the organization's ethical guidelines. What should the project manager do next?

Correct Answer: Evaluate the suggested benefit against the organization's ethical standards and discuss implications with stakeholders

The best course of action for the project manager is to evaluate the suggested benefit against the organization's ethical standards and discuss implications with stakeholders. This approach is the most professional and balanced way to handle the situation.

Here's why this is the correct answer:

1. It acknowledges the stakeholder's input while also respecting the organization's ethical guidelines.
2. It allows for a thorough assessment of the benefit's implications.
3. It promotes open communication and transparency with stakeholders.
4. It demonstrates the project manager's commitment to ethical practices and organizational values.

The other options are not as appropriate:

Documenting the benefit and including it in the project charter is not advisable, as it would mean accepting a suggestion that conflicts with ethical guidelines.

Rejecting the suggested benefit outright is too hasty and may damage stakeholder relationships. It doesn't allow for discussion or potential compromise.

Consulting with the project sponsor to adjust ethical guidelines is not a good practice. Ethical guidelines are typically established at an organizational level and should not be easily changed for a single project benefit.

By choosing to evaluate and discuss, the project manager maintains ethical integrity while fostering stakeholder engagement and exploring potential solutions or alternatives.

Question 2

In a project to develop a new customer relationship management (CRM) system, the project manager identifies potential benefits such as improved customer satisfaction, increased sales, and reduced operational costs. However, during the project execution, the project sponsor expresses concern about the project's ability to deliver these benefits. What should the project manager do to address this concern and ensure effective benefits identification?

Correct Answer: Organize a workshop involving the project sponsor, stakeholders, and team to collaboratively evaluate the benefits, aligning them with organizational goals and detailing a benefits realization roadmap with measurable indicators and assigned responsibilities.

The correct answer emphasizes the importance of collaborative engagement with all project stakeholders, especially the project sponsor, in validating and aligning the project benefits with organizational goals. It suggests a proactive approach in establishing a structured plan for benefits realization which is critical for addressing concerns and ensuring project success. The wrong answers, while relevant to project management, fail to directly address the sponsor's concerns about benefits realization, either by focusing on peripheral project management activities or by omitting stakeholder engagement essential for validating and aligning benefits with the organization’s objectives.

Question 3

As a Program Manager, you have identified a potential benefit for a new project that aligns with the strategic objectives of the organization. What is the next step in the benefits identification process?

Correct Answer: Evaluate the potential benefit against the organization's strategic goals and current portfolio for alignment and feasibility.

After identifying a potential benefit that aligns with the strategic objectives of the organization, the next step involves a more evaluative and preparatory phase. This includes ensuring the benefit's alignment and feasibility within the current organizational context and strategic plans. Conducting preliminary risk assessments, prioritizing against other objectives, and stakeholder analysis are relevant steps but come either concurrently with evaluation or as subsequent actions based on the initial validation process.

Go Premium

Certified Associate in Project Management Preparation Package (2024)

  • Earn 15 PDUs needed for your CAPM certification
  • 4454 Superior-grade Certified Associate in Project Management practice questions.
  • Accelerated Mastery: Deep dive into critical topics to fast-track your mastery.
  • Unlock Effortless CAPM preparation: 5 full exams.
  • 100% Satisfaction Guaranteed: Full refund with no questions if unsatisfied.
  • Bonus: If you upgrade now you get upgraded access to all courses
  • Risk-Free Decision: Start with a 7-day free trial - get premium features at no cost!
More Benefits Identification questions
29 questions (total)
Start 29 question test