Building the Business Case Seminar Agenda
Day 1
Day 1 Morning (900 - 1200)
Introductions and Overview
• Introductions, participants and instructors
• Business case overview (the view from 39,000 feet)
• 5 keys to a successful case (overview from 2,000 feet)
• Review essential financial concepts Part I
– Measuring business performance
– Income statement (Statement of operations)
– Balance sheet (Statement of financial position)
– Planning and budgeting concepts
– The time value of money
Designing the Case
• The business case introduction
• The subject statement:
– What is the case is about?
– Which business objectives does the subject addressed?
– Which business problems does the subject solve?
• The purpose statement:
– Why the case is being built?
– Who will use it? For what purpose? When?
– What information do they need?
• Case scope and boundaries:
– Whose costs and whose benefits will be included?
– What time period will the analysis cover?
• Case studies (Other case studies added at participant request)
– Justifying a major software system (ERP system)
– Estimating marketing program ROI
– Deciding whether or not to launch an e-business venture
Workshop Practical Exercise 1: Subject, Purpose, and Scope
– Writing the business case subject statement
– Determining the case purpose
– Setting the case scope and boundaries
Lunch (1200 - 1300)
Day 1 Afternoon (1300 - 1700)
• Essential financial concepts Part II
– Financial decision criteria
– Financial metrics in the business case
– Net present value (NPV) and discounted cash flow (DCF)
– Return on Investment (ROI)
– Payback period
– Internal rate of return (IRR)
– Other financial metrics to meet the case purpose
Designing the Case (Continued)
• Methods and assumptions
• Scenario design
• Data sources
• Precisely what do 'cost' and 'benefit'' mean?
• The cost model Introduction
– Rules for deciding which cost items belong in the case
– Ensuring that different scenarios are compared fairly
– A tool for cost analysis
– Showing that all relevant costs are included
• An activity-based cost model
• A resource-based cost model
• Identifying assumptions / Making assumptions
Workshop Practical Exercise 2: The Cost Model
– Choosing the approach: Activity-based or resource-based model?
– Designing the cost model structure
– Identifying cost impacts
– Turning cost impacts into projected cash flow
Building the Case
• Analysing costs and benefits
• Cost models for the case studies
• The road ahead: Benefits rationale and cash flow projections
Day I Summary and Wrap Up
Day 2
Day 2 Morning (900 - 1200)
• Review of Day 1, overview of Day 2
Building the Business Case (Continued)
• Analysing costs and benefits (continued)
• The full range of business benefits
• Building the benefits rationale:
– Benefits begin with business objectives
– Common conceptions about hard and soft benefits
– Problems with so-called intangible benefits
– Legitimising benefits for the business case
– Measuring value in financial terms
• The benefits rationale for case studies
Workshop practical exercise 3: Benefits
– Identifying business objectives for action
– Determining benefits (contributions to objectives)
– Making objectives and benefits tangible
– The value of reaching objectives
– Assigning value to benefits
Lunch (1200 - 1300)
Day 2 Afternoon (1300 - 1700)
Building the Case (Continued)
• The Financial model
• Cash flow statements
– Full-value cash flow statement for each scenario
– The incremental cash flow statement
– The baseline for measuring savings, increases, and improvements
• Building the financial model
– Static vs. dynamic models
– Assumptions and the dynamic model
– 'Costing' and 'valuing' from the assumptions
• Analysing results
Workshop Practical Exercise 4: The Financial Model
– Designing the financial model
– Spreadsheet implementation
– Testing the model
Packaging and Presenting the Case
• Asking 'What if?' questions
• Sensitivity, risks, and contingencies
– Sensitivity analysis: Which assumptions are most important?
– Simple sensitivity analysis
– Sensitivity analysis: rigorous
– Risk analysis: How likely are projected results? Other results?
• Risk and sensitivity analysis with Monte Carlo simulation
– Reducing uncertainty in projected results
– Measuring and reporting uncertainty
– Confidence intervals for projected results
– Implementing your own Monte Carlo simulation
• Non financial results in the business case
– The difference between 'intangible' and 'non financial' results
– Linking non financial results to business objectives
– Comparing financial and non financial results
Workshop Practical Exercise 5: Non Financial Results
– Non financial contributions to business objectives
– Comparing financial and non-financial results on the same basis
Recommendations and conclusions
• Meeting business objectives: What it's all about
• Contingencies: What must we mange, to bring in the predicted results?
• Risks: Which risk factors must we watch?
• Practical guidance for management
Your next steps
Course summary and wrap up
 Home Top Contacts
|
