INTRODUCTION - FEASIBILITY STUDY GUIDE

A feasibility report is a paper that examines a proposed solution and evaluates whether it is
possible, given certain constraints. It includes six sections: introduction, background information,
requirements, evaluation, conclusions, and finally, the recommendation or final opinion section.

How to write or start a Feasibility Study step by step

1. Step One: Conduct a Preliminary Analysis. ...
2. Step Two: Prepare a Projected Income Statement. ...
3. Step Three: Conduct a Market Survey. ...
4. Step Four: Plan Business Organization and Operations. ...
5. Step Five: Prepare an Opening Day Balance Sheet. ...
6. Step Six: Review and Analyze All Data.
Before committing time, energy, and resources to a new project, Project
Managers and executives want to know: Can this project succeed? And even if the
project is successful, will the outcomes justify the cost and effort it took to achieve
them? These questions, and ultimately the fate of the project, can be determined
through a feasibility study.

So, what is a feasibility study? In this article, we’re answering that question, and
we’re also examining how to do a feasibility study to help you and your management
team make better-informed decisions regarding which projects get funded and which
get tabled or scrapped altogether.

A Feasibility Study analyzes the practicality of a proposed project and assesses

how likely the project is to succeed. Typically, feasibility studies are prepared for
executives who will decide whether to greenlight the project based on the feasibility
analysis. Feasibility studies identify key project goals and relevant factors, examine the
market research, and detail the resources and budget needed to successfully execute
the project.

A legal feasibility study examines whether a project conforms with relevant business
licenses, certificates, copyrights, insurance policies, and other legal and ethical standards.
Conducting this analysis facilitates risk management and helps avoid major legal issues during
project development and implementation.

The seven feasibility study steps

Feasibility studies should include the following steps:

1. Preliminary analysis
Just as the feasibility study determines whether a proposed project is worth the effort,
the preliminary analysis determines whether the feasibility study itself is justified. The
fact is that conducting a feasibility study is an intensive, time-consuming process, and
the preliminary analysis will look to uncover any roadblocks that would render the
feasibility study useless.
2. Defining the scope
Before you can determine the potential impact of a project, you have to get clear on
the project’s scope. This includes defining the project’s goals, tasks, phases, costs,
deliverables, and deadlines. The project scope also identifies internal stakeholders as
well as external clients and customers.
3. Market research
Is there a demand for this particular venture in the market it seeks to serve? This is
critical information to know before committing to a project, and it’s precisely what market
research seeks to answer. Market research also gives insight into the current
competitive landscape and helps identify factors like geographic influence on the
market, the market’s overall value, and demographics.
4. Financial assessment
Naturally, the feasibility study will break down and analyze the financial costs and risks
involved with the project. Costs may include human resources, equipment, material,
software, hardware, facilities, and third-party services. Additionally, the financial
assessment will look at the potential impact that project failure will have on the bottom
line.
5. Roadblocks and alternative solutions
What are the potential problems and circumstances that could lead to project delays or
even failure? What are some alternative solutions that would circumvent those
problems? Most feasibility studies will include an assessment of these factors, too.
6. Reassessment
At this step, you should seek a reassessment of the entire feasibility study from top to
bottom by a fellow PM, a manager, or someone else in your organization. Having a
fresh set of eyes on the study will help ensure you don’t miss any key elements or
miscalculate potential project impacts.
7. Go or no-go decision
When it’s all said and done, the feasibility study comes down to one decision: Is the
project approved to move forward or not?

Feasibility study examples

While conducting a feasibility study may sound complicated, there are actually
thousands of real-world examples happening all around you all the time. It helps to
understand the different kinds of feasibility studies first, which include:

 Technical feasibility: Whether you have the technology and knowledge of how to use
it to complete your project.
 Legal feasibility: Whether your project meets all necessary legal requirements.
 Operational feasibility: Whether your project can be carried out according to your
organization's capacity, resources, and operational processes.
 Time feasibility: Whether your project timeline fits with the rest of your organization's
schedules.

Any and all of these feasibility studies can be found in real-world examples. Consider
the following:

 A busy father is running errands and figures out whether he can complete the weekly
grocery shop in between dropping his son off for chess practice and picking his
daughter up from a party. He has just conducted a time feasibility analysis.
 A teenager is choosing a new phone to buy, and researches which model will be the
most compatible with his most-used apps and platform. He has just conducted a
technical feasibility analysis.

The amount of detail included in your feasibility analysis depends on your

organization and your chosen project. To make the most of your next feasibility
analysis, let's take a look at some best practices.

What are the best practices of a feasibility analysis?

In order to make sure you get the most from your feasibility study, there are a few
best practices you can follow. For instance, soliciting feedback from seasoned
colleagues or managers can give you insight into the factors you have listed, and help
you fill in elements you hadn’t considered. Additionally, you’ll want to verify the data and
intel you’ve collected to make sure it’s accurate.

Another best practice is to follow a feasibility analysis template so that you don’t
have to reinvent the wheel with each project. If your organization conducts projects
regularly, then you can probably access a feasibility study example or template to work
from.
 What should be included in a feasibility report?

After conducting the necessary research, performing your due diligence, and compiling
all the data, it’s time to put together the feasibility report. The core elements of this
analysis may vary slightly depending on the type of project you’re undertaking, but
they’ll generally include:

 The executive summary

 Technological considerations and requirements
 Existing marketplace assessment
 Marketing strategy
 Resources and staffing
 Project timeline and schedule
 Financials
 Findings and recommendations

There are five types of feasibility study—separate areas that a feasibility study
examines, described below.
 Technical Feasibility. This assessment focuses on the technical resources available to
the organization. ...
 Economic Feasibility. ...
 Legal Feasibility. ...
 Operational Feasibility. ...
 Scheduling Feasibility.

Example of a Feasibility Study : Adding a New Product or New product development

Before investing in new product development, they conduct a feasibility study to assess the
proposed project. The feasibility study includes: Market research to gauge consumer interest,
assess competitor offerings, and estimate potential market share for the target market.

One of your key responsibilities as a product manager is to

evaluate the potential success of those opportunities before investing
significant money, time, and resources. A feasibility study, also known as a
feasibility assessment or feasibility analysis, is a critical tool that can help
product managers determine whether a product idea or opportunity is viable,
feasible, and profitable.

So, what is a feasibility analysis? Why should product managers use it? And
how do you conduct one?

What is a feasibility study?

A feasibility study is a systematic analysis and evaluation of a product
opportunity’s potential to succeed. It aims to determine whether a proposed
opportunity is financially and technically viable, operationally feasible, and
commercially profitable.

A feasibility study typically includes an assessment of a wide range of

factors, including the technical requirements of the product, resources needed
to develop and launch the product, the potential market gap and demand, the
competitive landscape, and economic and financial viability.
Based on the analysis’s findings, the product manager and their product team
can decide whether to proceed with the product opportunity, modify its
scope, or pursue another opportunity and solve a different problem.

Conducting a feasibility study helps PMs ensure that resources are invested in
opportunities that have a high likelihood of success and align with the overall
objectives and goals of the product strategy.

What are feasibility analyses used for?

Feasibility studies are particularly useful when introducing entirely new
products or verticals. Product managers can use the results of a feasibility
study to:
o Assess the technical feasibility of a product
opportunity — Evaluate whether the proposed product idea or
opportunity can be developed with the available technology, tools,
resources, and expertise
o Determine a project’s financial viability — By
analyzing the costs of development, manufacturing, and distribution, a
feasibility study helps you determine whether your product is
financially viable and can generate a positive return on investment
(ROI)
o Evaluate customer demand and the competitive
landscape — Assessing the potential market size, target audience,
and competitive landscape for the product opportunity can inform
decisions about the overall product positioning, marketing strategies,
and pricing
o Identify potential risks and challenges — Identify
potential obstacles or challenges that could impact the success of the
identified opportunity, such as regulatory hurdles, operational and legal
issues, and technical limitations
o Refine the product concept — The insights gained from a
feasibility study can help you refine the product’s concept, make
necessary modifications to the scope, and ultimately create a better
product that is more likely to succeed in the market and meet users’
expectations

How to conduct a feasibility study

The activities involved in conducting a feasibility study differ from one
organization to another. Also, the threshold, expectations, and deliverables
change from role to role.

For a general set of guidelines to help you get started, here are some
basic steps to conduct and report a feasibility study for major product
opportunities or features.
1. Clearly define the opportunity

Imagine your user base is facing a significant problem that your product
doesn’t solve. This is an opportunity. Define the opportunity clearly, support
it with data, talk to your stakeholders to understand the opportunity space,
and use it to define the objective.

2. Define the objective and scope

Each opportunity should be coupled with a business objective and should

align with your product strategy.
Determine and clearly communicate the business goals and objectives of the
opportunity. Align those objectives with company leaders to make sure
everyone is on the same page. Lastly, define the scope of what you plan to
build.
3. Conduct market and user research

Now that you have everyone on the same page and the objective and scope of
the opportunity clearly defined, gather data and insights on the target market.

Include elements like the total addressable market (TAM), growth potential,
competitors’ insights, and deep insight into users’ problems and preferences
collected through techniques like interviews, surveys, observation studies,
contextual inquiries, and focus groups.
4. Analyze technical feasibility

Suppose your market and user research have validated the problem you are
trying to solve. The next step should be to, alongside your engineers, assess
the technical resources and expertise needed to launch the product to the
market.

Dig deeper into the proposed solution and try to comprehend the technical
limitations and estimated time required for the product to be in your users’
hands.
5. Assess financial viability

If your company hasa product pricing team, work closely with them to
determine the willingness to pay (WTP) and devise a monetization strategy
for the new feature.

Conduct a comprehensive financial analysis, including the total cost of

development, revenue streams, and the expected return on investment (ROI)
based on the agreed-upon monetization strategy.
6. Evaluate potential risks

Now that you have almost a complete picture, identify the risks associated
with building and launching the opportunity. Risks may include things like
regulatory hurdles, technical limitations, and any operational risks.
7. Decide, prepare, and share
Based on the steps above, you should end up with a report that can help you
decide whether to pursue the opportunity or not. Either way, prepare your
findings, including any recommended modifications to the product scope, and
present your final findings and recommendations to your stakeholders.

Make sure to prepare an executive summary for your C-suite; they will be the
most critical stakeholders and the decision-makers at the end of the meeting.

Feasibility study example

Imagine you’re a product manager at a digital software company that
specializes in building project management tools.

Your team has identified a potential opportunity to expand the product

offering by developing a new AI-based feature that can automatically
prioritize tasks for users based on their deadlines, workload, and importance.

To assess the viability of this opportunity, you can conduct a feasibility

study. Here’s how you might approach it according to the process described
above:

o Clearly define the opportunity — In this case, the

opportunity is the development of an AI-based task prioritization
feature within the existing project management software

o Define the objective and scope — The business objective

is to increase user productivity and satisfaction by providing an
intelligent task prioritization system. The scope includes the integration
of the AI-based feature within the existing software, as well as any
necessary training for users to understand and use the feature
effectively
o Conduct market and user research — Investigate the
demand for AI-driven task prioritization among your target audience.
Collect data on competitors who may already be offering similar
features and determine the unique selling points of your proposed
solution. Conduct user research through interviews, surveys, and focus
groups to understand users’ pain points regarding task prioritization and
gauge their interest in the proposed feature
o Analyze technical feasibility — Collaborate with your
engineering team to assess the technical requirements and challenges of
developing the AI-based feature. Determine whether your team has the
necessary expertise to implement the feature and estimate the time and
resources required for its development
o Assess financial viability — Work with your pricing team to
estimate the costs associated with developing, launching, and
maintaining the AI-based feature. Analyze the potential revenue
streams and calculate the expected ROI based on various pricing
models and user adoption rates
o Evaluate potential risks — Identify any risks associated with
the development and implementation of the AI-based feature, such as
 data privacy concerns, potential biases in the AI algorithm, or the
impact on the existing product’s performance
o Decide, prepare, and share — Based on your analysis,
determine whether the AI-based task prioritization feature is a viable
opportunity for your company. Prepare a comprehensive report
detailing your findings and recommendations, including any necessary
modifications to the product scope or implementation plan. Present
your findings to your stakeholders and be prepared to discuss and
defend your recommendations

Feasibility study template

The following feasibility study template is designed to help you evaluate the
feasibility of a product opportunity and provide a comprehensive report to
inform decision-making and guide the development process.

Remember that each study will be unique to your product and market, so you
may need to adjust the template to fit your specific needs.

o Opportunity description:
o Briefly describe the product opportunity or feature
you’re evaluating
o Explain the problem it aims to solve or the value it will
bring to users
o Business objectives and scope:
o Define the business goals and objectives for the
opportunity
o Outline the scope of the product or feature, including
any key components or functionality
o Market and user research:
o Summarize the findings from your market research,
including data on the target market, competitors, and
unique selling points
o Highlight insights from user research, such as user pain
points, preferences, and potential adoption rates
o Technical feasibility:
o Detail the technical requirements and challenges for
developing the product or feature
o Estimate the resources and expertise needed for
implementation, including any necessary software,
hardware, or skills
o Financial viability:
o Provide an overview of the costs associated with the
development, launch, and maintenance of the product
or feature
o Outline potential revenue streams and calculate the
expected ROI based on various pricing models and user
adoption rates
o Risk assessment:
 o Identify any potential risks or challenges associated with
the development, implementation, or market adoption of
the product or feature
o Discuss how these risks could impact the success of the
opportunity and any potential mitigation strategies
o Decision and recommendations:
o Based on your analysis, recommend whether to proceed
with the opportunity, modify the scope, or explore other
alternatives
o Provide a rationale for your recommendation, supported
by data and insights from your research
o Executive summary:
o Summarize the key findings and recommendations from
your feasibility study in a concise, easily digestible
format for your stakeholders

Overcoming stakeholder management challenges

The ultimate challenge that faces most product managers when conducting a
feasibility study is managing stakeholders.

Stakeholders may interfere with your analysis, jumping to conclude that your
proposed product or feature won’t work and deeming it a waste of resources.
They may even try to prioritize your backlog for you.

Here are some tips to help you deal with even the most difficult stakeholders
during a feasibility study:

o Use hard data to make your point — Never defend your

opinion based on your assumptions. Always show them data and
evidence based on your user research and market analysis

o Learn to say no — You are the voice of customers, and you

know their issues and how to monetize them. Don’t be afraid to say no
and defend your team’s work as a product manager

o Build stakeholder buy-in early on — Engage stakeholders

from the beginning of the feasibility study process by involving them in
discussions and seeking their input. This helps create a sense of
ownership and ensures that their concerns and insights are considered
throughout the study
o Provide regular updates and maintain
transparency — Keep stakeholders informed about the progress
of the feasibility study by providing regular updates and sharing key
findings. This transparency can help build trust, foster collaboration,
and prevent misunderstandings or misaligned expectations
o Leverage stakeholder expertise — Recognize and utilize
the unique expertise and knowledge that stakeholders bring to the table.
By involving them in specific aspects of the feasibility study where
 their skills and experience can add value, you can strengthen the
study’s outcomes and foster a more collaborative working relationship

Final thoughts
A feasibility study is a critical tool to use right after you identify a
significant opportunity. It helps you evaluate the potential success of the
opportunity, analyze and identify potential challenges, gaps, and risks in the
opportunity, and provides a data-driven approach in the market insights to
make an informed decision.

By conducting a feasibility study, product teams can determine whether a

product idea is profitable, viable, feasible, and thus worth investing
resources into. It is a crucial step in the product development process and
when considering investments in significant initiatives such as launching a
completely new product or vertical.

HOW TO MAKE A FEASIBILITY STUDY TITLE

You should use a clear title that provides some insights into your project. A good example is
"Feasibility Study for Cultivating Unified Goals Across Departments."Your title page should also
include the names of the project leader and project members along with their job titles.

HOW TO DETERMINE IT THE STUDY IF FEASIBLE

Determining the feasibility of a research project requires careful evaluation of several factors,
including the research questions, design, data availability, funding, timeframe, research team,
ethical considerations, and feasibility analysis.
WHAT DOES A FEASIBILITY STUDY LOOK LIKE
Determining the feasibility of a research project requires careful evaluation of several factors,
including the research questions, design, data availability, funding, timeframe, research team,
ethical considerations, and feasibility analysis.

5 MAJOR COMPONENTS OF A FEASIBILITY STUDY

The five key components of a feasibility study include economic, marketing, technical,
financial, and management feasibility. Each type of study considers different aspects of the
project, so it's essential to consider all five when deciding which route to take moving forward.

All four parts of the feasibility analysis (product/service, industry/market, organizational, and
financial) are valuable and essential, but what is missed is a part that provided attention to the
longer-term requirements for success and sustainability.

HOW TO WRITE A FEASIBILITY PLAN

Top 10 Steps to Writing a Feasibility Study Analysis Report

1. Identify the project you wish to undertake and clearly explain it. ...
2. Ensure your market statistics and analysis is up to date. ...
3. Identify any legal hurdles that must be overcome. ...
4. Financials. ...
5. Use of proceeds. ...
6. Risk Factors. ...
7. Exit Strategies. ...
8. Scale the business.

IS A FEASIBILITY STUDY QUANTITATIVE OR QUALITATIVE

QUALITATIVE
To do so effectively, use both methods throughout the feasibility study process, from defining
the scope and objectives to creating a convincing report. Quantitative methods can be used to
test and validate qualitative findings, while qualitative methods can explain and enrich
quantitative findings.

HOW TO MAKE AN INTRODUCTION IN A FEASIBILITY STUDY

Below are the seven elements of a feasibility report: Introduction – You need to persuade the
decision maker to even consider any sort of alternative. You need to convince them to even
read your report first. Tell them what they will gain personally or as an organization by
considering your work.
The key to a successful feasibility study lies in its completeness, which means that it should
thoroughly evaluate various aspects such as economic, technical, legal, and scheduling to
determine the viability of the project.

WHAT INFORMATION IS REQUIRED FOR A FEASIBILITY STUDY

The study should provide full information about the project including but not limited to: •
Description, objective, rationale and justification for ADFD financing; • Outline of phases of the
project, data on any other stage, demand analysis; • Identification of risks and risk mitigation
measures; • Implementation and .

OUTLINE OF A FEASIBILITY STUDY

A Business Feasibility Study can be defined as a controlled process for identifying problems and
opportunities, determining objectives, describing situations, defining successful outcomes and
assessing the range of costs and benefits associated with several alternatives for solving a
problem.

PURPOSE OF FEASIBILITY STUDY

A feasibility study is an assessment tool that helps determine if a proposed product, service or
business will be successful. The study considers many factors, including technical, economic
and legal, to evaluate the proposal. There are several types of feasibility studies to consider
based on the project.

WHAT MAKES A GOOD FEASIBILITY STUDY

Not only should the Feasibility Study contain sufficient detail to carry on to the next succeeding
phase in the project, but it should also be used for comparative analysis when preparing the
final Project Audit which analyses what was delivered versus what was proposed in the
Feasibility Study.

CAPITAL REQUIREMENT OF A FEASIBILITY STUDY

The capital requirement is the sum of funds that your company needs to achieve its goals.
Plainly speaking: How much money do you need until your business is up and running? You
can calculate the capital requirements by adding founding expenses, investments and start-up
costs together.
HOW MUCH SHOULD A FEASIBILITY STUDY COST
 The cost of a feasibility study may range 1,000,000 OR MORE. All the factors explained above
may determine the final price which must be subject of analysis by experts in the topic. Make
sure you hire the right consultants to deliver you feasibility study or business plan.
CAPITAL COST OF A PROJECT
Essentially, capital costs are one-time expenses paid for things used in the production of goods
or service. A good example of a capital costs is the purchase of fixed assets, like new buildings
or business tools. It could also include the costs of intangible assets, like patents and other
forms of technology.

REQUIREMENTS FOR A FEASIBILITITY STUDY

Several factors need to be considered when conducting a feasibility study, including the
marketability of your product or service, the competition, the financial stability of your company,
and more. A feasibility study should cover the amount of technology, resources required, and
ROI.
Capital requirement is the total amount of funds that the firm will need for the business to
achieve its goal of raising profit. The way to calculate this is by adding the founding and start-up
expenses and investments.
Calculation of the Minimum capital requirements: The minimum capital requirements are
composed of three fundamental elements: a definition of regulatory capital, risk weighted assets
and the minimum ratio of capital to risk weighted assets.

CALCULATE THE WORKING CAPITAL IN A FEASIBILITY STUDY

Working capital is the amount of available capital that a company can readily use for day-to-day
operations. It represents a company's liquidity, operational efficiency, and short-term financial
health. Subtract a company's current liabilities from its current assets to calculate working
capital.
What does feasibility budgeting mean? At its most basic, it's working out if you can make money
from your business idea. Depending on how much detail you go into, you can also start to work
out what your return on investment would be.

Cost calculation and feasibility study

1. Economic offer and evaluable criteria through formulas. ...
2. Cost calculation. ...
3. Visit the locations and photo report. ...
4. Tender statistics. ...
5. Hypothesis of outcome scenarios Application of the formula and forecast of competitor
behaviour. ...
6. Forecast of the winning figure bracket and risk chart.

HOW TO DO FINANCIAL STUDY

7 Steps to Do a Feasibility Study

1. Conduct a Preliminary Analysis. ...
2. Prepare a Projected Income Statement. ...
3. Conduct a Market Survey or Perform Market Research. ...
4. Plan Business Organization and Operations. ...
5. Prepare an Opening Day Balance Sheet. ...
6. Review and Analyze All Data. ...
7. Make a Go/No-Go Decision.

“The main difference between authorized capital and paid-up capital is

that authorized capital is the maximum amount of capital a company can raise by issuing
shares, while paid-up capital is the actual amount of money the company has received from
issuing shares.”

BASIC CAPITAL REQUIREMENTS

Capital requirements are regulatory standards for banks that determine how much liquid capital
(easily sold assets) they must keep on hand, concerning their overall holdings. Expressed as
ratios, the capital requirements are based on the weighted risk of the banks' different assets.

HOW MUCH WORKING CAPITAL DO I NEED?

Consequently, a better guide to the liquidity of a business is the working capital ratio, Current
Assets / Current Liabilities. This ratio indicates the company's ability to meet its short-term
financial obligations. A working capital ratio of between 1.2 and 2.0 is considered healthy.