The only reason an organisation makes an investment is to obtain some benefit – either by solving a problem or taking a new opportunity. If we didn’t have a problem or wouldn’t receive any benefits, what would be the point of making an investment?
Most organisations have adopted the business case as the way that potential investments articulate and justify the case for an investment.
In common practice, business case documents have a strong focus on the solution that is planned to be delivered. However, they often fail to adequately describe the problem, explore the strategic options or specify the benefits that the investment will produce.
Whether buying a pair of shoes or building the Snowy Mountains Scheme there are a number of basic questions that must be addressed in sequence. The Victorian Government has defined these in the form of 16 questions investment decision checklist which provides the foundation for investment decision making. It has aligned its business case format to these questions.
This practice aims to elicit the information required to address the 16 questions.
Benefits of using these practices
These practices have been used extensively since 2005. They have been found to:
- shape investments that are more strategic and drive better outcomes;
- establish the logic and key content of the business case; and
- reduce the time and cost taken to develop business cases, and improve the chances that an investment will be funded.
This practice is suitable for investments of any type or complexity.
Irrespective of the complexity they will all be required to follow the same ‘line of enquiry’ as they develop their respective investment stories. However, the number of informed discussions (workshops) required will be different.
Very large or complex investments will require four workshops that will produce four documents that are key to a business case. Small investments may be able to complete the investment story in just one discussion that would only produce an investment logic map.
- Problem definition
- Benefit definition
- Strategic response
- Solution definition
The workshops involved in this exercise are best held at two-weekly intervals. Experience has shown that this provides sufficient time for the thinking of the previous workshop to be absorbed and is not so distant that the momentum is lost.
While the IMS practices were originally used for single inititives, they are increasingly being used to establish the logic for programs of investment.
We recommend using an accredited facilitator to facilitate the workshops for the more important investments. Evidence shows they are more likely to produce a quality result.