Business Case Assessment
We have a proven business case methodology which has been used for many years, including several high-profile, externally reviewed cases used for regulatory submissions and public domain reports.
Approach to Business Case Development
DGA Consulting conduct a collaborative approach to business case development producing a unique business case to reflect the individual operating circumstances of each client. This typically requires regular stakeholder interaction to assess how any new solution will impact the business and to get ‘buy in’ from the user community of the expected benefits from the new solution. An overview of the process is shown in the diagram below.
Model Setup Scenarios
The initial phase of the project involves defining the business case being assessed and creating the model. This definition may include additional options, or restricting benefits to a specific set of users. DGA Consulting’s model allow these options to be rapidly assessed through creation of a number of scenarios. These operate through drop down boxes that allows the user to instantly compare the outcomes under different scenarios. An example scenario box is shown in the opposite diagram
Example Outcomes of the Assessment
The model is set up to automatically produce a series of charts and graphs dependent on the project requirements. This includes summary cost and benefit calculations, cash flow calculation and calculations such as the NPV or IRR for the project. An example for a vendor assessment tool is provided opposite.
Sensitivity Analysis
An important part of the modelling is recognising uncertainty, which is assessed with 2 forms of sensitivity analysis. The first approach assesses the impact on the modelling results from changing a single key parameter from its most likely to a high/low extreme. This identifies the most critical parameters in any business case, which may justify more assessment.
The second sensitivity analysis is a Monte-Carlo simulation that randomly varies all of the key parameters within their defined probability distribution to predict a range of potential outcomes and the probability of a specific outcome. This can be important when comparing options as some projects may have far smaller ranges of potential outcomes.
BENEFITS OF DGA CONSULTING’S APPROACH
DGA Consulting have a proven business case methodology combined with extensive utilities experience that delivers several client benefits including:
• Traceability of costs and benefit calculations from a transparent bottom up process
• Collaborative approach developing an assessment that the clients can own with inputs reflecting user specific assumptions
• The ability to compare different scenarios and provision of a comprehensive quantitative and qualitative guide to decision making
• Sensitivity analysis to enable a graphical view of the most important benefits and the probability of achieving the expected business benefits