Feasibility Studies

Feasibility studies generalll examine each possible solution option in terms of the following four feasibility criteria:

• technical feasibility
• economic feasibility
• schedule feasibility
• operational feasibility

Technical Feasibility

• concerned with the availbility of the required information technology, its ability to operate with other technology and the technical expertise of participants and users to effectively use the new technology.
• few people will be trained in the use of the application. this means it will be difficult to replace trained personnel during teh system's future operations.

Questions used to determine a solution include:

• Do we currently possess the necessary technology?
• Is the technology readily available?
• How widely used is this technology?
• Are existing users of the technology happy with its quality and performance?
• Will the technology continue to be upgraded and supported in the future?

Will the new technology operate with other existing and possible future new or emerging technologies?

Economic Feasibility

• the economic feasibility of eachs olution is determined by performing a "cost-benefit anlysis".
• this involves calculation all the costs involved in the development and implementation of each solution option.
• there are various factors that contribute to the economic feasibility of a solution and should be considered as part of a cost-benefit analysis.

           - Development costs:

• cost f development team
• system analyst and other consultancy fees
• software costs to purchase or build the software.
• hardware costs to purchase, lease and/or assemble the hardware.
• Infrastructure costs such as new buildings, communication links and power.
• installation of the syste,
• training particpation and users
• converting from the old system to the system.

           - Ongoing Operational Costs

• hardware maintenance and repair costs
• software licences and upgrade
• maintenance of teh infrastructure that supports the system
• salary/ wages for participants
• support costs for users, including ongoing training
• consumables such as toner catridges and paper.

           - Tangible Benefits

• increased sales
• cost reductions
• increased efficiency
• increased profit on sales
• more effective use of staff time

           - Intangible Benefits

• increased flexibility of the system
• higher quality products or services
• improved customer satisfaction
• better staff morale

Issues to consider during a cost-benefit analysis:

• Compares all costs with all the benefits in an attempt to determine the total return on the money invested into the new system
• Aims to determine the real benefits of each solution option. Techniques used are similar to those used by economists to analyse investment
• Issues to consider in this process include:
• Money spent on the new system could have been invested elsewhere; hence the benefits of the new system must also exceed the benefits that would have been realised without the new system. Net Present Value (NPV) requires to be determines, a positive NPV indicates a good investment and the largest NPV indicates the best investment. Negative NPV values indicate investments that should not be developed further.
• Comparing the percentage profitability of each solution option rather than just the absolute profit. This is known as return on investment (ROI) analysis. ROI describes the percentage increase of an investment over time.
• Break-even point – refers to the point in time where the new system has been paid for and it begins to make a profit. The period of time prior to the break even point is called the payback period.
• Solutions with a high NPV, high ROI and shot payback period will be the most economically feasibly.
• All these measure are based on future predictions, therefore they can not be determined with complete accuracy.
• As each client will have different needs this will affect the relative importance of each measure when determining the economic feasibility of solutions to particular problems.

Schedule Feasibility

• Largely about whether the solution can be completed on time
• The project plan and in particular the Gantt chart will specify the deadlines for the completion of each development task.
• It aims go determine if such deadlines can be met
• It should also examine the consequences should some tasks and even the entire project fail to meet its specified deadlines.
  
  Questions used to determine a solution include:
• How long will it take to obtain the required information technology?
• If new personnel need to be employed then how long will that take/
• How long will it take to retrain existing team members?
• Will retraining affect the ability of staff to complete existing tasks on time?
• Are the deadlines mandatory or are the desirable?
• If the project runs over time what are the consequences?
• Is it possible to install an incomplete solution should deadlines not be met?
• How can development of the solution be monitored to verify deadlines are indeed being met?

Operational Feasibility:

• Aims to evaluate whether each solution option will work in practice rather than whether it can just work.
• Considers support for the new system from management and existing employees.
• Solution option is likely to be operationally feasible if it meets the needs of the participants and users of the system.
  
  Questions used to determine a solution include:
• Do existing staff support the solutions option?
• Do management support the solution option?
• Does the nature of the solution “fit in” or conflict with the nature of the other systems that will remain in place?
• Will the nature of work change for participant?
• Are participants open to change or resistant to change?
• How do the end-users feel about the delivery information from the new system?
• Do participants already possess the technical skills to use the technology?
• Is the training and support available and will it remain available?

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