Creating a solid business case is integral to the success of any new opportunity. The right business case can mean the difference between funding your idea and floundering to make it a reality. Many people fail to gain support for their ideas because they fail to create a compelling business case.
For over 25 years, I’ve worked with innovation teams within big companies to help them craft business cases for their ideas, and with founders to gain funding for their startups. Whether corporate innovator or startup founder, creating a business case is essential for success.
A Business Case clearly outlines the fundamental reason for why an organization should engage in a particular project or task. They can either be formally or informally presented to top-level management or other relevant stakeholders. Generally, the team creating the business case for a project or task should aim to argue that whatever resources (e.g., money, time, talent, etc.) need to be expended for a project are being requested in order to fulfill a business necessity.
Business Case Development typically includes gathering a broad set information about what the project is, what benefits the project will bring to the organization, the advantages and disadvantages of going-forward with the project, how much the project will cost and potential risks associated with the project as well as those associated with not doing the project.
The Business Case Development process is typically:
- Applied consistently to every proposed project
- Comprehensive in that it addresses every potential concern of top-level management
- Clearly written and/or presented, relevant to the business or industry the organization is in and easy to judge
- Easy to measure the progress and/or success of if the project is brought to fruition
- Focused on ensuring the most important points are well-justified
- Centered around who will be responsible for delivering certain aspects of the project
The format of a Business Case often includes:
- The Executive Summary – a brief summary of the whole business that effectively communicates the most salient aspects of the project and the key takeaways of the case. It should be written after the entire case is complete.
- Project Definition – this should be the bulk of the business case. This section provides details on what the project is, why it needs to be enacted and how the innovation team plans to bring it about. In addition, it should address what environmental circumstances or opportunities created the need for the proposed project
- Finances – this section should be able to address what financial consequences are associated with the proposed project as well as whether the proposed projects fits within the organizations budget. Further, the financial section should include cash-flow projections and a comparison of project costs and benefits.
- Project Organization – this section details the plan for executing the project including who is responsible for each part, how decisions will be made, how often progress reports will be presented as well as how project success will be measured.
There are many different versions of Business Case development tools out there. I helped create the one we use at upBOARD, and that we make freely available as a download. It’s simple and is based on best practices I’ve gathered in the 3 decades I’ve spent as a strategic business consultant.
About the Author
Soren Kaplan is the bestselling and award winning author of Leapfrogging and The Invisible Advantage, an Affiliate at the Center for Effective Organizations at USC’s Marshall School of Business, a columnist for Inc. Magazine, a globally recognized keynote speaker, and the Founder of Praxie. Business Insider and the Thinkers50 have named him one of the world’s top management thought leaders and consultants.