Business Case Writing Introduction to Business Case Writing 2 — Questions and Answers
Question 1: Which section of a business case defines the boundaries of what the proposed initiative will and will not address?
- Executive Summary
- Scope Statement (Correct answer)
- Risk Register
- Financial Projections
Correct answer: Scope Statement
The Scope Statement explicitly defines what is included and excluded from the project, preventing scope creep.
Question 2: When presenting multiple solution options in a business case, what must each option include to allow fair comparison?
- A unique project sponsor
- Consistent evaluation criteria applied to all options (Correct answer)
- The highest possible ROI estimate
- A separate executive summary
Correct answer: Consistent evaluation criteria applied to all options
Applying consistent evaluation criteria across all options ensures decision-makers can make an objective, apples-to-apples comparison.
Question 3: A 'do nothing' option is often included in a business case primarily to:
- Satisfy regulatory requirements
- Provide a baseline against which alternatives are measured (Correct answer)
- Demonstrate the author's thoroughness
- Reduce the total number of options analyzed
Correct answer: Provide a baseline against which alternatives are measured
The 'do nothing' option establishes a baseline, making the value of action clear by contrast.
Question 4: Which financial metric measures the time required for an investment to generate enough returns to recover its initial cost?
- Net Present Value (NPV)
- Internal Rate of Return (IRR)
- Payback Period (Correct answer)
- Benefit-Cost Ratio
Correct answer: Payback Period
The Payback Period calculates how long it takes for cumulative benefits to equal the initial investment.
Question 5: In business case writing, 'sensitivity analysis' is used to:
- Assess the emotional impact of the project on staff
- Test how outcomes change when key assumptions are varied (Correct answer)
- Identify stakeholders who may be sensitive to the proposal
- Evaluate the cultural fit of the proposed solution
Correct answer: Test how outcomes change when key assumptions are varied
Sensitivity analysis tests how changes in key variables (costs, timelines, demand) affect the projected outcomes, revealing how robust the case is.
Question 6: What is the primary purpose of a SWOT analysis within a business case?
- To schedule project milestones
- To assess internal strengths/weaknesses and external opportunities/threats relevant to the proposal (Correct answer)
- To calculate the financial return on investment
- To assign roles and responsibilities to team members
Correct answer: To assess internal strengths/weaknesses and external opportunities/threats relevant to the proposal
A SWOT analysis provides a structured assessment of internal and external factors that affect the viability of the proposed initiative.
Question 7: Which of the following best describes a 'benefit owner' in a business case?
- The executive who approves the budget
- The person accountable for realizing a specific benefit after implementation (Correct answer)
- The lead author of the business case document
- The vendor delivering the solution
Correct answer: The person accountable for realizing a specific benefit after implementation
A benefit owner is assigned accountability for ensuring a specific projected benefit is actually achieved post-implementation.
Business Case Writing Introduction to Business Case Writing 2
Which section of a business case defines the boundaries of what the proposed initiative will and will not address?