Feasibility Report & Its Importance

What is feasibility report?

Feasibility report is the analysis carried out to decide on the viability of a proposed venture; basically it answers the essential question of ‘is it a viable option and should the project be implemented’. All stages of feasibility report analysis are carried out in order to answer this question.

Conducting feasibility report is quiet common for all large successful businesses to ensure they embark on a viable project, for example Microsoft have a large research department situated in many different cities throughout the globe, this department collaborates with many institutions producing many feasibility analyses a year. When examining successful businesses such as Microsoft, I discovered they will not commit to a new project without first thoroughly assessing all of the variables and reviewing the probability of success through a feasibility study.

Process of feasibility analysis...

Feasibility analysis is always time consuming and hence also tends out to be an expensive affair. Many companies pay consultants to perform analysis for their companies.

A preliminary study is always undertaken to determine if it would be worthwhile to proceed to the feasibility analysis, within this preliminary study the evaluation of alternatives is made along with brief cost and benefit analysis. A feasibility study is usually conducted after the project managers have discussed all project ideas and every possible scenario, only if the results are positive the feasibility study begins.

How does it work?

Operational factors; Operational feasibility is used to assess how well the information systems will work if implemented in the given environment.

• Define the urgency of the project
• If the project is implemented, will it be a success?
• Does management support the project?
• How do end users feel about the new system?
• People tend to resist change - can this problem be overcome?
• Can management and end users adapt to the change?

Has the proposed venture conflicted with organisational or government regulations?

Schedule factors:

• It often takes time to build and implement an information system solution; will the project still be necessary on completion?
• The technology may exist, but are there the skills available to not only complete the project but complete it on schedule?
• Is the project deadline reasonable?
• Is the deadline desirable or mandatory? What are the results of failing to meet the project deadline?

Technical; Technical feasibility is the measure of the practicality of specific technical information system solutions and the availability of technical resources. Often new technologies are solutions looking for a problem to solve:

Is the technology for the information system solution practical?

• Does the necessary technology exist?
• Is the technology proven?
• Is the technology practical and reliable?
• Are the necessary skills available to design and implement the system?
• Is there the infrastructure to cope with ongoing maintenance (problems, upgrades)

Economic; this is regularly the most important analysis made, it asks important questions;

• Is the project justified (i.e. will benefits outweigh costs)?
• Can the project be done, within given cost constraints?
• What is the minimal cost to attain a certain system?
• Which alternative offers the best return on investment?
• How much will it cost to maintain?