What is a business case?

“Great idea – write me a business case for it,” says the manager. And another great idea bites the dust.

Why? Because it’s often unclear what, exactly, is required. The definition of the business case has become very woolly in recent years. Depending on who you ask, it can be a highly structured formal document, or a back-of-the-envelope calculation.

With no clear guidelines, the hapless employee risks delivering a document that misses the mark. This can be costly in terms of time and credibility.

Demystifying the business case

A business case is a decision-making tool for comparing several options, and making a robust recommendation.

It’s exactly what many of us do when we are deciding which TV to buy, or where to go on holiday (assuming we are not making these decisions on impulse). We look at several alternatives, compare the costs and benefits of each , make a decision, and work out how and when we’re going to make it happen.

The advantage is that by comparing our proposal to other viable alternatives, we have more faith in our decision. And it’s easier to sell our ideas to others.

In the business case we compare at least two alternatives – our recommendation, and the ‘do nothing’ or status quo option, which acts as a benchmark. This would be like comparing going to the Maldives for two weeks with staying at home.

Obviously my case for the Maldives might be strengthened if I also compare it to, say, a fortnight in the Cotswolds (risky with the weather, almost as expensive).

Business case elements

A business case can be a one-page summary or a seventy-slide presentation. It depends on the audience and what they need to make a decision. Broadly speaking it will cover the following elements:

• The problem or need your case is addressing
• Your proposal, its features and scope
• The options you considered
• Your rationale for choosing the recommended option
• The implementation plan
• The expected costs
• The risks, and how you will mitigate them

A good business case can earn you the resources you need. It can be good for your career if it demonstrates your clear-thinking business acumen.

If you’re inspired to have a go, look out for next week’s article: “Business case: FAQs.” Good luck!

Jakki

PS To learn how to write better business cases, check out my How to Write a Business Case course.