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In lean economic times, budgets are reduced, and many senior leaders will push back on budget requests that lack a clearly defined business case. Unfortunately, not all HR professionals know where to begin or how to build a business case. Here’s some help.
A business case is a form of gap analysis. It describes the business problem, the current status, the desired status and an action plan stating how the organization can achieve its goals. A well-formulated business case is a tool that supports planning and decision-making regarding purchases, vendor selection and implementation strategies.
A well-written business case provides a clear statement of the business problem and a potential solution, outlines consequences resulting from specific actions, and recommends metrics for the proposed solution. More important, a business case provides an opportunity to propose options that are based on objective data and that offer an increased sense of understanding and ownership of the solution.
Before you start building a business case, it’s important to be aware of a primary limitation: Each organization requires and uses different financial metrics. For example, senior management at your organization may want to see a return on investment (ROI), total cost of ownership or cost-benefit analysis. If you’re undertaking a business case and aren’t familiar with these concepts, you should consult someone in your finance department.
Similar to most projects, the typical requirements for business case development are time, people and money. Expect to spend at least eight hours writing a comprehensive business case. However, the time spent writing and the number of people involved can expand based on the problem. A more complex or costly problem can extend the time frame significantly. The roles needed to pull the information together include a basic project manager (you), a financial expert with organizational knowledge and good spreadsheet skills, researcher(s) to gather data and perform competitive analysis, and an editor to put the information into an organized format.
The 10 elements of an HR business case include:
The 10 elements above provide a basic framework. However, you may still encounter challenges when formulating your specific business case. The table below outlines some common problems and solutions.
Now you’re ready to get started. But because each organization is different, consider the following suggestions:
If you’ve done your homework, you’ll be on your way to eliminating a performance gap within your organization.
Ed Mayberry, Ed.D., is a senior leadership consultant with Kaiser Permanente and a performance consultant in the San Francisco Bay area. His experience includes talent management, executive development, and training/online learning development. He can be contacted at
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