1.

Business Case
An example and explanation of a
business case
Business Case An example and explanation of a business
case

Version History and Sign-off

Version Reason for Change Date Name
0.1 Initial draft <dd-mm-yyyy> <Name>
1.0 Review and approval <dd-mm-yyyy> <Name>

Authorisation
The following individuals have reviewed and approved this document:

Approver’s Name Job Title Approved on (Date) Signature

<Name> <Title> <dd-mm-yyyy>
<Name> <Title> <dd-mm-yyyy>

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Business Case An example and explanation of a business
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Table of Contents
1. Executive Summary.............................................................................................................4
1.1 The Issue................................................................................................................4
1.2 The Outcome..........................................................................................................4
1.3 The recommendation..............................................................................................4
2. Business Case Analysis Team............................................................................................5
3. Project Overview..................................................................................................................5
3.1 Goals.......................................................................................................................5
3.2 Performance...........................................................................................................6
3.3 Assumptions...........................................................................................................7
3.4 Constraints..............................................................................................................7
3.5 Major Milestones.....................................................................................................7
4. Cost Benefit Analysis...........................................................................................................7
5. Approvals.............................................................................................................................8

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Business Case An example and explanation of a business
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Introduction
A good Business Case explains to a company’s’ executive board why they should authorize a
new project. It outlines the current problem the company is facing and its impact, explains the
proposed solution and the benefit it will entail and performs a cost benefit analysis. It may also
present alternative solutions, and their benefits.
Based on the business case the stakeholders check whether the proposed project aligns with the
company’s strategy, and then approve / deny it. The scope of the business case document differs
from company to company, and the rule-of-thumb is that the larger the company, the larger the
scope.
The following section presents the template and example of a business case for implementing the
SAP system in a company. The black font is the template, while the blue font is the example.

Template with Example

1. Executive Summary
This section is usually a one-page summation of the entire document, and presents the bottom
line to the stakeholders. The rest of the document allows them to drill down into the details for
further explanations. This section is usually written last.
This business case describes how the new SAP system will transform our company from a
holdings company to a global one.

1.1 The Issue

This section briefly describes what the problem is (but not the solution).
Due to the recent expansion which occurred by our acquisitions in 8 different countries, we
now work with 3 different ERP (Enterprise Resource Planning) systems. The result is that
we don’t have a common computer language in the company, and this prevents us from
using out global presence to receive bulk discounts, lower logistical expenses and
shipment tariffs.

1.2 The Outcome

This section outlines the expected outcome and the business benefit.
Transferring to one ERP system will allow our company to implement standard processes,
methodologies and systems. This will result in lower expenses, less interfaces between the
systems and the ability to measure our company as a whole and not each branch on its
own.

1.3 The recommendation

In this section the approach to solving the business problem is explained.

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Business Case An example and explanation of a business
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The approach described in the business case explains how we will meet our objective of
continuously improving our efficiency, reducing costs and capitalizing on our global
presence. Some of the ways which implementing the SAP system in our company will
achieve these goals are –
• All our branches will have visibility regarding orders of materials, thus reducing
shipping costs and receiving discounts for ordering in bulk.
• We will be able to transfer employees from one branch to another quite easily, since
all of them will work with the same processes and systems.
• HQ will be able to measure the company as a whole, and not just each branch on its
own.
• The system comes with a BI (Business Intelligence) system, which allows the branch
management to easily pinpoint bottlenecks and red flags.

2. Business Case Analysis Team

This table contains the team members who put the business case together.

Role Name E-mail Telephone #

Project Manager Dwayne O’Donnell Dod@example.com +1-2255-1465-227

mlchoi@example.co
Technical Analyst Mi-ling Choi +420-155-4789-226
m

PMO Kostas Rachevicious krach@example.com +44-248-367-1186

Technical Writer Svetlana Apelfeld sap@example.com +972-54-6697-020

Business Owner Akshat Das ada@example.com +91-0023-556-789

3. Project Overview
This section describes the project in more detail, and includes all the information required to
make a go / no-go decision. It includes the goals, assumptions, performance, constraints and
major milestones of the project.

3.1 Goals

All the business goals and their description ore outlined in the table below.

# Business Goal Description

The SAP system will allow the users to see the

business KPI’s in real time, thus allowing them to make
1 On-line measurements
better decisions and see the results of said decisions
clearly

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Business Case An example and explanation of a business
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Since analysts will spend less time gathering

Improve analysis
2 information, they will have more time to analyse it and
capabilities
recommend better solutions to the issues we’re facing

The new system will eliminate all the interfaces

3 Reduce overhead costs between the various systems which exist today, and
the manpower required to operate it

Since all the branches will use the same system to

order goods, we will be able to ship to one central
4 Reduce shipping costs
location and then distribute the goods to the branches
more efficiently

The new system will encompass all the divisions of the

company (HR, Logistics, Procurement, Finance), and
5 Define accountability
will clearly define the boundaries between each
division and their responsibilities towards each other

3.2 Performance

This section aims at ascertaining whether the project succeeded in its objectives by
outlining the business measurement which will be used to gauge the goals.

# Process / Service Measurement

The system will eliminate discrepancies between

1 Reporting
reports, and will require 80% less time to create

The new system will produce reports in 86% time it

2 Reduce response time
required the old system

The new system will allow to eliminate 7 HQ positions

3 Staff resources
as now many functions will be automated

Reduce the maintenance costs by 35%, due to the

4 Maintenance
standard system and the ability to perform remote fixes

3.3 Assumptions

This section outlines the high-level assumptions of the proposed project. This list will most
likely grow if the project is approved.
• There will be a 3 - week training effort throughout the company on using the new
system
• Funding for the licenses and hardware is available

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Business Case An example and explanation of a business
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• Major stakeholders will support and drive this project forward

• No system customization will be required

3.4 Constraints

This section outlines the constraints which may hinder the successful implementation of
the proposed project. This list will most likely grow if the project is approved.
• The project will be carried out internally, and no 3rd party vendors will assist
• 5 new temporary positions will be opened for the sake of this project
• Phasing out the legacy systems will be met by opposition by the unions

3.5 Major Milestones

This section presents the major milestones of the project and their deadline dates. This list
will grow if the project is approved.

# MMS Due Date

1 Approval of the Project 14-Jul-2017

2 Project Kick off 17-Jul-2017

3 Blueprint complete 10-Nov-2017

4 System build phase complete 05-Feb-2018

5 System implemented in pilot branch 09-May-2018

6 System implemented in entire company 11-Sep-2018

4. Cost Benefit Analysis

This section is the heart of the business case, and presents its bottom line. Based on this
analysis the stakeholders usually approve / deny the go-ahead. It describes the costs and
financial benefits (savings) of the project. Of course the desired outcome is that the savings will
be more than the costs, but this isn’t necessarily a must (especially in strategic costs). Some of
the savings are periodic, while some are one-time only.
The following table describes the net savings for the first year of using the new system –

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Business Case An example and explanation of a business
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First Year
# Action Type Description
Costs

1 Purchase 3 Cost The new system requires an upgrade of $40,000

servers the servers

2 Purchase 35 SAP Cost Each year we will need to pay for ~35 $30,000
Licenses licenses for the users. This may grow
as the company expands

3 Reduce HQ Savings The new system will allow to reduce 7 -$35,000

staffing employees

4 Reduce Savings The new standard system will no longer -$28,000

Maintenance require specialized knowledge which is
available through experts

5 Reduce Savings The new purchasing processes and -$15,000

Purchasing Costs bulk discounts

Net First Year Savings -$8,000

Bottom Line: The above table comes to the conclusion that the first year of the new system will
save our company $8,000.

5. Approvals
This section requires the approvers to sign their names.

# Approver Name Title Signature Date

1 John Fesic President

2 Kate Mulgrew CEO

3 D.B. Penipacker CFO

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