A business case takes an organization through a thought process that evaluates its current functioning, future goals, and what it needs to accomplish those goals. It is designed to provide information for senior management, from the president on down, so they can make informed decisions regarding the future direction of the organization. Essentially, it is an argument written by a representative of the organization, outlining the reasons for undertaking a certain project or activity. It often is presented in a well thought out written document, however, can also come from a short oral presentation or verbal discussion. Because it provides such detailed information, a business case is often the first step a management will take when formulating their strategy.
In order for a business case to be truly effective, it must be well organized and written, and it must provide a clear summary of the risks associated with implementing a strategic initiative. In addition, it must have supporting documentation such as customer feedback and other financial documents. Some people believe that a business case is a prerequisite to a successful project, while others believe that a successful project can be implemented without a business case. While the former is correct, if the business case lacks the detailed information necessary to support its claims, the implementation will fail.
As stated above, a business case is primarily a planning tool. However, it can also provide the executive leadership tools necessary to outline the benefits derived from a new project. For example, if there are known benefits from a new project, these should be included in the case. Likewise, the benefits from existing projects should also be highlighted, especially those that directly impact key stakeholders.
Let’s consider 2 business case examples: One hypothetical involves a man whose job is to implement a computer program that will help increase his personal life and overall productivity. The man is interested in increasing the profitability of the business. The second man is a married man who realizes that he needs a more effective method for managing his personal life.
In this business case, the first man creates an outline of his desired goals, and he analyzes the current situation and budget. He then identifies the benefits derived from the project, and he analyzes the remaining options. As part of his summary, he includes two pages that include the summary of his recommendations, the cost-benefits analysis, and his recommendations on how to make sure that everyone involved in the project understands the key benefits of the initiative. At the end of this page, he includes two pages that display his summary and project details, with instructions and a link to his contact information. To ensure that the organization fully understands the implications of his recommendations, he includes a final set of organizational goals, values, and short-term and long-term goals.
Each of the two business case examples has a number of important benefits. However, the first man’s summary and plan goes one step further in describing the impact of his recommendation. The benefits include the anticipated benefits from increased productivity, improved morale, and increased market share. The analysis on the other hand analyzes the negative costs that could result if the initiative fails. He also includes information on timescales, such as deadlines and milestones, and he provides information on how his plan will affect each of these timescales.