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Business Case

Purpose

A Business Case is used to document the justification for the undertaking of a project, based on the estimated costs (of development, implementation and incremental ongoing operations and maintenance costs) against the anticipated benefits to be gained and offset by any associated risks.

The Project Board will monitor the ongoing viability of the project against the Business Case.

Content

An executive summary highlights the key points in the Business Case, which should include important benefits and the return on investment (ROI)
The reasons define the reasons for undertaking the project and explains how the project will enable the achievement of corporate strategies and objectives
Business options are an analysis and reasoned recommendation for the base business options of: do nothing, do the minimal or do something
Expected benefits that the project will deliver expressed in measurable terms against the situation as it exists prior to the project. Tolerances should be set for each benefit and for the aggregated benefit
The expected dis-benefits are outcomes perceived as negative by one or more stakeholders. Dis-benefits need to be valued and incorporated into the investment appraisal
The timescale over which the project will run (summary of the Project Plan) and the period over which the benefits will be realized
Costs include a summary of the project costs (taken from the Project Plan), the ongoing operations and maintenance costs and their funding arrangements
The investment appraisal compares the aggregated benefits and dis-benefits to the project costs (extracted from the Project Plan) and ongoing incremental operations and maintenance costs. The objective is to be able to define the value of a project as an investment. The investment appraisal should address how the project will be funded
Major risks gives a summary of the key risks associated with the project together with the likely impact and plans should they occur.

Format and presentation

A Business Case can take a number of formats, including:
A document, spreadsheet or presentation slides
An entry in a project management tool.

Used sources

Managing Successful Projects with PRINCE2, 2009 edition