Better business cases overview presentation and notes

1© 2014 copyright of Training ByteSize unless otherwise stated.

Presentation on Better Business CasesOctober 2014

Management

Financial Commercial

Economic

Strategic

Applicable -strategic fit & business needs

Appropriate – optimises public value

Attractive – to supply side and feasible

Affordable –within budget

Achievable –can besuccessfully delivered


Training BytesizeMartyn Kinch

[email protected] 61035207850 202444martynjkinch

mailto:[email protected]


Who Are Training Bytesize:

• Project Management Translation projects • Español, français, Deutsch, Polski, العربية

• Preferred PM Training suppliers to:

• Top Tier Trainers and Great Customer Service• Family run business with a passion for training in project management• Over 350 Exams a month now taken through TBS• New Office in Australia, partners in Germany, Spain, France and Poland


Courses Include

Courses available as ClassroomBlended or Online:

PRINCE2AgileBetter Business CasesManaging BenefitsBusiness AnalysisChange Management (2015)APM- ICAPMPAPM PQ (2015)APM Risk Level 1Green Project Management


“Public sector invest vast sums of money each year on new

or replacement assets such as buildings, equipment and

facilities.

With so much demand for Capital Investment it is essential

that we make the right choices and demonstrate value for

money”


The Five Case Model

(from HM Treasury)

A framework for ‘thinking’ to help answer three basic questions

‘where are we now?’,

‘where do we want to be?’ and

‘how are we going to get there?’

A step by step guide to developing a business case by:

• Establishing a clear need for intervention - the case for change.

• Setting clear objectives – desired outcome

• Considering a wide range of potential solutions - an optimal balance

of benefits, cost and risk.

• Putting the arrangements in place to successfully deliver the proposal. Successful execution

The process is about

thinking not writing


UK Projects

“Study of government projects reveals $4billion in wasted efforts as a result of failed projects.

‘Only 30% of our projects and programs are successful’ - Joe Harley, programme and systems delivery officer at the Department for Work and Pensions.”

Source : Guardian Newspaper (UK)Scope : Investigation into government waste in the UK since year 2000

Date : 5 Jan 2008

“© The APM Group Ltd. 2014. All rights reserved.”


Why Better Business Cases?

• In The UK:

– Over 900 public Sector Organisations each procure around 30 key investments a year

– Equates to around 27,000 business cases p.a.

– Conservative cost of around £50,000 average cost each

• Over £1.35 billion spent on Public Sector Business Cases per year

• Use of BBC guidance could reduce this by 15-25%

• Potential savings of between £200-£300 million per year


The BBC Programme is currently in use in:


Why are Business Cases important?A business case provides decision makers and the public as well as the private sector with a

management tool for transparent, evidence-based decision making.

Successful projects are a result of:

•Realistic planning

•Clear focus on end goal

•Robust implementation plan

•Consideration of associated risks


Management

The 5 key elements of good practice business cases

The Five Case Model

Financial Commercial

Economic

Strategic

Applicable -strategic fit & business needs

Appropriate – optimises public value

Attractive – to supply side and feasible

Affordable –within budget

Achievable –can besuccessfully delivered


Strategic Context

•The spending objectives, existing

arrangements and business needs. The

business need is the overriding factor

•The potential business scope and key

requirements

•The benefits, risks, constraints and

dependencies

•Economy – to reduce costs.

•Efficiency – improving throughput and unit

cost. Doing more for less.

•Effectiveness – improving quality outcomes

•Re-procurement

•Statutory Compliance

The Spending Objectives


Great Value for £50,000!

But Can We Afford it!


Short List

Long List

PreferredWayForward


Preferred Option is best NPVCost Benefit Analysis to decide best option to move forward

In too many projects people are either too optimistic in stating the benefits the project will deliver or understate the costs and risks




• Change Management• Benefits Realisation• Risk Management• PER & PIR


Three Types of Business Case

1. The key purpose of Strategic Outline Case is to:

– establish the strategic context for the spending proposal;

– evidence the case for change;

– establish the preferred way forward

2. The key purpose of the Outline Business Case is to:

– revisit the SOC assumptions and main findings

– establish the preferred option

– put in place the arrangements for the procurement of the scheme

3. The key purpose of the Full Business Case is to:

– revisit OBC assumptions and main finding;

– evidence that the most economically advantageous tender (MEAT) for the scheme has been accepted;

– establish that the management arrangements for successful delivery are in place.


Three Types of Business Case

1. The key purpose of Strategic Outline Case is to:

– establish the strategic context for the spending proposal;

– evidence the case for change;

– establish the preferred way forward

2. The key purpose of the Outline Business Case is to:

– revisit the SOC assumptions and main findings

– establish the preferred option

– put in place the arrangements for the procurement of the scheme

3. The key purpose of the Full Business Case is to:

– revisit OBC assumptions and main finding;

– evidence that the most economically advantageous tender (MEAT) for the scheme has been accepted;

– establish that the management arrangements for successful delivery are in place.


10 Key Steps


10 Key Steps - Continued


Benefits

For Organizations:-

• Reduction in unnecessary spending and consultancy costs.

• A process and guidance designed to optimize value from change initiatives.

• A clear, proportionate approval process and improved, more informed decision

making.

• Complements existing best practice

• Short courses minimize disruption to business as usual.

For Individuals:-

• Improved understanding of the Better Business Cases process, relevant not only to

those producing business cases and spending proposals, but also those

reviewing.

• Understanding of an established and proven methodology which can be applied at

both strategic (macro) and tactical (micro) levels.

• Recognized certification for a core business competency for so many in mid and

senior management roles.


Courses and Qualifications

• Foundation Course and Exam

– Online or Classroom course 2 days followed by optional closed

book exam

– Closed book, multiple choice, 50 questions

– 50% pass mark 40 minutes duration

• Practitioner Course and Exam

– Classroom course 3 days followed by an exam on day 3

– Open book exam

– 4 questions per paper, with 20 marks available per question

– 50% pass mark 2 ½ hours duration

• Reviewer Course

– Under development/discussion


Conclusion

Better Business Cases lead to:

Better decisions, better investments & achievement of better outcomes.

“If Applied with common sense and proportional effort relative to

the size of the project why wouldn’t you use BBC Guidelines –

Public or Private?”

Treasury now insists on BBC framework on all Business Cases

Outside Contracting Organisations are skilling up

Contractors and Consultants will need to show the knowledge

Which will lead to adoption in the Private Sector


Any questions


Education

Better business cases overview presentation and notes