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Business Case

At a glance

  • Purpose: Justify a project in business terms — why do it, what it costs, what it returns, and what happens if you do nothing.
  • Use it when: Before a charter exists, when someone must decide whether to fund the work. Also when scope or cost changes enough to re-open that decision.
  • Owner: Usually the sponsor or business owner; the project manager contributes the delivery estimates.
  • Related: Module 02 · Lab 13

How to use this template

  1. Write the problem and the options before writing the costs. A business case that starts from a chosen solution is a justification, not an assessment.
  2. Include at least two alternatives, one of which is do nothing. A single-option case cannot be evaluated.
  3. Estimate costs and benefits as ranges with the assumptions stated. See Lab 13 for the method.
  4. Make the benefit measurable and name who will measure it. A benefit nobody measures is a claim.
  5. State the recommendation and what would change it. A case with no reversal condition cannot be challenged, which usually means it has not been thought about.

Field descriptions

Field What goes in it Watch out for
Problem or opportunity What is going wrong today, for whom, and what it costs Describing a missing feature as the problem — that is a solution
Strategic fit Which organisational objective this serves Claiming every objective; pick the ones that actually apply
Options considered At least two, plus "do nothing" Options that are obviously worse, included to make one look good
Option description What each option delivers, at what scale Detail that belongs in a scope statement
Costs Build and operate, as a range, with basis and assumptions Build cost only — the cheapest part of a system's life
Benefits What improves, by how much, who measures it, when Unmeasured benefits, or benefits the project cannot influence
Risks The risks that would change the decision A full risk register — this is not the register
Recommendation Which option, and why, in one paragraph Restating the options instead of choosing
Reversal conditions What would make you withdraw the recommendation "If things change" — too vague to act on
Decision and date Who decided, when, and what they approved A blank decision block that stays blank

Blank template

# Business Case — [Project or initiative name]

| | |
| --- | --- |
| **Prepared by** | [Name, role] |
| **Date** | [YYYY-MM-DD] |
| **Version** | [1.0] |
| **Decision required from** | [Who must decide] |
| **Decision by** | [YYYY-MM-DD — the date the decision is needed] |

## 1. Problem or opportunity

[What is going wrong or what opportunity exists, for whom, and what it costs today — in
time, money, risk, or quality. Do not mention a solution here.]

## 2. Strategic fit

[Which organisational objective(s) this serves. If it serves none, say so.]

## 3. Options considered

| Option | Description | Build cost (range) | Operating cost per year | Benefit | Main risk |
| --- | --- | --- | --- | --- | --- |
| A — Do nothing | [What the status quo looks like] | 0 | [Current cost] | — | [The cost of inaction] |
| B — [Option name] | [What it delivers] | [Low – High] | [Range] | [Benefit] | [Risk] |
| C — [Option name] | [What it delivers] | [Low – High] | [Range] | [Benefit] | [Risk] |

## 4. Costs of the recommended option

| Component | Basis | Amount |
| --- | --- | --- |
| Labour | [person-days × rate] | |
| Non-labour | [licences, infrastructure, training] | |
| Contingency (known risks) | [Derived from the risk register] | |
| Management reserve | [Held by the sponsor] | |
| **Total (range)** | | |

**Excluded:** [What is deliberately not costed, e.g. post-launch hosting — and who pays it instead.]

## 5. Benefits

| Benefit | How it is measured | Baseline today | Target | Measured by | Measured when |
| --- | --- | --- | --- | --- | --- |
| [Benefit] | [Measure] | [Current value] | [Target] | [Role, outside the project] | [Date] |

## 6. Risks that could change the decision

| Risk | If it occurs | Effect on the case |
| --- | --- | --- |
| [Risk] | [What happens] | [Benefit reduced / cost increased / decision reversed] |

## 7. Recommendation

[Which option, in one paragraph, with the strongest single reason.]

## 8. This recommendation should be revisited if

1. [Concrete condition]
2. [Concrete condition]
3. [Concrete condition]

## 9. Decision

| Field | Value |
| --- | --- |
| Decision | [Approved / Approved with conditions / Deferred / Rejected] |
| Decided by | [Name, role] |
| Date | [YYYY-MM-DD] |
| Conditions | [Anything attached to the approval] |

Worked example

A partial example for the University LMS used in Lab 03, with invented figures for teaching:

Option Build cost Operating cost per year Benefit Main risk
A — Do nothing 0 0 — Marks remain at risk of loss; reconciliation continues
B — Departmental LMS ≈ PKR 2.7m ≈ hosting only Marks in one recoverable place; reconciliation time falls Adoption by sceptical lecturers
C — Buy a commercial product ≈ PKR 1.2m licence + integration Licence per year, rising Faster to launch; more features Annual cost grows; data held by a vendor

The completed version would state the measurement for the adoption benefit, name the head of department as the owner, and give three reversal conditions — for example "if the commercial licence cost rises above the departmental budget in year two".

Common mistakes

  • Starting from the solution. If the options section contains one real option, you have written a proposal.
  • Build cost only. Operating and exit costs decide most technology business cases, and they are usually omitted.
  • Benefits nobody measures. Name the measurer and the date, or delete the benefit.
  • A single number. Ranges with stated assumptions survive scrutiny; a point figure invites argument about the figures instead of the decision.
  • Leaving the decision block empty. An undocumented decision will be re-made by someone else, with worse information.
  • Treating the case as finished when it is approved. Re-open it if cost or scope changes materially — that is what reversal conditions are for.