A Business Case Is a Decision Document

Every organisation has more good ideas than money, people and time. A new computer system, a second warehouse, a training programme, a change of supplier: each one asks the organisation to give up resources now in return for something better later. Someone has to decide which ideas go ahead. A business case is the document that helps them decide.

A simple working definition: a business case is a structured argument, backed by evidence, that a particular investment is worth making and can be delivered. It explains why change is needed, which options were considered, what each would cost and deliver, what could go wrong, and how the chosen option would be bought, paid for and managed.

The key word is decision. A business case is not written to describe a project or to sell an idea. It is written so that a decision maker can say yes, no, or "not yet, come back with more", and understand exactly what they are agreeing to.

When an organisation asks for one

Most organisations require a business case above a spending limit set in their delegation of authority, the internal rule that says who may approve how much. Below that limit a short request may be enough. Above it, the case may go to a senior manager, an investment committee or the board.

A case is also often required for changes that cost little money but carry high risk or affect many people, such as moving to a new operating model, closing a site, or outsourcing a service. The trigger is the size of the decision, not only the size of the spend.

Who reads it

Expect at least three kinds of reader. The decision makers want the recommendation, the cost, the benefit and the main risk, quickly. Finance wants to test the numbers and the funding. Specialists such as procurement, legal, information technology (IT) and operations want to check that the plan is realistic in their area. A good case serves all three without making any of them read everything.