A feasibility study is an essential activity to carry out within any project initiation phase. It helps to efficiently analyze the project regarding the technical feasibility and viability of the business.
The results of the study will show that a project is reasonable and, justifies the need for the launch of such project.
Upon the completion of a feasibility study, a feasibility report is developed to give a summary of the activities carried out, and to conclude if the project is realistic and practical.
Before we dive right into how to prepare a feasibility report, let us first know what a feasibility report means, and why it is essential.
Definition Of A Feasibility Report
So, what is a feasibility report?
Simply put, it is a document that is primarily made to show, explores, and evaluates the solution of a particular project to save time and money.
It is a formal document that shows the output of a feasibility study showing the summary of the analyses and evaluations that was conducted in the course of reviewing the proposed solution and alternatives to a project.
It shows if the plan is indeed feasible, cost-effective and otherwise profitable. It aims to describe and support the most practical and reasonable way to carry out a project.
A feasibility report explains the project and also gives necessary information about the project. The report is formally used as the starting point when running the Pre-Charter Sub-phase.
Practically, it indicates that the sponsor can go ahead with investing in the project and also give out important assignments to the project manager.
Importance Of A Feasibility Study
The process where one writes the report is termed feasibility study reporting. Most times, it is the duty of the project manager to control the feasibility study reporting.
The feasibility report is essential in providing legal and technical proof of the vitality, sustainability, and cost-effectiveness of a project. Feasibility study reporting gives the senior manager the chance to grab hold of all the vital information that will enable him/her to make critical decisions concerning the budget and investment planning of the project.
A feasibility report that is adequately written is helpful in the following ways:
- It helps in project analysis. A good feasibility report helps to conclusively link the efficiency of the project to the budgeted cost.
- It serves as a risk mitigation plan as it is a vital element of the contingency planning and risk treatment strategy development.
- It also helps with staff training because the senior management can use the feasibility report to identify staffing needs and also to obtain and teach new specialists.
Now that you know what Feasibility report entails, below are simple steps you can follow to write an excellent feasibility report.
Steps To Writing A Feasibility Report
How do you write a feasibility report?
No matter the size of the project, all you need to do is follow the critical steps stated below, and you will find it very easy to accomplish.
Write The Project Description
This step requires you to get all the background information about the project which will enable you to write a proper description of it.
For instance, your company wishes to increase traffic and improve brand awarness Then, in the first stage of your report, you could go ahead to give a brief description like this:
“The project is the use of different social media platforms as a marketing strategy to increase traffic and improve brand impression online.”
Describe Possible Solutions
To successfully take the step, you will need to carry out an alternative analysis and write a description of the feasible solutions for the project.
For instance, in your Feasibility report for the marketing strategy, you might offer the following solutions:
“The project will be successful with the implementation of these possible solutions:
1) Create an online social media profile;
2) Employ the services of a social media agency.
Each of these solutions is analyzed meticulously and adequately, giving all the necessary information needed, so the management team makes a valid final decision.
List Evaluation Criteria
In this step, you clearly define and set the evaluation criteria for the feasible solutions.
This stage of the feasibility report writing needs you to discover and examine the facts of the solution, then putting them against a set of criteria for their evaluation.
Propose the Most Feasible Solution
Once you have successfully used the criteria to evaluate the solutions, the next step would be to determine the economic and technical solution that is feasible and which allows the company to keep an optimal use of the resources allocated for the project, and to gain as much profit from the project as possible.
For instance, your feasibility report might include:
“After a proper evaluation and examining of the feasible solutions, the best solution for the project is discovered and thus, selected. The project turns cost-effective and practical”.
This is the last and final step. Here, you conclude by giving a summary of the aim of the project and presenting the best solution for the project.
That was a quick overview of how you conduct a feasibility report. Overall, it can be a critical report for deciding on whether a project should go ahead.