Business case software: On the case

Business case software can help make your funding pitch to OMB

Prove it. That's the challenge from the Office of Management and Budget to federal agencies these days. Not 'Show me the money,' but 'Show me why you need the money.'

To get IT funding, agencies must submit a business case that convinces OMB the money will be well spent.

The idea behind the business case is simple and, as the name suggests, originates in the world of business. Before committing capital to a new or existing IT project, business managers want to see how that project will help the business. Will it increase revenue? Will it reduce costs or save money? No? Sorry, maybe next year.

Federal agencies are now in a similar position with OMB: Construct convincing business cases for IT investments or risk loss of funding. OMB's goal is not just to save money but to encourage agencies to manage their technology portfolios proactively and with long-term planning.

By fiscal 2005, agencies must demonstrate the connection between their business cases and their enterprise architectures. In addition, agencies need to illustrate how their technology expenditures contribute to the performance of their mission. And business cases must now cover office automation, infrastructure and telecommunications technology.

The problem for many federal agencies is a lack of experience in creating business cases. Of course, there are books and classes available, and OMB offers its own guidance via Circular A-11.

But for agencies that need extra help, vendors are rushing to fill the niche with business case software.

In its simplest form, business case software could be a fill-in-the-blank template that takes a few numbers and some explanatory text and cranks out a canned business case. More complex versions can interact with planning and spreadsheet software to extract necessary information. Some packages are complete portfolio management programs that produce business cases as only one of many possible outputs.

Which type is most appropriate to an agency depends on the size of the agency, how familiar its officials are with business cases and how committed they are to the process.

For small agencies'or those unfamiliar with business cases or making the move to portfolio management'a simple template would be a good beginning. For large agencies that see the necessity of more encompassing solutions, a full-service package might be more appropriate.

Either way, business case software should be able to deal with real-world situations in a pragmatic way, not just on a theoretical or abstract level. And the software should be sufficiently easy to master that an occasional user can pick it up and make progress with it.

What's the score?

All business case tools take in information, either from a person or from computer files. The information can be qualitative'Does this project have an internal auditing system?'or quantitative'What is the current and projected budget?

Some business case tools have templates that mirror the OMB decision-making process. Others let you construct your own templates. Either way, there is a set of rules and logic to give your business case a score on how well it meets the known criteria. Some tools offer feedback and guidance on how to improve your score.

One of the first business case tools for federal agencies was created by consultant Robbins-Gioia LLC of Alexandria, Va. The company customized an offering from ProSight with templates oriented toward the federal Exhibit 300 business cases. Another'and free'business case tool is available from the General Services Administration (see sidebar).

Some business case tools can automatically access computer files to gather needed information. Once this kind of linkage is set up, it can simplify the creation of business cases and make it possible to observe changes in the business case as new information becomes available. This can be useful to keep track of how well the agency is meeting goals the business case monitors.

Different approaches

While one approach is simply to use business case tools to get a good score and ensure ongoing funding, another is to use the business case in an overall program for managing technology and becoming more efficient and effective.

Clearly, this is what OMB has in mind. For agencies that embrace this approach, business case software including portfolio and project management is more appropriate. The programs help managers keep track of technology assets, plan goals for technology, and decide when to discard unnecessary technology and how best to acquire new technology. In such a system, the actual business case would become one of many reports on how the plan is proceeding.

For agencies with many sources of input to a business case, the software should offer features to simplify collaboration. This will let distant users contribute to the business case, sometimes on an automated basis. Some tools offer Web-based interfaces that make remote interaction easier.

The output of business case software can come in several forms. Ideally, you could output in the format for submitting reports'including Exhibit 300 and Exhibit 53 reports'to OMB. Some tools produce output in standard formats, such as Extensible Markup Language or HTML. Others create output in proprietary formats useful with other applications such as Microsoft Word documents or Excel spreadsheets.

Because agencies differ in their missions, approaches and methods, you should be able to configure the software as necessary. This can include altering the rules of the business case to use different criteria or weight them differently. It may also be that your agency prefers output in specific formats or layouts.

For Rod Bond, director of IT strategy and planning in the Office of the CIO at the Food and Drug Administration, the most important factor in using a business case tool is support from the top.

'The CIO and project managers want to proceed strategically,' he said. 'That makes all the difference.'

Bond said novices should move tactically to adopt business case software. FDA had to do a lot of labor-intensive cutting and pasting to move information to its ProSight tool, but that information is now more accessible. The templates provided by ProSight make OMB compliance far simpler and provide the basis for ongoing portfolio management in the agency.

Similarly, it is essential to match the attitude and commitment of your agency in choosing a business case tool. If your agency is pursuing portfolio and project management, you'll want a tool with the horsepower to handle forecasting, scheduling, performance metrics and all the associated intricacies. If your technology assets are modest and require minimal change'and management'a more modest tool is appropriate.

It isn't enough to match a tool to the platform alone. You must also take into account the applications you want the business case software to interact with. These might include planning applications, spreadsheets, databases, collaboration tools and other significant sources of information in your agency.

As use of business cases becomes the norm in government, expect to see more choices in business case software. Competition will add features and reduce prices. Your own agency's use of business case software may change, also. Keep an upgrade path in mind when you make your choices. You may find more uses for business case software than you originally planned.

Edmund X. DeJesus of Norwood, Mass., writes about IT.

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