Everything about Feasibility Study totally explained
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What is Feasibility Study
A feasibility study is a preliminary study undertaken to determine and document a project's viability. The term
feasibility study is also used to refer to the resulting document. The results of this study are used to make a decision whether or not to proceed with the project. If it indeed leads to a project being approved, it'll — before the real work of the proposed
project starts — be used to ascertain the likelihood of the project's success. It is an analysis of possible alternative solutions to a
problem and a recommendation on the best
alternative. It, for example, can decide whether an order processing be carried out by a new system more efficiently than the previous one.
Importance of Project Feasibility Study
It is estimated that only one in fifty business ideas are actually commercially viable. Therefore a Business Feasibility Study is an effective way to safeguard against wastage of further investment or resources If a project is seen to be feasible from the results of the study, the next logical step is to proceed with the full Business Plan. The research and information uncovered in the feasibility study will support the business planning stage and reduce the research time. Hence, the cost of the Business Plan will also be reduced. A thorough viability analysis provides an abundance of information that's also necessary for the Business Plan. For example, a good market analysis is necessary in order to determine the business concept's feasibility. This information provides the basis for the market section of the Business Plan
Finally, a feasibility study should contain clear supporting evidence for its recommendations. The strength of the recommendations can be weighed against the study ability to demonstrate the continuity that exists between the research analysis and the proposed business model. Recommendations will be reliant on a mix of numerical data with qualitative, experience-based documentation. A Business Feasibility Study is heavily dependent on the market research and analysis. Afeasibilitystudy provides the stake holders with varying degrees of evidence that a Business Concept will in fact be viable.
DIMENSIONS OF BUSINESS VIABILITY
The Business Feasibility Study findings will be assessed by potential investors and stakeholders regarding their credibility and depth of argument. The Business Feasibility Study places the findings of the Dimensions of Business Viability Model assessment into a formal business report. It also aligns the findings with functional processes of an enterprise which an audience can easily understand (Thompson 2003a).
Technical feasibility study
This involves questions such as whether the technology needed for the system exists, how difficult it'll be to build, and whether the firm has enough experience using that technology. The assessment is based on an outline design of system requirements in terms of Input, Processes, Output, Fields, Programs, and Procedures. This can be qualified in terms of volumes of data, trends, frequency of updating, and other areas in order to give an introduction to the technical system.
Schedule Feasibility study
This involves questions such as how much time is available to build the new system, when it can be built, whether it interferes with normal business operations, type and amount of resources required, dependencies, etc. Contingency and mitigation plans should also be stated here so that if the project does over run the company is ready for this eventuality.
Cultural Feasibility study
In this stage, the project's alternatives are evaluated for their impact on the local and general culture. For example, environmental factors need to be considered.
Legal Feasibility study
Not necessarily last, but all projects must face legal scrutiny. When an organization has either internal or external legal counsel, such reviews are typically standard. However, a project may face legal issues after completion.
Marketing Feasibility study
This will include analysis of single and multi-dimensional market forces that could affect the commercial, along with the company that's carrying out the feasibility achieving more and more reputation as they've carried out safety checks which allow the system to run appropriately.
- Economic feasibility – Establishing the cost-effectiveness of the proposed system for example if the benefits don't outweigh the costs then it isn't worth going ahead.
Legal feasibility – Determines whether the proposed system conflicts with legal requirements, for example the Data Protection Act.it willbe done by some legal advisiors
Operational feasibility – Do the current work practices and procedures support a new system. Also social factors for example how the organisational changes will affect the working lives of those affected by the system.
Schedule feasibility – Looks at how long the system will take to develop, or whether it can be completed in a given time period using some methods like payback period.Further Information
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