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Top 8 Reasons Why Feasibility Analysis is Essential for Any Project

A feasibility analysis can help assess whether a suggested project is within reach or not, in terms of funding availability, marketability of the project, profitability, and the availability of the resources that matter.

To increase the chances of success, project managers should avoid commencing a project before studying its feasibility.

Feasibility study billboard.

A thorough feasibility study should convince stakeholders to invest in a project because it reveals all the legal, technical, and economic requirements.

Stakeholders will only turn down an unprofitable or non-doable project after a thorough look into its feasibility.

Types of Feasibility Analysis All Project Managers Should Know

The best feasibility analysis should mention all the strengths and weaknesses of a project. All investors must consider the following factors before funding a project;

1.  Planning Feasibility.

Seek to know how much time it will take to complete a project successfully. And then use feasibility analysis during the planning process to tell if a project it will finish in the perceived time.

A project that does not have this type of analysis is vulnerable to delays or budget overrun.

1. Permissible (Legal) Feasibility. 

Permissible feasibility assesses whether the advocated project meets all the legal approvals before initiation.

If, for instance, you wanted to construct rental houses, it is a must-do to check whether the suggested location abides by the zoning laws.

1. Economic Feasibility. 

Economic feasibility is a critical factor to consider when analyzing the possibility of a project’s success. It helps in the approximating the total costs and benefits that a proposed project will accrue before designating resources.

1.  Technical Feasibility. 

This type of feasibility constitutes the technological resources a project needs and the ability of the team members to apply their ideas into workable solutions. Consider assembling robust technical resources as well as qualified team members who can generate and evaluate ideas.

1.  Ethical Feasibility. 

Some projects are very rewarding but culturally unacceptable. Before you start a project, find out its effect on the users or the environment and how the people will perceive it. You must aim at getting maximum profit, and that’s not possible without customers.

1.  Operational Feasibility Study. 

Studying the operational feasibility of a project means the ability to fulfill the objectives of a project by utilizing the allocated resources appropriately. It helps to identify possible project problems and how to fix them.

 Eight Reasons Why Feasibility Study Is a Very Important Element in the Management of Projects

Analyzing the feasibility of a project is important since it reveals the project’s variables and if a project is practical. Here below are eight points explaining the essentiality of feasibility analysis.

1. Help in Spotting and Preventing Risks in A Project. 

Doing a feasibility study before the initiation of a project help project managers to assess potential risks that may arise. With these predicted risks at hand, it is easier to find ways of approaching or stopping them before they become a bigger problem.

1.  Help Identify Internal & External Constraints of a Project. 

There are a lot of difficulties involved during the consideration of the possibility of project success. Some of these difficulties are; shortage of resources, low-level technology, under/over budgeting, illegal schemes, and lack of marketing strategies.

A feasibility analysis can help identifies such problems in advance. If the constraints of a project are explicit, it is not reasonable to implement an unprofitable plan.

1.  enhances the Focus of the Project Team Members.

Conducting a viability study gives the team members a clear picture of the suggested plan. When the team members are confident that a project is doable and the objectives are clear, they get motivated and work hard to attain the project goals.

1. Improves the Decision Making Process in a Project. 

Studying the feasibility of projects provides project managers and the relevant stakeholders with more information thus facilitating informed decisions. With a good analytical study, making decisions on matters like; shortage of resources, technological support, finance sources, or inadequate time won’t be a problem.

These different types of feasibilities help PMs understand what they need to increase the likelihood of project success. After carefully analyzing these feasibilities, it becomes easier to decide on what’s best because you have evidence.

1.  Tells When to Proceed or Not with a Project. 

Skipping project preliminaries like a feasibility study is very dangerous. Studying the feasibility of a project determines if a plan is within reach or not since it will give you all the odds of performing the project. No sane entrepreneur or company will throw their resources in an undoable project.

Some projects are feasible, but their timing is not appropriate. In such cases, the project manager and business executives might decide to hold the idea until the right time comes.

1.  It Exposes a Plan to New Opportunities and Ideas. 

You’ll almost certainly come up with new ideas and opportunities during the feasibility examination process.

Some of the opportunities are the identification of better marketing strategies, technicality possibilities, and ways of finishing the project in time.

1. Increases the Chances of Success. 

Through a feasibility study, you can predict all the variables that may befall a project. Getting to know these factors before performing the project will help you strategize how to counter them. For PMs, studying the feasibility of your project increases the chances of leading it to completion.

1.  Addresses Potential Complications.

Analyzing the feasibility of projects points out all the possible problems that may affect the success of the proposed plan. After speculating these risk factors, the PM finds a way to tackle them before starting the project.

Risks are spontaneous events that may arise and affect the progress of work in a project. Most projects managers work to spot and mitigate risks in their formulation stage. Still, various forms of risks can arise in the course of project activities.

Identifying and tackling financial risks is a hard nut to crack for many project administrators. Money matters can make or break a venture because risks tied to finances can lead to delays and even bring project activities to a halt.

When taking on any activity that involve finances, it is important to evaluate scenarios that could be compromised.

It is normal to hope for the best, but it is imperative to prepare for the worst-case scenario. This way, it is possible to plan and manage anything that comes your way.

 Blunders to Avoid in Your Feasibility Studies. </h2>

The feasibility study precedes a project which explains why you must spend quality time conducting one.

Components of feasibility study.

A feasibility study plays a critical role in assessing a plan freely, conducting a thorough look into the expectations behind it, re-analyzing its risk profile as well as likelihood of success.

That being said, here are the most common feasibility blunders to avoid.

• Not doing a feasibility Study. 

Diving into a project without a feasibility analysis is a big mistake. Don’t be in a hurry to begin a project before assessing its plan, conducting a thorough look into the expectations behind it, re-analyzing its risk profile and its likelihood of success.

The truth is; failure is costlier than a feasibility study so you have no business skipping this important step that could shed useful light into your project.

•  Doing it alone. 

Don’t go solo; invite the experts who know the real risks, expenses and facts about the planned activities.

As a project manager, you may know a lot of stuff but can never be a master of all. The key is to work with the professionals in the various activities that make up your project to get the real picture.

Doing a feasibility study alone seems economical until you meet unexpected risks that threaten to bring down your project.

•  A wrong or incomplete Project Definition. 

The goal of a feasibility study gives a clearer view of the future because it provides conclusive answers to specific questions.

“Is the space enough for a Hospital” is a good place to star but it ISN’T precise enough to be the topic of in feasibility study.

The statement may need further detail like the size of the hospital, type of healthcare facility.

For instance; “Is the space enough for a 100 bed (20,000 to 50,000 square foot) quarantine and coronavirus treatment facility?”

• Rushing things Up. 

Moving too fast is not safe approach. A feasibility study seeks to analyze even the most trivial of facts.

If you are going to analyze the practicality of your idea then you have to pay attention to every detail. Remember, you can only get things underway after you have completed the feasibility study.
Do not succumb to the pressure from a client. If possible, stress on the importance of conducting a feasibility analysis before launching a project

Finally,

Do not fall for a venture that seems too smooth to be true. If your feasibility study doesn’t expose any risks and dangers then you might have missed on a few important factors.