Projects typically get funded based on their business cases. Business cases that seem to stack up on paper usually get budget. Business cases that don’t stack up are either rejected, because they’re clearly absurd, or, they do get budget because the business sponsor shouted loudest or had more political influence.
Business cases can be cooked with the ‘right’ numbers to win funding but I like to think they’re written with reasonable intentions. When multiple business units (or lines of business) get their funding from a shared budget, I suspect that human nature and politics come into play and as a result business unit priorities take precedence over the common good of the portfolio.
Business cases are in the eye of the business sponsor. Benefits tend to get amplified while the risks and costs are played down.
But there’s something important missing. No matter how business cases get funded, they should be treated as hypotheses by everyone and especially by the business sponsor (or product manager). If funding is granted, the business case should be tested repeatedly, in the market, with users, to find evidence that supports it.
Without evidence that trends towards the expectations (usually defined as targets) in the business case, we need to be constantly asking questions like: Should we pivot? Are we targeting the right users? Can we reach the users? Should we stop? If we don’t, budget will be wasted on projects that will never generate revenue or have simply yielded all they can.
