A feasibility study is a study carried out by a company to determine the possibility of being able to develop a business or a project that it hopes to implement.
However, this type of study allows the company to know whether the business or project it hopes to undertake is likely to be favourable or unfavourable to it. It also helps to establish the kind of strategies that can help it to achieve success.
In other words, in a few words, the feasibility study allows us to know if the business or project can be done or not, what are the ideal conditions to carry it out and how it could solve the difficulties that may arise.
Types of feasibility
In doing a proper feasibility study, the following types of feasibility should be considered:
On the one hand, operational feasibility is related to the personnel who have to carry out the project. Therefore, it is analysed whether the staff has the necessary labour competences to develop and carry out the project.
Above all, the operational feasibility depends on the human resources that are part of the organisation. Since they are the ones who must carry out all the activities in the different processes of the system in order to meet the proposed objectives. Clearly, it must be assessed whether they have the necessary requirements to carry out the project successfully.
Indeed, when developing a project or business, a system has to be implemented. In any new system that is implemented, the following must be considered:
- If it is not too complicated for the workers who are going to operate on it.
- Observe whether workers are reluctant to use it out of fear or for any other reason.
- Analyse whether staff can adapt to change, especially if change occurs very quickly.
- Assess whether it is not likely to become obsolete too quickly and look for contingency plans.
In the same way, this aspect evaluates whether the technical infrastructure that the company possesses can respond in a favourable and efficient way to develop the project or business that has been planned. It is also necessary to verify whether people have the necessary technical knowledge to be able to use the necessary equipment and software.
In terms of economic feasibility, a thorough cost-benefit analysis of the business or project should be carried out and both aspects should be weighed up. If the assessment shows that the costs outweigh the benefits, it would be better not to develop the project. On the other hand, if the benefits outweigh the costs, the decision to implement the project becomes less risky, although it does not imply that there are no risks involved.
Now, on the commercial side, it is determined whether there is a potential possibility that there will be an adequate number of customers. These customers must be willing to consume or use the products that the business or project will be able to offer to the market.
In addition, the distribution and marketing logistics are assessed to see if they meet the needs of the market.
Political and legal feasibility
Of course, in this part it is verified whether the type of business or project to be developed does not violate or infringe any law or regulation of a municipal, state or global nature. Otherwise it cannot be implemented because it will be against the legal provisions and therefore not viable.
Finally, the time feasibility allows us to know if the time planned to carry out the project coincides with the real time needed to implement it.
In conclusion, it can be said that a feasibility study is important before a company launches a new business or project. Because it allows us to know if it is possible to carry it out or not. Additionally, it allows us to know what difficulties may arise and how they can be overcome. Finally, it allows us to visualise the ideal conditions for a successful realisation.