Reasons to Use a Feasibility Study in Project Management

Reasons to Use a Feasibility Study in Project Management

There are several reasons to conduct a feasibility study in Dubai. For example, a major hospital might want to add a new building to its campus. In determining the costs of a project, a feasibility study looks at the potential need and revenue streams. Then, a program plan is created to explore the options for financing the project. Then, a financial forecast is completed, and an economic impact analysis is done.

Helps in the planning process:

Besides providing an accurate idea of the project’s scope, a feasibility study helps in the planning process. It is better to do this than rushing into the project and having to change your plans. The feasibility study results are useful for making preliminary decisions and preparing the income statement and balance sheet forecast for the project. In addition, it helps in planning the business. Once you know the market demand, the plan is more viable.

Help right-size visions:

In project management, feasibility studies help right-size visions. They can identify the components of the project that aren’t feasible. They also indicate whether or not the project should be delayed until it has favorable conditions. For a successful feasibility study, you should involve other departments, team members, and customers. The results of the study should include budget calculations and sales projections. The study should also address questions about resources, budget, and other financial details.

It helps adjust the scope of a project and its risks:

The feasibility study is not black and white and isn’t always a green-lighting process. This process aims to adjust the scope of a project and its risks. It may also address budgeting, scheduling, and risk issues. A feasibility study is the most important step in project management because it gives you valuable information about the project. It can guide you in executing the project with more confidence and certainty.

Help you make better decisions:

A feasibility study can help you make better decisions on which feasible projects. Often, a project that proves profitable can eat up valuable resources in other areas, such as the company’s cash flow. Similarly, a project that is a success for everyone involved. However, it may cost the organization money and ultimately will not be profitable. Consequently, it’s important to do a feasibility study.

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