Heathrow business case

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Value realisedValue realised

Ensuring future income streams whilst, at the same time, exerting greater control on an increasingly safe investment portfolio were amongst the bigger wins that London Heathrow (LHR) were able to achieve through the deployment of CITI support in driving up business case management capability.

Max Vialou-Clark, a senior manager of LHR retail assets, commented that: "The expertise and modelling tools that CITI brought to bear saw a quantum leap in the quality and, consequently, usefulness of business cases within our retail investment environment".

Engagement focusEngagement focus

Earlier work, principally in the Capital Delivery division, on improving lifecycle and assurance management had high-lighted the opportunity for focus on business cases as a potential area for improvement. Simultaneously the arrival of Max saw the instigation of a review of the existing business cases in the retail area of LHR. The conclusion of this review was that there was insufficient consistency or confidence in the business cases; they appeared to be created and treated more as an initial investment hurdle, to be cleared, than a vehicle for shepherding each investment successfully through and beyond its delivery lifecycle. Max needed to be able to sort out the investment portfolio on a 'level playing field' and therefore needed reliability and consistency in each investment's business case to enable comparability.

The initial focus of the engagement was therefore to develop a standard understanding of what the use and application of a business case was along with the basic capability to develop compelling business cases. The former ambition was aimed principally at developing the sponsoring community and the latter at delivery personnel who were the primary authors of business cases.

Both were to be taught through workshops and practical application. Heavy focus was placed on the primacy of desireability over doability (that is to say the establishment of benefits should precede the determination of cost and risk) and the reinforcement of this learning by creating and reviewing business cases against a new and consistent model. Sponsors were faced with their accountability for successful delivery of the business case whilst the delivery community were exposed to the finer aspects of assessing the reality of the benefits position and creating increasingly reliable perspectives on the cost and risk components of the business case.

Simultaneously to the development piece gaining traction, not only within retail but also elsewhere within the organisation, the pressure was also increasing on LHR, as a whole, to put a consistent and well balanced business-level business case to the Civil Aviation Authority (the arbiters of LHRs regulatory income) for the next five year planning horizon. At this point the focus of the engagement shifted from developing capability to reviewing and validating the component business cases that would contribute to securing LHR's future income streams.

Approach to solutionApproach to solution

Two strands were therefore pursued in parallel.

The first and most labour intensive strand was subjecting the community (principally of project managers and business analysts) of business case authors to focused two-day workshops. Day one hinged on the examination of benefits and their associated impacts whilst day two focused on the scrutiny of the cost and risk components of the business case. The outcomes sought from this strand were twofold. Firstly achieving a consistency in outlook and authorship of a business cases; such that the language (categories of benefits, appropriate key performance indicators e.t.c.), syntax and presentation. The second outcome sought was an attitude that business cases were not 'one-off' investment hurdle devices but 'living' documents that could and should evolve across the lifecycle of the investment and should therefore inform most aspects of governance decision making.

The second strand of the solution was the instigation of a series of sponsor briefings to ensure that sponsors were demanding and scrutinising the appropriate emphasis in their business cases such that there decision making and focus was improved.

Ultimately the upshot of this two strand approach was to drive up quality, consistency and application of business cases across Heathrow to the extent that a solid, internally consistent representation could be made to the CAA for future funding. With subsequent clarification of the CAA constraints the business cases could be used to adjust the workload to leave LHR with the optimum investment portfolio.

Lessons learnedLessons learned

The development of authorship capability in isolation of sponsor awareness of the right content and proper purpose of the business case, from their perspective, is not effective; the two elements conducted in parallel maximises the value of the investment.

Having a sound and consistent set of business cases is a pre-requisite for appropriate portfolio balancing and decision making. Accidental as an outcome in LHR's case, it turned out to be a huge serendipity, in light of the emerging constraints from the CAA, when it came to re-jigging the optimum portfolio for BAA.

Models / tools usedModels / tools used

CITI's approach of giving primacy to benefits, over cost and risk, in the development sequence of a sound business case was the essential model in developing both halves of the capability. Sponsors from a benefits and strategic value perspective and authors from, a benefit, impacts, product mapping perspective balanced against the costs and risks of delivery. The mission model tool was the main instrument for understanding, discussing and expressing this balance.

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"The classic training model, taking individuals out of the business to sit in a classroom for a week at a time, was not going to work for us. But at the same time, we knew we needed to raise our game in managing change. I have to say, your people are brilliant!"

Head of business change, Legal & General