Process Improvement Business Case Methodology

The method used to develop Process Improvement Business Cases is illustrated below as a (Value Added Chain)
diagram.
Design the To-Be
Understand the As-Is Define To-Be Perform benefit and
process & gather Perform gap anlaysis
process & metrics guidelines risk analysis
metrics

Compare operational
Perform operational Perform project Make
benefits and project
cost analysis budget cost analysis recommendation
costs

Understand the “As-Is” process and metrics; During this phase workshops will be conducted with Subject Matter
Experts (SME) within the University to first confirm the understanding of the “As-Is” process, and then gather “As-Is”
process metrics, organisational and skills information and issues information. A root cause analysis will also be
conducted to ensure the base cause of an issue is understood (ensuing that the symptoms is not simply treated) and
used to clarify the improvement opportunities promised by the Business Case.

Define “To-Be” guidelines; To allow management to select a proposal for improvement based on available
resources. Two sets of guidelines will be defined that are likely to have a favourable cost to benefit ratio and fit within
broad University constraints. These guidelines will then be used to develop and model the optional “To-Be” processes.

Design “To-Be” process and gather metrics; To design the “To-Be” processes based upon the two sets of
guidelines, the project team will run facilitated workshops with business experts and the relevant Process Steward. The
workshops will also gather process metrics, organisational and skills information, and confirm and ensure that the root
causes of issues are treated.

Perform gap analysis; The Project Team will then undertake analysis relating to IT, Organisational and Process gaps
between the current and optional “To-Be” processes. These gaps will be documented and where appropriate Change
Action Requests will be developed and sent to the IS Development Group for further analysis.

Perform benefit and risk analysis; For all options, a benefit analysis will be performed against defined business
objectives, related project critical success factors and identified opportunities for improvement. The findings will then be
summarised and graphically presented. This will also be done for both Business and Project Risks, in alignment with
the Project’s Risk Management Framework.

Perform operational cost analysis; Operational costs associated with each of the options will be gathered from
SMEs during the conducted workshops. Completed versions of models containing costs will then be circulated for
review and signed off by SMEs. Following this, summarised cost estimates will be calculated and used within Net
Present Value Calculations.

Perform project budget cost analysis; In response to the lodged Change Analysis Request (CAR), the IS
Development Group (within the IT Services Department) will provide a breakdown of the IT related Major Products and
associated development estimates. This list of Major Products will then be expanded to cover all project activities (e.g.
project management, process analysis, training, User Acceptance Testing etc) and used to define a high-level project
schedule, which will include the allocation of resources. Resource levelling will then be performed and a total project
cost estimate will be produced.

Compare operational benefits and project costs; Using the operational and project cost estimates, calculations will
then be performed for each of the options to establish the Net Present Value (NPV). The NPV will be calculated over a
five year period, using a discount rate of 8% (as directed by the Finance Department). These calculations will be
performed based on an internal project team and an external project team made up of an appropriate mix of
consultants and freelance contractors.

Make recommendation; Once the document is completed, less the recommendation and executive summary, it will be
circulated to a recommendation panel made up of the Lead Process Steward, Process Steward, Associate Director,
Information Systems, Business Analysts, Project Manager and other key stakeholders. A meeting will then be held
where participants will make recommendations and provide advice to the Lead Process Steward and Process Steward,
who will then make the final recommendation. This recommendation is then included within the Business Case and
allows for the Executive Summary to be completed.

The completed Business Case will then be sent to the Lead Process Steward and Process Steward for acceptance.
Once accepted, the completed Business Case will be sent to the Project Board for acceptance and a decision.

SAPIP Project: Business Case Definition Page 1 Date: 03/08/2007