Business Case Benefits

Mark Mullaly is president of Interthink Consulting Incorporated, an organizational development and change firm specializing in the creation of effective organizational project management solutions. Since 1990, it has worked with companies throughout North America to develop, enhance and implement effective project management tools, processes, structures and capabilities. Mark was most recently co-lead investigator of the Value of Project Management research project sponsored by PMI. You can read more of his writing at markmullaly.com.

  Portfolio Management  

As I noted in last month's column, business cases are a decision-making tool that looks solely at financial considerations. While this is fine as far as it goes, the challenge with this is that if the benefits of your business case don't have a hard dollar value, they don't make the business case any better.

I know that some will argue at this point that they include a narrative of the other positive benefits associated with the project. That's fine and dandy, however those statements don't do anything to improve cash flow, payback period or rate of return. They just sound good. And the problem with good sounding statements is that most executives gloss right over them, assuming--correctly--that they're just positive assertions designed to make an option look appealing. Instead, they go straight for the bottom line--where the statements had zero impact whatsoever.

Now, if your benefits have no financial impact, and never will have a financial impact, I would argue long and hard with you that a business case is the wrong way to go. A simple letter of justification may be appropriate--or some form of decision analysis. Maybe a simple, earnest explanation of the value of doing the project is enough. If you have to do a business case, though (for reasons of policy, protocol or plain perversity), then numbers must be dealt with. So how do we make those wonderful but fuzzy …

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