Prince2 Business Case question

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kwalford
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Can someone please explain the below Business Options (do nothing, do minimal, do something)? It is an element of the Business case but I am not clear exactly why it is in there and what it achieves...


7. Business Options
Analysis and reasoned recommendation for the base business options of:
• do nothing
• do the minimal
• do something
Do nothing’ should always be the starting option to act as the basis for quantifying the other options – the difference between ’do nothing’ and ’do the minimum’/’do something’ is the benefit that the investment will buy.
The analysis of each option provides the Project Board and the project’s stakeholders with sufficient information to judge which option presents the best value for the organization. It provides the answer to the question: for this level of investment, are the anticipated benefits more desirable, viable and achievable than the other options available? The Business Case for the chosen option should be continually assessed for desirability, viability and achievability as any new risks and/or changes may make one of the other options more justifiable.
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dhaughey
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Usually these questions are designed to get you thinking about different options for your project. Is doing nothing a viable option? What does it mean to the business? If the project is needed for legal or regulatory reasons then this option can be disregarded; however, you may wish to do the minimum to be compliant with the new legal requirement or regulations.

Perhaps the project will increase profit, reduce costs or improve lead times. You may wish to do something as doing nothing would result in an opportunity loss or advantage for your competitors. You may argue that doing something will bring benefits to the business, or alternatively enable you to avoid a loss.

To summarise, can the business do nothing, perhaps invest the money elsewhere in a more profitable project, or avoid risk inherent in the project being proposed. Can the 80/20 rule be applied and 80 percent of the benefits obtained from 20 percent of the effort - doing the minimum necessary to bring about a benefit. Does the full project need to be carried out to deliver a significant benefit to the business?

Understanding the answers to these questions will help you build a convincing and compelling business case.

For information about building a business case take a look at these articles:

http://www.projectsmart.co.uk/business-case.html

Hope this helps.

Duncan
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kwalford
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Thank you for a detailed repsonse; it makes thing a lot clearer in my mind now. The Prince2 official response is not in simple terms, which makes it hard to understand I found.

With the Business Review Plan, does the Senior User supply all the info (they specify) on what the benefits of the project will be? Basically, they say by doing this project it will benefit us by... Then list the benefits (e.g. staff can work from home remotely on the new IT system).

So, if the project went ahead and the products (deliverables) were successfully achieved but they did not add benefit (it turned out that the staff could not work from home on the new IT system) then would the Senior User be help accountable by the Project Board? I am presuming that the PM would not be responsible as they delivered the products to spec; it is not their fault that the products did not achieve the benefits. The Senior User advised in the Benefits Review Plan originally that by producing the new IT system the staff could work from home but it turned out that was not the case.

Am I right?
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kwalford
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What I am trying to ask, is if the PM delivered the correct products, to the specified spec but the products did not add benefit to the organisation then would the Senior User be accountable? The Senior User specified the benefits but the products created did not achieve these benefits
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dhaughey
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Hi,

The Senior User is not accountable, the Sponsor is:

The sponsor provides leadership on culture and values, owns the business case, keeps the project aligned with the organisation's strategy and portfolio direction, governs project risk, works with other sponsors, focuses on realisation of benefits, recommends opportunities to optimise cost/benefits, ensures continuity of sponsorship, provides assurance and provides feedback and lessons learnt.

If a project reaches a successful conclusion, but no benefits are realised, then something has gone wrong along the way. There must be regular milestones throughout the project where the benefits are reassessed and these questions asked:
  1. Is the project still aligned to business strategy?
  2. Are the benefits still valid?
  3. Will the project produce the desired benefits?
For more information on Benefits Realisation read this article:
What is Benefits Realisation

If you are in the UK you might be interested in this event on 11th July:
Active Benefits Management Realisation 2012

Cheers,
Duncan
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kwalford
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Hi Duncan,

Thank you for this and the private message. This makes sense. So as the Executive (customer) owns this business case, they are responsible for making sure that the project produces a product which would add value and benefit the people (customer users) which will use it.

When Prince2 says that the Senior User is responsible for realizing the benefits, what exact does this mean in simply speak? Does it mean that they are given the product (which the project produced) and from that they need to 'gleam' the benefits from it. After all, they are the ones using the product, so they need make sure that it is a benefit to them (might improve sales, streamline work etc). Correct?


Thank you for your help too :)
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dhaughey
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Hi i3666,

Simply speaking the Senior User is there to ensure the project produces products that meet user requirements and provide expected user benefits.

Usually to realise benefits from a project some effort is needed. User training, embedding a new process in the business etc. This is the role of the Senior User.

If the Senior User has done their job well the products will meet the users needs, be easy to use and of good quality.

Hope this helps.

Duncan
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kwalford
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Thanks again Duncan.

Right, I see. That makes a lot more sense now. I was mis-interpreting the term 'realising'; your example of possible training on the products would in turn help users 'realise' the benefits of what the product can offter. The Senior User would arrange the product training for the other users so that they can make the most of the product (benefit from it).

Thank you :)
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