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Business case approach to project development

The NZ Transport Agency uses a Business Case Approach as the basis for activity and programme development for investment from the National Land Transport Fund. The Business Case Approach supports planning and investing for outcomes, ensures early collaboration between stakeholders and the development of a robust, evidence based investment case.

The Business Case Approach is a principles-based approach that clearly links our strategy to outcomes, and defines problems and their consequences thoroughly before solutions are considered. This principles-based approach ensures a shared view of problems and benefits early in the transport planning process without requiring that the work has to be done in a particular way.

A key aspect of the Business Case Approach is that a case for investment is built progressively – starting with a strategic case, a programme business case an indicative business case and finally a detailed business case – with decision points along the way that determine whether the investment is worthwhile in relation to the desired outcome. And at every step of the way, there’s a strong connection between strategy and outcomes.

This overview outlines the key points and phases of the Business Case Approach [PDF, 49 KB].

This summary diagram gives a good indication of the process and supporting tools [PDF, 125 KB].

To help with learning the business case process, the Transport Agency has created a set of Business Case Approach learning modules. These modules are designed to provide consistency in approach, language and application of the business case approach.

Transport Agency staff can access these modules through learningzone.nzta.govt.nz (external link) . Transport Agency customers can access the modules by sending an email to nltp@nzta.govt.nz with your name, email address, title and Transport Agency contact name.

The benefits of our Business Case Approach

The key benefits are:

  • Increased effectiveness of investment resulting in an increase of outcomes and benefits – more bang for our buck
  • Increased efficiency of processes and reduction in churn – quicker for less cost
  • Greater clarity of evidence-based decision making on investment – evidence to back up decisions
  • Planning and investment optimised across the whole network – getting the most out of the whole network

These benefits arise through:

  • More clarity – identifies desired outcomes; sets investment objectives; sets measures at outset to monitor benefits
  • Greater efficiency – reduced churn throughout process; all stakeholders agree to scope at the outset; the right options are appraised
  • Reduced risk – greater assurance at project stages
  • Improved stakeholder engagement – provides a basis for meaningful, upfront conversations; early agreement on outcomes
  • Strategy led – speeds up the planning process; improves basis for decision-making; connects strategy to shovel

Status of advice

The NZ Transport Agency Planning and Investment Knowledge Base (external link) sets out the planning and operational policy and processes for developing and implementing the NLTP, to give effect to the Government Policy Statement (GPS). The Knowledge Base includes advice to the transport sector on applying the Agency’s Business Case Approach.

The guidance, tools and templates contained on the Highways Information Portal have been developed by the Transport Agency to be specific to the requirements of developing state highway investment proposals and are aligned to the Planning and Investment Knowledge Base guidance.

For further information contact outcomeplanning@nzta.govt.nz.

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