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The Commerce of Content
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Published in Learning Circuits, February 2000
by Saul Carliner
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In this Article |
To many line workers and managers, and independent consultants, business executives thrive on a blood sport called "what if?" Workers, managers, and independent consultants enthusiastically propose a project, only to have the executives shred it apart with "what ifs?" and "have you considereds?" and "what abouts?"
These questions actually indicate that the proposal for the project is incomplete. The people who prepared it probably did not consider relevant component costs, assumed a too optimistic or pessimistic result, or overlooked relevant alternatives.
Executives seem to perform especially well at "what if" on proposals for projects involving new technologies. Although the benefits of the technology often seem self-evident to the converted, a combination of high expense and potential organizational disruption can sober most executives.
Preparing a complete and persuasive effective business case increases the likelihood that a technology project will be accepted.
A business case is a request for investment in a project. As a prospectus for a mutual fund indicates the assets, liabilities, opportunities and threats of a potential investment, so a business case identifies the costs and returns of a proposed project, and compares it with other possible investments.
A business case is not a project plan. You would prepare the project plan after the business case sufficiently convinces a client to move forward with a project.
Specifically, a business case discloses the following information.
Rationale: Present a succinct of the proposed project. Doing so serves two purposes. First, it reassures the sponsor that you understand the request. Second, business cases are occasionally distributed outside of the organization for review and the description helps familiarize outside reviewers with the project.
Constraints and Criteria: List all of the constraints affecting the project, as well as the criteria for comparing among alternatives. Constraints include the traditional business constraints of schedule and budget. Also list quality constraints. For example, for an online learning program, the visual appearance of a course intended for sale is usually higher than that expected of a course intended for internal use.
List, too, technical constraints. For an online learning course, consider requirements for authoring systems (for example, some organizations only use Authorware), and delivery (such as "users will take this course over a dial-up connection).
Finally, list and prioritize among criteria for considering among alternatives. For example, of schedule, cost, and quality, which is most important (no, all three cannot have equal weight despite belief to the contrary).
The Sidebar "Elements of a Business Case" provides a comprehensive list of costs for constraints to consider when proposing programs.
All Relevant Alternatives: Research each possible option for a given situation. Show how each addresses the constraints and criteria for a project. For an online learning program, that might mean researching the option of traditional classroom instruction and instructional television.
Complete List of Component Costs: A component cost is a partial cost of a project, such as costs for instructional design services, authoring software, and registration fees for training. One of the concerns about many proposals for learning projects is that they inadvertently omit one or more of these costs.
For example, development costs for classroom courses are admittedly lower than those for most online learning projects, but delivery costs are much higher. Some business cases focus only on development costs. Others omit some key delivery costs, such as the reduced time usually required to take online learning courses.
Provide realistic estimates of component costs based on research. For example, use salary surveys to calculate labor costs and contact publishers and re-sellers to estimate software costs.
List costs in a table, so sponsors can compare the component costs for each alternative side-by-side. Note, too, that some costs are not financial. Anticipate the response to each alternative and identify them in the business case.
The Sidebar "Elements of a Business Case" provides a comprehensive list of costs for online learning programs. The Sidebar "Comparison of Delivery Options" shows a presentation of two alternatives and their component costs and benefits.
Realistic Projections of Returns: Like any investment, that in training is expected to yield a return to the sponsor. Similarly, as the projected yield on most investments ranges from a worst case scenario to a best case scenario, so the investment in learning programs can yield a variety of potential outcomes.
So often, business cases for learning programs present a single projected return, and that often represents a best case scenario. For example, a proposal for a revenue-generating course might assume only one level of enrollment, even though enrollment might range from a low end to a high end.
Instead, present 3 or 4 potential scenarios: at one end of the spectrum, a worst case scenario and, at the other end, a best case. For example, for a revenue-generating course, your worst case scenario might represent the minimum threshold and the best case scenario might represent the anticipated best.
Base estimates of revenue on market rates. The rates for specialty training, such as technical training, often differ from commodity training, such as professional development. Similarly, you can choose among several pricing models for estimating the revenues for online learning, such as tuition by the course, monthly subscription, or site licenses.
Another flaw of most business cases for learning projects is a projection of near 100 percent enrollment. Rarely does this occur. If your organization maintains numbers, base future enrollments on past performance.
In the absence of such numbers, assume conservatively. For internal courses, assume that 10 to 60 percent of the population might take a course. For external courses, assume that 1 to 10 percent of the population might purchase the course.
Adequate Explanation: Succinctly explain all technical concepts and terms. When possible, explain technical concepts in terms familiar to the sponsor (even if it means you can't show off all that you know).
Language creates a barrier to technology. When describing technology, people tend to assume the audience knows ideas and terms it does not. When the sponsor cannot understand a proposal, the sponsor cannot support it.
Compounding the situation is the fact that, in many organizations, executives in many corporations are often among the last to adopt new technologies and might have heard the terms, but might not understand them.
Acknowledgement of Sponsors Needs: Sponsors often initiate the request for a proposal by identifying a list of requirements for a project. In some instances, sponsors also outline components of the solution. For example, a client requests that addresses 6 topics. The proposal addresses only 3 of them and 2 additional topics, without explaining what happened to the missing three.
Consider these components as project requirements, much like a "drop dead" date in a schedule or a "not to exceed" amount for a proposed budget.
In some instances, the solution the sponsor proposes might not be in their own best interest. Propose it as one option, then propose a your alternative and explain why your alternative better addresses the problem.
For example, suppose a sponsor says that an online learning program must be complete in 4 months but, based on your understanding of the project and the current status of the material, you believe that the project will take 6. Propose a schedule that assumes the project will be completed in 4 months, but also propose a "what if" schedule, that shows a 6-month timetable.
By doing so, you acknowledge the sponsors' needs and demonstrate that you listen. By ignoring the sponsors' requests, you appear as if you are ignoring the sponsor. A common complaint of sponsors is that trainers ignore them.
Recommendations: Recommend a course of action for the client. When doing so, reiterate the full cost of the project, the range of potential benefits, and the human issues to consider when implementing the solution.
As a prospectus for a mutual fund is intended to help convince a potential customer to invest in it, so a business case is intended to convince a sponsor to invest in a proposed project.
Admittedly, each sponsor responds to different concerns and presentation styles. But by repeating the rationale, listing the constraints and criteria, researching all possible alternatives, providing a complete list of component, projecting a range of benefits for each alternative, providing adequate explanation, and acknowledging the sponsors' needs, you are likely to have a ready answer should an executive play "what if" the next time you present a business case.
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(c) Copyright. 1999-2005. Saul Carliner. All rights reserved.
