Monday, March 26, 2012
Building a Business Case – The Case for Change II
My last posting in the series titled Building a Business Case told a rather odd tale of my confrontation with reality when it came to trying to decide if I should go solar and replace my roof shingles with the kind that can get me off the power grid. The story must have resonated. Indeed, readership went so far and wide that a Google search for solar shingles makes this site #1 on the results! (Not really, but I can dream).
The story itself never really happened, but hopefully the connection to building a business case made sense. Today, I'd like to talk more directly about what an organization deals with when making that case for change.
Despite how it may seem at times, corporations and public organizations are not a font of endless capital do with as they please. Cash is king, and in the "new economy" this is even more true. What capital is available is being held (Wall Street Journal: Corporate Coffers Have Surged 59% Since 2008 Crisis, but Some Executives Say Spending Now Is Risky; 'We're Going to be Cautious'). What this means for any exec trying to make a case for change is that it is harder than ever.
More than ever executives, are asking the question "Why do we need to do anything?" as they consider any case for change. It is an appropriate and critical question that I believe should always be asked. A business case should be about more than how much an approach can save the organization. It should be about more than numbers. When every department in an organization is presenting requests for investment, there is fierce competition for capital. And you can be sure that many of the requests can demonstrate a better ROI than your request. Others may not have any return, but are probably identified as mission critical.
So to get you business case approved it must be compelling. It must drive home the reasons why doing nothing is no longer an option. It has to stand out among a multitude of requests so it doesn't continually get relegated to next year's project. Some reading this probably recognize that trap as they think about the employee self service module that still isn't implemented or the performance management system that only does half of what it was meant to do.
These days you must get creative. Unfortunately your projects need to be marketed and your reasoning must be clear. Sure, the numbers have to be there. But your 10% return has to look more compelling than another with 11% return or 9% return. You need to sell it! If your case for change falls short, the pages that follow won't even be considered.
Just as my solar roof shingle story points out, there are always plenty of ways to invest or spend your money. And since we know corporations are people too, it's no different in the work environment.
About the author - Donald Glade is president and founder of Sourcing Analytics, Inc., an independent consulting firm specializing in helping companies optimize their HR / benefits / payroll service delivery through financial analysis, relationship management, and process improvement.