Option appraisal/value for money analysis/return on investment
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Use this to help you to find the right structure for presenting your options appraisal or alternative means of communicating your benefits, costs and risks.
- Identify if you need this section in your business case, or exactly what type of appraisal is required. Depending on your organisation's approach to business cases you may need to:
- ignore this section - some business case templates do not require you to describe different options or quantify benefits/savings; instead you may simply make a recommendation for action along with the appropriate cost/benefit/risk description
- list different options for funding and action; you may need to describe benefits, costs and risks of each option (often called a cost-benefit analysis)
- quantify your return on investment); this usually means showing where a benefit can, for example, result in a saving on staff costs or perhaps result in less storage space required than current projections
- only describe a 'do nothing' option - ie what would happen if your business case is not funded (and no action is taken).
- Some business case templates use an explicit methodology for options appraisal - which may involve assessing implementation costs, ongoing costs, savings resulting from the investment, or other criteria specific to your organisation. This is likely to be the case for large capital projects but may not be needed for business cases which require a smaller level of investment.
- You may need to research further. There are lots of resources that can help with options appraisal and/or cost-benefit analysis. There are also resources that can help with quantifying, or at least measuring, intangible benefits. There's a list of resources below - choose the ones that will help you address the needs of your business case.
- Don't forget to present your recommended option from the option appraisal!
Use these guides to help you develop the key elements of your options appraisal.