Business Case Writing Business Case Writing 4 — Questions and Answers
Question 1: What is 'benefits realization' in the context of a business case?
- The process of calculating projected benefits before approval
- The post-implementation tracking of whether forecasted benefits are actually achieved (Correct answer)
- A section that lists intangible benefits
- The final sign-off by the project sponsor
Correct answer: The post-implementation tracking of whether forecasted benefits are actually achieved
Benefits realization management ensures the organization measures actual outcomes against those promised in the business case after project delivery.
Question 2: In which situation would a business case most likely be REJECTED despite a positive NPV?
- The project has a short payback period
- The risk profile is unacceptably high or strategic fit is poor (Correct answer)
- The benefits exceed costs by a wide margin
- Stakeholders are broadly supportive
Correct answer: The risk profile is unacceptably high or strategic fit is poor
A positive NPV alone does not guarantee approval if the project carries excessive risk, conflicts with strategy, or consumes scarce resources needed elsewhere.
Question 3: What is the role of the 'discount rate' when calculating NPV in a business case?
- It reduces the project budget by a fixed percentage
- It reflects the time value of money and organizational cost of capital (Correct answer)
- It penalizes late-stage benefits to discourage long projects
- It is set by the project manager based on team preference
Correct answer: It reflects the time value of money and organizational cost of capital
The discount rate converts future cash flows to present value, accounting for the fact that money today is worth more than money received in the future.
Question 4: Which element should appear in the 'Implementation Plan' section of a business case?
- Detailed vendor contract terms
- High-level milestones, resource requirements, and key dependencies (Correct answer)
- Full line-item budget for every project task
- Performance reviews for team members
Correct answer: High-level milestones, resource requirements, and key dependencies
The implementation plan in a business case is high-level, showing feasibility through key milestones and resources without replacing the detailed project plan.
Question 5: A business case written for a regulatory compliance project should emphasize which type of benefit most strongly?
- Revenue growth projections
- Risk avoidance and penalty cost avoidance (Correct answer)
- Market share expansion
- Employee engagement improvements
Correct answer: Risk avoidance and penalty cost avoidance
Compliance projects primarily justify value through avoided fines, legal liability, and reputational damage rather than direct revenue generation.
Question 6: What is a 'critical success factor' (CSF) in a business case?
- A financial metric that must exceed a threshold for approval
- A condition that must be in place for the project to achieve its intended benefits (Correct answer)
- A stakeholder who must approve the document
- A legal clause protecting the organization from liability
Correct answer: A condition that must be in place for the project to achieve its intended benefits
CSFs are the essential conditions—such as executive sponsorship, technology readiness, or organizational change capacity—without which the project cannot succeed.
Question 7: When writing a business case for a technology upgrade, which cost category is most commonly underestimated?
- Hardware purchase costs
- Software licensing fees
- Change management and training costs (Correct answer)
- Data center rental fees
Correct answer: Change management and training costs
Organizations frequently underestimate the people-side costs of technology projects—training, communication, process redesign, and adoption support.
Business Case Writing Business Case Writing 4
What is 'benefits realization' in the context of a business case?