How to Review your Project PRINCE2 Business Case – Part 1
Your PRINCE2 project Business Case is probably the most important element of your project as it contains the justification – the reason you are doing the project. You run projects to deliver a business benefits or meet a business imperative.
Measuring PRINCE2 benefits
Wherever possible you need to be able to measure business benefits so that you can show that they were achieved. It is not all was easy as it takes a lot of thinking to work out how to do it, but as far as possible you need to determine measures even if it is only for part of the benefit.
Watch out for ‘non-quantifiable’ benefits because although sometimes real and valid, they are by definition not measurable and you can easily for yourself that the project is delivering more than it really is.
Benefits can be realized at different points in time, not just after the project
This is particularly true when your products are being taken into operational use during the project, benefits may start to be seen or realized, before the project has completed.
With the blending of agile approaches to PRINCE2, even if some benefits can be measured during the project, it will give everyone an indication of whether the project is headed for success – or that the benefits projections were wildly optimistic!
This is also yet another reason why it is important to plan benefit reviews during the project, at the end of the project, and off to the project with benefits will not be clearly visible until some time off to the project has closed.
Beware of NOT isolating benefits
It is often a mistake within PRINCE2 projects not to isolate benefits correctly in order to genuinely attribute them to the project.
It is easy to make the mistake of bouncing off too quickly and coming up with benefit measures that are not precise enough and which get contaminated by other factors. An example here might be an increase in sales of 20% – but if sales to grow up by 20%, how can you be sure that this is just down to your project?
Perhaps sales of reason for other reasons that are not connected with your project at all.
Perhaps a market has grown by a 25% and the project actually worked to reduce sales!
When working the PRINCE2 Business Case into full detail in project initiation, state clearly against each benefit how you plan to measure it. Then, in the benefits review plan, you set down when the checks will be made and who is to make them.
Contamination of benefits can be a tough area to deal with. You need to select a benefit measures that isolate benefits from non-project factors and prove that they relate directly to your project.
One way to potentially reduce this problem is by baselining.
If the project is claiming a percentage change as a benefit – such as increasing the speed of fulfilling orders by 10% – don’t forget to take baseline measures at the start of the project if you do not know the current statistics.
This way you can show the change off to the new procedures are up and running – and thus correctly claim the benefit realization directly from your project.
Reviewing the Business Case regularly
The Business Case is a vital and ‘Living ‘document in PRINCE2. Do not just use the Business Case as a mechanism to get funding apps the project start, only to file it away and forget it.
The Business Case must be kept up to date throughout your PRINCE2 Project.
As an absolute minimum, update the Business Case just before the end of each stage, so that you have it ready for the Project Board to check at the end stage assessment – Their end of stage meeting.
Prudence is not just for politicians!
Being prudent or conservative is a principle of accounting, and it holds true in project Business Case is as well.
Be careful not to be over optimistic with benefits projections when you are using the PRINCE2 Starting up a project and Initiating a Project processes.
The improvement with benefits during pre-project and the initiation stage is can ensure you don’t start a project that should not be started.
Another reason to be prudent about benefits, is so you don’t undermine the success of a project.
If you promise unrealistically high benefits and then fail to deliver them, the project can end on a sour note and the organization may well see the project as a failure.
But if you are prudent and keep your estimates of benefits conservative, then when the project delivers, or even slightly exceeds, the promised benefits, the organization sees the project and yourself as a success.
If you are the non-financial professional, and recognize the powerful advantages for your job and career of becoming conversant in financial techniques, then you need to Grab my “Finance for non-financial professionals” Masterclass:
