A PRINCE2® business case is the“…definition of the business benefits that are the driving force behind the project itself.” p.9 (& section 9.1 & Apdx B.2). A project is only valid while the justification in the Business Case A2 exists
Business Case A2, Ch13 13.3 & 13.4
BN01: Benefits Focus of PRINCE2® in Project Management
BN03: The Final Product & The Business Case
BN02 to 5: Ownership & Use of the Business Case
BN03: Contents of a A2 Business Case
Knowledge of the Business Case contents excludes any detailed knowledge of how to perform an Investment Appraisal or techniques such as sensitivity analysis and GAP analysis
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BN 01 describe the fundamental importance of the benefits focus of PRINCE2® in project management (p) |
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BN 02 describe the purpose of the Business Case (p) |
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BN 03 understand the contents of a Business Case, where in the eight processes these are created, updated and monitored, and which roles are responsible for this work (p) |
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BN 04 identify the factors in a given project scenario that would be considered in the development of the Business Case |
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BN 05 show how a Business Case would be created, updated, used and modified within the PRINCE2® processes, and how the various roles would be involved, by application to a given project scenario |
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BN 06 create, modify or discuss a Business Case from information provided in a given project scenario |
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BN 07 identify the relationship between the Business Case and other PRINCE2® products and components in any given project scenario |
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BN 08 state benefits in measurable terms |
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Benefits focus is of fundamental importance |
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The manual says “Benefits focus” p.9, section 9.1 and at B.2, & “Business Case focus” in the Fwd, at section 2.3, and in Ch13 |
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Demonstrates strategic business alignment |
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Provides the information required to decide if the entire business change, rather than just one aspect of it is a sound investment |
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Change may be wider than just the project |
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The Business Case is intimately related to risk management. It provides an assessment of the opportunity and the threats. |
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The Business Case is enabled by the outcome or final products of the project |
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13.0 “PRINCE2’s key philosophy is that it’s A2 Business Case MUST drive the project… |
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If a satisfactory Business Case does not exist, a project should not be started. If …[the] justification disappears … the project should be stopped… …The focus of the Business Case should be on the totality [entire scope] of business change, not just one element” |
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“the Business Case is developed at the beginning of the project [to organisational formats and standards] and maintained throughout the life of the project, being reviewed by the Project Board at each key decision point (DP1, 2, 3, 4, 5)” |
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13.1 “ the most important set of information for the project. It drives the decision-making processes and is used continually to align the project’s progress to the business objectives/benefits” |
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A2.1 “to say why the forecast effort and time will be worth the expenditure” |
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2.4 A PRINCE2® project must have a clearly defined end point
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When the end point is clear it is described in the A.2 Business Case | ||||||||||||
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22.1 1st Step of Product Based Planning
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The Project’s Business Case* is Owned by the Executive
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13.3 Updated at each key decision point | ||||||
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SU: Create with Project Brief from Project Mandate and discussions with the customer to resolve gaps (SU4?DP1) | ||||||
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1st assessment in DP1 is ther sufficient justification to invest in creating a Business Case by investigating the Background and Reason (in the Project Mandate) properly | ||||||
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IP: Finalise and add cost/ timescale data from Project Plan (IP3?DP2) | ||||||
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Asses the benefits, costs and risks of the project for Go/No-Go in DP2 | ||||||
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SB: Revise (in SB3) as routine matter(CS5?SB1) or due to an exception(CS8?SB6) before assessing whether to continue or cancel in DP3 | ||||||
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CS8: Business Case used in reporting on exceptional matters for assessment in DP4 of current best case before proceeding to SB6 or stopping summarily (CP) | ||||||
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*Supplier business case not considered further in PRINCE2® |
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Describes the justification for the total business change, the estimated development, implementation and through life cost and risk versus the expected benefits |
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Provided to the project in the Project Mandate (maybe), checked & set-out as an outline in SU4 (as part of the A26 Project Brief), refined to an Initial version in IP3 (as Part of the A27 PID), updated at stage end (by IP3) |
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Considered by the Project Board at every decision point (DP1, 2, 3 and 4) to verify that the forecast effort and time remaining will be worthwhile |
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IE the project remains viable versus the current version of the A2 Business Case |
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Confirmed for alignment and consistent with corporate or programme strategy |
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Assessed versus project plan for alignment & realism |
Composition
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Reasons for the project (from Customer and Project Mandate and/ or Project Brief) |
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Options considered, selected, rejected and why |
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Benefits expected expressed in justifiable and measurable terms against today’s situation |
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Summary of threats and opportunities from the project A34 Risk Log |
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Cost & Timescale from the best current source (the A30 Project Plan after IP2) |
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Appraisal and evaluation of Best, Most Likely and Worst costs and B/ ML/ W benefits* together with analysis of sensitivity factors influencing costs and benefits |
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Possibly including Net Present Value/ Discounted Cash Flow and other financial modelling |
*PRINCE2® terminology is Good Average Poor or GAP Analysis. This is in contrast to the normally understood “gap” between available and desired features in a vendors offering to an Request For Proposal
Template at A.2, explanation at 13.2
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“The balance between the development, operational, maintenance and support costs against the financial value of the benefits over a period of time” |
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Base lined versus “Do nothing” |
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Based on objective measures |
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Early expression of relative terms (e.g. “Improve”) should, where practical be replaced by prioritised, measurable benefits benchmarked against today’s position |
Two suggested techniques
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Sensitivity analysis: determination of factor success is heavily dependent upon
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GAP (good, average, poor) analysis of the investment appraisal
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*PRINCE2® exam syllabus explicitly de-scopes need to perform an investment appraisal or sensitivity analysis in an exam question |
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The Business Case A2 is the justification for a PRINCE2® project |
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Totality of the business change |
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Cannot start and must stop a project if the business case is weak or disappears |
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Products of the project enable the benefits expected in the Business Case |
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The Executive owns the Business Case |
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Business Case development process and resulting document sets out the benefits, costs & timescales plus the accepted and rejected options |
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(may be) Received in the Project Mandate* |
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(at the least an) Outline Business Case is included in the Project Brief** |
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An initial, complete, robustly argued Business Case presented to the Project Board at DP2 in the PID |
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Updated at each natural or exceptional end of stage (SB3) for review at DP3 |
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Assessed at project close for framing the Post-Project [Benefits] Review Plan |
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Investment appraisal is omitted from the exam syllabus |
* Project Mandate may be so poor as to omit entirely or so good as to already be a competent PID ** “Outline” means some information e.g. cost and timescale, incomplete until IP sub-processes are complete
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BN 04 identify the factors in a given project scenario that would be considered in the development of the Business Case |
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BN 05 show how a Business Case would be created, updated, used and modified within the PRINCE2® processes, and how the various roles would be involved, by application to a given project scenario |
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BN 06 create, modify or discuss a Business Case from information provided in a given project scenario |
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BN 07 identify the relationship between the Business Case and other PRINCE2® products and components in any given project scenario |
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BN 08 state benefits in measurable terms |
If you were attending a course you could now turn to Section:5.2 Sample Practitioner questions and try question 1
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Do this question against the clock |
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Consider how long will you have in the exam for reading & answering |
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Re-read the scenario S:5.1 page:2 if you need to |
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There is ‘Additional Information’ for this question after the scenario |
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Answer the question using a blank answer grid from S:5.3 then mark your answer using S:5.4 |
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Research any questions where you disagree with the marking scheme |
