DEVELOP A BUSINESS CASE The first step you need to take to initiate a project is to develop a business case. A business case is a document which justifies the start-up of a project. It includes: • a description of the problem or opportunity that exists in the business; • a list of the available options for delivering a solution to resolve the problem; • a list of the costs and benefits associated with each solution option; • a recommended solution option for approval. The business case is usually presented by senior management in the business to an identified business sponsor or customer. During the creation of a business case, it may be necessary to undertake a feasibility study. This process involves undertaking a more detailed assessment of the current business problem or opportunity, the various solution options available and the likelihood of each alternative solution meeting the customer’s requirements. The feasibility study adds more rigour to the solution options defined in the business case. The business case is referred to throughout the project to determine whether the costs, benefits, risks and issues align with those originally documented. At the end of the project, a post-implementation review (PIR) will be undertaken to determine whether the project delivered the business benefits outlined in the business case. In this regard, the success of the project is measured against the ability of the project to meet the criteria outlined in the business case. Identify the business problem Perform an environmental analysis To create a business case, start by identifying the core aspects of the business environment which resulted in the need for this project to take place. Examples include: • changes to the business vision, strategy or objectives; • particular business processes or technologies that are not operating efficiently; • new competitor products or processes which have been identified; • opportunities resulting from new technologies introduced to the market place; • commercial or operational trends which are driving changes in the business; • changes to statutory, legislative or other environmental requirements. You should collate any evidence to support the conclusions drawn above. Complete a problem analysis Then describe the business problem or opportunity to be addressed by the project. Write a summary of the core business problem, including: • a full description of the problem; • the reasons the problem exists; • the elements that create the problem (such as human, process, and technology factors); • the impact the problem is having on the business (such as financial, cultural or operational impact); • the timeframes within which the problem must be resolved. Write a summary of the core business opportunity, including: • a full description of the opportunity; • any supporting evidence to prove that the opportunity is real; • the timeframe within which the opportunity will exist; • the impact that realization of the opportunity will have on the business. Assess the available options After defining the business problem or opportunity, list all of the alternative solution options, their benefits, costs, feasibility, risks and issues. Try to minimize the number of options available by conducting a detailed feasibility study. Complete the following steps. Identify the options Identify each of the alternative solutions and create a detailed description for each. Quantify the benefits Identify the financial and non-financial business benefits to be gained from implementing each alternative solution, by completing Table 2.1.

Solutioning

Next: Undertaking A Feasibility Study

Forecast the costs
Identify the business expenses involved with implementing each alternative
solution, by completing Table 2.2.
Note that you may need to identify whether the expense item is a capital
expense (CAPEX) or operational expense (OPEX). A separate spreadsheet
providing an analysis of each of the expenses may need to be provided.



















Assess the feasibility
Assess the overall feasibility of each solution option. A feasibility study may
need to be undertaken to identify the likelihood of each solution satisfying the
business problem or opportunity. Complete Table 2.3 for each alternative
solution.In the example provided, the likelihood of new technology delivering
the required result is very high, as it has been rated 9 out of 10. To come to this
conclusion, a technology prototype was created.















Identify any risks
Risks are defined as any event that may adversely affect the ability of the
solution to produce the required deliverables. Summarize the most apparent
risks associated with the adoption of each solution. For each risk, identify the
mitigating actions required to reduce the likelihood of it occurring, as well as
reduce the impact on the project should the risk actually eventuate. Complete
Table 2.4 for each alternative solution.

















To complete this section thoroughly, it may be necessary to complete a risk management plan.

Document the issues
Summarize the highest priority issues associated with the adoption of
each solution. Issues are defined as any event that currently adversely
affects the ability of the solution to produce the required deliverables. Complete
Table 2.5 for each alternative solution:

















List any assumptions
List any assumptions associated with the adoption of each alternative solution. Examples include:
• There will be no legislative, business strategy or policy changes during the project.
• Prices of raw materials will not increase during the course of the project.
• Additional resource will be available from the business as required.

Recommend a preferred solution
You should now compare each of the alternative solutions and recommend
a preferred solution for implementation.

Rank the alternative solutions
Identify the assessment criteria required to compare each of the alternative
solutions and then agree a mechanism for rating the solutions to determine
an overall score. Although a simple rating mechanism (such as applying a
score from 1 to 10) may be used, you may wish to weight criteria which are
important to the final decision. Use Table 2.6 to help you summarize the ratings
given to each alternative solution.

Identify the recommended solution
The solution option with the highest total score in Table 2.6 will become your
preferred solution. This solution will be explicitly listed in your business case
document along with the primary reasons that this solution was chosen over
the other potential solutions identified.