Developing a Business Case Training

A business case is the justification for proposed investment in projects – from marketing campaigns to cost savings through equipment purchasing. This course places business cases within the strategic context – is the proposal in line with strategy and does it support key performance drivers. Our course will help managers to develop an efficient working model that enables results to be generated easily as key variables are changed, allowing managers to answer “what if” questions.

The course addresses financial issues from the accounting perspective (profit and loss, balance sheet, cash flow), including typical ratio measurements, and from a value management perspective using NPV and IRR. We tie “intangibles” into the value perspective exploring how managers can justify investment in relationships, culture, knowledge, brand etc. In this way, we balance both short and long-term perspectives.

Business Case Perspectives

In our developing a business case training programs, we consider 3 perspectives: strategic, financial and management.

Strategic Perspective

Business Case - Strategic FitA business case must show that the proposal helps the organisation to achieve its strategic objectives. The business case should show how the proposal will:

  • develop or maintain competitive advantage in target markets
  • help the company to leverage both tangible (equipment etc) and intangible (brand, relationships etc) assets
  • create synergy with current and future plans
  • play to the company’s distinctive competencies
  • take into account changes in the macro-environment and recognise the full range of opportunities and threats
  • improve competitive position and anticipate likely competitor moves
  • ‘fit’ organisational culture

This perspective draws on elements from our Planning and Marketing courses. 

Financial Perspective

Before pursuing a proposal, the management team should consider:

  • sales, costs and profits
  • the likely return on investment
  • cash flow implications and the impact on working capital
  • capital transactions – and particularly ‘stranded’ capital
  • financial and operational risk
  • the payback period
  • the net present value and IRR of the proposal
  • appropriate financial indicators

It is likely that a detailed financial plan, encompassing sales forecast, income statement, balance sheet and cash flow, will be produced for at least the first year. 

Management Perspective

How will the the proposal be implemented? The business case should demonstrate:

  • the resources required
  • how the proposal will be implemented
  • timelines with key milestones
  • how change will be managed
  • key performance indicators (and how they will be measured)
  • contingency planning
  • appropriate systems

Although the focus of this site is primarily ‘hard’ skills, we have over 25 years’ experience designing and delivering leadership programs and so are well aware that successful implementation depends on many ‘soft’ factors. As the saying goes, ‘Culture will beat strategy very time’.

Process

Using techniques from our planning course, we can help you to manage one of the major challenges in developing a business case, the iterative nature of the process. The world doesn’t stand still and so inputs will change, new information will come to light and you are likely to have new ideas as you build your case. Almost every change is likely to have financial repercussions and that means building financial sensitivity models that can instantly show the impact of changes.

Presentation

It is rare that a proposal exists in isolation; there is usually competition for funding and so the business case needs to sell the proposal. When presenting, different audiences require different information and levels of detail. And presentation matters!

Business Case Course Overview

pdf-icon

tips, articles, resources

subscribe to our quarterly newsletter