The business case, along with the benefits realisation management (BRM) plan are the main inputs to portfolio management.
All planned benefits should be appraised, astimated, verified and agreed by the organisation. After all, the planned benefits (aligned with their respective organisational objectives) are what justifies the organisation to commission a portfolio, program or project and proceed with these initiatives.
A business case is developed during the early stages of a project and outlines the why, what, how, and who necessary to decide if it is worthwhile continuing a project. A business case answers the question:
“What will happen if we proceed with this investment decision?”
There are different drivers for a business case which can be summarised as:
- Risk reduction and reduction of negative financial impacts
- Positive financial impacts and growth through new markets, increased sales and cost reduction
- Increased employee attraction and retention
- Increased customer loyalty and attraction
- Innovation and development of new technologies
- Operational efficiency and effectiveness
Typically the structure of a Business Case will comprise the following:
- Executive Summary — Communicate a high-level summary of the project.
- Finance — Provide a robust estimate of the costs of the investment, and its financial benefits.
- Project Definition — Outline the business objective. Provide relevant background and supporting information to put the investment into business context (yes, that means market assessment). Rigorously assess the benefits, inherent risks, including how they are likely to affect the investment and outline strategies for mitigating them. Identify the project scope and outline the main activities and overall timescale.
- Project Organisation — Describe how the project is structured and the different levels of decision-making. Finally, prepare a concise progress report.
Experienced organisations may have in-house expertise allowing them to prepare a business case. However, some organisations will not have the full range of skills required and may wish to appoint an independent management consultant to assist them.
Some interesting articles to read about business cases:
A business case is developed during the early stages of a project and outlines the why, what, how, and who necessary to…