Question to answer: Is the cost/benefit worthwhile?
At this step we need a written down detail of strategic aim, cost, benefit in a format acceptable to finance for investment or project appraisal
Process: Get a CAPEX FORM fill it in. Attach it to the Business Case template and get sign-off from your manager or exec (depending on the value)
If you need any help please contact the Strategy, Projects and Change Office
KEY INFORMATION
| Project Title | |
| Author | |
| Sponsor | |
| Current Date | |
| SPCO Project Code |
WHICH BU OR FUNCTION IS THIS FOR? WHICH PROGRAMME WILL THIS BE PART OF?
| Name of Business Unit, Support Function or Corporate | |
| Strategic Programme |
| Project Type (tick all that apply) | Capital | Property | IT | Other (specify) |
PROJECT SUMMARY
What are the key benefits of this change? (Highlight the key points, which should include important benefits and the return on investment (ROI)) |
| How have your tested/trialed this idea? (Please attach documentation showing any test/trial results or other supporting research) |
| What other options are available? (Analysis and reasoned recommendation for the base business options of: do nothing, do the minimal or do something) |
WHAT ARE THE TIMESCALES?
(The period over which the project will run (summary of the Project Plan) and the period over which the benefits will be realized. This information is subsequently used to help timing decisions when planning (Project Plan, Stage Plan and Benefits Review Plan)
| Year | Project Stages (1-7) | Expected Benefits Realised |
WHAT ARE THE MAJOR RISKS?
(Give a summary of the key risks associated with the project together with the likely impact and plans should they occur)
| Risk | How likely is it to happen (probability) | What would the impact be? | What could/should we do to limit this? | Who should manage this risk? |
WHAT ARE THE BENEFITS, DISBENEFITS AND COSTS OF THIS CHANGE?
(The benefits that the project will deliver expressed in measurable terms against the situation as it exists prior to the project. Benefits should be both qualitative and quantitative. They should be aligned to programme benefits.
Dis-benefits are actual consequences of an activity (unlike a risk, which is uncertain). E.g. merging two elements of an organization onto a new site may lead to better joint working and lower costs but lead to dis-benefits (e.g. drop in productivity during the merger). Dis-benefits need to be valued and incorporated into the investment appraisal)
| Benefits / Disbenefits | Value |
| Total | |
| Project / One-off Costs | Value |
| Total | |
| Ongoing / Annual Costs | |
| Total |
INVESTMENT APPRAISAL SUMMARY
(The analysis may use techniques such as cash flow statement, ROI, net present value, internal rate of return and payback period. The objective is to be able to define the value of a project as an investment. The investment appraisal should address how the project will be funded)
| Heading | Target | Low/Low | Medium/Medium | High/High |
| Accounting Rate of ReturnDoes the project meet the target return? | 12 | |||
| Payback Period (Years) How long will it take to repay the initial investment? | 67 of Life or 10 years | |||
| Interest Cover Multiple | 2 |
