Why Prepare a Business Case?
The reason for developing a business case is to identify the financial justification for the potential benefits arising as part of the proposed outcome from the proposed activity, in order to provide an objective support to the investment in the costs of the change. These potential benefits and costs may be tangible or intangible and they may be easily quantifiable or purely qualitative.
The process followed in preparing the business case would be as follows; hold preliminary discussions with the business stakeholders to identify their problem; aim to ensure that they own the problem and has identified the potential opportunities at this stage; perform further investigation to deepen the awareness of these opportunities; quantify and – given that organisations operate with finite resources – prioritise the identified opportunities; design action plans for those opportunities that the business wishes to pursue and implement the strategies.
The tracking of the potential benefits and costs that will eventually be realised is also an integral part of the business case. It will usually be the case that the monitoring of the change project is embedded into the organisation’s normal routines for management reporting.
Typically in a large scale project, there will be at least two business cases: the first based on the high level project design grounded in the preliminary work and the second based on the more detailed, committed project results and budgets.