What is a triangulated financial model in your business case?

A structured business case financial model built to CFO and Board decision standards, with linked assumptions, calculations, and outputs that quantify the costs, benefits, cash flows, and value-for-money of a proposed initiative. The forecast is validated by reconciling two complementary estimation approaches: Top-Down (market-driven) and Bottom-Up (unit-economic).

Explanation:

A triangulated financial model is designed to be both credible and auditable. It translates strategic intent into measurable outcomes—typically revenue or savings, operating and capital costs, working capital impacts, tax effects, and risk/sensitivity scenarios—and produces decision outputs such as P&L impact, cash flow, ROI, NPV, IRR, payback period, and break even.

The defining feature is the deliberate reconciliation of two views of the same forecast:

- Top-Down (market-driven): starts from the market’s upper limit (e.g., total addressable market, penetration rates, price benchmarks, macro trends, regulatory constraints). It asks: “Is this forecast plausible given market size, adoption dynamics, and competitive context?”

- Bottom-Up (unit-economic): starts from operational drivers (e.g., customer volumes, conversion rates, average order value, utilisation, throughput, unit costs, staffing ratios). It asks: “Can we deliver this forecast with our capacity, resources, and unit margins?”

Triangulation occurs when both approaches are modelled explicitly and aligned through a reconciliation bridge (key drivers, constraints, and assumptions) so variances are explained and resolved. The result is a forecast that is market-realistic, operationally feasible, and defensible to executives, finance, and governance reviewers.

A Bottom-Up (unit-economic) model is valuable because it ties the forecast to drivers you can manage—such as volumes, utilisation, cycle time, cost-per-transaction, and margin per unit. This increases defensibility (traceable inputs), executability (clear operational levers), and risk control (sensitivities focus on the few drivers that matter most). Importantly, these drivers create a direct line of sight to benefits realisation: each assumed improvement maps to a defined benefit with an owner, baseline, target, and measurement method. Those same drivers then anchor the KPI scorecard, balancing lag indicators (e.g., revenue, EBITDA) with leading indicators (e.g., adoption, throughput, quality, customer outcomes) that predict whether benefits will be delivered on time and in full.


​​​​​​​For additional information:

- Our Business Case Masterclass—Workshop 2 on Financial Analysis in Business Cases—is a deep dive into building CFO- and Board-ready financial models.

- My Business Case Hub® provides access to the Business Case Course, which includes step-by-step guidance on how to build the financial model for business cases (including Top-Down and Bottom-Up triangulation).