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Business case

Purpose:

  • e Business Case is used to obtain management commitment and approval for investment in business change including projects and programmes, through rationale for the investment.
  • The Business Case provides a framework for planning and management of the business change.
  • The ongoing viability of a project or programme will be monitored against the Business Case.

Fitness for purpose checklist:

  • Is the business need clearly stated?
  • Have the benefits been clearly identified?
  • Are the reason for and benefits of the project consistent with the organisation’s strategy?
  • Is it clear what will define a successful outcome?
  • Is it clear what the preferred option is?
  • Is it clear why this is the preferred option?
  • Where there is an external procurement is it clear what the sourcing option is?
  • Is it clear why this is the preferred sourcing option?
  • Is it clear how the necessary funding will be put in place?
  • Is it clear how the benefits will be realised?
  • Are the risks faced by the project explicitly stated?
  • Are the plans for addressing those risks explicitly stated?

Suggested content:

The Business Case should contain information covering five key aspects: strategic fit, options appraisal, commercial aspects, affordability and achievability.

Strategic fit

  • Minimum content needed for this section:
  • Description of the business need and its contribution to the organisation’s business strategy

Objectives

  • Why it is needed now
  • Key benefits to be realised
  • Critical success factors and how they will be measured.

Options appraisal

  • Minimum content needed for this section:
  • High level cost/benefit analysis of (ideally) at least three options for meeting the business need
  • Include analysis of ‘soft’ benefits that cannot be quantified in financial terms
  • Identify preferred option and any trade-offs.

Commercial aspects

  • This section is applicable where there is an external procurement; this section outlines the potential deal. Most of this information will be produced for the Outline Business Case.
  • Minimum content required for this section:
  • Proposed sourcing option with rationale for its selection
  • Key features of proposed commercial arrangements (e.g. contract terms, contract length, payment mechanisms and performance incentives)
  • The procurement approach/strategy with supporting rationale.

Affordability

  • Minimum content for this section:
  • Statement of available funding and ‘ballpark’ estimates of projected whole-life cost of project
  • Including departmental costs (where applicable).

Achievability

  • Minimum content for this section:
  • High level plan for achieving the desired outcome, with key milestones and major dependencies (e.g. interface with other projects)
  • Outline contingency plans e.g. addressing failure to deliver service on time
  • Major risks identified and outline plan for addressing them
  • Provider’s plans for the same, as applicable, skills and experience required. 

Source information:

  • Procurement documentation
  • Programme/Project management plans and documentation
  • High level requirements
  • Business Strategy

 

Notes:

  • For larger projects, the Business Case should be developed in three stages:
  • Preliminary Business Case (or Strategic Outline Case) to confirm strategic fit and business need, typically no more than one or two pages.
  • Outline Business Case - indicative assumptions to support the preferred way forward (including procurement strategy, where applicable), variable length depending on the scale of the project.
  • Full Business Case - validated assumptions to support the investment decision, variable length depending on the scale of the project.
  • The level of detail required at each stage depends on organisational standards and the scale or complexity of the project.
  • For small projects, you may only need to produce the business case in one stage, with confirmation of prices, funding availability etc.

 

Templates

Business case template - minimal content (PDF)

Business case template - detailed content (PDF)

 

Further information:
HM Treasury Green Book for options appraisal.

See the briefing on the Business case

OGC's Achieving Excellence Guide 7: Whole life costs

See also the Gateway workbooks, which ask key questions about the development of the business case throughout the project lifecycle