Business case

• Defined
  • Purpose
  • Business Case defined
  • Outputs, outcomes and benefits
  • Types of Business Case
• Approach
  • Overview
  • Developing the Business Case
  • Verifying and maintaining the Business Case
  • Confirming the benefits
• Approach - The contents
  • Typically contains
  • Reasons
  • Business options
  • Expected benefits
  • Timescale
  • Costs
  • Investment appraisal
  • Major risks
• Responsibilities

Key sections

• Introduction
• Business case
• Organization
• Quality
• Plans
• Risk
• Change
• Progress
• Introduction to processes
• Starting up a projectDirecting a project
• Initiating a project
• Controlling a stage
• Managing Product Delivery
• Managing a Stage Boundary
• Closing a Project
• Tailoring PRINCE2 to the project environment
• Directing Projects with PRINCE2

The PRINCE2® approach

Verifying and maintaining the Business Case

The Business Case drives all decision making by ensuring that the project remains justified and that the business objectives and benefits being sought can be realized.

To drive the decision making, the Business Case should be reviewed:

• At the end of the Starting up a Project process by the Project Board in order to authorize project initiation based on a reasonable justification
• At the end of the Initiating a Project process by the Project Board in order to authorize the project
• As part of any impact assessment by the Project Manager of any new or revised issues or risks
• In tandem with an Exception Plan by the Project Board, in order to authorize the revised stage and the continuation of the project
• At the end of each stage by the Project Manager to determine whether any of the costs, timescales, risks or benefits need to be updated
• At the end of each stage by the Project Board, to authorize the next stage and the continuation of the project

During the final stage by the Project Manager, to assess the project’s performance against its requirements and the likelihood that the outcomes will provide the expected benefits As part of the benefits review (possibly by corporate or programme management), to determine the success of the project outcomes in realizing their benefits.

It is the responsibility of the Executive to assure the project’s stakeholders that the project remains desirable, viable and achievable at all times.
The Executive should not rely on end stage assessments alone to make this judgement and should use Project Assurance to assist.
The investment appraisal section of the Business Case provides the Project Board with the source of information to verify that the Business Case justifies the authorization or continuation of the project.

Example of an unverified Business Case:

A project to build a tourist attraction in London was justified on the basis of attracting 12 million visitors in its first year.
The projected number of visitors determined the revenue for the exhibition and, with the project team under pressure to build a ‘world class exhibition’, the project budget was set at a level that was break-even with 11 million visitors.
The projected 12 million visitors was an untested assumption and significantly higher than the actual 4.5 million visitors.
In project terms it was a success – the exhibition opened on time, was within 5% of cost budget and had all the facilities that were requested (so therefore met the acceptance criteria). However, the shortfall of visitors significantly reduced revenue, which meant that the necessary government grant increased from £399 million to £628 million.
It was a commercial and public relations disaster, illustrating that delivering a project on time [see 'The Complete Time Management package'], within budget and to specification based on unsound benefit assumptions negates the successful project delivery.

PRINCE2® is a Registered Trade Mark of the Office of Government Commerce in the United Kingdom and other countries.