Business CaseHere you can find a simple Business Case template in Microsoft Word/Excel format, along with explanation on how to use it.
Let’s say you’re initiating a project to create a mobile app for your business. Why are you doing that? Just because everyone else does, or do you have a good reason?
Maybe you believe that it helps with your sales. That’s a good start; now you need to have a good level of confidence that it’s going to happen. You want to know that the benefits of that app is higher than its cost. But, is it enough only if the benefits are higher? Maybe you can do something else instead of that that is much more beneficial to you.
So, first we focus on the goal. In this example, our goal is to increase sales. We have to think about different “options” that we have for achieving our goal; i.e. options other than the mobile app. Then we will evaluate all those options and pick the one that seems to be the best. Let’s say the mobile app is our best option.
Now it’s time to document the justification of the project that will run this option. Do you remember that continuous justification is one of our principles in PRINCE2?
OK, to do that, we will think of what we have to spend, and what we will earn. What we have to spend is the cost of the project and the cost of maintaining the product after the project. In addition to that, each project has dis-benefits, so we should consider them here as well. Then this part will be compared with what we earn: benefits. Hopefully the benefits are much higher and the project is justifiable ;)
But wait! How can we be sure? What about the uncertainties?
Of course, we must consider the uncertainties (aka risks) as well as we can. That’s why we should document the major risks in the Business Case, and see how they affect the benefits and costs. Since these things are uncertain, you can measure them in ranges of values instead of exact ones.
OK, that’s it about the Business Case! Let’s see what we have in the template:
Document information: this is the generic information about the document and connections with your Configuration Management system. Feel free to add more information here, but it’s best to keep it simple.
Approval: this section is for capturing approvals. There are multiple lines, because you may have multiple versions of this document approved. If you have a well-formed Configuration Management system to track approvals, feel free to remove this section.
Reasons: why did we start thinking about having this project? What is the problem that we want to solve? This is the absolute starting point, and we should document it to ensure that we don’t forget it during the project.
Options: how can we solve the problem? There are always multiple options. By the way, don’t forget the option of “do nothing”.
Costs and Benefits: here you add anything that can cost you money, or help you earn money.
Investment Appraisal: finally, you combine all the costs and benefits to see if the project is justifiable. The result can be something like “The cost of this app will be returned in 4 months, and after that, we will have about €20k extra profit each month.
If you’d like to learn everything about PRINCE2, I can suggest our eLearning courses:
- PRINCE2® Foundation Online Course
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- PRINCE2 Agile® Practitioner Online Course
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