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Business Case capability improvement – a myth or a reality?

A question that APMG is often asked is “show me where the knowledge that you create in a training product is being used to increase capability? “

Many examples exist, a legacy of delivering certified training products for 23 years across the globe.  In the area of Business Case capability, the investment that The Treasury has made in the New Zealand Government highlights what can be achieved through an integrated approach.

If capability is defined as the power or ability to do something, then the approach taken by The Treasury has definitely resulted in improved capability.  Theory from the APMG Better Business Case (BBC) certification states that improving business case development will;

  • Reduce unnecessary spend and optimize public value;
  • Reduce consultancy costs;
  • Provide faster delivery and a clear proportionate approval process; and
  • Improve the quality of decision making.

The NZ Treasury mirrored these objectives and chose to invest in the Better Business Case process to enable smart decision for public value; reduce the costs and time to develop business cases and meet recognized good practice.

Business case development was not treated in isolation, as work was also commenced on improving benefits management.  NZ Treasury now has a comprehensive guidance (publicly available) that outlines why this is needed, when BBC is required, specific BBC guidance, methods and tools, where to obtain accredited training, access to BBC experts, BBC clinics and evaluation of this approach.

Capability is not simply sending someone off to a BBC training course; the NZ Govt has ensured that there is a clear mandate and Executive commitment together with tailored tools and support networks.

One example of the support that has been established is the BBC Clinics. Launched in 2015 by the Treasury Investment Management and Asset Performance (IMAP) team, BBC Clinics are a way of supplementing expertise on BBC with a more consistent review process using experts from across the New Zealand Government corporate center.  This provides experienced and skilled assistance with deep sector knowledge.  Clinics are available to Government projects that have been identified as needing extra support and scrutiny.

In addition to the clinics there is a list of BBC experts. Experts are categorized as either an Expert Practitioner or an Expert Reviewer (or both).

Accredited training is also recommended using APMG’s Better Business Case and delivered by APMG Accredited Training Organisations.  In 2016 the UK and Welsh Government’s BBC Guidance was extended to include program management and an international guidance was developed.  This new guidance contained less Eurocentric terminology and responded to specific feedback from NZ Treasury and NZ training providers.  The APMG BBC course was subsequently revised and now incorporates the new international guidance as the core publication; a publication that now covers business case development at both a project and program level.

So what has been the result of this investment in capability?

In 2014 the Treasury invited the chair of the International BBC Standards Board to evaluate the use of the Better Business Case and five-case model approach to support investment decision making.   This review was published in November 2015 on the Treasury website.  The main findings from the evaluation were that since 2013 there had been significant improvement in the application of BBC to support investment decisions.  The strategic, economic and management sections of business cases matched the required level of quality with further improvement  required in respect of many commercial and financial cases.  Maturity will improve with further alignment to the development of policy and strategy.

NZ Treasury has responded to the recommendations in the report including:

  • “recently updating our business case guidance, to simplify and bring it up to date with changes to the investment management system
  • launching a series of more interactive reviews and workshops that draw on expertise from across the Corporate Center, known as clinics, and
  • helped embed the launch of other guidance materials, including updated Procurement & Construction guidance, as well as new CBA tools to support stronger cost-benefit analysis. “ (NZ Treasury).

Recently NZ Treasury has provided an incentive for improvements in benefits capability and performance via the Investor Confidence Rating (ICR) assessments of the 25 investment intensive Government Agencies.

Two yearly ICR assessments embed investment management and assets performance and accountability which are reported to Cabinet.  Currently 20 of the 25 ICR assessments have been completed and from July 2017 NZ Treasury will support agencies in the Cabinet reporting process.  Portfolio benefits management in now included in the NZ Government’s Investing for NZ Annual Report.

If capability is defined as the power or ability to do something, then the NZ Government clearly has demonstrated an increase in the capability of developing and managing Business Cases.  This development has not just focused on accredited training to a global standard; it has ensured that knowledge provided from this training is able to be used within a whole of government approach.

Capability development for Business Cases is not a myth but a reality in New Zealand.

Credits:

Lawrie Kirk, Business Development Manager for APMG Australia and New Zealand.

Lawrie.Kirk@apmg-international.com

Posted in Accreditation, Qualifications.

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