Change Management Initiative - Business Case Importance
- Peter F Gallagher
- Feb 1
- 4 min read
"It is always worth checking that the change programme is not a pet project caused by the hunch and launch syndrome*, without strategic consideration or a plan on how the benefits will be realised"
The business case provides the commercial reasons for starting the change programme as well as justifying the investment of the organisation’s resources, time, and effort before starting. It is developed to assess the change programme’s balance between costs and benefits.
The business case could either be basic and high-level or detailed and comprehensive. The business case includes key parameters used to assess the objectives and constraints for the intended change programme. The business case may include details about problems or opportunities; business and operational impacts; cost-benefit analysis; alternative solutions; and risks. The business case establishes the authority, intent, and philosophy of the business need. It also serves as a formal declaration of the value that the programme is expected to deliver and a justification for the resources that will be expended to deliver it. The four typical components of the business case are:
Cost Benefit Analysis:
A technique used to compare the total costs of the change programme against its benefits, using common metrics (monetary units, market share, etc.). Change programme decisions are based on whether there is a net benefit or cost to the approach, i.e., total benefits minus total costs.
Alternative Solutions:
Assessing other possible courses of action, solutions, or change programmes. It is about asking an independent and challenging question: ‘Are there alternatives and have they been investigated?’
Risks:
The probability of occurrence of a specific event that affects the pursuit of change objectives. Risks are not negative by definition. Risks are potential external events that could have a negative impact (although not always) on the change programme if they occur. Risk also refers to the combined likelihood of the event occurring and the impact on the change programme if the event does occur.
Business and Operational Impacts:
This relates back to organisational change capacity. The analysis of business and operational impacts could provide invaluable insights to the sponsor and change team. It is about performing a systematic process to determine and evaluate the potential impacts on normal day-to-day operations.
The business case may contain other relevant documents, such as the programme charter, but this varies from organisation to organisation. The programme charter is a short document formally issued by the organisation that describes the change programme in its entirety. It provides the programme sponsor with the authority to apply organisational resources; it will also contain the objectives and constraints, solution direction, identified stakeholders, risks, statements about scope, etc.
"Unless the change initiative is continually aligned to the organisation’s strategy it will not deliver benefits or value to the organisation."
Hunch and Launch Syndrome:
A name given to the process of coming up with a change idea (hunch) and then introducing (launch) it into the organisation without strategic consideration or a plan on how the benefits will be realised. These ideas rarely deliver strategic change or sustainable benefits and are sometimes referred to as ‘pet projects’.
Find out more:
Further Reading: Change Management Handbook - Leadership of Change Volume 3
Peter consults, speaks, and writes on the Leadership of Change®.
He works exclusively with boards, CEOs, and senior leadership teams to prepare and align them to effectively and proactively lead their organisations through change and transformation.
For insights on navigating organisational change, feel free to reach out at Peter.gallagher@a2B.consulting or schedule a free consultation
Peter F. Gallagher is a leadership guru, change management global thought leader, organisational change authority, international corporate conference speaker, 15X author, and C-level change leadership coach.
Listed #1 by leadersHum Top 40 Change Management Gurus You Should Follow in 2022 (Mar 2022).
Ranked #1 Change Management Global Thought Leader: Top 50 Global Thought Leaders and Influencers on Change Management (2024-2023-2022-2021-2020) by Thinkers360.
Listed #15 in the “Top 30” for Global Gurus Leadership (2024) by Global Gurus.
Ranked #1 Business Strategy Global Thought Leader: Top 50 Global Thought Leaders and Influencers on Business Strategy (2022) by Thinkers360.
Ranked #6 Leadership Global Thought Leader: Top 50 Global Thought Leaders and Influencers on Leadership (April 2024) by Thinkers360.
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