Options Analysis

Purpose of this section of the Business Case

Options Analysis enables the Project Team and, subsequently, Cabinet to make an informed decision on the most appropriate way to address/realise the problems/opportunities identified in the ILM and Needs Analysis. The guiding principle of Options Analysis is to prioritise and select the option that maximises value for money.

The purpose of this section is to outline the robust, structured, objective and evidence-based Options Analysis that the Project Team undertook to identify the recommended project option.

If the Options Analysis process undertaken by the Project Team is not deemed sufficient when the Business Case is reviewed by iCBR, FABG and ICA, significant rework may be required. Refer to the detailed Options Analysis Guidelines for further information about the process that should be undertaken to identify the recommended option.

The key questions this section should consider are:

• What is the ‘Base Case’ (that is, what is a suitable and justifiable ‘do minimum’ or ‘Business-as-Usual’ option)?
• What is the strategic solution that best addresses the problems or opportunities, and realises the benefits, identified in the ILM and/or Needs Analysis? Summarise why this is the case.
• What are the full range of project options that could be pursued to reach the recommended strategic solution?
• What evaluation criteria should be used in the MCA to assess the selected project options?
• Which project option provides the best fit against the agreed evaluation criteria in the MCA?
• For Tier 1 and Tier 2 projects, which project option is recommended based on the detailed assessments undertaken (including the Financial Analysis, Economic Appraisal and Wellbeing Impact Assessment)?
• For Tier 3 projects, which project option is recommended based on the outcome of the MCA?
• For Tier 1 projects and other projects where staging is feasible, what is the recommended staging option for the recommended project option?
• For Tier 1 projects and other projects where staging is feasible, if the project option does not incorporate staging, why is this the case?

Content required for the Business Case

Within this section, the Project Team should include a summary of the Options Analysis process that has been undertaken. Unless stated otherwise, the content described in each sub-section is required for all Tiers.

‘Do minimum’ Base Case

In this section, the Project Team should outline the ‘do minimum’ or ‘Business-as-Usual’ option that would be expected to take place should the project not go ahead.

Strategic solutions

This section is mandatory for Tier 1 and Tier 2 projects and recommended for Tier 3 projects.

In this section, the Project Team should document the full list of possible strategic solutions that will address the problems and realise the benefits the Project Team identified in the ILM and/or Needs Analysis.

The Project Team may have undertaken this strategic solutions analysis prior to the Business Case (such as during the ILM). In this case, the Project Team should summarise the findings of the strategic solutions analysis in this section and include the detailed analysis in an appendix.

Recommended strategic solution

The Project Team should outline the recommended strategic solution based on the assessment process undertaken.

Project options

In this section, the Project Team should identify the project option(s) based on the recommended strategic solution, the approach taken to identify the recommended project option and a description of the recommended project option.

The Project Team should also present the evaluation criteria selected for the MCA, and the results of the MCA and other detailed assessments on the project options undertaken to determine the recommended project option.

Evaluation criteria

The Project Team should identify and present the selected evaluation criteria that have been used to inform the Options Analysis and the relative importance given to each criterion (refer to the MCA Guidelines for further guidance). The number of evaluation criteria selected by the Project Team may vary depending on the complexity of the project, but should be at least five and should not exceed ten.

Project options

Within this section, the Project Team should summarise the results of each step of the Options Analysis process, providing a robust rationale for each decision made. If an initial, high-level MCA was undertaken to identify the shortlist of project options from a longlist of options, the Project Team should also document the process taken in this section.

The Project Team should include a description of each of the shortlisted project options (or the recommended project option for Tier 3 projects). For Tier 1 projects and Tier 2 projects, the Project Team should also document the results of the detailed assessment of the shortlisted project options against the whole-of-life costs (including the social cost of Greenhouse Gas (GHG) emissions) and revenues, the Economic Appraisal (including Cost Benefit Analysis (CBA) and MCA assessments) and Wellbeing Impact Assessment.

For more information on how to undertake MCA, the Project Team should refer to the detailed Options Analysis Guidelines and the MCA Guidelines.

Recommended project option(s)

The Project Team should outline the recommended project option(s).

Staging analysis

This is mandatory for Tier 1 projects, unless the Project Team receives specific authorisation from the Under Treasurer to exclude it. It is recommended for Tier 2 and Tier 3 projects, particularly where staging is feasible.

In this section, the Project Team should document the rationale for seeking (or not seeking) a staged approach. If a staged approach is potentially an option, the section should include a justification of the recommended staging approach, informed by the staging analysis.

Appendices required for the Business Case

None required. The Project Team may append further information on the Options Analysis performed prior to the Business Case, where available.