A business case reveals a situation which is a problem or an opportunity, and details how the situation could be improved or addressed to significant benefit.
Define the Situation
Your starting point is to have a crystal-clear understanding of the situation. In fact, you should have it so clear in your own mind that you could sketch a simplified version of the situation on the back of an envelope.
How do I start?
Based on your understanding of the situation, you need to detail your proposition. It might be to save cost, make money, improve a service, or achieve competitive advantage.
Whatever it is, you need to link your proposition to the situation, and detail the benefits your proposition will generate. Quite simply, benefits are the drivers of any business case.
How do I test my ideas?
Test your ideas with users and or potential buyers of your proposed idea at an early stage and keep checking. At every stage of writing your business case, you need to probe and sanity -check your ideas.
Define Options
There is usually more than one way of doing something, and so you need to explain why you are proposing your way of doing things.
Each option needs to be detailed in precisely the same way – option definition, implication, and payback – so that they can be compared equally.
Writing a Business Case
This is a typical structure:
- Executive summary
- Purpose
- Situation definition
- Options
- Recommendation
- Proposed business case
- Strategic fit
- Assumptions and dependencies
- Financials
- Benefits
- How to make it happen
Executive Summary
This section is the most important section of your business case because it is likely to be read by all stakeholders. Produce a benefit-focused first sentence as an entrée into an appealing, scene setting, first paragraph.
Your complete summary should be written so that it can be understood at a glance. It should be credible and highly persuasive.
Draft your executive summary before writing your document and finalise it after you have completed the final document draft.
Purpose
The purpose of your business case needs to be detailed with the anticipated benefits. It needs to claim value for money, commercial viability, affordability, and achievability.
Situation Definition
Detail the problem or opportunity so that it can be easily understood. Ensure that your definition is complete.
Exclude all jargon so that anyone not associated with your business idea can understand it easily. If you refer to acronyms or technical terms, explain their meaning in plain English.
Use charts, diagrams, and images if they help get your message across.
Options
There is usually more than one way of addressing a situation. All reasonable options need to be analysed including “do nothing” – provided doing nothing is a realistic option.
Recommendation
Summarise why you have chosen a particular option and or decided on a particular approach.
Proposed Business Case
This is the main body of your document where your proposed approach to the problem or opportunity should be detailed stage by stage. Link your proposition to the situation.
You must explain why your proposition is well-placed to address the situation and how your approach complements your organisation’s policy, strategy, or approach.
Use charts, diagrams and images as appropriate
Strategic Fit
Identify which strategic organisational objectives the business case supports and explain how it will support them.
(These may include policy, regulatory requirements or commercial governance.)
Assumptions and Dependencies
List assumptions which drive the business case. Detail the environment (economic, financial, strategic, operational, political or other) on which your business case is dependent.
Financials
This section should provide a cost-benefit analysis detailing the pros and cons of your case. Use facts, figures, and charts to get your messages across and use captions to emphasise them.
Readers need to assimilate critical points from your data at a glance.
- Detail funding requirements, envisaged return on investment, and cash flow.
- Make sure description is attached to numbers and lines as appropriate.
- Ensure every table and chart has a consistent style.
- Highlight key messages from each table or chart.
Benefits
List the benefits in order of importance. These should relate to all considerations from the financial to the strategic.
How to make it happen
Specify the critical path – a timeline – of all stages of approval necessary to proceed. Include the names of the people who need to give their approval.
Any winning tips?
Once you have checked the coherence of your argument and the completeness of your document, it is time to cast a critical eye. In addition to being complete, your document needs to look highly readable.
Make sure that your proposition is easy to read, logical, strong, well-written and with all essential facts and figures.
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