Course Duration: 2 Days

Course Category: Business Analysis & Requirements Engineering


14 Contact Hours

Developing a Business Case (Providing the Financial Justification for Software Projects)


Course overview

It is not unheard of for the cost of a project to exceed the financial benefits delivered by the project. One reason for this, is that projects are often justified using poorly defined and overly optimistic benefits. Another common reason is the failure to quantify benefits financially and ensure that the project offers a financial return.

Often large sums of money are committed to projects on the basis of vague benefits such as – "greater efficiency", "accurate and timely information" or "improved decision making". Where financial benefits have been identified, there is often an over reliance on "cost savings" to justify projects.

This course is designed to improve the way software projects are justified by teaching participants how to develop a business case that provides a solid basis for funding projects. Participants are taught a comprehensive six-step process for developing business cases that pays special attention to benefits, risks and assumptions.


Course Features

  • Based on a comprehensive six-step process with each step building on the outcomes of the previous step.
  • Estimating development costs and clarify vague benefits by identify realistic financial goals.
  • Identifying stakeholders and relate benefits to their needs.
  • Performing a feasibility, cost-benefit and risk analysis.
  • Choosing the most cost-effective solution from a number of options.
  • Aligned with IIBAs BABOK and PMIs PMBOK klnowledge areas.
  • Includes comparisons between traditional and agile projects.

Participant Benefits

  • Easy to follow, six-step approach.
  • Participants are provided with extensive checklists and templates.
  • Participants leave with the confidence and ability to develop successful business cases.
  • Potential to enhance participants careers by improving the odds of them being associated with successful projects


Who Should Attend

  • Easy to follow, six-step approach.
  • Participants are provided with extensive checklists and templates.
  • Participants leave with the confidence and ability to develop successful business cases.
  • Potential to enhance participants careers by improving the odds of them being associated with successful projects.



Course Agenda

Anatomy of a business case

  • The who, why and what of a business cases
    • What is a business case?
    • Why prepare a business case?
    • Who prepares a business case?
    • When should a business case be prepared?
    • What should be included in a business case?
    • How is a business case prepared?
  • A framework for developing business cases
    • Analyse stakeholder needs
    • Identify stakeholder benefits
    • Define solution scope
    • Plan the schedule
    • Develop the budget
    • Analyse value

Analysing stakeholder needs

  • Identifying stakeholders
    • Who has the need?
    • Who are the subject matter experts?
    • Who are the decision makers?
    • Who are the beneficiaries?
    • Who owns the budget?
  • Analysing needs
    • A hierarchy of needs
      • Stakeholder need
      • Solution feature
      • Requirements specification
    • Different types of need
      • Operational needs
      • Identifying operational needs
      • Information needs
      • Business rules
      • Strategic needs
      • SWOT analysis
      • Acting on SWOT
      • Keep or improve a strength
      • Remedy a weakness
      • Exploit an opportunity
      • Avoid a threat
      • Identifying strategic needs
      • Improving a capability
      • Mitigating a risk
      • Solving a problem
    • Performing a needs gap analysis
      • Current situation (as-is)
      • Desirable situation (to-be)

Defining solution scope

  • Identifying potential solutions
    • Solution options
      • Do nothing
      • Enhance existing software application
      • Replace existing software application
      • Acquire new software application
      • Build (develop in-house)
      • Build (outsource)
      • Buy commercial off the shelf software (COTS) package
      • Other initiatives
      • Staff development
      • Organisational restructure
      • Business process improvement (BPI) or redesign (BPR)
      • Acquire new technology
      • Combination of options
    • Brainstorming solutions
    • Linking solutions to stakeholder needs and addressing gaps
    • Outlining potential solutions
  • Identifying software application features
    • What is a feature?
      • Solution capability
      • Solution constraint
    • Identifying and describing solution capabilities
    • Identifying and describing constraints
  • Evaluating solution options
    • Assessing solution feasibility
      • Technical feasibility
      • Operational feasibility
      • Compliance feasibility
    • Selecting options based on feasibility
    • Finalising solution options
  • Traditional vs. agile scope
    • Product, release and sprint backlogs
    • Feasibility and architecture "spikes"
    • The concept of a "minimum viable product"
    • Evolving product features

 Identifying stakeholder benefits

  • What is a benefit?
    • Strengthening position
    • Increasing revenue
    • Avoiding costs
    • Improving service
    • Ensuring compliance
  • Identifying solution benefits
    • Software applications
    • Other initiatives
  • Developing a results chain
    • Components of a results chain
      • Assessing the contribution of application features
      • Assessing the contribution made by other initiatives
      • Making assumptions explicit
      • Identifying outcomes
    • Identifying and quantifying the financial benefits of "intangible" benefits
  • Identifying the beneficiary who receives the benefit

Planning the schedule

  • Estimating the size of software applications
    • Functional vs. physical size
    • Techniques for estimating functional size
      • Function points
      • Use case points
      • User story points
      • Other Measures of Functional Size
    • Techniques for estimating physical size
      • Lines of code
      • Other measures of physical size
    • Developing early estimates
  • Estimating the effort required to deliver the solution
    • Estimating effort and software applications
      • Estimating development effort from functional and physical
      • Distributing effort across life cycle phases
      • Assessing the accuracy of estimates
    • Estimating effort for other initiatives
  • Incorporating staff productivity
    • The relationship between effort and elapsed time
    • Staffing the project
  • Developing the project schedule
  • Traditional vs. agile estimating
    • Estimating effort vs. estimating scope
    • Relative vs. absolute estimating
    • Planning game
    • Productivity vs. velocity

Developing the budget

  • Cost categories
    • Staff costs
    • Hardware costs
    • Software costs
    • Network costs
    • Other costs
  • Life cycle costs
    • Project costs
    • Operating costs
    • Ongoing change and growth costs
  • Fixed vs. variable costs
  • Techniques for estimating costs
  • Traditional vs. agile budgeting
    • Traditional budgets depends on staffing and schedule
    • Agile requires a fixed budget for known duration

Analysing value

  • Understanding the time value of money
  • Developing a project cash flow
  • Performing a cost-benefit analysis
    • Return on investment (ROI)
    • Payback period
    • Net present value (NPV)
    • Internal rate of return (IRR)
  • Comparing solution alternatives
    • Selecting the most cost effective solution
    • Incorporating non-financial factors
    • Weighting financial and non-financial factors

Clarifying assumptions

  • Scope assumptions
    • Assumptions related to understanding of stakeholder needs
    • Assumptions related to software applications
  • Technical assumptions
  • Operational assumptions
    • Assumptions related to other initiatives
  • Schedule assumptions
    • Estimating assumptions
  • Software application size
  • Effort estimates
    • Staffing assumptions
  • Financial assumptions
    • Budgeting assumptions
    • Benefit assumptions
    • Cost-benefit assumptions
  • Compliance assumptions

Accommodating risk

  • Identifying the risk context
    • Solution characteristics
    • Technology characteristics
    • Project characteristics
    • Enterprise characteristics
    • Contract haracteristics
    • Environmental characteristics
  • Scope risks
    • Risks related to understanding of stakeholder needs
    • Risks related to software applications
      • Technical risks
      • Operational risks
    • Risks related to new technologies
    • Risks related to other initiatives
  • Schedule risks
    • Estimating risks
      • Software application size
      • Effort estimates
    • Staffing risks
    • Project management risks
  • Financial risks
    • Budgeting risks
    • Cost benefit sensitivity analysis
    • External financial environment
  • Compliance risks

Preparing the Business Case

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