Business Case Writing Introduction to Business Case Writing 4 — Questions and Answers
Question 1: What does a 'risk mitigation strategy' in a business case describe?
- Steps taken to eliminate all project risks
- Actions planned to reduce the probability or impact of identified risks (Correct answer)
- Insurance policies purchased to cover project losses
- The process of transferring risk to a third-party vendor
Correct answer: Actions planned to reduce the probability or impact of identified risks
Risk mitigation strategies outline proactive actions to lower the likelihood or severity of risks, though they rarely eliminate risk entirely.
Question 2: In business case writing, the 'recommended option' section should:
- Present all options equally without bias
- Clearly state the preferred solution and justify why it best meets the objectives (Correct answer)
- List options alphabetically for neutrality
- Defer the recommendation to the approving committee
Correct answer: Clearly state the preferred solution and justify why it best meets the objectives
The recommended option section should make a clear, well-justified choice to help decision-makers act confidently.
Question 3: Which of the following costs should be included in a business case's total cost of ownership (TCO)?
- Only the initial purchase price of the solution
- All costs including implementation, training, maintenance, and decommissioning (Correct answer)
- Only the costs incurred in the first fiscal year
- Costs that have already been approved in previous budgets
Correct answer: All costs including implementation, training, maintenance, and decommissioning
TCO captures every cost across the full lifecycle of the solution, not just the upfront price.
Question 4: A business case author who omits known risks to make the proposal look stronger is:
- Following best practice to maintain stakeholder confidence
- Committing an ethical violation that could harm organizational decision-making (Correct answer)
- Acting appropriately if risks are minor
- Following standard executive communication guidelines
Correct answer: Committing an ethical violation that could harm organizational decision-making
Omitting known risks is intellectually dishonest and can lead to poor decisions, undermining trust and potentially causing significant harm.
Question 5: What is the key difference between an 'assumption' and a 'constraint' in a business case?
- Assumptions are facts; constraints are estimates
- Assumptions are things believed to be true without proof; constraints are real limitations imposed on the project (Correct answer)
- Assumptions are external factors; constraints are internal factors
- Assumptions are documented by sponsors; constraints are documented by the project team
Correct answer: Assumptions are things believed to be true without proof; constraints are real limitations imposed on the project
Assumptions are unverified beliefs the case relies on, while constraints are fixed boundaries (budget, time, regulations) the project must operate within.
Question 6: Which of the following best illustrates the 'strategic alignment' section of a business case?
- A Gantt chart showing the project timeline
- A statement showing how the proposal supports the organization's stated goal of expanding into new markets (Correct answer)
- A list of project team members and their qualifications
- A breakdown of vendor pricing options
Correct answer: A statement showing how the proposal supports the organization's stated goal of expanding into new markets
Strategic alignment demonstrates that the proposed initiative directly supports the organization's goals, increasing its chance of approval.
Question 7: When a business case is described as 'evidence-based,' it means the justification relies on:
- The personal authority of the project sponsor
- Data, research, and documented facts rather than opinion alone (Correct answer)
- Precedents set by competitor organizations
- Internal political support from key departments
Correct answer: Data, research, and documented facts rather than opinion alone
An evidence-based business case uses verifiable data and research to support its claims, making it more credible and defensible.
Business Case Writing Introduction to Business Case Writing 4
What does a 'risk mitigation strategy' in a business case describe?