Business Case – is intended to convince key decision-makers of the merits of the

particular course of action. It is the document that are prepared to make case. A
justification for wide organization used to invest in specific project or product.

Business Case Components

I. Present the Business Problem or Opportunity
- Provide details and some history on the problem or opportunity.
- Demonstrate why it is important to the organization.
Executive Summary – highlights the key points in the business case. It is the cover
page or opening scene to your story. It must be concise.
Your executive summary should include the following parts:
1. The current situation and opportunity. Describe what is going on in the
business or in the marketplace that necessitates action. For new opportunities or
product, discuss why the time for this new product to be developed is now. Give
a very high-level description of the opportunity.
2. Business drivers behind the recommendation. Business drivers are the
primary business reasons that you’re presenting the recommendation; they
explain how the business will be impacted if they’re approved.
3. Recommendation description. The recommendation is the solution you’re
proposing to take advantage of the opportunity. Describe it at a very high level in
this section – in just enough detail for the audience to be able to articulate it to
someone else.

Mission Statement – is the combination of goal and objectives of the opportunity. The
Goal is the business driver stated in the executive summary. The Objectives are
quantitative or measurable indicators that indicate whether the opportunity has achieved
its goal or the problem has been solved.
Setting S-M-A-R-T Objectives
Specific: the goal must be clear and unambiguous. Explain to the project team
exactly what is expected.
Measurable: the goal’s threshold for success must be something you can
concretely measure. The reason you create a measurement is to assess your progress
to the goal and to know when you meet it.
Attainable: you want to make sure the goal you set can reached.
Relevant: the objectives need to be relevant to the organization and matter to
organization.
 Time-bound: This part of the objectives tells you when you need to measure to
see how well you achieved your specific goal.

Need to consider to alternatives:

COST
1. Capital Cost – upfront expenditures to set up the process or develop the
product.
2. On-going Cost – recurring operational cost for licenses, staff, and other
overhead cost.

BENEFITS
1. Tangible Benefits – increase revenue or income, increase production or
quality, and reduced cost.
2. Intangible Benefits – cannot be measured in monetary terms but they do
have a very significant business impact.
(Goodwill and customer, employee, or vendor satisfaction)
FEASIBILITY STUDY - an analysis of a proposed project to determine
whether it is feasible and should go ahead. It is an analysis effort to determine
whether the opportunity can be reasonable achieved. Presenting a strong
business case can garner you support for conducting this study.

II. ANALYSIS OF THE SITUATION

CASH FLOW – the net amount of cash and cash equivalents being transferred
into (cash flow in) and out of (cash flow out) a business. It is the availability of
assets at any given time in an organization.
Three Major Financial Matrics
1. Return on Investment – financial performance measure used to evaluate the
efficiency of a number of different investment. It is calculated by dividing the profit
or saving of an investment by the cost of the investment over time.
2. Payback Period – the number of years required to recover the original
investment. It is the length of time required to recover the cost of making the
change or development a new product. Most organizations have a minimum
requirement for a project to be paid back in order to be approved based on the
amount funded.
3. Net Present Value – the gain from the project after discounting for depreciation of
value of money over years.
 ASSUMPTION – events that a business case assumes will happen and factors
them into the calculations.

CONSTRAITS – limitations that can be restrict some aspect of business case.

MARKET ANALYSIS
SWOT Analysis (strength, weaknesses, opportunities, threats) or PESTLE
Analysis (Political, Economic, Social, Legal, and Environmental)

III. RECOMMENDATION
Present the result of the feasibility analysis for each potential option. Specify any
constraints, assumption, risks, and dependencies for each option. Rank in order the
alternatives and list the recommended one. Include why the others are not. Summarize
the cost benefits analysis for the recommended option. Include the implementation
approach, including milestones, dependencies, roles, and responsibilities.

IV. EVALUATION
Include a plan for measuring benefits realization. The plan typically includes
metrics for evaluating how the solution contributes to goals and objectives. It may
necessitate additional work to capture and report those metrics.