Managing the financial impacts of change

I've had a few discussions lately about financial control in a change and project environment. Too much to discuss in detail here, but here's a 'top of my head' list of the things that you might do to keep financial control of your project;

• Build a narrative business case, and detailed plan;
• Align that to detailed numbers - implementation (revenue) expenses, capital expenses phased to show cashflow (cash is king!), and benefits case - what will be delivered when and what will the real impacts be;
• Develop a risk weighted NPV - use factors such as 'do we know how to do this?', 'do we have the resources?', 'budget?' to show an NPV - over time improve the NPV by adjusting the risk factors as you satisfy yourself that you can achieve it. The NPV (or ROCE) is a great measure to show expected financial outcomes.
• use qualitative measures to support your numbers (which of course you will monitor in detail weekly/monthly!) - are deliverables being completed or is there a bow-wave of activity building up with consequent cashflow impact, are the numbers and criticality of open issues/risks increasing etc
• Use graphs to compare measures - see the relatives as well as the absolutes.
• Make sure any numbers that you use are reconciled to source data (ie; are accurate), and preferably 'triangulated' to two sources

With proper (basic) systems and processes, much of this monitoring can be automated!

Enough for now!