Build Your Business Case for New Comp Technology: 5 Easy Steps
What is a Business Case?
Simply put, a business case is a document used to objectively evaluate a business initiative relative to other priorities. It outlines the request, reasoning, needs for implementation, and projected benefits. For comp pros exploring either bringing in new technology, this means outlining how the benefits outweigh the costs and what you intend to achieve by purchasing or changing technologies.
Do I Really Need One?
Most decisions you make in your day-to-day work don’t require a business case. No one, at least no one I know, puts a business case together about where to grab a cup of coffee. Whether you need one for comp initiatives is going to depend on your organization’s approval processes.
However, I recommend building at least a simple one even if it’s not required. Mainly because a business case helps bring clarity and objectivity to decisions. It’s easy to only look at the potential up-sides of a software purchase, but creating a business case will force you to evaluate the costs and resource allocation required to help determine if moving forward is really the best decision for your company and department. Having a business case can also make your proposal stand out vs. other internal initiatives that haven’t done that work.
Creating Your Business Case
Business cases can range from relatively simple to enormously complex. For purchasing or transitioning to a new comp software solution, your business case will likely be fairly straightforward. Afterall, you’re not proposing launching a new product or acquiring a competitor. I’ve boiled it down to 5 simple steps.
1. Understand Your Audience
Who will be reviewing your request and approving your software purchase or partner change? Knowing who will be evaluating and ultimately green-lighting your request will help you build a business case that has more chance of success. That doesn’t mean leaving out potential pitfalls or skipping information. It does mean highlighting the benefits that will mean the most to the person or people who have purchasing power.
As part of understanding your audience, you’ll also want to put together your business case in a way that they’ll be able to understand and digest. For example, a busy executive team won’t want to read a 5-page document but will be more open to looking at a couple slides.
Ask your favorite comp technology provider to help make your business case. Oftentimes they have examples from other customers, such as slides with great visuals, or can provide feedback on your business case to improve your chances of success. They’re not successful unless you’re successful, so use their willingness to help to your advantage.
2. Define Your Goals
One of the most important components of a business case is stating why a change is needed. I.e. what’s broken that needs fixing? It may be that something isn’t working well or there are sticking points in your process; it could also be an opportunity for improvement.
Executives think in blunt terms, usually framed as either moving towards a positive or moving away from a negative.
- What good thing happens if we do this? (moving towards a positive)
- What bad thing happens if we don’t do this? (moving away from a negative)
If you can align your why to your broader organizational goals or initiatives, this becomes even more powerful. Think of these as a train leaving the station - can you attach your car to the train and get brought along? Think through the understanding you have of your audience - whether it’s your CHRO or board of directors. How can you tie your goal back to their objectives and needs?
3. Identify Your Solution
If you’re building a business case, you’ll likely have a preferred solution that you’re ready to choose. Part of your business case should give a quick overview of how you came to that conclusion. What steps did you take to arrive at your choice? What alternatives did you evaluate? What you’re really doing here is proving you’ve done your due diligence.
If you need help with that part of your process, check out my post on evaluating potential market pricing solution partners.
4. Outline Resource needs
This is going to be one of the more detailed elements in your business case. This will include the financial investment for your solution, as well as resources needed for implementation - think of these as people, time, and money - all are costs in different ways.
If you have a preferred vendor, they will be able to help you gather this information. It’s often a good idea to get thoughts from other departments, specifically HR Operations or IT, on their current capacity and the expected resources needed. You may not be able to provide the exact number of hours implementation and set-up will take, but even providing t-shirt sizing guidelines (S, M, L, XL) on the effort it will take from individual departments should be sufficient.
Examples of other similarly sized customers and how long their process took can help firm up estimates.
5. Show the Benefits
Some people confuse the expected benefits with the why behind the ask. And the benefits you outline should tie back to the problem or opportunity outlined in your business case. However, when you’re detailing the expected benefits to your solution, you’ll want to be more specific about exactly what and how your new technology will impact your business and department. Numbers always speak louder than words but need to be well thought out and reasonable.
Not all benefits have to align directly with your stated goals. A goal around getting better customer service from your technology partner may not be terribly compelling to an executive who’s not the one receiving poor service. But, if you can show how poor service is inhibiting you from achieving a business result, then talk about what missing that business result will do to the business - the benefit is the value of achieving that result.
Market Pricing Technology Business Case Resources
One of my favorites is the business case template from Miro. We’ve also put together some more comp-specific templates you can use to build your case and get your comp technology solution green-lighted.
Download our business case resources using the form below.