The business case analysis comprises the work and research that precede the preparation of a business case. It includes a detailed presentation and comparison of all costs, benefits and risks associated with the investment project. At the same time, it weighs up the possible courses of action. As a result, the analysis provides constructive proposals for the implementation of the project described therein as well as a transparent basis for the business decision.
If a company is planning a project that involves a major investment, it may be useful to prepare a business case. With the help of this method, it is possible to assess whether the implementation of the investment project is really worthwhile for the company. The preparation of a business case is particularly helpful if, for example, the project involves a far-reaching structural change in the company, the introduction of a new product or expansion into new business areas in which the company concerned has not yet been able to gain any experience.
The preparation of the business case is preceded by the business case analysis. Transparency and comprehensibility are of particular importance here – in terms of a detailed, differentiated and comprehensive approach – for the executive decision-makers and other stakeholders. As a rule, an impact matrix is used that clearly illustrates how the various issues and parameters of the investment project interact with each other. The current and forecast situations are always compared. In addition to calculations and risk assessments, existing case studies, comparable business cases and expert assessments are also consulted.
The final result is the business case with decision and implementation proposals. These include, for example, the recommended number of employees to be assigned to the project, reporting intervals on the degree of target value achievement, and well-founded financial forecasts.
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