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Value for Money Tradeoffs


Location:

New Zealand and Australia

Client:

Two separate Not for Profit enterprises

The one charity is an iconic and mature organisation with desires to widen and deepen their offering in a number of ways; the other is relatively new with significant expansion opportunities, some involving large capital investment others ranging into new markets and new services including via acquisition. Both needed to make value for money tradeoff decisions of what they could afford to do and absorb organisationally.

The particular challenge the organisations faced was all initiatives fell within their strategic direction, so a wider set of assessment criteria was needed to evaluate tradeoffs. We provided a proven evaluation methodology well suited for clients with a range of strong stakeholder interests. The methodology evaluates the strategic, investment and consequential benefits of delivering each initiative and sets them off against the strategic and ‘execution’ risks of actually delivering that benefit. It also considers ‘opportunity window’ implications and the degree the initiative is driven by compliance requirements.

Each initiative evaluation is scored, so they can weighed against each other and their relative ranking established. The criteria are sufficiently broad to be able to rank almost all business initiatives with them. This provides a useful way to compare the ranking of say an asset investment opportunity against an organisational expansion initiative.

We conduct the evaluation using facilitated exec team workshops. As much benefit is gained from the shared understanding of the benefit/risk of the initiative as from the outcome of the ranking. Ultimately the rankings are not taken as ‘givens’ but as inputs to making hard decisions on what tradeoffs will be made to accelerate, drop or reshape initiatives.

Project Contact: David Taylor