[0:00]Hello, my name is Paul, and I'm a product manager at Google. Welcome to this short course on making a business case. What do I mean by making a business case? We're going to think about how you formulate, write, and present an argument for change in your organization. I'm going to start off by explaining why it's such an important skill, why everyone should have this skill, then we're going to go through a five-step process that you can follow to formulate your business case. And then finally, we'll finish up by thinking about what happens once you've submitted your business case. So let's get started. So why is making a business case such an important skill? Well, everyone working in any organization, large or small, for-profit or not-for-profit, will have ideas for how that organization can be improved. You'll see things that could be done better, things that could be changed, new products that could be developed, new markets that could be entered. And the skill of making a business case is how you take those ideas and get them implemented. It's how you turn your good ideas into action, and that's why it's such an important skill for everyone. So let's get started with our five-step process. So the first step is to state the problem. And it sounds really obvious, but it's really important to spend a lot of time on this particular step. The reason for that is if you don't clearly articulate the problem, then all the subsequent steps are going to be much weaker. You might end up solving the wrong problem or coming up with a really weak solution. But more importantly, people reading your business case are going to come to it with a completely open mind. They may not understand the context of your business case, and they certainly won't know the solution that you're proposing. So it's important to give them that context, tell them the problem that you're trying to solve. There are three key components to stating the problem. The first is to make sure it's really well structured. The second is to make sure that you're using data, and the third is to make sure that you are really focusing on the user. So let's start with structuring the problem statement. My favorite way of doing this is to imagine that you're writing a very short newspaper article or an internal company memo, because it's going to have a headline, a one-sentence summary, and then a slightly more detailed explanation. So the headline is going to grab the reader's attention and tell them very clearly what problem you're trying to solve. The one-sentence summary is going to again clearly articulate that problem, but this time it's also going to state the impact of the problem. Why is this problem important? And then the final section is just a little bit more detail about the nature of the problem, where it's occurring, when it's occurring, how often it's occurring. But crucially, at this stage, you are not talking about the solution. You are only talking about the problem. The second key component of the problem statement is to make sure that you're using data to back up your problem statement. Data is important because it allows you to be specific about the problem. Rather than saying, for example, our website is slow, you can say our website takes three seconds to load on a mobile device. That's a much more specific problem statement. Data is also really important because it allows you to show the impact of the problem. So rather than saying, our website is slow, you can say our website takes three seconds to load on a mobile device, which means we lose 25% of our potential customers. That's showing the impact of the problem. So data is really important. The third key component is to make sure that you are focusing on the user. Remember that people are reading your business case for the very first time, and they don't have the context that you have. It's important to bring them into the problem and explain the impact on the user, whether that's an internal user in your company or an external user, a customer, for example. So an example of that might be our customers are complaining that they can't log in to our website. That shows the user and the impact of the problem on the user. So in summary, step one, state the problem. Remember to structure it well, remember to use data, and remember to focus on the user. So the next step is to analyze the root cause. Now, it's really important at this stage that you're not just looking at the symptoms of the problem, but you're actually digging down and finding out what the underlying root cause is. The reason for that is if you only look at the symptoms, you'll come up with a really superficial solution, and it's not going to be effective. So a great way to think about this is to use the five whys technique. This comes from Toyota, and it's a technique where you ask why five times, and it helps you to get to the underlying root cause. So let's take an example. Let's say that your website is slow. Why is it slow? Because the servers are overloaded. Why are the servers overloaded? Because we've seen a surge in traffic. Why have we seen a surge in traffic? Because there was a really successful marketing campaign last week. Why was the marketing campaign so successful? Because we featured in a national newspaper. And why did we feature in a national newspaper? Because the story about the new product was particularly compelling. So that helps you get down to the underlying root cause. Now, at this stage, it's also really important to distinguish between causes and consequences. Remember that you're only looking at the causes here. You're not looking at what happened as a consequence of the problem. So in summary, step two, analyze the root cause. Remember to use the five whys technique to get to the underlying cause. Now, the next step is to propose a solution. Now, at this stage, it's really important that you are proposing a solution that directly addresses the root cause that you identified in the previous step. It's also important to make sure that the solution is proportionate to the problem. So you wouldn't, for example, suggest that you completely rewrite your website if the problem is that there's a typo on one of the pages. So make sure that the solution is proportionate. There are three key components to proposing a solution. The first is to make sure that you are considering alternatives. The second is to make sure that you're explaining the benefits, and the third is to make sure that you are thinking about the risks. So let's start with considering alternatives. Now, it's a really good idea to suggest three alternative solutions to your problem. One of those solutions should be your preferred solution, the one that you want to go ahead with. The second should be a slightly less ambitious solution, and the third should be a do-nothing solution. Now, the reason for this is that it demonstrates to the reader that you've really thought about the problem. It also allows the reader to understand the different options that are available, and the do-nothing solution is really important because it allows you to highlight the consequences of not doing anything. The second component is to make sure that you are explaining the benefits. What are the benefits of your proposed solution? And there are two types of benefits that you should think about. The first is tangible benefits, and the second is intangible benefits. So tangible benefits are those that you can measure in some way, either in terms of money or in terms of time or in terms of some other metric. So an example of that might be our proposed solution will save us 10,000 pounds a year, or our proposed solution will save us 100 hours a month. So those are tangible benefits that you can measure. Intangible benefits are those that are much harder to measure. So an example of that might be our proposed solution will improve customer satisfaction, or it will improve employee morale. Now, it's important to include both tangible and intangible benefits in your business case. The third component is to make sure that you are thinking about the risks. Every solution has risks, and it's important to identify those risks and explain how you're going to mitigate them. So an example of that might be our proposed solution might delay the launch of our new product by two weeks, but we've put in place a plan to mitigate that risk by increasing the number of engineers working on the project. So in summary, step three, propose a solution. Remember to consider alternatives, explain the benefits, and think about the risks. So the next step is to estimate the costs. Now, it's really important at this stage that you're not just looking at the upfront costs, but you're also looking at the ongoing costs. The reason for that is that often the ongoing costs can be much higher than the upfront costs. There are three key components to estimating the costs. The first is to make sure that you are including all costs. The second is to make sure that you are providing a breakdown of costs, and the third is to make sure that you are thinking about the return on investment. So let's start with including all costs. This includes things like the cost of people, the cost of software, the cost of hardware, the cost of training, the cost of marketing. All the costs associated with your proposed solution should be included. The second component is to make sure that you are providing a breakdown of costs. So rather than just saying our proposed solution will cost 100,000 pounds, you can say our proposed solution will cost 50,000 pounds for people, 20,000 pounds for software, 10,000 pounds for hardware, and so on. That allows the reader to understand where the money is going. The third component is to make sure that you are thinking about the return on investment. So this is where you compare the costs of your proposed solution with the benefits that you identified in the previous step. So an example of that might be our proposed solution will cost 100,000 pounds, but it will save us 200,000 pounds a year, so it will pay for itself in six months. That's a really compelling return on investment. So in summary, step four, estimate the costs. Remember to include all costs, provide a breakdown of costs, and think about the return on investment. So the final step is to make a recommendation. Now, this is where you bring everything together and make a clear recommendation about what you want to do. There are three key components to making a recommendation. The first is to make sure that you are making a clear recommendation. The second is to make sure that you are summarizing the key points, and the third is to make sure that you are thinking about the next steps. So let's start with making a clear recommendation. This is where you state very clearly what you want to do. So an example of that might be we recommend that we implement solution A, or we recommend that we go ahead with this particular project. The second component is to make sure that you are summarizing the key points. So this is where you briefly recap the problem, the root cause, the proposed solution, the costs, and the benefits. It's a really good idea to include a table or a matrix that summarizes all of those key points. The third component is to make sure that you are thinking about the next steps. So this is where you explain what's going to happen once your business case has been approved. So an example of that might be once this business case has been approved, we will form a project team, we will develop a detailed project plan, and we will start implementation in two weeks. So that gives the reader a clear idea of what's going to happen next. So in summary, step five, make a recommendation. Remember to make a clear recommendation, summarize the key points, and think about the next steps. So what happens once you've submitted your business case? Well, there are three key things that you should be doing. The first is to be available to answer questions. The second is to be open to feedback, and the third is to be prepared to iterate. So let's start with being available to answer questions. Remember that people are reading your business case for the very first time, and they're going to have questions. So it's important to be available to answer those questions, whether that's in a meeting, in an email, or in a one-on-one conversation. The second thing is to be open to feedback. Remember that people are going to have different perspectives, and they might have different ideas about how to solve the problem. So it's important to be open to that feedback and to consider it. And the third thing is to be prepared to iterate. It's very rare that a business case will be approved first time around. You'll probably have to go back and make some changes and resubmit it. So be prepared to iterate, be prepared to make those changes, and resubmit it until it's approved. So in summary, once you've submitted your business case, remember to be available to answer questions, be open to feedback, and be prepared to iterate. So I hope you found this short course on making a business case useful. Just to recap, we've covered why it's such an important skill, why everyone should have it. We've gone through a five-step process that you can follow to formulate your business case, and we've finished up by thinking about what happens once you've submitted your business case. So I hope you found it useful, and I wish you good luck with your next business case.