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EDITION 009

Learning Tree
Management Insights
Expert Advice from Today’s Top Professionals
Creating and Proving Business
Benefits in Six Simple Steps
Is this a familiar scenario? You need to get management project, so management didn’t fully trust the cost/benefit
approval for your project to proceed. In a panic, you look for analysis.
the last proposal you wrote—or get a copy of the last successful
For the purposes of this article, let’s presume the latter
one—and use it as a template. To be persuasive, you frame the
outcome. In a proposal, tangible costs and benefits do need
benefits of the initiative by advancing “the numbers”, believing
to be compared to each other, but many businesses are also
it’s what the business cares most about.
seeking to achieve benefits that are harder to quantify. For
But here’s the catch: You don’t have a clue how to prove your example, “improved efficiency” is valuable, but how do you
initiative’s benefits using “the numbers” because there are prove (or quantify) that value?
intangible benefits that are difficult to quantify in both the short
Rather than start with the numbers, consider the real goals
and long term. You struggle with determining the cash value
of any proposal:
of “increased efficiency” and “improved morale”. Plus, your
knowledge of the financial factors affecting the return from this • Clearly outline what is being proposed
project is limited—so even the value from the tangible benefits • Demonstrate the ways in which the proposal benefits
is suspect. Your recourse is to invent numbers for the intangible the business
benefits and mix them in with the tangible ones. You do all this,
all the while knowing full well that cash is historically the least • Make sure your proposal is understood by all stakeholders
effective predictor of project success. (not just those with finance degrees)

On the up side, generating costs for the project is simpler, and This is what’s involved in creating a successful business case,
once you have your cost and benefit numbers, you can provide and it can be easily done using a simple six-step process called
a cost/benefit analysis. However, since the benefit numbers you ADAPTS.
invented are qualitatively different from your cost numbers,
your analysis is suspect at best.
Nevertheless, you persevere and submit the proposal. One of
two things happens: Peter Dillon-Parkin
1. Your proposal is approved because the key decision had Able Solution UK Ltd
already been made. Writing the proposal was simply an Our Management Insights article for this month addresses the
internal process requirement and it was never actually read. fundamentals of creating a clear and persuasive business case. Author
2. Your proposal is read but rejected. While it had many Peter Dillon- Parkin, a documentation specialist and business analyst,
numbers, it never made a strong case for pursuing the offers a six-step process for success.

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EDITION 009
Learning Tree
Management Insights
Expert Advice from Today’s Top Professionals

ADAPTS: A Six-Step Process for Creating and Proving Business Benefits

Applying the ADAPTS Process to to those factors that the business worries about. For instance,
a cash rich business might not care about cash overruns but
Create a Successful Business Plan care very much about missed deadlines. Using BARs lets you
synchronise the evaluation of risk in your initiative with the risk
Step 1: Agree on the Scope profile of the business.
Your first step is to harvest the stakeholders’ key perceptions
and opinions to build a clear set of business requirements. Step 5: Target Alternatives
Next, write a clear statement of the problem or opportunity Now you must ensure that your initiative (and the alternatives
that has engendered the proposed initiative and compare that you generated back in Step 2) are culturally compatible with
to the requirements. Requirements that address the problem the way the business, and/ or its management, operates. To do
or opportunity are the key requirements while the remaining this, you must profile the decision-making processes of the key
are “nice to have” and rarely cause the initiative to fail if stakeholders and satisfy the selection criteria they use, thus
they’re not met. establishing that you’re presenting appropriate alternatives.
For instance, presenting an alternative that stresses “increased
Step 2: Develop the Initiative throughput” for a company that values “care and quality” is
Now you can add detail to the key business requirements by unlikely to succeed.
identifying all stakeholders, understanding their goals and
activities and getting more detailed information. This step Step 6: Sell the Business Case
provides two important insights: First, an understanding of Finally, pull together the knowledge you’ve collected from the
the user scenarios that will be affected by implementing the previous steps to create a compelling reason for implementing
initiative and, second, possible alternatives for meeting the your initiative. Remember: Without a strong rationale for
business need that engendered the initiative. implementing your initiative, readers will distrust any numbers
you provide. More business cases fail because of this than for
Step 3: Analyze Costs and Benefits any other reason. To further help your cause, consider writing a
The first part of this step corresponds to a traditional proposal clear, concise executive summary that focuses on the key points
where you compare tangible costs with tangible benefits. the decision makers are interested in. It is often the best place to
Because you are comparing apples to apples, standard make your case.
financial measurement tools such as return on investment,
payback period and net present value are helpful here. The Following the ADAPTS process, you’ll produce a business case
degree to which you’ll deal with the financial aspects of a document that accurately represents the real value that your
business case is directly related to the exposure to risk for the initiative provides to the business and, more importantly, enables
business caused by the sums involved. If you’re unsure about informed decision making.
this aspect, involve the finance department or an outside
expert for their expertise.

In a business case, you must also go beyond the “the numbers”


to measure intangible benefits by tying those benefits
to business drivers and their Key Performance Indicators
(KPIs). A business driver is one or more of your business’
critical success factors, grouped into areas such as market
attractiveness or operational efficiency. For instance, in the
“customer satisfaction” area, a key business driver might be
“increasing our responsiveness in dealing with client needs”.
Having identified a driver, you can tie it to a measurable KPI.
For “customer satisfaction”, a KPI measurement could be
“average call response time”. If you can demonstrate that your
initiative will result in a measureable improvement in a KPI
tied to one of the company’s critical success factors, then your
initiative demonstrates a benefit to the business.
About the Author
Peter Dillon-Parkin is the author of Learning Tree’s Course 212, “Building an
Step 4: Prioritise Risk Effective Business Case: Analysing and Communicating Business Opportunities”.
Here’s where you help the business recognise areas of Peter is a consultant specialising in documentation, business analysis and
potential deviation in the business case. You should use communication skills, and works in Europe, the USA and the Middle East.
behaviourally anchored ratings (BARs), which are anchored pdillonp@yahoo.co.uk

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