Making the case
MAKING THE CASE
Good ideas aren't always good business.
BY GARY R. HEERKENS, MBA, CBM, PMP
I have witnessed a disturbing practice in far too many organizations: turning anything that “seems like a good idea” into a project. This is not good business. And while it's certainly possible that some of those good ideas are wise investments, how can you be sure? Answer: Take the time to prepare a project business case.
The project business case document is among the most valuable tools to help support decision-making available to organizations. A properly prepared business case explores, examines and presents just about everything needed to make wise choices. It is an elegant combination of a variety of balanced elements:
- Historical data and future predictions
- Facts and assumptions
- Financial and non-financial considerations
- Personnel and resources
- Logical arguments and mathematical formulas
In the private sector, business cases play a pivotal role in funding decisions. And for those projects that are approved, business cases can effectively take the decision-making process one step further, helping to identify the best way to solve a business problem, satisfy a business need or exploit a business opportunity.
In the public sector, business cases are frequently used to promote widespread understanding of how the budgeted funding can be put to the best possible use.
There are many ways to structure the project business case, which I will explore in greater detail in future columns. For now, I‘d like to advocate for project managers preparing business cases.
A Special Note to Senior Managers
Business case preparation presents an excellent opportunity for project manager involvement, particularly early on. Many project managers today express frustration that they are being assigned to manage projects far too late in the overall investment life cycle. Many report that their organizations use a business case approach—but the project management community does not participate in its creation. These are lost opportunities.
Consider implementing a model where your project manager's initial responsibility is to prepare a project business case. This has many notable benefits:
- An unbiased author proficient in structuring and organizing information
- A project manager who will gain extensive knowledge and insight about the project's “roots” (invaluable for making decisions later)
- More accurate estimates of execution and implementation costs and timelines
- More accurate predictions of deliverable performance
- Continuity in leadership
One of the common criticisms of the business case is that it takes too long and costs too much. As a blanket statement, this criticism has little merit. In fact, one of the best things about business-case preparation is that the time and money that goes into preparing one tends to be proportional to the size of the overall project effort. In other words, a case for a relatively small project can usually be prepared in a few days and will only be about three to four pages long.
Bottom line: For a proportionately small investment, business cases hold the promise of helping organizations avoid the “seems like a good idea” syndrome. For my money, asking your project managers to take the time to prepare a comprehensive business case is the best project-related investment an organization can make. PM
Gary R. Heerkens, MBA, CBM, PMP, is president of Management Solutions Group Inc., and a consultant, trainer, speaker and author. His latest book is The Business-Savvy Project Manager.
APRIL 2011 PM NETWORK