Project Portfolio Management: A View From The Management Trenches

10.8. BUSINESS CASE

The business case consists of several major elements. Often the first element brought up when thinking about a business case is the financial model, yet the financial model is not all there is to a business case.

Often the terms "business case" and "financial case" are used interchangeably. This may be the result of many people's emphasis on the financial elements, or models, involved in the business case. However, a business case considers more than just the financial aspects of the decision under consideration. Some folks will think they require a business case, but really need a project plan, business plan, or operating budget to address the given situation. All too often, people will bring forward a "business case" for consideration, when what they really are supplying is a sales presentation for a specific idea that explores only one option (Stratton, 2004).

The business case should present clear evidence and reasoning that supports the conclusions presented in terms that can be understood from a business, technical, and financial perspective. A key component in any business case is the financial model constructed to simulate the business problem or opportunity, as well as the expected results of following the ultimate recommendation (Stratton, 2004).

10.8.1. Why Do a Business Case?

A business case is in order any time there is a decision to be made regarding an investment of the company's money either through distribution of capital or use of other company ...