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1 Best practice No 177 Best practice guideline: writing a business case for servicedevelopment in pathologyM J Clin Pathol2004;57:337 343. doi: guideline reviews the introduction and development ofbusiness planning in the National Health Service. Aguideline for writing a business case for servicedevelopment that would form part of a pathology businessplan has been developed. This guideline outlines six stepsthat are required in the preparation of a business case . Theformat of the guideline has been developed largely fromother national guidelines that have been published for thedevelopment of capital projects. In view of the publicationof these guidelines, the scope of this guideline excludesbusiness cases for information, management, andtechnology projects and large capital to:Dr M J Galloway,Consultant Haematologist,Department ofHaematology, E Floor,Sunderland RoyalHospital, Kayll Road,Sunderland SR4 7TP, for publication25 September guideline reviews the introduction anddevelopment of business planning in theNational Health Service (NHS).

2 Guidelinesfor writing a business case for service develop-ment that would form part of a pathologybusiness plan have been developed. Wherenational guidelines have been published forthe preparation of business cases for capitalprojects and for information, management,and technology (IM&T) projects, these areincluded in the literature review. However, thesenational guidelines are not appropriate forbusiness cases for service development and aremore appropriate for large projects that requirean assessment of the involvement of the privatesector through the private finance , developments including IM&T andlarge capital projects are not included in SEARCHThe following search strategy was developed inthe preparation of this guideline.

3 Medline andEMBASE from 1966 to March 2003 and theConsortium of University Research Librariescatalogue ( ) were searched forthe terms business planning, business plan, business case , NHS, and pathology. Relevanthealth circulars were searched for on theDepartment of Health s internet site ( ), the Department of Health s circularlibrary (COIN) and publication library, bothaccessed through , and the UK official publicationsinternet site ( ). Other databasessearchedincludedtheNationalElec tronicLibrary for Health ( ) and theBritish Library ( )DEFINITIONS: business PLANNINGAND business CASEAll NHS trusts (England and Wales), Health andSocial Services trusts (Northern Ireland), andoperating divisions of NHS boards (Scotland) arerequired to prepare annual plans.

4 This plan (thebusiness or service plan) is a document that setsthe organisation s short and longterm is to establish the organisation s priorities asdetermined by national and local policies. Thisdocument is prepared on an annual basis andusually covers three forward years. The planincludes a statement on what the organisationintends to achieve, an assessment of the level ofactivity against the ability of commissioners(that is, primary care trusts or equivalentpurchasing organisations) to support this levelof activity over the period. It also includes plansfor capital development and the fundingarrangements for these developments, otherchanges that it intends to make, and an analysisto take into account different assumptions,especially to deal with unexpected business plans contribute to thedevelopment of the organisation s business an annual basis, each directorate outlines thefinancial and other resources that it requires todeliver its service, what is expected by thecommissioners (previously known as purcha-sers) and senior managers in their organisation,the services to be provided, and proposals forservice and capital developments.

5 A businesscase is the document that supports the proposalsfor a new service development or a The business case should be an opportunityfor clinicians who develop business cases tocommunicate effectively with clinical :CPA, Clinical Pathology Accreditation;IM&T, information, management, and technology; NHS,National Health Service; SWOT, internal strengths andweaknesses versus external opportunities and on 28 January 2019 by guest. Protected by Clin Pathol: first published as on 26 March 2004. Downloaded from and senior managers who will decide on whether aproposal goes forward or not Following on from the recent changes in the structure ofthe NHS, together with the impact of devolution, a moreunified and cooperative approach to the provision of healthcare services has been a result, the termbusiness planning has largely been replaced by the termservice planning.

6 However, the term business case is still ingeneral use, at least in develop business plans?The development of business plans allows NHS organisationsto integrate service developments with the financial planningyear. It ensures that services are well planned, are financiallyviable, and that other consequences have been assessed suchas staffing, maintenance, etc. It also ensures that risks havebeen assessed and impacts on other directorates have beentaken into account. The business case document should bemore than just the paperwork necessary to obtain approval ofan investment. It should be an opportunity for clinicians whodevelop business cases to communicate effectively withclinical directors and senior managers who will decide onwhether a proposal goes forward or not.

7 It is an opportunityfor the clinician to sell the project to decision makers in theorganisation within the context of other local and nationalpolicies. In addition, the document allows clinical directorsand senior managers in the organisation to evaluate theproposal objectively, and enables managers to consideralternative ways of providing a AND DEVELOPMENT OF BUSINESSPLANNING IN THE NHS: REVIEW OF THELITERATUREThe concept of business planning evolved from the introduc-tion of the clinical directorate model of management into devolved type of clinical management was basedon a model that had already been developed at JohnsHopkins Hospital in Boston, USA in the addition,as far as pathology services were concerned, at about thesame time the Management Advisory Service report onstaffing in pathology had recommended that the directoratemodel should be the basis on which pathology services of the consequences of this revised structure was theneed to appoint a business manager to support the work ofthe clinical of the responsibility of this newrole was the requirement for clinical directorates to producebusiness plans that followed on from the development of astrategic plan for their directorate,10together with the need toprepare business cases to support service.

8 It was only with the introduction of NHS trustsin April 1991 that business planning became an integral partof the management process in the wider methodsthat were developed for the business planning processevolved from the methods used in option appraisal of newservices and capital equipment that had been in use beforethis 13 Further guidance for the development of business caseswas published in 1995 in the Capital investment manual .2 The manual is a series of eight booklets including one on thepreparation of business cases for capital and IM&T projects inEngland and equivalent document was subse-quently published in guidance on the development of business casesfor capital and IM&T projects included the requirement forthe NHS to explore the potential for private sector involve-ment through the private finance 17 The guidanceon the development of business cases for IM&T has recentlyrecommended a move to the five case modelreplaces the model used in the Capital developmentmanual.

9 The five areas covered in this model are strategic,economic,financial,commercial, this approach is appropriate for IM&T projects, itwould not seem to be appropriate when developing aguideline for service development in , there has been no specific guidance produced on thedevelopment of business cases for service , the guidelines outlined here have been developedbased on the methods previously used in option appraisal andadapting the guidance produced in the Capital investmentmanual . writing A business case FOR SERVICEDEVELOPMENT IN PATHOLOGYG etting startedIdeas for new service development or equipment replacementcan arise from several sources. Within pathology, one of themost common reasons for developing a business case is as aresponse to increasing workload or a need to introduce newtests into the service.

10 Recent examples of this would be theintroduction of troponin testing for myocardial ischaemiaand an increased workload for consultant histopathologistsin response to the setting up of new out patient services, suchas endoscopy. The ideas for service developments often comefrom individual clinicians, but may also arise from servicereviews that have been carried out by the organisation or anexternal review. National guidelines may also have an impacton new service developments; however, once the need for anew service or equipment replacement has been identified,the first step is an informal discussion with with the clinical director and business manager isan important initial step to assess the likelihood of success ofthe proposal. Other staff to talk to at this stage would includethose managers involved at the organisational level in eitherservice or business development or planning, who will beFigure 1 Factors affecting whether a business case is successful(adapted from Ryder19).