Business case development

Aligning investment cases with strategic goals to meet customer needs.

A clear and robust business case is key to helping organisations make sound investment decisions. It sets out the benefits, costs, and risks, providing evidence in a structured way which enables leaders to scrutinise and validate investment decisions.

The challenge with developing business cases

There are many challenges to overcome in developing your business case, including:

Regulatory outcomes: Demonstrating that investments improve service to customers while remaining affordable is essential. Linking performance, risk, and investment with a compelling narrative is key.
Cost assessment: Forecasting how much it costs to provide services, including investments in infrastructure, maintenance, and operational expenses.
Economic and market conditions: Anticipating external factors, like fluctuations in energy prices and economic conditions, and planning accordingly.
Environmental and sustainability: Meeting environmental regulations and sustainability goals is a growing challenge. Companies must invest to protect the environment and face into the net-zero challenge.

How we can help

We bring together our multidisciplinary technical expertise when developing business cases. This means the services you get are informed by a wealth of water, energy, and environmental infrastructure knowledge from across the project life cycle.

Applying our business case development process will help you to:

Identify and define an investment need
Prioritise investments by understanding the costs versus the benefits
Scrutinise and validate investment decisions
Deliver regulatory statutory requirements
Deliver investible and deliverable projects
Ensure projects ultimately support and achieve your organisation's strategic objectives

Strategic resource options

The Regulators’ Alliance for Progressing Infrastructure Development (RAPID) was set up in 2019. It is a partnership made up of the three water regulators – Ofwat, the Environment Agency (EA) and the Drinking Water Inspectorate (DWI).

The National Infrastructure Commission estimated that new water supplies would be needed by the mid 2030s. Responding to that challenge, RAPID was formed to facilitate the development and funding of new large strategic resource options by the water companies. With a ringfenced fund of £469m, RAPID helps to improve regulation and remove barriers, helping the sector respond to water resources challenges while promoting the best interests of water users, society, and the environment.

We are uniquely positioned to support the commercial elements of these schemes. We are industry-leading when it comes to cost benchmarking, estimating and assurance. This ensures that enhancement costs are robust and deliverable for securing passage through each gate.

In combination with our other services, we can lead and collaborate on development of strategic resource options from end to end, providing industry-proven intelligence.

Direct procurement for customers

Direct procurement for customers (DPC) is a process allowing water companies to competitively tender for a third-party (CAP) to design, build, finance, operate, and maintain infrastructure.

Guidance states that DPC is the default delivery mechanism for all projects above ~£200m, with Ofwat reserving the right to explore the use of DPC for major projects below this threshold. Projects can also be grouped, with cumulative values triggering the need to default to DPC.

DPC is relatively new to the water industry, with limited experience across water companies which presents a real challenge. Latest Ofwat guidance (published September 2022) continues to develop the DPC model and consult the water industry.

We offer a comprehensive, integrated end-to-end solution to support water industry clients with DPC, harnessing our expertise in strategic advisory, engineering, commercial, and project services to add significant value and ensure robust and effective delivery, including:

Providing robust guidance on DPC to leadership teams, board, investors, and delivery teams
Driving optimal efficiency through early identification and rigorous assessment of possible DPC projects
Ensuring the clarity and suitability of scope for DPC projects are clear and fit for purpose
Offering robust and effective challenge to the regulator to support DPC
Leveraging our expertise to maximise project success through our role of independent technical advisor
Supporting the client by facilitating a comprehensive and effective selection process of the CAP
Delivering a seamless end-to-end service for DPC, leveraging our expertise in strategic advisory, asset management, engineering, commercial, and project services
Providing invaluable industry intelligence based on extensive knowledge and experience of DPC
Ensuring the client’s capital delivery processes are highly effective, to successfully deliver DPC
Facilitating the development of a robust DPC strategy
Fostering and instilling confidence in DPC throughout the client’s organisation

Long-term delivery strategy

Understand your core pathway to achieving a long-term vision with a set of adaptive pathways that account for future uncertainties.

We provide advice on the regulatory structure around long-term delivery strategy planning, the interface with other strategic planning frameworks (e.g. DWMP), and how you can develop a robust plan. Our aim is to introduce an adaptive systems planning capability using a mix of consultancy and technology services.

Our solution uses top-down modelling technology to help us assess core and adaptive pathways over the long-term. This unlocks the ability to test many future scenarios against a range of uncertainties to determine which triggers drive a deviation in investment pathways.

The benefits include assurance of plans and strategies, positive engagement with regulators using adaptive pathways to demonstrate the strengths of a chosen plan, and filling the pipeline with future investments.

CMA support

We have a range of experience supporting business plan submissions on cost, efficiency, cost structuring and benchmarking in PR09 and PR24, and have acted as expert witness and generated reports in PR14 and PR19.

Our advisors can provide strategic and procedural guidance while you lead your case with robust evidence.

We can assist you in several ways through the CMA process, including: