For launching new products or services, initiating projects or investing funds on company projects, business cases are always needed. Whereas certain firms define market benefits with the express purpose of having business cases accepted, established companies prefer to commit their time to monitoring and evaluating perceived business benefits after project completion.
The essence of the advantages described in the business case will definitely affect whether or not they are accepted. It is necessary to understand the characteristics of the advantages that need to be recognized in your business case and whether or not the advantages identified are sufficient to secure approval of financing.
As you define advantages especially for the purposes of Return on Investment measurement (ROI), bear in mind that it may be challenging to measure ROI on one project, because other operation indicators or financial results continue to be affected by improvements in systems, program development and certain related ventures.
So if you are a Business Analyst responsible for planning a business case or finding advantages for one, below are some important facts on the business case benefits:
The effects are typically incremental over a set period. This means that advantages can accrue annually and cannot generally be one-off. In creating a cost-benefit analysis, this is of particular importance.
The identification of benefits is just the start. It is necessary to create a profit realization mechanism or structure as part of the project management in order to monitor outcomes on a continuing process and determine when an intervention is required.
Know the current state and file current KPIs in order to ensure that benefits are assessed after implementation of the project. This is especially important to promote constant improvement. The data source is essential here and can affect the overall precision of your outcomes.
Business cases are not fixed, and the relevance at certain milestones must be continuously evaluated all throughout the project
Document accountability for the advantages by recognizing which parts of the business and roles are responsible to ensure that benefits are achieved.
Whilst benefits are generally classed as tangible (hard benefits that can be quantified in monetary terms, such as headcount reductions) or intangible (soft benefits that are not convertible into cash directly, such as higher customer satisfaction), intangible advantages may translate into tangible benefits over time. Nevertheless, you would have to follow the “chain of outcomes.” For instance, higher consumer loyalty may contribute to an increased retention of consumers, with a quantifiable effect on the business like a reduced sum of money for recruiting new clients.
Business cases are not static but are analyzed for their relevance over the lifespan of their projects. It needs a model or structure for supporting benefits to make sure the benefits found in the business case can be recouped and further calculated.