Developing new schemes is one of the largest areas of expenditure for Registered Providers (RPs), often amounting to millions. Without the right benchmarking and financial oversight, these projects can pose significant risks. DTP assists clients in addressing these challenges by offering a tailored, data-driven approach to benchmarking, informed by extensive experience in the sector.
Here DTP Senior Consultant Andy Chapman explores the importance of benchmarking for RPs, the key challenges it can address and the support DTP offers to help RPs manage development projects effectively.
How can Benchmarking support the development process?
Given the scale of investment required for developments, it is crucial for RPs to have a clear understanding of costs, risks and the financial health of their development programmes. Benchmarking allows RPs to measure their performance against others in the sector, providing insights that can inform better decision-making and mitigate risks.
The need for benchmarking arises from several common challenges we’ve observed in the sector:
These issues highlight the importance of having robust procedures and financial assessments in place to ensure development success. Benchmarking plays a critical role in this process by providing data that informs decision-making at every stage of a project, from appraisal to completion.
What does Benchmarking Involve?
At DTP, we work closely with more than 50 clients on business planning and treasury management, with their permission, this gives us access to a wealth of data on development benchmarks. By drawing on this data, we can provide our clients with insights into key performance metrics, such as:
In addition to providing these benchmarks, we also explore whether these parameters are integrated into both the business plan and development appraisals, which is often not the case. This can lead to friction between finance and development teams, as financial realities are sometimes overlooked during the appraisal process. By ensuring alignment between business planning and development appraisals, RPs can avoid potential conflicts and ensure projects remain financially viable.
Development Appraisal Software
Another key area where we support RPs is in selecting and implementing the right development appraisal software. Whether it’s ProVal, PamWin, bespoke spreadsheets or DTP’s own spreadsheet model for smaller clients, we help RPs review their current software to ensure it is fit for purpose. If improvements are needed, we guide them through the process of identifying and procuring the best solution.
A critical consideration in this process is ensuring that the development appraisal software integrates smoothly with financial business planning models such as Brixx or Abovo. This ensures that the financial impact of development decisions is clearly visible, enabling RPs to make informed choices that align with their long-term financial plans.
Procedural Reviews for Improved Collaboration
One of the most common issues we encounter is a lack of understanding between different departments, particularly finance and development. This can lead to miscommunication, misaligned objectives and, ultimately, poor decision-making. To address this, we facilitate workshops where teams from across the organisation come together to review the process of agreeing and delivering a scheme. By mapping out the journey from initial appraisal to completion, we can identify challenge points and develop solutions that satisfy the needs of all parties.
This collaborative approach fosters a deeper understanding of the challenges faced by each department, improving inter-departmental harmony and ensuring that key information reaches the board and committees at the right time.
Supporting Smaller Housing Associations
For smaller housing associations that lack dedicated development teams but still have development ambitions, DTP offers light-touch project management. We provide support in running development appraisals, integrating them into long-term financial plans and continuously updating these plans as projects progress. This ensures that boards are kept informed of any changes and can take timely action if required.
Additionally, we conduct post-project reviews to capture lessons learned, helping smaller RPs improve their processes and avoid repeating mistakes in future schemes.
Setting up a Benchmarking Club
For our business planning retainer clients, we are in the process of establishing an annual benchmarking club. For a small fee, clients will have the opportunity to compare their development performance against that of their peers. This initiative will provide invaluable insights into key development parameters, helping RPs stay competitive and aligned with sector trends.
How DTP can Help
At DTP, we have developed a comprehensive toolkit based on years of experience working with social housing providers. Whether it’s benchmarking, selecting the right software, facilitating cross-departmental reviews or supporting smaller housing associations with project management, we are committed to helping RPs deliver successful development projects that meet their financial and operational goals.
For more information on how DTP can support your organisation with development benchmarking and other services, please get in touch with Andy Chapman on: a.chapman@dtp.uk.com
