October 10, 2005 (Computerworld) --
Jay Rollins wants to rein in unnecessary spending. He wants to leverage the size of his company to get better prices and services from vendors. And he wants to clearly articulate how technology projects help his company reach its strategic goals. So Rollins, vice president of IT at Churchill Downs Inc. in Louisville, Ky., now requires business cases for proposed IT projects. He says the requirement will help the company better analyze risks, predict successes and hold executives accountable. "I'm looking at it for the betterment of the business," Rollins says. These days, IT and business executives are often asked to build business cases to justify technology initiatives, and many are making developing the business case part of their standard operating procedures. "The CIOs I talk to are much more aware that IT is expensive, and if you're going to use it properly, you have to have a plan," says John Hummel, enterprise CIO and senior vice president of information systems at Sacramento-based Sutter Health, a nonprofit holding company for 65 heath care organizations. Business managers normally take the lead in developing business cases for projects that benefit their departments, even though there may be a large IT component. But building a business case is a group effort, and IT leaders need to know how to contribute. Moreover, on certain projects such as infrastructure improvements that benefit the entire company, the business case may require an IT lead. Crafting such formal analyses isn't easy, particularly for department leaders who are busy handling day-to-day operations. "It's very difficult to put together a good business case," says Christopher Kowalsky, senior vice president and CIO at Education Management Corp. in Pittsburgh, one of the country's largest providers of private postsecondary education.
It takes time and resources, a deep understanding of the technology and how to scale it, and a clear view of how the project meshes with other priorities in the organization, he says. Here are seven steps that should help you efficiently build a solid business case: 1. Understand Your Business Goal IT leaders say a strong business case forecasts costs and savings, details expected benefits and risks, and clearly shows how the proposed project fits with the organization's strategic vision. "You shouldn't think of [the project] as an IT improvement. You should be thinking of it as enhancing a business benefit: What benefits are you providing to the core function of the organization?" says Charles Maxson, CIO at Merrimack College in North Andover, Mass. Hummel understands that his technology initiatives must pass a high bar to get the green light. After all, he says, they're competing for funding against requests to
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