Advice and Information for Finance Professionals

Gathering Evidence for a Winning ERP Business Case

Guest Author

By Jim Maholic, Business Value Services, Oracle

In my last post, I stated that a sound business case is comprised of four components, which are:

  • Hypothesis
  • Evidence
  • Analysis
  • Recommendation

We covered the hypothesis in the last post. In this post we’re looking at gathering evidence that supports and validates your hypothesis.  

Gathering evidence is tedious; there’s just no other way to put it. But if approached carelessly because it’s tedious, the results will be disappointing. This process is best compared to mining for gold. Gold mining requires the removal of a lot of earth, then sifting through the dirt and rocks to reveal the treasure.  

The same is true for your business case discovery efforts. Your interviews and workshops will provide you with much more data than you ultimately need. And once the data are collected, you’ll have to spend some time sifting through all of the data to determine which pieces are the irrelevant dirt and which pieces are the true gold.

Also, keep in mind that building a business case with the expectation of gaining funding is a selling activity. In order to identify and present the perceived value of your proposal, you must supplement your hunches with solid evidence that supports your project’s hypothesis. Your ability to collect the right evidence is influenced by your ability to tactfully and skillfully request, gather, and organize information.  

To be effective at gathering the right evidence, you will engage in a process called discovery. This process includes four primary activities, which are:

  • Validate your hypothesis using common discovery methods
  • Align your hypothesis with corporate goals
  • Organize yourself for success
  • Confirm the project’s beneficiaries

Validate your hypothesis using common discovery methods

One of the first things you must confirm is that the hypothesis is valid and reasonable. Confirming your hypothesis requires you to engage in dialogue with managers and staff in the affected business areas and press them for specific pain points demonstrating that this problem warrants a solution.

Collecting evidence would be easy if you could simply circulate a questionnaire to prospective project participants seeking their comments on your topics. And it would be great if they would thoroughly and honestly answer your questions with concise analysis of all real or imagined benefits. It rarely works that way. You have to go exploring.

There are three primary methods of collecting discovery information for a business case: interviews, workshops and to a limited degree, questionnaires. Each method has its pros and cons. And it’s likely you’ll find a use for each method in your discovery activities. Interviews and workshops can provide the richest set of discovery notes, but that is often based on the depth of your preparedness and the fitness of the participants. By fitness I mean their knowledge and willingness to openly share their knowledge. The most effective evidence-gathering sessions are those with attendees who are knowledgeable and empowered to speak for their respective business areas.

Knowing where to start your journey of discovery is frequently one of the harder tasks of a business case. Where do you find benefits? If your executive sponsor is supportive, he or she may offer some good suggestions on where you might expect to find benefits and possibly how you might quantify those benefits. If your sponsor doesn’t offer suggestions, you’ll have to seek out someone else so that you can put some real dollars to these benefits. In the next post, we’ll explore a few specific, common, measurable business areas where value can be measured and applied to a business case.

Align your hypothesis with corporate goals

Business goals and objectives can change over time. It is important that your hypothesis align with your organization’s current goals and objectives. If you can’t seem to get a definitive list of your organization’s corporate goals, you can always align your hypothesis to one or more of the four universal business drivers: increase revenue, reduce expenses, optimize assets, and mitigate risk.

Organize yourself for success

To ensure that your interviews and workshops yield rich, relevant information, prepare in advance to be an excellent facilitator. By investing the time, in advance, to develop a few, dynamic, high-yield questions and reflect on your knowledge of the current challenges, you set the stage for a successful interaction. Just showing up and asking, “What keeps you up at night?” does not exhibit much preparedness.

Confirm the project’s beneficiaries

You want your interviews and workshops to be productive. To do that you need the right participants. The first place to start would be the leaders that stand to benefit most from your proposed initiative. For example, a project to replace an aging ERP with a cloud-based system might directly benefit the CFO and the chief operations officer (COO). Support from either of these executives would significantly improve your chances of the business case receiving approval.

Finally, you should also seek to understand which constituencies, if any, might be adversely impacted if your recommendation is adopted. One situation that crops up frequently is resistance from IT teams, who are concerned that moving to the cloud might leave them with less work and thereby make them more vulnerable to layoffs. Understanding these objections will help you develop counter-arguments (e.g. with less grunt work, IT staff can be reassigned to more strategic projects) to bolster your case. Analyzing input from all interested parties, both advocates and adversaries, will help you create a comprehensive participant list for your upcoming discovery sessions.

In the next post we’ll get down to putting numbers on paper and finding measurable, tangible benefits.

Missed the previous post in this series? Read it here: “Give Executives a Reason to Buy Cloud ERP.”

This post is the fifth in a series of eleven articles excerpted and adapted from my award-winning and Amazon Top 10 book, Business Cases that Mean Business.

Developing a business case is simply the identification, calculation and communication of the value of your proposed capital expenditure. Creating a sound business case should not be intimidating. You simply must approach the development of a business case with discipline and ample planning. This series of articles will give you an overview of the creation of a successful business case. If you wish to explore this topic deeper, or just jump ahead right away, check out my book on Amazon.

The next article in this series is “Show Me the Money.”

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