n the face of an economic downturn, many business managers will push back development requests that lack a clearly defined business case. Unfortunately, not all HR and training professionals know where to begin to create one. Here's some help.
Essentially, a business case is a form of gap analysis. It describes the organization's current status versus the desired status and how the organization can achieve its goals.
A well-formulated business case is a tool that supports planning and decision making regarding purchases, vendor selection, and implementation strategies. It offers a clear statement of the business problem and a potential solution, outlines consequences resulting from specific actions, and recommends ROI metrics for the proposed solution. More important, a business case provides an opportunity to propose learning options that are based on objective data and offer an increased sense of understanding and ownership of the effort.
Before you start building a business case, it's important to be aware of a basic limitation: Each organization requires different financial metrics, such as ROI, total cost of ownership, and return on assets. If you're undertaking a business case and aren't familiar with these concepts, work closely with your financial department.
Similar to most projects, the typical requirements for business case development are time, people, and money. Expect to spend at least eight hours writing a comprehensive business case. However, the number of people involved and the complexity of the project can extend the time-frame significantly. The roles needed to pull the information together include a basic project manager, a financial expert with organizational knowledge and solid spreadsheet skills, researcher(s) to gather data and perform competitive analysis, and an editor to put the information into an organized format.
Here's a breakdown of the basic elements you need to cover.
Problem statement: In one paragraph or less, clearly state the specific business problem.
Background: Be sure to include significant information regarding skills, budgeting, and performance which contribute to the business problem. Indicate, in general terms, what's required to resolve or reduce the problem.
Project objectives. Use a maximum of seven bullet points to state what the proposed solution is trying to accomplish. Some examples may include purchasing hardware and software or selecting a new vendor.
Current process. Identify the organizational processes that the proposed solution will affect, including the training department, other departments within the organization, and relationships with clients, external partners, and the competition.
Requirements. List resources needed to complete the project, such as staff, hardware, software, print materials, time, budget, and so forth.
Alternatives. Outline at least four other options to implementing the proposed solution. Be sure to include basic requirements for each and estimate project risks, ramp-up time, training costs, and project delays.
Compare alternatives. Compare and contrast each of the alternatives with the proposed solution and the other alternatives. State similarities and differences, benefits and detriments, and costs associated with each option.
Additional considerations. List critical success factors other than ROI metrics; for example, affects on partnership agreements with specific vendors or the potential need for help desk or customer support.
Action plan. Propose specific action steps. State your short-term (first three months) and long-term (three months to conclusion) action plans, including major milestones.
Executive summary. Write a clear, one-page summary of the proposed learning solution. Tailor it to your audience and offer a high-level overview of research that leads you to the proposal.
Although there's a basic framework, you may still encounter some problems formulating your business case. The table below outlines some common problems and solutions.
Now you're ready to get started. But because each organization is different, I offer the following suggestions:
- make friends with a knowledgeable person within your financial department
- know your audience's expectation and comprehension levels
- keep it simple and get your facts straight.
If you've done your homework, you'll be on your way to eliminating a performance gap within your organization.