As innovation continues to be at the forefront of companies’ strategies, it often hinges on the ability to produce a persuasive business case for a new venture or transformation. In 2023, 79% of companies ranked innovation among their top 3 priorities in 2023, according to Boston Consulting Group.
But how do you go about the intricacies of building a successful business case for a platform? In this blog, we share insight on navigating the complexities of creating a compelling argument for investment within a business.
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The Importance of Equating Value
One key aspect of constructing a business case is the importance of equating the proposed platform’s value to tangible monetary terms. Demonstrating that the platform will result in cost savings, increased revenue, or reduced risk will strengthen the business case. Quantifying potential benefits makes the case more robust and credible, whether it involves operational cost savings, revenue generation, or risk mitigation.
Demonstrating ROI from the Platform
ROI is an essential element in equating value as it provides a tangible measure of the potential benefits compared to the costs involved in a project. Decision-makers will prioritise opportunities which yield high returns and set clear expectations.
How to demonstrate ROI in your business case? You need to demonstrate all your current and future expenditures without the platform vs the cost of the platform and ROI. This diagram helps to map out how to approach demonstrating ROI.
Synergising with Existing Initiatives
Another critical consideration is aligning the business case with the company’s broader strategic initiatives. Every organisation has specific objectives, such as fostering a better workplace, digital transformation, or employee engagement. Aligning the platform proposal with these objectives can resonate strongly with senior leadership, showcasing the platform’s relevance in achieving broader company goals.
Connecting to Other Business Cases
An additional point that enhances the strength of a business case is connecting it to other business cases. When you demonstrate that funding this specific business case not only yields a value driver but helps unlock other related opportunities, it becomes a more compelling argument for investment. In the realm of Contract and Risk, this is particularly feasible. By connecting the upstream processes, such as sales and procurement, with downstream activities like revenue and payment management, you can illustrate how the platform creates a seamless and interconnected ecosystem that maximises value throughout the entire process.
Quantifying Risk: A Unique Challenge
Quantifying risk is a unique challenge that involves calculating the financial implications of various scenarios. It may include assessing the impact on reputation, share price, or the company’s ability to recover from a crisis. While it can be challenging to assign precise values to these variables, embarking on the journey of quantifying risk is vital to present a comprehensive business case.
Seizing the Opportunity Amid Chaos
The current unpredictable business landscape, characterised by crises, has created a heightened sense of urgency. Companies are increasingly concerned about resilience and risk management. Highlighting the platform’s role in enhancing resilience and mitigating risk can make a strong case for funding. Leveraging the collective influence of various stakeholders, from risk management to procurement and legal teams, can present a unified front when seeking investment.
Conclusion
Creating a business case for a platform is not a one-size-fits-all endeavour. It involves a delicate interplay of financial quantification, alignment with business objectives, and understanding the nuances of risk. By emphasising value, aligning with strategic goals, and quantifying risk, you can increase your chances of persuading decision-makers to invest in your platform. In today’s rapidly changing business environment, making a compelling business case may be the key to your organisation’s future success.
Are you currently working on creating a compelling business case for a new platform? Download our How to Guide to craft the ultimate business case for your next funding request to innovate your strategy.
