It All Starts With Quality Business Cases

Did you know as a product owner, you must also be a excellent salesperson?

To get your project approved, you must sell. You must win the hearts and minds of finance, executive leadership, your boss, and peers. You need to sell your project to meet certain measurable projections. Once the project is complete, for you to succeed and continue to get funding on future projects and operations you need to meet or exceed the projections.

How do you do this? It all starts with a quality business case. A well-crafted business case is an excellent objective selling tool. As Frank Geric from ROI selling points out, “The numbers contained in a business case are often the persuading factors that helps your internal stakeholder secure budget approval from his or her finance team.”

As noted by Harvard Business Review: “Senior managers are paid to make tough decisions. Much rides on the outcome of those decisions, and executives are judged—quite rightly—on their overall success rate.” Your job is to make these decisions easier, and more accurate which is made possible by creating a solid business case.

We will show you why it is critical for you to create business cases for any substantial investment. Then, we will walk you through the 5 steps to implement. We will walk you through the steps in a logical order and you can follow along using the template provided.

What is in it for me?

There are 4 compelling reasons you should be creating business cases.

  1. Your business must make money. Period.

You need to be sure you are investing heavily in the operational areas and projects that will improve your bottom line. If you have ever complained about the requirements of a program/project, this is your chance to directly shape and create what you will do. Call the shots.

Your company has a duty to choose projects which improve the Return on Investment (ROI) of capital.

A business case makes selecting the right projects easy, by looking at the bottom-line impacts of each project.

From The Right Questions, we see that there is some nuance to the idea that a business case must be completely centered around showing profit. However, your business case must focus on how the project benefits your bottom-line. They say “A business case is generally focused on the need to make money; if a business proposition doesn’t demonstrate the ability to make money it has to be adapted or discarded. But the ability to make money is driven by the fact that something you do or make is attractive enough to make someone buy that service or product.”

  1. Focus on Minimum Viable Product (MVP)

A business case helps you and your organization thoroughly understand both the benefits and costs of a project.

It becomes clear which parts of the project really drives business value. And, which really don’t impact the benefit side of your business case.

Knowing what is beneficial, you can focus MVP features there. And, leave non-essential features for a future release.

I will provide an example to illustrate the point. Working with a major B2B company, we were implementing a web content management system to manage our customer facing websites.

The business case focused on three major things:

  • To remove the reliance on the IT team to perform updates, to avoid going through a development cycle for every update to the site. This would be done by putting updates into the hands of business teams.
  • Faster updates allowing for more responsive changes to the site.
  • Personalization

When defining MVP, if a feature did not directly impact one of these three items, it was almost certainly moved post-MVP. The impact of this was that the project was completed early, and under budget.

  1. Vetting Process

Your company may have a strong strategy, set of objectives, and KPIs.

However, your company may have multiple business units, product teams, etc. How do you ensure that projects selected fit the company’s strategy, objectives, and KPIs? You need to have a process where all projects require a business case and are vetted.

More on this later.

  1. The Project’s Vision

The business case can serve as the vision for the entire team.

You will want to include the business case in project inception documentation, and distribute it to all team members.

This helps your entire project team understand the key drivers of success and acts as their guiding light on decisions.

How do we implement?

We will walk you through the 5 step process. To make it very practical, we will also tie in the business case template we have created.


Step 1: Alignment from your organization on the business case process

Step 2: Within your business case, document the costs, benefits, assumptions, and risks

Step 3: Bring the business case draft to finance / approval managers for review

Step 4: Go for approval!

Step 5: After the product has been implemented, conduct a post-mortem to see how close projections were to reality


Step 1: Alignment from your organization

If your organization is not familiar with creating business cases, this step is critical.

Before jumping in and creating business cases, it is important to get buy-in from key stakeholders: finance, the business unit leaders, and executive leadership on a few key items:

  • Who are your project sponsors? Who will be in the vetting discussions? Who are the right people to be able to say yes or no to a project.
  • What business case template will we use (more on this later)
  • What ROI is required for a project to be considered?
  • Who will be responsible for creating the business cases? The finance team? The business team? A combination of teams?
  • What will the post-mortem process look like to validate if a project was as successful as promised?

This step can be lengthy and the process is highly specific for each company, so we decided to keep discussion on this step light. Contact us if you would us to help you build a process tailored to your specific company.


Step 2: Document costs, benefits, assumptions, and risks

  1. Costs of the project

You will want to thoroughly review the costs of the project.

These costs can be broken down into one-time costs, and recurring costs. There are also capital and expense breakdowns. Bucket your costs into these categories.

Once you have created your draft think about:

  • How did you arrive at these costs? Did you bid out for the project? Are they internal transfer costs?
  • Do you expect the costs to go up or down over time?
  • What levers can you pull to decrease the cost of the project? Any scope you could consider cutting?
  1. Benefits of the project

Now we are onto the more tricky part, defining the benefits quantitatively.
To do this, you need to think, what are the major improvements to the business? How does our project improve the company’s KPIs / metrics? This is a great starting point for analysis.

We recommend choosing the top few drivers of success for your business case, and then put the less important drivers in the appendix.

For example, let’s say you are a product manager for Search on a B2C eCommerce site. You want to add a feature called AutoSuggest. This feature will automatically show the user product options as they type in their search. You expect this feature will drive more successful searches, and lead to an increase in search conversion rate. It may also lead a little less time by the merchandising team to create redirects. However, the major driver of this effort is clearly conversion.

  1. Identify certainty of the benefits and risks of the project

You need to assess how certain you are of each quantifiable benefit from your business plan.

Here are some of the most common pitfalls we have seen. Be sure to think through these and adjust your business case accordingly.

Every project presents some level of risk. The best cases scope them out and offer ways of offsetting them throughout the project.” from SixSigmaDaily.

  • Labor: How does your company respond to using labor savings in your business case? At many companies if you quote labor you must eliminate those positions. If you plan to count labor cost reduction as a benefit, be sure to understand how your company treats a reduction in labor. Are they satisfied with an opportunity cost improvement, meaning the worker does something more productive now. Or, will they expect you to remove headcount?
  • Sensitivity Analysis: What if a small change to your figures occurs? Small changes in the benefits – positively or negatively – can mean the difference between a solid ROI or not. Be sure to run a sensitivity analysis with upper, middle, and lower bounds to understand under what circumstances your project will meet ROI requirements.
  • Time: How long will the benefits last? Immediate benefits? Next year? 3 years? You need to understand how often and for how long the benefit will remain. Is it one time? Or, happens for multiple years? Be careful to not overstate the length of time value will be provided. (find example)
  • Change Management: How confident are you that your customers will use the feature to the extent you think they will? Will your organization quickly adapt to the change? How fast will it be to implement the changes?
  • Macro changes in your industry and market: How would macroeconomic changes impact your business? How about shifts in company direction? Disruptive change in  your industry?

Defining metrics and analytics that automatically report on the above items above can greatly increase the speed at which decisions take place. More details at Insights and Reporting section of our site.

You should now be in a great position to understand the benefits of the project and your confidence in the business case.


  1. Document the assumptions / inputs to create the business case?

What are the key things that must be true or become true for your business case to be valid?

To help you brainstorm, here are some common assumptions / dependency categories.

  • For each benefit, what is the predicted improvement? And, how did you come up with this number? These are the critical assumptions, and thus should be easily adjustable in your business case. You should also consider a sensitivity analysis for these figures.
  • What other projects are you assuming that your company will continue?
  • Does your project have any dependencies on other teams that you don’t directly control?

Be sure to document all assumptions in your business case.

Helpful tip: Make sure all assumptions are easily adjustable and tied to an automated metric in your reporting platform.

Step 3: Bring to finance / approval managers for review.

The best way to ensure you have a smooth project approval meeting is to get feedback throughout the business case development process and to get informal approval.

You want to get buy in early and often from each team whom will make the official call on whether or not your project moves forward.

Step 4: Go for approval!

You should feel confident to go present your business case.

You have taken a systematic approach to business case development, and have vetted it ahead of time with the right people.

You should have the key compelling figures up front, with a clear explanation of ROI and how it beats your company’s targets.

Consider putting your detailed business case in the appendix, to be used as reference if you get specific questions.

Step 5: After the product has been implemented, conduct a postmortem

business case post mortem

This step is all about learning to improve accuracy of your business case estimates going forward.

Where were your estimates accurate? Where were they off?

What can be done next time to increase accuracy?
You should take the knowledge gained to adapt your business case template, and projections for future projects.

We hope this will be helpful for getting your projects approved. Let us know your thoughts in the comment section below.