Abstract
The development
of business case and business plan in organizations is vital in accomplishing
the desired outcomes for new business ideas. The paper describes and compares
and contrasts business case and business plan. The paper also identifies three
business case templates and selects the best while listing its advantages.
Definitions and applications of
Business Case & Business Plan
A business case
refers to a justification for pursuing a course of action in an organizational
context to accomplish defined business goals. The business case entails the
evaluation of the value of an investment concerning its potential benefits and
the resources required to set it up and sustain it that is its on-going costs
(Remenyi & Sherwood-Smith, 2012). It provides precise information about the
return investment on a particular project such as breakeven and the period to
reach the breakeven etc. The various benefits brought by developing a business
case are that it keeps the potential of scope creep to a minimum, assist in
sustaining the morale of the team and assists in prioritizing business
objectives. It also helps investors to monitor the investment progress, risks,
and budget through the regular updating of the business case.
A business plan
refers to the business process and vision set to attain financial success tied
to defined strategic outcomes. It gets connected to the strategic planning
processes emphasizing on the sustainability of the chosen business model.
Business planning in a company is responsible for the various decisions namely:
Ø What
products or services the business will deliver
Ø Where
the firm will compete
Ø Why
the consumer should conduct business with the company
Ø How
the enterprise will organize and reengineer so as to meet its goals (Crego,
Mancuso, Schiffrin & KAUSS, 1979).
A good business
plan is continuous work-in-progress that must adapt to change over time. The
business plan should project financial targets out further than a year, as
opposed to the budget that focuses on one year. The main purpose of a business
plan includes identifying and measuring risks, guides management in setting and
prioritizing organizational objectives, projects future financial performance,
and serve as a starting point for developing budgets.
Compare
and contrast Business Case and Business Plan
Business
Case
|
Business
Plan
|
Provides
the information about the potential market opportunity at a product level.
The evaluation culminates with a Go/No-Go decision on whether an enterprise
should introduce a new product o compete with existing products.
|
Is
a potential business opportunity at a company level to offer the product to
the target market.The evaluation culminates with a Go/No-Go decision on
whether the company should be created to compete with other companies.
|
Answers
the question, “What happens when a company takes a particular course of
action?”
|
It
is a description of how a business unit aims at navigating successfully
through its unique competitive environment (Harvard Business School Press,
2013).
|
It
gets made up of a single action or single decision and its alternatives
|
An
organization of the entire business and covers a single product or product
line or entire company
|
It
focuses on the business objectives that the action aims at accomplishing
|
It
focuses on business objectives for the organization.
|
Its
measures include financial metrics that include IRR, ROI, NPV, TCO and
payback period and also non-financial impacts
|
Its
measures are business performance elements such as profits, margins, sales
and business health.
|
In
government and non-profit organization, its scope comprises of benefits and costs
to the consumers
|
In
government and non-profit organization; it focuses on funding requirements,
budgetary needs and operation within a budget
|
It
gets based on a cost model and a benefits rationale designed for the case and
applied to one or more action scenarios
|
It
gets based on the business model for the organization and expected trends,
competitor actions, etc.
|
Business
case is a comprehensive project assessment to establish its viability as a
stand-alone business proposition
|
Business
plan is a blueprint for the proposed new-entity operation
|
State
why the details in the business case template are there and how this represents
the corpus of data that would be submitted to obtain funding and project
approval to get a project started.
Components of a
business case:
a) A
clearly stated business objective and a set of outcomes. It is a justification
that the proposed plan will generate an acceptable organizational return.
b) A list
of stakeholders and beneficiaries of the investment
c) A
statement of the way that the proposed infrastructure will support the
corporate strategy
d) An
assessment of the appropriateness of technology and operational plan
e) An
assessment of the risks associated with the investment
The content of a
business case is vital for a company as investors since they can determine
whether a proposed plan will be viable/profitable or not before investing on
it. The systematic financial justification for proposed projects also
identifies drawbacks, risks and constraints thus can identify how to solve them
in advance. The content in business case assists investors to identify whether
a particular business-related concept is practical and profitable or not.
Select
a business case template that you like and tell me why you selected that
business case template. I want you to reference at least three different
business case templates and select the one you believe to be the best. Include
the three templates or the URL's for it, with your paper just above the matter
but not in the references. You should reference the others that you evaluated
to come to your conclusion.
Among the three
business case templates considered that are business case template 1, business
case template 2, and business case template 3, business case template 1 is the
best
Business case 1
is extremely detailed especially in the part of business problem/need which is
a vital step when developing a business case. It is the problem which the
business aims to solve hence should get considered thoroughly. The business
case template 1 is also detailed in the risks sections in which it describes
the risk, classifies it likelihood and impact and also lists mitigation
measures for each risk. This process would assists investors make appropriate
and informed decisions. Business case 1 then identifies various alternatives to
solve the problem and compares their benefits, costs, feasibility, risks and
issues options while making all the necessary assumptions thus able to identify
the most suitable. According to Harvard Business School Press, (2013), the
phase of identifying business alternatives is critical and ensures that a
business does not select the first one or two ideas that emerge. Various
pitfalls to avoid in this stage include limiting the list of choices to first
solutions determined, having a limited mindset, having a strong preference for
a specific solution to the business need at the outset of the process and
failing to make consideration of the status quo. The other reason that makes
business case template 1 seem more practicable and effective is that it
contains an implementation plan for the business alternative selected in the
section above. The implementation approach comprises of project initiation,
project planning, project execution, project closure, and project management.
The process is systematic and effective to accomplish the defined business
objectives include the monitoring of the investment progress by all the
involved stakeholders of the proposed business. The purpose of the business
case maintenance is to track whether the investment gets undertaken as
specified (concerning the changes, costs, and objectives) and update when
required (concerning the assumptions and risks).
References
Business Case Template 1: West Virginia Office of
Technology Retrieved from
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&sqi=2&ved=0ahUKEwijttO64oDNAhUeM8AKHfcbBeYQFggiMAE&url=http:%2F%2Fwww.technology.wv.gov%2FSiteCollectionDocuments%2FProject%2520Management%2520Templates%2FBusiness%2520Case%2520Template.doc&usg=AFQjCNFDvQ32Jz15jUN2y6dgf6aDcYYm0g&sig2=2ex488B5sXeHFuLmzeVOyQ&bvm=bv.123325700,d.d2s
Business Case Template 2: Initial Business Case
Retrieved from https://www.google.com/?gws_rd=ssl#q=business+case+template+pdf
Business Case Template 3: Retrieved from
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=16&cad=rja&uact=8&sqi=2&ved=0ahUKEwijttO64oDNAhUeM8AKHfcbBeYQFghhMA8&url=http:%2F%2Fwww.yesser.gov.sa%2Fen%2Fpublicconsultation%2Fdocuments%2Fppp_business_case_template-en.doc&usg=AFQjCNGgh88jFbuUc6-NsRHvgp7SHo3CKw&sig2=lJzer8D7gqnY1aFIYVBm8g&bvm=bv.123325700,d.d2s
Crego, E. T., Mancuso, J. R., Schiffrin, P. D.,
& KAUSS, J. C. (1979): How to write a
business plan. AMACOM Div American Mgmt Assn.
Harvard Business School Press, (2013): Developing a Business Case: Harvard
Business Press
Remenyi, D., & Sherwood-Smith, M. (2012): IT investment: making a business case.
Routledge.
Sherry Roberts is the author of this paper. A senior editor at Melda Research in research paper services if you need a similar paper you can place your order for cheap research paper services.
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