March 24, 2023

How to Write a Good Software Business Case [+ Template]


Do you think your company needs to invest in new software? In this post, you'll learn how to write a good software business case. Free template included.

Nikesh Ashar

You can always improve your processes. And as your scale-up grows, optimizing different workflows becomes a top necessity. Luckily, this need can be easily addressed through the right software. 

However, adopting new tools may require a significant financial investment. So, before you can implement new tools, you may need to get some expenses approved by upper management. 

Making a software solution appealing to top leadership can be challenging. Here’s where software business cases can be truly helpful. And today, we’ll tell you everything you need to know about them.

If you’re a manager and want to convince your team and supervisors to invest in a new SaaS tool, this post is for you.

We’ll share:

  • What a business case is
  • Why business cases make a difference
  • How to compare different software solutions for a business case
  • A step-by-step guide to writing a good business case for your software purchase proposal
  • A software business case template 

Ready? Let’s get started.

Free Business Case Template

Need help creating a business case for your next software investment? Download the time-saving business case template, for free.

By entering your email you agree to the Privacy Policy and consent to receive emails from Cledara.

What Is a Business Case?**

You may already know what a business case is. But let's go over a definition to make sure we’re on the same page.

A business case is a key deliverable that upper management reviews before approving and funding any project or purchase.

Business cases provide detailed and well-structured information about:

  • The business problem you’re trying to solve
  • The positive impact the proposed solution will have on the company 
  • How those benefits will be achieved
  • Risks associated with not solving the problem
  • Estimated costs
  • Team members involved 
  • Scope/impacted team
  • How long it will take to solve the problem

Once the business case is approved, it should serve as a formal agreement regarding budget, resource allocation, and solution scope. 

But why are software business cases so important? Why wouldn't you give your manager an elevator pitch of the tool you want to acquire, instead of producing documentation? 

Why Business Cases Make a Difference**

Business cases provide an excellent opportunity for you to engage key stakeholders and win collective buy-in for your software proposal. 

In fact, a strong software business case will:

  • Explain why the potential investment is strategically reasonable
  • Give context regarding the challenges, goals, and potential alternatives informing the proposal
  • Justify the potential investment based on common goals rather than personal preferences
  • Keep stakeholders aligned and motivated throughout the tool’s adoption process
  • Serve as a solid foundation for justifying the software investment in the long run
  • Add a paper trail to the budget approval process

But, what if you don’t submit a business case? You could just send an email to stakeholders introducing the tool and going over its costs. But this type of proposal:

  • May not be taken seriously or prioritized
  • Relies on stakeholders having the exact same information and short-term incentives as you, which is unlikely
  • May fail to keep stakeholders motivated during the tool’s adoption process, which can hurt adoption

How to Compare Different Software Solutions**

One of the key components of a powerful proposal for software purchase is a comparison between different options. Even if there’s an option you’re sure you want to go for, adding some alternatives can enrich the conversation significantly. 

To contrast and evaluate multiple software solutions, we advise you to:

  • Read software reviews
  • Make the most out of free trials
  • Schedule a product demo

Read Software Reviews

This may be the oldest trick in the book, but it surely works. You can look for tool reviews online and ask for your colleagues’ opinions. 

Wondering how to find actually useful content on Google, instead of just product ads? Here are some search queries you can use:

  • “[Tool] pros and cons”
  •  “Why we stopped using [Tool]”
  •  “[Tool] alternatives for [type of team/user]”

For more efficient research, create a list of essential, non-negotiable features. If a tool doesn’t include these functionalities, don’t consider it as an alternative. 

Get a Free Trial 

Many SaaS tools offer free trial periods, so users can have the chance to discover their interface and capabilities. Use free trials to gain a deeper understanding of how the tool operates and how it can potentially benefit your organization. 

Trial periods can last anywhere between 7 to 30 days. What’s more, some companies give users a chance to extend their trial and continue exploring their product for a few extra days.

Schedule Product Demos

Some tools don’t offer trial periods. Instead, they provide live product demos. During a demo, you can ask questions, and learn whether the tool is a good fit for your needs. 

Take control of your SaaS with Cledara

Take control and gain visibility over every software subscription.

Learn more

How to Write a Good Software Business Case**

You’ve identified a challenge and found a software solution that could help you address it. It could be a project management tool like Jira, accounting software, or even integrating new technology like artificial intelligence into your workflow.

Regardless of the specifics, some team members might be reluctant to adopt new software. And the reason is quite simple: a new tool comes with risks and expenses. And we’re not just talking about the cost of a monthly subscription. 

A new tool requires a training period and forces team members to rethink their workflows. So, even if the tool’s long-term impact will be positive, you’ll probably encounter some friction early on. But including a good business case in your proposal for software purchase can help you navigate these challenges.

To write a good software business case, you should:

  1. Gather key information
  2. Provide a breakdown of the costs
  3. Get stakeholders involved

Let’s take a closer look at each step, shall we?

1. Gather Key Information for your Business Case

When upper management greenlights your proposed investment, they won’t just be agreeing to a new monthly or annual cost, they’ll also agree to operational changes. So upper management needs to be sure that you considered all the pros and cons of this new solution. The more specific, the better.

Hence, we advise you that your business case includes:

  • An executive summary
  • Pain points and testimonials 
  • Solution description & scope
  • Cost and resources overview
  • Risks
  • Timing of execution & milestones
  • Tool governance & dependencies
  • Benefits of the new software solution

Let’s take a closer look.

Executive Summary

To give upper management an overview of what they can expect, it’s a good idea to start your business case with a summary. You should write this section after you’ve already completed the entire proposal. So, although this is the first thing your managers will see, you should leave it for last.

Your executive summary should mention:

  • The business problems the new software will solve and its key features
  • Why this software solution is necessary now
  • Changes in rules or regulations that may require this investment (if any)
  • How the tool will lead to cost savings or revenue enhancement

It’s important to note that rather than focusing on a specific software tool, your summary should focus on the business problem and the solution. Remember that your primary objective is to address the problem at hand, rather than merely purchasing software.

However, remember to clearly state in your summary that you want to buy new software. Sometimes, as you work and rework this section’s wording, it can become ambiguous.

Pain Points and Testimonials 

Explain the affected team’s current workflow and software stack. Then, outline the pain points and challenges they’re encountering. In fact, you can recruit coworkers and ask them to share some real-life examples.

Their testimonials will:

  • Strengthen your case 
  • Show how serious the issue is
  • Explain its likely consequences

This way, stakeholders will be able to understand why it’s important to act quickly. If the current challenge involves dealing with old technology, direct users are great candidates. Meanwhile, if the challenge is more focused on processes, employees responsible for that task will be a good fit. 

Last but not least, don’t forget to connect with the managers of the teams that are dealing with these challenges. They will surely provide valuable insights.

Solution Description & Scope

Now that you’ve described the challenges you’re trying to solve, it’s time to describe how this new software can address them.

Remember to outline:

  • The scope of the solution, its capabilities, and limitations
  • The requirements the tool should meet to support your team's needs
  • Roles and teams involved
  • What makes this software solution the best option
  • Why you wouldn’t suggest developing a custom solution in-house or hiring an external software development firm

Moreover, you might mention what makes this software solution stand out from alternatives.

Additionally, you can include success stories and case studies from other companies in your industry.

Costs & Resources Overview

Don’t forget to include:

  • Implementation cost
  • Total cost ownership (TCO)
  • Return on investment (ROI)

This aspect of your proposal will require some extra attention. So, we’ll cover it further in the next step.

Additionally, it’s important to outline the resources that you’re depending on but don’t imply a cash outlay. 

For example:

  • IT Hardware & equipment
  • Server storage space
  • Workspaces
  • Time
  • Team members

Indicate which of these resources you’ll need, as well as where you expect them to come from. Moreover, state your assumptions regarding the available resources as well. For instance, you may assume that the storage capacity already available will be enough for the new software.


Analyze the critical risks associated with the project. 

Next, cover:

  • How you plan to mitigate, reduce or even eliminate those risks
  • The implications of not taking preventive measures
  • Each risk's probability of occurring
  • The circumstances in which you would be unable to reduce the risk effectively

Execution Timing & Milestones

Provide a timeline for the implementation of the software solution, especially if the company must meet a certain deadline. The steps you take will depend on where you are in the tool selection process. So make sure you know when and how they will be taken. 

Additionally, you could also include:

  • The impact of starting or delaying adoption by a certain date
  • Major milestones, like kickoff meetings, training dates, and more
  • Meeting schedules, status reports, and demos

Dependencies & Governance

Include the name of each person who will be involved and their role. 

Plus, specify if your team needs support from another team to complete adoption. In other words, don’t forget to mention any project dependencies.

Summary of the Software Benefits

Wrap up your business case with an overview of the benefits the new software will bring to your company.

Some of the expected benefits and gains that you can highlight include:

  • Time and money saved
  • Increased collaboration 
  • Productivity boost
  • Improved risk management protocols
  • Higher task efficiency

It’s fair to note that this section must be mainly focused on the business benefits rather than technical benefits. 

2. Provide a Breakdown of the Costs & ROI

Explaining the costs associated with an investment is every bit as important as explaining why the investment makes sense. 

Typically requested costs include:

  • Total implementation costs
  • Total cost of ownership (TCO)

Additionally, you should do your best to calculate the investment’s ROI.

Total Implementation Costs

To calculate the total implementation cost, you need to take adoption costs into account.

Your total implementation costs may include:

  • The price of your initial subscription
  • The cost of the hours you’ll spend training your team to use this tool
  • Any additional costs related to transitioning out of current software

Total Cost of Ownership (TCO)

The Total Cost of Ownership (TCO) often serves as the basis for calculating the return on investment (ROI) and comparing vendor prices. Finding the TCO involves:

  • Calculating the upfront costs of each software solution
  • Estimating the net present value (NPV) of recurring costs over the tool's expected lifespan
  • Totaling the upfront costs and future costs' NPV

Many businesses tend to only consider the onset expenses associated with new software when analyzing vendors and potential risks. However, there are numerous variables that must be taken into account when determining the TCO. 

Commonly, these variables include:

  • Total implementation costs
  • Renewal fees
  • Module additions, if necessary
  • Any integrations that may require third-party tools such as Zapier
  • Data migration costs
  • Server maintenance, in case the tool is self-hosted

Return on Investment (ROI)

It’s no news that ROI can be challenging to measure and even more difficult to guarantee. Plus, no one knows with 100% accuracy how the business and the industry will change in the future. Hence, as time goes by, you may need to expand the functionality of a tool or add integrations, which can lead to increased costs.

Nevertheless, your managers will still expect you to put your best effort into calculating these benefits and cost projections.

3. Get Stakeholders Involved

There’s no need to write a business case on your own. In fact, involving relevant colleagues and decision-makers will provide you with valuable insights and help you develop a thoughtful solution. 

We recommend:

  • Communicating with department leaders
  • Getting all contributors on the same page before submitting the software purchase proposal
  • Starting the conversation with upper management before sending the proposal

Communicate with department leaders

Before submitting your software business case, it’s always a good idea to get in touch with the teams that will be affected by the investment. Identify internal advocates and ask them for their help. With their help, you’ll be able to identify blind spots in your proposal, offer alternative solutions, and validate your perspective. 

Don’t forget to include the names of your contributors on your software proposal. That way, you’ll let upper management know that you’re not representing your individual preferences, but a team’s needs.

Get all contributors on the same page

Prior to submitting your software business case, make sure everyone whose feedback you received and who is named in the final document gives their approval. Nobody likes to see their name on a document without their consent. So make sure everyone reviews it before submitting it to upper management.

Talk to upper management before submitting your proposal

Your in-depth proposal may be great for contextualizing and explaining the software investment you'd like to make. But if you send it to upper management out of the blue, it may be deprioritized or get lost in a sea of emails. 

So, before sending your proposal for software purchase, make sure upper management is expecting it. Talk to leadership, find internal advocates, and use the proposal to move that conversation forward. 

Additionally, connecting with upper management before developing the proposal will help you consider their point of view and anticipate frictions.

Get Control Over Your Software With Cledara**

There are numerous aspects to contemplate when investing in new software. Software business cases make for a goal-oriented, collective, and transparent software buying process. But remember, the key to a strong business case is to focus on solving the challenge, not on the software purchase itself.

The right tools can make a huge difference in your scaleup’s everyday operations. But, before getting a new solution, there’s something worth asking: Are you managing your existing software subscriptions? 

If left unmonitored, SaaS expenses can easily pile up, leading to:

  • Shadow IT
  • Tool redundancy
  • Untrackable and unstandardized workflows

Here’s where Cledara can help.

With Cledara, you will:

  • Have a centralized view of all your software subscriptions
  • Identify which tools bring value to your company
  • Easily unsubscribe from unused or redundant tools
  • Make sure you know which tools each team member is using
  • Streamline employee onboarding and offboarding processes
  • Get 2% cash back on every software subscription

Take back control of your SaaS stack. Book a Cledara demo today.

Take control of your SaaS with Cledara

The software management tool that automates your expenses.

Learn more



Subscribe to our newsletter

Receive the latest insights in your inbox

Nikesh Ashar

I currently look after Quality Assurance and IT at Cledara. Having built a robust QA process and now a team, we work with Product and Engineering to make sure that our software is robust and well tested.

Share this post

Subscribe to our newsletter and stay informed on the latest SaaS insights

Explore more

Explore more

A CFO’s Guide to SaaS Contracts

Here’s what to look for when you sign a SaaS contract—which clauses to read carefully, which to insist upon, and how to come away with a great deal.
Read more

9 Best Spend Management Software Solutions for 2024

Discover the best spend management software for your needs, with this detailed rundown of the tools on the market.
Read more

What Is SaaS Procurement?

SaaS procurement encompasses the entire lifecycle of a SaaS tool within a company. From identifying a need, purchasing the solution, assessing its security and compliance, and implementing it.
Read more

Have You Secured Your Software Stack?

SaaS security is a set of practices, protocols, and processes that have the primary goal of ensuring the security of a company's SaaS environment.
Read more

How to Negotiate Your SaaS Agreement

Learn how to negotiate your software agreements and secure a good deal with this comprehensive guide.
Read more

Software Tail Spend: Why It Matters and How to Manage It

Uncover the hidden impact of tail spend on your company's software purchases and learn how to effectively manage it with our free, downloadable cheat sheet.
Read more

What is SaaS?

Software as a Service (SaaS) is a cloud computing model that allows users to access applications over the Internet. But there's far more to it - find out here.
Read more

What is an SBOM?

Software providers must now meet SBOM requirements in order to qualify as US public sector vendors. Learn everything you need to know about SBOMs in this post.
Read more

13 Key Procurement KPIs You Should Track in 2023

Setting procurement KPIs is essential to track your procurement team's performance, ensuring smooth operations, and minimizing costs.
Read more

Avoid $65m Cloud Bills with a Cloud Management Platform

Wondering if it's time to adopt a Cloud Management Platform? Here's everything you need to know before investing.
Read more

What Is Software Asset Management? [Benefits & Best Practices]

Software Asset Management helps organizations gain control and optimize software costs and usage. Learn more about its benefits and some best practices in this post.
Read more

IT Governance Framework: A Guide for Enterprise Companies

IT governance is a formal way to integrate an IT strategy into an organization's business strategy. In this post, we’ll cover everything you need to know about it.
Read more

Technology Business Management (TBM): A Guide for Scaleups

Rationalize your IT expenses and align them with your business goals through Technology Business Management (TBM). Here's what you need to know.
Read more

What is Application Rationalization and How to Implement It

Application rationalization is the process of assessing and streamlining an organization's software applications to improve efficiency, reduce redundancy, and optimize resource allocation.
Read more

Is Shadow IT Hiding in Your Company? Tips for Bringing Informal SaaS Out of the Dark

Unsure about how to tackle hidden software used throughout the company? You're not alone.
Read more