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Who said you had to rush the initiation phase of your project? You’d be much better off if you took the time to conduct a proper project feasibility study before getting your engine running.
Indeed, this crucial step will reveal whether your project could really be successful and if your efforts will ever lead to tangible, positive results. This insight could not be more valuable when deciding between kickstarting your project or shelving it.
However, many project managers are put off by the apparent complexity of evaluating the feasibility of their project. But don’t let the initial impression fool you: being rigorous and following the proper method is more than enough to complete this task.
You can even cheat a little, with our free Excel template: this file and our foolproof 6-step method will guide you throughout the feasibility study.
But let’s start with the basics first, shall we?
The feasibility study is conducted during the first phase of the project life cycle. This process aims at determining whether the project is viable (or doable), based on the analysis of its different aspects, including:
As always in the field of project management, these perspectives are to be analysed in view of the delays, quality and deliverables expected for the project.
This study should include the objectives of the project and its timeline. This ensures it can later be used as a basis for the project manager during the next step, mostly throughout the project planning phase.
Both documents address important aspects of the project. However, they do so from different perspectives.
Regardless of the nature of your project (creating your own company, launching a new product, building a house…), there are many advantages to conducting a feasibility study. This study assesses the practicality of a proposed project, and can help you:
The study should give you an overview of the technical, organisational and economic feasibility of your project. If it is not profitable, evaluate different options or revise your strategy before carrying out the next phase. If nothing seems realistically achievable, consider postponing or scrapping the idea altogether.
Carrying out a feasibility study generally implies producing a thorough report. But some elements can be summarised via a simple table or organised on a spreadsheet.
Our free project feasibility template will help you get started. This simple Excel file can be customised to suit the specific needs of your project using any spreadsheet software (Microsoft Excel, Google Sheets…).
Project Feasibility Study Excel Template
DownloadThe feasibility study will bear its fruits only if the final objectives of the project are designed to bring concrete benefits to the company. Setting clear goals will enable you to make the inventory of the means and resources to employ to reach your target.
💡 To help you define meaningful objectives, use the SMART method. An objective should be:
As much as the success of your project may depend on the internal resources and strengths of your company, no project is free of external influences. Positive or negative externalities can affect the course of your project:
💡 Use the PESTEL analysis to help you navigate these external factors, including:
Getting a clear picture of the environment of your project will help you evaluate and anticipate risks, but also seize opportunities along the way.
What will your project require to succeed? You should list all the needs, among which:
After listing all the requirements, associate them with their cost based on data analysis. This will give you reliable estimates for your provisional budget and a way to map out cash flows.
What would be the use of putting your efforts into a project that doesn’t generate sufficient returns, or is a source of losses? This concern is why the feasibility study contains a cost/benefit analysis, designed to evaluate the Return on Investment (ROI).
By estimating the budget and identifying future business opportunities, you can determine whether the project will generate revenue, and if so, how long it will take. This could take months or even years in the case of very long-term oriented endeavours. Therefore, you need to make sure that your business can keep operating until the project becomes a source of cash.
💡 Depending on the nature of your project, and especially if it’s a complex enterprise, we advise you to proceed in two steps:
To account for the different ways the execution of your project could play out, you should define three possible scenarios:
Each should provide returns, even the last!
These scenarios should be as detailed as possible, and each could include:
💡 You may find the SWOT matrix helpful when developing your scenarios. It regroups your strengths and weaknesses, as well as each opportunity and threat.
Once you have defined all these key elements and weighed the advantages and disadvantages of possible scenarios, you may choose the ideal path to completing your project. You can then proceed to the next phase with confidence and execute your vision.
☝️Don’t discard the other scenarios! They could come in handy if you need to adapt your progress to unforeseen circumstances or external changes.
The feasibility study is essential to all kinds of projects. With this guide and our Excel template, you should be able to improve your chances of achieving success! Preparation is key, and this assessment of the practicality of your goals ensures no time and resources are wasted on fruitless efforts.
Be sure to analyse future projects from all angles, assess your strengths and weaknesses and create scenarios to help you make the best decisions. Come prepared and you’ll be able to respond to change more efficiently!