Investment in a project should be justified on the maximum value that is available. But too often projects define only enough value to justify the expenses to get the project approved.

Identifying And Quantifying Your Project's Full Value

The next major question central to the business case – after those questions dealing with strategic relevance and rationale - is about business value:

 What is value your organization shall receive from investing in this project?

This may sound obvious, but the analysis of business value is often poorly done or largely missing in most business cases.

That is because most business cases are the result of topsy-turvy thinking. 

Topsy-turvy thinking destroys value

In most business cases, there is much discussion about the cost. Benefits are simply seen as the offset to these costs, what is required to achieve a positive (or acceptable) return on investment (ROI).

That is, the aim is to find enough benefits to get the project "over the line" and approved. 

The project’s benefits are usually buried in a section headed “Cost/benefits”. Provided the benefits’ financials are acceptable, the project is approved. This approach completely misses the point of projects - which is to deliver, enable and support the realization of the business benefits.

It frequently also ensures the Business Case benefits are reduced to only those needed to generate the requisite ROI.  Provided the benefits and financial model are acceptable, the project is approved.

This approach then leads either to understating the full benefits, which means the project then does nothing to deliver them, or even worse, making up the benefit numbers to get the project approved. 

Start by defining th project's Value Equation

Your business case should spell out the project's Value Equation™:  

  1. Business outcomes/end states: These are (or should be) your project’s primary measures of success. This is your future business end state, defined in measurable terms.
  2. Associated benefits: Outcomes delivery or enable the delivery of benefits. Benefits are consequential on the successful delivery of the business outcomes. Diminished outcomes result in diminished benefits. Simple. Every benefit must be linked to its enabling/delivering outcome to ensure it can and will be delivered by this project.
  3. Measurable value: Only some benefits will be financially quantifiable or via KPIs; however what is important here is that the bases on which these financial benefits are quantified are known and traceablethroughout the project; so that any changes in the value drivers can be monitored and the financial viability of the project recomputed at any time.
  4. Outcomes path dependency roadmap: This includes the time frame over which the outcomes and their associated benefits will be delivered, and their interdependencies and delivery sequence. This also aids where and how you estimate the value.
  5. Change activities required in delivering these outcomes.

Your business case should spell out the outcomes, benefits and value that will be delivered, when it will be delivered, and what is required to deliver it.

Just having some series of numbers masquerading as ‘the benefits’ is woefully insufficient.

What does this simple approach enable?

You can:

  • track the measures of success (each element should be measurable to verify its achievement),
  • create simple progress tracking (outcomes deliver benefits, some of which have a financial value that can be recomputed at the time of realization),
  • ensure no benefits are claimed that cannot be delivered and eliminate spurious benefits claimed to get the project over-the-line .

(The most common complaint with the TOP Value Equation is that it generates “too many benefits!” — now that’s a nice problem to have.)

On a recent project one manager was adamant that “reducing financial errors” was a key benefit; but he could not point to any project outcome that would do anything to reduce any financial errors if they existed. The benefit was deleted!

The Sponsor's Commitment

The Value Equation is the Project Sponsor’s commitment to the organization — “this value is what I will deliver through the project/program”.

These are also the Sponsor’s measure of success so they need to ‘own’ it. These are the set of outcomes that are being approved.

What should be in this section of the Business Case

At the end of this section of the business case you need to have established:

  • the business value of this project in outcomes, benefits and value terms — is it worthwhile?
  • the consequential ROI/NPV or alike based on the costed activities required to deliver.


Defining the Value Equation for your project allows you to maximase the value to be delivered and then track its delivery through all stages of the project.

The Value Equation makes the case for the project to be approved. 

Topics: Business Case


Revision History

First published: Simms, J. (Sep 2009) as "The Business Case 3 – What Is The Value Proposition?"

Updated: Chapman, A. (March 2020), Revisions and Corrections