Writing a business case: How to check your real return on investment

Business cases too often lack rigor in their ROI calculations or conciseness in making an argument for a project or product. The medical profession has recently made checklists more scientific and offers valuable lessons for anyone who has to write a business case or use an  IT due diligence checklist.

I just finished reading Safe Patients, Smart Hospitals: How One Doctor's Checklist Can Help Us Change Health Care from the Inside Out by Peter Pronovost and Eric Vohr.

For the business case writer and ROI calculator, it offers several lessons:

1. Lose the long winded. Medical science tends to produce 120-page guidelines. Though based on thorough evidence, they are too long for use in day-to-day work. This lesson applies to anything including long winded books, three-day business case training, 10-plus page white papers. In medicine, checklists are used because they are "high impact, low risk, cost effective, and, most importantly, time efficient." Same argument for making IT investments.

2. Model success. Pronovost and his team created a model for patient safety based on their research in fighting central line infections. He defines three elements for success when using a checklist scientifically:

  • Develop a checklist that encapsulates as much knowledge and evidence as possible on a particular procedure;
  • Change the culture and any broken systems that impede implementing the checklist
  • Measure results to guage the checklist's efficacy and make necessary changes to improve it.

3. Improvement means measurement. IT investments are often minimally tracked if at all after initial funding. Pronovost points out the doctors are first and foremost scientists: "we are scientists and the cornerstone of science is measurement." He recommends measuring outcomes and comparing them with the baseline measures to see whether the checklist actually improves performance. The exact same process should apply to business case analysis both before the IT investment and afterwards.

4. Use risk-benefit ratios. The book outlines a disturbing true story where a surgeon is challenged to change his latex gloves because they are causing an allergic reaction in the patient lying on the surgeon's table. Pronovost points out the trade off, saying to the surgeon: "If I'm wrong, then you will waste five minutes changing gloves. If you are wrong, the patient dies. Do you really think this risk-benefit ratio warrants you not changing your gloves?" Think about the risks of any projected business case benefits.

5. Keep a low ego and seek objective opinions. Pronovost estimates that misdiagnosis kills at least forty thousand to eighty thousand people every year. His research found that this is in large part due to ego, autonomy, and an overreliance by doctors on their own knowledge. Though a bad white paper won't cause physical harm (apart from a headache) it will waste loads of time and money. Please consider our fast and objective White Paper Review service.

    For an IT Due Diligence Checklist built on scientific principles please take a look at The Business Case Checklist available from Amazon.

    And whether you are in medicine or a business case or white paper writer, please wash your hands!