A feasibility study is a key part of project management as it creates a foundation for which your project plan begins. The feasibility of a project determines the actual viability of your proposed project and so may in fact be the most important part of any project.

What is the definition of a feasibility study?

Simply, a feasibility study is defined by projectmanager.com as an assessment of the practicality of a proposed project plan”. This involves a variety of activities including analysis of technical, economic, legal, operational and time feasibility factors. 

A feasibility study should be carried out as soon as the business plan has been created to ensure that the proposed idea is actually viable to commence.

What should a feasibility study be used for?

The GOV.UK website states that a feasibility study should be used after the development of your initial project plan to identify any issues with your project before a full-scale evaluation takes place. It will also offer you the opportunity to refine the design of your project and test the practicalities of actually carrying it out. 

A feasibility study should be undertaken in the very early stages of a project and tend to be carried out when a project is particularly large or complex. 

Although this will require extra time and effort on your behalf, it will make the rest of your project run much more smoothly and so is an essential part of any large construction project.

Why should I conduct a feasibility study?

Carrying out a feasibility study can:

• Establish whether a project is viable or not 
• Identify feasible options
• Assist in the overall development of your project in terms of business case, execution plan and strategy.

What issues should be considered in my feasibility study?

DesignBuildings.co.uk provide an extensive list of the different issues which should be considered when carrying out a feasibility study, below are just some of the things you should consider: 

• Planning permissions
• Environmental impact assessments
• Budget analysis
• Site assessment 
• Assessment of operational and maintenance issues
• Servicing strategies
• Procurement options

What do I need to conduct my feasibility study?

1. Conduct a preliminary analysis involving getting feedback about the concept from your stakeholders
2. Ask questions about the data collected to ensure it is solid
3. Conduct market research to ensure there is a demand in your market and a real opportunity to pursue the project
4. Write out a business plan
5. Prepare a projected income statement (revenue, operating cost and profits)
6. Identify any potential challenges and vulnerabilities of the project and come up with solutions

What should be included in my feasibility study?

A feasibility study will be compiled into a report which should contain the following: 

1. Executive summary
2. Description of product or service
3. Technology considerations
4. Product or service marketplace
5. Market strategy
6. Organisation and staffing
7. Schedule
8. Financial projections
9. Findings 
10. Recommendations

What types of feasibility study are there?

Technical feasibility: 

Determine if you have the technical resources required to meet the demands of the project. You should ensure you have the right resources, equipment, and team for your proposed project.

Economic feasibility: 

Assess the economic factors of your project using a cost-benefit analysis. This will help decision-makers by providing a list of economic benefits to the organisation.

Legal feasibility: 

Does your project meet the legal requirements for your country? Zoning laws for example must be examined to ensure that the law will permit all elements of your project and achieve planning permission.

Operational feasibility: 

How well does the plan match the capacity of your organisation in terms of resources, goals and business objectives. This analysis will determine the level of involvement required from managers, identify how stakeholders feel about the current system in place and uncover the true benefit of the project to your organisation.

Time feasibility:

 Create a schedule for your project ensuring to implement deadlines. This ensures that your team know how much time is required for each task and keeps everyone on track to meet the completion date.

What is the bottom line of conducting a feasibility study?

In short, a feasibility study can ensure project managers are aware of the viability of a project, as well as carve out the factors which will lead to the success of any large construction project. These types of studies provide the potential return of a project and start the beginning of a full risk assessment, which will be required for your project. 

The report created will contain detailed analysis of the plan for your project and show important financial projections. 

What are the benefits of a feasibility study?

As discussed, feasibility studies are extremely important for undertaking a large construction project. Not only will it outline the project, but it will also put investors and stakeholders at ease knowing that the project has been fully thought out and researched.

Other benefits of this type of study include: 

• Identify valid reasons to advance with a project
• Create focus for your project team
• Provide useful information for your project manager 
• Create a good list of business alternatives 
• Evaluate the resources and technology needed for your project
• Enhance the success of your project by assessing all variables 
• Accurately determine your return on investment 

At AJH Consulting Services we can provide practical advice and support throughout a project life cycle, delivering bespoke estimating, commercial, planning and ADR services. Read more about our pre-tender and estimation services here.