A formal document that provides justification for undertaking a project, programme, or investment by evaluating the benefits, costs, risks, and strategic alignment of a proposed initiative to enable informed decision-making.

What is a business case?

A business case is a comprehensive analysis that outlines the rationale for initiating a project or making a significant business change. It presents a structured argument demonstrating why an organisation should invest resources in a particular initiative, comparing expected benefits against costs and risks. 

Serve as decision-making tools that help stakeholders evaluate whether a proposed investment will deliver sufficient value to justify the required resources and align with organisational objectives.

Key components of business cases

• Executive summary – High-level overview of the proposal and key recommendations
• Problem statement – Clear definition of the issue or opportunity being addressed
• Options analysis – Evaluation of alternative solutions including ‘do nothing’ scenario
• Cost-benefit analysis – Detailed financial assessment of investments versus returns
• Risk assessment – Identification and mitigation strategies for potential challenges
• Implementation plan – Timeline, milestones, and resource requirements
• Success metrics – Measurable outcomes and performance indicators

Types of business cases

Strategic

Focuses on long-term organisational transformation, market positioning, or capability development aligned with corporate strategy.

Financial

Emphasises return on investment, cost savings, revenue generation, and other quantifiable financial benefits.

Compliance

Justifies investments required to meet regulatory requirements, legal obligations, or industry standards.

Technology

Evaluates technology investments including systems, infrastructure, or digital transformation initiatives.

Operational

Addresses process improvements, efficiency gains, or operational excellence initiatives.

How HR can use business cases

HR technology investments

Business cases for HRIS implementations, payroll systems, or learning management platforms demonstrate how technology investments will improve efficiency, reduce errors, and enhance employee experience. They typically include cost comparisons between current manual processes and automated solutions, showing payroll processing time reductions and compliance improvements.

Workforce expansion

When requesting additional headcount, HR develops business cases showing how new positions will address workload demands, support business growth, or mitigate compliance risks. These cases quantify productivity gains, overtime cost reductions, and revenue enablement from strategic hires.

Training and development programmes

Business cases for leadership development or skills training initiatives link programme costs to measurable outcomes like reduced turnover, improved performance metrics, or succession readiness. They demonstrate compliance with Work Health and Safety training requirements whilst showing broader organisational benefits.

Diversity and inclusion initiatives

D&I business cases connect programme investments to tangible outcomes including improved innovation metrics, expanded talent pools, reduced discrimination claims, and enhanced employer branding. They reference Fair Work Act requirements whilst building broader value propositions.

Wellness and benefits programmes

Business cases for employee wellness initiatives quantify returns through reduced absenteeism, lower workers’ compensation claims, improved productivity, and enhanced retention. They demonstrate duty of care compliance whilst showing financial benefits from healthier workforces.

HR service delivery transformation

Cases for HR shared services or outsourcing arrangements compare current decentralised costs against proposed models, showing efficiency gains through standardisation, technology enablement, and economies of scale whilst maintaining service quality.

Common uses of business case

• Capital expenditure approval – Justifying major investments in equipment or infrastructure
• Project initiation – Securing approval and funding for new initiatives
• Change management – Building support for organisational transformation
• Resource allocation – Competing for limited budgets and personnel
• Vendor selection – Comparing options for outsourcing or procurement
• Policy changes – Demonstrating need for new procedures or guidelines

Business case benefits 

• Enables data-driven decision making rather than intuition
• Creates accountability through documented assumptions and projections
• Facilitates stakeholder alignment and buy-in
• Provides baseline for measuring actual outcomes
• Reduces risk of failed investments through thorough analysis
• Ensures strategic alignment with organisational goals
• Improves resource allocation efficiency

Legal and regulatory sites related for business case

• Public Governance, Performance and Accountability Act 2013 – Commonwealth agencies must demonstrate value for money in spending decisions
• Corporations Act 2001 – Directors must exercise due diligence in major investment decisions
• Work Health and Safety Act 2011 – Business cases for safety investments must address duty of care obligations
• Fair Work Act 2009 – Employment-related cases must consider industrial relations implications
• Competition and Consumer Act 2010 – Major investments must consider competition implications
• Australian Accounting Standards – Financial projections must align with accounting principles

Business case best practices

1. Start with the problem – Clearly articulate the issue before jumping to solutions
2. Use reliable data – Base projections on verifiable information rather than optimistic assumptions
3. Consider intangibles – Include qualitative benefits like employee morale or brand value
4. Be realistic – Acknowledge limitations, risks, and implementation challenges
5. Keep it concise – Focus on key decision criteria whilst providing supporting detail in appendices
6. Plan for measurement – Define how success will be tracked post-implementation
7. Update regularly – Revise business cases as circumstances change during long projects