Wednesday, April 2, 2014

Why Bother With a Business Case? (Part 2/2)

There are also times when a business case is not the right tool to use.  Here are some examples:

1. When the proposal is relatively small.

If your proposed solution costs less than one million dollars, a business case is probably overkill.  Most opportunities that Mainstay works on are upwards of ten million dollars.

2. When the decision is being made in the next 30 days.

A competently prepared business case takes at least 45 days to complete, usually longer.  If you don’t have the time to do the job right, you’re better off not doing it at all.

3. When the key data holders are opposed to you, your company or your solution.

Unfortunately, Mainstay has had experience working with customers who were strongly opposed to the solution being offered.  In these conditions, data is withheld, delayed and sometimes intentionally falsified.  
This forces the business case to be developed using extrapolated data.  The case can then be attacked by the opposing players, claiming it to be inaccurate.

Without at least one influential person on your side, developing a good case and getting an open-minded hearing of it is unlikely.  Be warned: a business case presented in this situation can actually hurt your cause.
4. When the data is unlikely to be available.

If the customer tells you that cost information is not available, be cautious about offering a business case.  Examples include customers that have recently done large acquisitions; decentralized multinational corporations; customers with outsourcers who will not be participating in the business case; customers who are under significant external pressures such as government audits, criminal investigations and the like.

Customers with a major presence outside the US and Europe will always have trouble getting good data.  Most countries in Asia, Africa and South America require local ownership and control of foreign subsidiaries.  This means there is no centralized accounting or purchasing.  As a result, data can be very fragmented.  Mainstay has done dozens of studies involving Asian and South American locations and has almost never gotten good data.

5. When the true objection is not financial.

Beware of the customer who tells you the problem is budget approvals when it’s really something else.  You may spend months and money to create a good business case and still not get an order.  Only offer a business case when you are certain there are no technical or cultural issues blocking your deal.

In Mainstay’s experience, business cases are too often overlooked as a way to make a big deal happen - and too often thrown into the breach as a last-gasp effort to save a lost cause.   A business case is a great tool for closing business.  But it needs to be used at the right time.




2 comments:

  1. That's true. Most countries in Asia, Africa and South America require local ownership and control of foreign subsidiaries. This means there is no centralized accounting or purchasing. As a result, data can be very fragmented.
    ideals

    ReplyDelete
  2. Once in a while it can be troublesome or costly to catch the lighting you need in camera, Said Jean Moore, President of Brooklyn Impacts, We outlined our lighting modules for Finished edition Master X to enable editors to make particular lighting styles that would have been significantly harder to do amid the creation stage. FCPX

    ReplyDelete