Business case development: Is it important and what should it contain?

By Allan Watton on

Business Case DevelopmentThe most successful service delivery relationships have business case development at their core, ensuring that they clearly articulate the specifics of what will change in the organisation once the business objectives or outcomes have been achieved. A sound business case will identify what operational, financial and resource challenges will be overcome from the present state and what business objectives will be achieved through successful service delivery (the future state). It will also quantify what the adverse impact of poor delivery will be on the organisation in the event the services do not deliver the expected business objectives. This allows the organisation to have a ‘Plan B’ about how to remediate such a situation and over what timescale. 

Why is Business Case development important?

The reasons why you need to create a clearly articulated business case are relatively straightforward: 

1 – It helps decision-makers to ensure that: 

    • The proposed service delivery will have value and relative priority compared to alternative delivery methods based on the objectives and expected benefits laid out in the business case. 
    • The performance indicators it contains can be used as clear measurements to monitor whether the business and behavioural changes are being achieved.

2 – Relevant extracts from the business case help suppliers to understand ‘why’ your organisation is outsourcing/commissioning the service and what is expected of them.

What should a sound Business Case contain? 

A sound business case should: 

  • Align to the criticality, scale and nature of the service to be delivered 
  • Address the key business issues to be resolved on a consistent basis 
  • Highlight the business capabilities required to make the desired impact on services. It would not normally be appropriate to include any detailed technical focus 
  • Include all the factors necessary for an objective evaluation/assessment to be made 
  • Ensure clear communication so that the reasoning is relevant, understandable and is structured in a way so that it is simple to evaluate 
  • Have clear and quantified measurements so that the realisation of benefits can be appropriately tracked and measured to determine whether you are on target to achieve the business objectives you had set out 
  • Have transparent reasoning which can be appropriately evidenced 
  • Have clear accountabilities about who is responsible for the delivery of the various aspects of the benefits and how the costs of delivery will be managed. 

How is a good Business Case structured?

Anyone involved in business case development needs to understand that it is not just the content that is important, the structure of the business case should help to present your case clearly and logically. For a business case to effectively communicate the ‘why’ (evidence and justification for mobilising the investment decision) of supporting specific types of strategic service delivery, it must be presented in a structure that is both clear and all-encompassing of the facets needed for a reader’s understanding of the case you are making. The following structure has been formulated from the evidence we have analysed in our research: 

  • Preface 
  • Table of Contents 
  • Executive Briefing 
  • Recommendation 
  • Summary of Results 
  • Decision to be Taken 
  • Introduction 
  • Business Drivers 
  • Scope 
  • Financial Metrics 
  • Analysis 
  • Assumptions 
  • Cash Flow Statement (NPV) 
  • Costs 
  • Benefits 
  • Risk 
  • Strategic Options 
  • Opportunity Costs 
  • Conclusion, Recommendation, and Next Steps 
  • Appendix 

Want to know more?

If you were looking specifically for help with developing a Business Case for Termination, visit our dedicated service page here.