A Business Case is a document which gives you a way to validate the project benefits. The Business Analysis for Practitioners: A Practice Guide from PMI (on page no: 36) says:

A business case is a living document that is constantly referenced throughout a program or project of work. It may be necessary to review and update a business case based on what is discovered as a program or project progresses over time

But in the reality, how many times do we refer business case during project duration? In one of my public webinar session, I ran a poll asking- ‘Have you participated in benefits analysis of your projects?’ and the response only reiterated the fact that business case is not often referred. – only 30% of Project Managers and Business Analysts were involved in the study of project benefits.

The second poll question was – ‘How do you measure your project success?’ -Around 67% said that a project is successful if it is delivered within Triple Constraints i.e. Time, Scope, and Cost.

Projects are executing to meet the scope, cost, and schedule constraints; still several surveys are reporting high project failure rates. The customers are not satisfied even if the project is delivered according to the agreed scope. The reason is the lack of alignment between business need and project output. In past few years, a strong need for alignment between project output and business strategies are identified. Now, the criteria for measuring projects success are changing – A project is successful if the Business Needs is meet. Yes, still meeting the Triple Constraints are important, but realizing business benefits are given more value.

PMI has always emphasized the importance of business benefits realization, however traditionally this has been perceived as line organization responsibility and projects have focused primarily on Triple Constraints. It has changed to an extent with Agile Framework. However, there is a long way to go. Project are initiated to fulfill part of organizational benefits, and Project Manager should be aware of how his/her project is contributing to Business Benefit Roadmap/Strategy. In line with this thought process, PMI has introduced PMP® certification exam changes in Jan 2016, added tasks for project managers role towards benefit realization and not just meeting Triple Constraints.

Now the question is how can you ensure the realization of project benefits? The answer lies in making the Business Case a living document throughout the project execution. A project is initiated, as a result of Approved Business Case and funding. Thus during project initiation, the approved Business Case is the key input in the ‘Develop Project Charter’ process. Every single task Before we discuss on how you can realize benefits throughout project, lets have a quick understanding of what are benefits and Business Case:

  • What are the Benefits:Benefits are measurable improvements resulting through project outcome. Ultimate ownership of benefits is with business stakeholders at the strategic or tactical level, whereas the project is responsible for achieving benefits through execution.
  • What Business Case includes for Benefit Realization: One of the key ingredients of approved Business Case is a list of benefits, perceived as positive outcomes by the business stakeholders. There are several ways to categorize benefits, while most of them are linked to monetary benefits, benefits can also be non-monetary. Example benefits could be:
    • Financial/Tangible: Some of the expected financial/tangible benefits could be like Increase sale by 40%, easier customer reporting, etc. Tangible benefits can also be definite like reduce five steps in the insurance claim approval process.
    • Non-Tangible: Benefits which cannot be quantitatively measured and are defined in relativity/subjectivity scale, like improved company brand Image, increased customer satisfaction. The project can develop a scale to measure these benefits or use the organizational existing scale like the client satisfaction rating was five before the project initiation, now after the deployment of the project, it should reach to the nine. The selected business stakeholders give the value of these scales.

Let’s look at what should be done during each process group of project execution to achieve benefit’s realization:

  • Activities During Project Initiation: During the initiation, Project Manager works with the business stakeholders to validate if the benefits mentioned in the Business Case are realistic and can be realized within project constraints. During validation, the analysis of dependencies on other projects/programs is also necessary. After the validation, the excerpts of these benefits are included in the Project Charter. If Project Manager receives already developed Project Charter, Project Manager still needs to validate Business Case.
  • Activities During Project Planning: Project planning should focus on maximizing potential benefit’s through a realistic project management plan (including its subsidiaries). After the initiation, Benefits are planned within your project management plan based on prioritizing requirements which result in maximum business benefits. Your stakeholder engagement plan is highly influenced by the way your project needs to realize the benefits. Your project plan should give the information about how you are going to Monitor& Control the benefits and at what frequency these benefits will be monitored. You can also define the metrics to measure the realization of these benefits. For example, if you are doing partial delivery of a segment of product in between, you can measure the customer satisfaction to check if it is improved as expected.
  • Activities During Project Execution: You engage stakeholders in a way which support in the realization of benefits. When the benefits realization is critical for the success of the project, it will impact the way how the time and resources are invested in the project.
  • Activities During Monitoring & Controlling: You need to measure if the project is on track to deliver business benefits. You can measure benefits using metrics defined in project planning. Also, CPI, SPI, burn down chart, velocity chart are the metrics which you use to measure the project output – can also be utilized as an input to evaluate benefits. Requirement Traceability Matrix is also an important tool to check if the developed requirements trace back to the business benefits. You may also choose to do Exploratory Testing or DITL testing. Day-in-the-Life (DITL) Testing determine whether or not a product provides the functionality for a typical day of usage by a role that interacts with the solution. You should also proactively watch for any assumption that has changed and can impact benefits realization plan if necessary update project plan and other project documents with appropriate approvals. And you may also have an updated business case.
  • Activities During Project Closing: It is the time to measure and demonstrate project success with respect to benefit’s realized in project. All benefits mentioned in project Business Case may not be realized immediately after the deployment of the product/services. You should know that after the deployment when the benefits are expected to realize fully. Based on that evaluation activities are conducted, and project closure report is created. In measuring these benefits, post-deployment survey and focus group can be carried out to solicit quantitative or qualitative feedbacks. In closing, you measure, evaluate, demonstrate, and report the benefits. Your closure report should mention which benefits are realized, dependencies on other projects in realizing pending benefits, and which benefits will be realized by line operations after project handover.

To summarize, traditional approach of linking success of project to Triple Constraints needs a paradigm shift in mind-set of project managers, business analysts and organizations. Projects Business Case should be a live document, referred, and if necessary updated throughout project lifecycle. You should be aware of the benefit’s to be realized in the project and be able to demonstrate projects success through benefits realized.

You can enrol in our online PMP® or PMI-PBA® program to learn how the project management and business analysis contribute in the benefits realization. Our online programs not only will meet your needs to pass the exam but also it will make your exam journey comfortable and enjoyable. You will have Unlimited Access to the technical support. And it happens via the FORUM, emails and Live Interaction Opportunity every alternate week both for PMP® and PMI-PBA®.

If you have any query regarding the use of Business Case as ‘living Document, post your questions in the comment box below