A
feasibility study is an evaluation of a proposal designed to determine the difficulty in carrying out a
designated task. Generally, a feasibility study precedes technical development
and project implementation. In other words, a feasibility study is an evaluation or analysis of the potential
impact of a proposed project.
Definition of Feasibility Studies: A feasibility study looks at the viability of an idea with an emphasis on
identifying potential problems and attempts to answer one main question: Will the idea work and should
you proceed with it?
[edit]Five common factors (TELOS)
[edit]Technology and system feasibility
The assessment is based on an outline design of system requirements in terms of Input, Processes,
Output, Fields, Programs, and Procedures. This can be quantified in terms of volumes of data, trends,
frequency of updating, etc. in order to estimate whether the new system will perform adequately or not.
Technological feasibility is carried out to determine whether the company has the capability, in terms of
software, hardware, personnel and expertise, to handle the completion of the project
[edit]Economic feasibility
Economic analysis is the most frequently used method for evaluating the effectiveness of a new system.
More commonly known ascost/benefit analysis, the procedure is to determine the benefits and savings
that are expected from a candidate system and compare them with costs. If benefits outweigh costs, then
the decision is made to design and implement the system. An entrepreneur must accurately weigh the
cost versus benefits before taking an action.
Cost-based study: It is important to identify cost and benefit factors, which can be categorized as follows:
1. Development costs; and 2. Operating costs. This is an analysis of the costs to be incurred in the
system and the benefits derivable out of the system.
Time-based study: This is an analysis of the time required to achieve a return on investments. The future
value of a project is also a factor.
[edit]Legal feasibility
Determines whether the proposed system conflicts with legal requirements, e.g. a data processing system
must comply with the local Data Protection Acts.
[edit]Operational feasibility
Operational feasibility is a measure of how well a proposed system solves the problems, and takes
advantage of the opportunities identified during scope definition and how it satisfies the requirements
identified in the requirements analysis phase of system development. [1]
[edit]Schedule feasibility
A project will fail if it takes too long to be completed before it is useful. Typically this means estimating
how long the system will take to develop, and if it can be completed in a given time period using some
methods like payback period. Schedule feasibility is a measure of how reasonable the project timetable is.
Given our technical expertise, are the project deadlines reasonable? Some projects are initiated with
specific deadlines. You need to determine whether the deadlines are mandatory or desirable.
[edit]Other feasibility factors
[edit]Market and real estate feasibility
Market Feasibility Study typically involves testing geographic locations for a real estate development
project, and usually involves parcels of real estate land. Developers often conduct market studies to
determine the best location within a jurisdiction, and to test alternative land uses for given parcels.
Jurisdictions often require developers to complete feasibility studies before they will approve a permit
application for retail, commercial, industrial, manufacturing, housing, office or mixed-use project. Market
Feasibility takes into account the importance of the business in the selected area.
[edit]Resource feasibility
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,
[edit]Cultural feasibility
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 and these factors are to be well known. Further an
enterprise's own culture can clash with the results of the project.
[edit]Output
The feasibility study outputs the feasibility study report, a report detailing the evaluation criteria, the
study findings, and the recommendations.[2]
[edit]See also
Mining feasibility study
Proof of concept
SWOT analysis
[edit]References
1. ^ Bentley, L & Whitten, J (2007). System Analysis & Design for the Global Enterprise. 7th ed. (p. 417).
2. ^ Michele Berrie (September 2008), Initiating Phase - Feasibility Study Request and Report
Matson, James. "Cooperative Feasibility Study Guide" United States Department of Agriculture.
Rural Business–Cooperative Service. October 2000.
[edit]External links
The Wikibook Professional
and Technical Writing has a
page on the topic of
Feasibility studies
Hoagland & Williamson 2000
United Nations Industrial Development Organization (UNIDO)
UNIDO Manual for the Preparation of Industrial Feasibility Studies
Matson
Allan Thompson 2003
Westar Trade Resources
Categories: Business process | Evaluation methods
