The role of business cases in improving major projects’ performance across Government

Earlier this year the National Audit Office (NAO) published an excellent paper on “Delivering major projects in government: a briefing for the Committee of Public Accounts”[1], which provides some very interesting statistics, facts and figures on the Government’s Major Projects Portfolio and describes some of the reasons why so many large public projects fail to deliver on time or to budget, and why so many are currently at risk of repeating the same mistakes.

The paper’s final conclusions were that the Major Projects Authority and departments faced three key challenges during this Parliament:

  • Prevent departments making firm commitments on cost and timescales for delivery before their plans have been properly tested;
  • Develop an effective mechanism whereby all major projects are prioritised according to strategic importance and capability is deployed to priority areas; and
  • Put in place the systems and data which allow proper performance measurement.

It struck me that a key tool for addressing all of these challenges, at least in part, exists in the form of HM Treasury’s Green Book[2] and Five Case Model business case guidance.  To my mind this guidance is an exemplar for large organisations trying to allocate scarce investment capital and resource to maximise value for money.

The problem is it is so rarely adhered to in letter, much less spirit.  Some of the failings in the use of business cases which ultimately result in the failings of major (and minor) projects include:

  • Business cases seen as an administrative hurdle or impediment rather than a project tool to reach the right answer;
  • Poor options analysis, blinkered thinking and a self-justification for the predetermined “right answer”, which is rarely the “Do nothing” or “Do minimum” option;
  • Lack of genuine, broad and early user and market engagement; and
  • Unwillingness to invest in pilots or minimum viable products to help confirm potential costs and benefits[3].

To respond directly to the challenges identified by the NAO:

  • A well-developed business case, built on good data will provide departments with a much better intelligence of project timescales and prevent a commitment to erroneous costs and timescales
  • Accurate and well-prepared business cases will support existing channels of approval within departments and HM Treasury to prioritise major projects more appropriately
  • Business cases should already include lots of data, for example on time, costs and benefits on which any performance management should be based.

In conclusion I would say that meeting the challenges of improving project performance are well within our grasp if we use the tools and processes already in place more effectively.

 

[1] https://www.nao.org.uk/wp-content/uploads/2016/01/Delivering-major-projects-in-government-a-briefing-for-the-Committee-of-Public-Accounts-Summary.pdf

[2] https://www.gov.uk/government/publications/the-green-book-appraisal-and-evaluation-in-central-governent

[3] An exception here would be some good work by Government Digital Strategy in introducing a more agile approach to systems and software development

Meet the author

Paul Marshall

Paul Marshall

Paul is Director of Finance and Performance Management with deep experience in business cases and investment appraisal, project and change management, process improvement, activity and service costing and procurement. Paul is a Chartered Management Accountant and Prince 2… Read more »