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Six keys to better business cases for digital projects

A holistic approach is essential

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Gianni Giacomelli

Business Leader, Digital Solutions

November 1, 2017 - Business cases matter more than ever in digital. Yet research shows that most digital investments don't return the cost of capital. In a study conducted by Genpact and Harvard Business Review Analytic Services, only about 30 percent of companies surveyed said that they're seeing significant results from their digital technologies.

What's holding back the other 70 percent? Often, the issue lies in confusion over where to start. As well, many companies don't have a clear vision of what they want Digital to do. Possibly that's because they've had difficulty establishing an accurate business case for a range of digital investments and don't make the necessary comparisons between them.

Should I deploy half a dozen pilots for robotic process automation (RPA)—or only two and use the money to start building an RPA center of excellence? Should I deploy a fully functional natural language processing (NLP) sandbox, or save that money to couple the NLP engine with a dynamic workflow to redesign the adjacent business processes from end to end?

The multi-function, multi-unit business case

The problem with most business cases is that they only look at the impact on cost, such as reducing the cost of processing a client inbound call or disbursing a loan. And, while many business cases can span multiple functions or business units with multiple budgets and cost centers, there is often a tendency to only consider the part that pertains to one specific budget.

Thus, there is a bias towards projects centered on one functional area and that attack only easy-to-quantify costs. These companies miss out on the larger picture and other projects that could potentially boost productivity, unlock effectiveness, and promote growth.

These are acute problems given the cross-sectional nature of digital work. For instance, customer experience often suffers from lackluster front ends (for example, websites, contact centers). But the root of the problem may lie in the inability to source master data (such as customer profitability) in real time from back-office systems and combine them with decision support systems in the front. Further complicating the issue is the fact that digital investments today (unlike in the past) are typically a mesh of various technologies.

How can your organization build a good business case so you can reap the full benefits of your digital projects? Keep the following six keys in mind.

  1. Focus on getting the talent or skill sets that can build proper, holistic business cases. Consulting firms routinely define a "size of the prize," but internal teams often don't. To build a good business case, you need a blend of analytical, business domain, and technology skills, such as those used in Lean Digital practices.
  2. Value the impact on customer experience in measurable ways. For example, think about what the average revenue per user (ARPU) is of segments with different net promoter scores (NPS). What is the impact of different digital investments on the NPS? You can look at similar results and effects across other variables such as churn rate.
  3. Employ customer experience mapping to identify the points of customer delight and associate a score to each point to understand its contribution to the overall business case. Often, these points range across functional silos, well beyond the front end. So they're hidden from the scrutiny of the CMO or CIO. Create a portfolio of points scored according to the impact they create, and generate scenarios (from simple point solutions to more extensive, multi-step work) to facilitate choices.
  4. Factor risk, speed to result, and agility—that is, the ability to change—of different options and calculate the impact of those parameters. For instance, what is the impact of bringing streamlined onboarding features to the market 12 months earlier than waiting for a full-fledged core systems redeployment? And, what is the impact of being able to change those capabilities more rapidly by using a dynamic workflow tool instead of the heavier standard workflows of a system of record? And what is the impact of needing to scrap the solution after two years instead of fully depreciating it, assuming that the rate of obsolescence is faster? How do the results compare with more traditional waterfall deployments that return better economic benefits in stable, long term projects?
  5. Evaluate the impact of quick experimentation to reduce the cost of failure, especially in environments where the best solution isn't obvious. Calculate the value of avoiding significant waste down the road, by incurring modest and deliberate waste through experimentation upfront. That's the amount that to spend on design thinking or rapid prototyping.
  6. Bring the business case to more senior decision makers as the benefit may impact multiple functions and business units. As part of this, think of fixing some back-end applications and processes that can help the customer operations team. Also, someone who can benefit holistically should sanction the distribution of the investment. Further, ensure that your CIO has enough budget and authority to rise above the siloed interests of individual business functions.

Without a strong business case in place, most organization will end up with incomplete, unproductive digital projects. Once more, the road to digital transformation falters not for lack of technical acumen, but because of the insufficient maturity of business and change management practices.


About Gianni Giacomelli - Business Leader, Digital Solutions

Gianni Giacomelli is senior vice president and business leader for Genpact’s rapidly-growing Digital Solutions business.  In this capacity, he is driving the growth strategy and go-to-market operations for all of Genpact’s digital-led solutions portfolio. He also oversees the company’s design thinking services to help drive innovation with clients.


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