Sample Business Case Template (Page 13 of 18) in pdf

Sample Business Case Template Page 13

Section

Cost/Benefit Analysis

Purpose of the Cost/Benefit Analysis Section:

The reason for writing the Cost/Benefit Analysis Section is to provide the reader with an evaluation of the costs and

benefits associated with each viable alternative. The reader can easily understand and compare the initial and on-

going expenditures to the expected financial and non-financial benefits, for each viable alternative.

Quantitative Analysis – Financial Cost & Benefit:

Description:

Full Cost Analysis

Where possible all costs and expected benefits resulting from this opportunity should be analyzed for each viable

alternative (including the costs and benefits of status quo). This methodology provides the reader with a total cost

picture and is much more informative that an incremental approach. Any detailed worksheets should be attached

as an appendix.

Incremental Cost Analysis

If it is not possible or practical to fully analyze the entire cost or where the incremental project costs are relatively

small to the entire cost, an incremental approach may be used. This methodology involves identifying the changes

or differences between each alternative, using the projected benefits/costs of the status quo alternative as a basis.

Timeframe:

Identify an appropriate project timeframe over which both the cost and benefits will be analyzed. Timeframe should

be appropriate to the expected lifecycle of the project, from incurring costs to achieving the anticipated benefits.

Costs:

Identify all relevant costs incurred by all stakeholders over the chosen project timeframe:

Direct costs

Indirect costs

Initial costs

On-going costs

Capital costs

Consideration should be given to:

When the costs will be incurred

Who will incur the costs

Certainty of costs

Benefits:

Identify all quantifiable benefits related to all stakeholders, over the chosen project timeframe.

Consideration should be given to:

When the benefits will be achieved

Who will be the be the recipient of the benefits

Certainty of benefits

BUSINESS CASE – [PROJECT NAME]

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Sample Business Case Template Page 13