# Presentation: 272489

## Business Case Process

- John DiNofrio
- Gary Graybill
- April 8, 2003

## Overview

- The Business Case is a standardized management tool that captures planning information about a new project.
- It is constructed by the originator, the sponsor, and the performing organization to document business decisions.
- It should be used to help decide if a project/program proceeds.

## Business Case Objectives

- The Business Case is the basis of a presentation to decision makers so they may make more informed decisions.
- It is a formal document that is reviewed and signed by the originator, sponsor, and the performing organization to ensure all parties understand and agree on their roles and responsibilities.
- It should be signed by decision makers to approve and grant authority to proceed.

## Business Case Requirements

- Business Case needs to be developed:
- External New Business
- DOT other than FAA
- Other Government Agencies – Military, State and Local Gov’t., etc.
- Industry
- Academia
- International
- New Projects valued at over $50K
- Example - VizSim Lab
- Business Cases are _not_ required:
- Existing Projects and Customers
- Projects with PDs
- Follow-on to Existing Projects

## Business Case Timeline

**Due Diligence** – Begins with initial discussions to determine project feasibility
**Business Case Development** – Begins when “players” begin to formalize and document business decisions.  This cycle ends when all are satisfied with the documented decisions and sign the Business Case.
**Review/Approval** – Begins with the development of the Business Case Presentation and ends after the Business Case is presented and approved.

| Due Diligence (Initial Discussions) |  |  |  |  |  |   |   |   |   |   |   |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|   |   |   | Business Case Development |  |  |  |  |  |   |   |   |
|   |   |   |   |   |   |   |   | Review/Approval Cycle |  |  |  |

## Business Case Process

- Each LOB personally commits to ensuring business cases are developed
- Each LOB will develop their own process to track and approve business cases
- All business cases that go to the SLT for approval will be maintained by LOB and ACF
-  Tech Center wide initiatives
-  Initiatives that require funding outside of LOB budget
-  Initiatives > $$$
- On a quarterly basis, the number of business cases developed and ROI will be tracked for measurement reporting

## ACF’s Roles & Responsibility

- Assist the originator, the sponsor, and the performing organization in developing the business case
- Provide support to the SLT and LOB staff throughout decision making process
- Provide support to the originator in developing the financial case for the program/project

## Next Steps

- SLT and LOB ensure that business cases accompany project requests.
- LOB develop internal process to carry business case from due-diligence to approval.
- ACF develops corporate processes..
- Begin tracking business cases and ROI’s for corporate measurement reporting.

## Summary

- The Business Case process establishes a standard procedure for documenting new business opportunities.
- Business Cases are required for:
- External New Business Opportunities (i.e. other than FAA)
- New Projects valued at over $50K (i.e. VizSim Lab)
- The Business Case ensures buy-in from project stakeholders and grants approval to proceed.
- The Business Case Template provides guidelines as well as format instructions.
- It is available now!
- Suggestions for Business Case Template improvement should be made to ACF-1.

## Backup

## Business Case Contents

- The Business Case contains key information to support informed management decisions
- Describes the project and approach ***(What is this Project about?)***
- Lists organizational stakeholders ***(Who is involved?)***
- Sponsor (funder)
- Originator (if different from performer)
- Performer
- Stakeholder
- Benefactor
- Competitors
- Lists Benefits  ***(Why do this Project?)***
- Relevance to Corporate Goals
- Intrinsic or Derived

## Business Case Contents(Continued)

- Costs ***(How much will this cost?)***
- Resource Requirements
- Facility Requirements (e.g. Laboratories)
- Other (Materials, Equipment, etc.)
- Revenue ***(How much will it bring in?)***
- Schedule  ***(How long will the project take?)***
- Risks ***(What could cause the Project to fail?)***
- Assumptions ***(What constants are required for success?)***
- Summary
- Recommendations ***(Request for signature authorizing approval to proceed.)***

## Business Case Cover Page Sample

## Business CaseTable of Contents Sample

** **
**Executive Summary**
**1.0**	**Project Name**
**2.0**	**Business Case Participants**
- 2.1	Originator/Requestor
- 2.2	Performer/Acquirer
- 2.3	Sponsor
- 2.4	Stakeholders, Customers (internal and
-              external)
**3.0**	**Competitors**
**4.0**	**Situational Assessment (Current State) **
**             ****and Problem Statement**
- 4.1	**Project Description and Scope**
- 4.2	**Proposed Solution/Approach**
**5.0**	**Resource Requirements**
**6.0**	**Timeline / Milestones**
**7.0**	**Financial Assessment**
- 7.1	Costs

**8.0**	**Mission Relevance to Goals**
- 8.1	FAA Goals
- 8.2	ARA Goals
- 8.3	Technical Center Goals
**9.0**	**Benefits**
- 9.1	Intrinsic or Derived Benefits
- 9.2	Measurable Benefits
**10.0**	**Cost and Benefit Analysis**
**11.0**	**Assumptions and Risks**
- 11.1	Project Assumptions
- 11.2	Risk Assessment
*11.2.1*	*Adverse Impact Of Not Performing The*
*                      **Project*
- 11.3	Risk Summary
**12.0**	**Conclusions and Recommendations**
**13.0**	**Approvals and Authorizations**
**14.0.**	**Document Change History**

## Sample Financial AssessmentVizSim Lab