The Feasibility study: Why is it really important?

Feasibility study

The feasibility study is conducted to determine if a certain project would be profitable, achievable and fundable. The Feasibility study is an important element of the international project management cycle but is more often ignored because of a lack of time, funds, etc. Ironically, it would serve as protection against wasted funds and time on a project which does not hold any benefits. This said, in the following paragraphs, I will examine some reasons why it should not be ignore.

1. Economic and political instability

As part of an international feasibility study, the country’s context and main issues that the project is meant to address are usually examined. Thus, during this examination, key economic and political factors must be considered in order to determine if a project could be viable in the long run. When and where should the project take place? Considering the time the project will take, can long term sustainability be foreseen? Ignoring, the field context, general concerns and sometimes, well based ‘rumors’ may prove costly in time and resources.

2. Project Definition Deficiencies and technical oversight

Considering the project feasibility study is aimed at determining if a project is in fact achievable, the project must be well defined and all technical obstacles that could compromise the project be identified in order to propose solutions. During this study, it is possible to redefine a project in order to help make it achievable. I have personally seen, a project aimed at implementing a too advanced Information Management System in parts of a country that did not even have electricity and internet. Needless to say, this project was a complete failure and undoable as defined. Thus, a feasibility study would have revealed such a deficiency and would have help project planners in preparing other activities necessary for the possible achievement of this project.

3. Insufficient budget and unsustainability of the project

The Feasibility study includes the evaluation of initial and recurring costs. This is very important considering many projects are sometimes successfully completed but are unsustainable. I have personally been made witness too many such projects. In particular, a country where numerous schools were newly built but were unused because of lack of funding. If a project is meant to help build a school, then it is important to estimate how much it would cost to run this school and will the government have sufficient funds to help support that school. If not, than what can be considered for funding that new school. Is the local population able and willing to pay to enrol in this school? If they are not, then building such a school, even if it is absolutely necessary is still pointless.

4. Poor knowledge of the risks and insufficient planning of mitigating options

Risks are inevitably linked to implementing a project. These risks must not only be assessed but mitigation plans must be prepared in order to face them adequately. A feasibility study not only examines these risks but usually can even discover additional risks that were not considered during the project definition phase. Thus, making it quite important to deal with possible bottlenecks that the project might encounter and that it should deal with. When these risks are already planned for, the project will not only gain in time efficiency and successful resources allocation but can actually ensure its actual completion.

This said, some may argue that all these possible problems can be foreseen during the project planning phase and thus, the feasibility study can be skipped all together. But, the field evidence shows that more often than none, key related matters that the feasibility study covers are ignored or overlooked. Why should a project be completely planned on wrong basis or money spent on undoable projects?

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Phase 4 of the international aid development project cycle: the Project planning

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In my previous blog, I described the third phase of the international aid development project cycle. The fourth phase is the project planning which is aimed at explaining how the project will be implemented and evaluated. The image above describes the tasks that should be detailed during this phase.

The project planning phase is usually conducted by the project planner of the country or of the financing agency. Once the project is planned, the country will most probably divide the project implementation between different execution organisations or individuals. These organisations or individuals will be recruited by different procurement process: open procurement process, selective procurement process, invitations, etc. depending on the project, government and financing agency procedures. To be selected, these organisations or individuals will need to propose an implementation plan of the project. A separate blog will describe the procurement process of a project.

The following paragraphs will describe each task as part of the project planning:

 1. Description of the project and the country

Again, the project planner will review the description of the project and country as some time may have elapsed between the initial project definition and the project planning. Thus, it is important to make sure that the problem the project is aimed in solving is still current.

2. Project Logical framework

Once the situation has been clarified, the project planner will need to describe the project logical framework. To do so, it is important to summaries the project as shown in the following tables:

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Following this table, the project planner will pursue with more details as follows:

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It is easier to describe the project logical framework in a table.

3. Project Implementation: Execution modality

This section is meant to be a narrative expression of the activities that will be conducted during each phase and for each output. The project planner should explain who and what should be conducted in each phase. The reader should be able to understand what the execution agency must do in order to obtain the expect outputs for each phase, who will conduct the work and what activities will be conducted.

4. Roles and responsibilities of partners

The roles and responsibilities of each key player in the project should be clearly explained. The key players include the government, the executing agencies, the financing agencies and the recipients of the services/products to be conducted. Defining roles and responsibilities will help the smooth execution of the project and help in making sure that all players know what is expected of them and what they will need to do for the proper implementation of the project.

5. Work Matrix (table of tasks)

The work matrix is a table or graphic representation of the activities that will be conducted during each phase. It is a summary outlook of the execution modality. The following is an example of a work Matrix:

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6. Work Plan (Gantt chart)

Once the work matrix is clear, the project planner must plan the project activities during the entire duration of the project. A work plan usually looks like the following:

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The project planner can also include the number of days, weeks, or years each phase, sub-phase, activity will require.

7. Table of resources allocation

The table of resources is meant to explain what each human resources will conduct during the duration of the project. It could be regrouped for each resource or follow the work plan as shown in the following table:

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The above table can be produced with MSPROJECT. MSPROJECT can also regroup the activities that each resource will conduct. The table can also be done in an excel sheet. It should be kept simple and clear. A table regrouping the resources would be as followed:

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8. Budget

At this stage, the project planner must detail each cost associated to each phase, sub-phase and activity. A summary table may regroup the total cost of each phase. The project planner must plan for contingencies, inflation, and exchange rate provision and must include the cost of all materials, equipment, salaries, hotel, airline, etc. required to conduct the project. This is important to conduct the follow up of the budget especially if phases are spread between different execution agencies selected by procurement process on a quality/cost basis.

9. Risks Analysis

The risks analysis may be described for each output of each phase or follow the work plan. Usually, the risk must be identified, described and rated and then selected options of mitigations and strategies must be described as follows:

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The project planner may decide to prepare a summary table describing each risk in each phase and task and the rating.

10. Evaluation Means

The project planner must also describe how the project will be evaluated. The evaluation must include the following:

  • Process evaluation (time/budget/resources quality)
  • Objectives achieved (measurable)
  • Evaluation of the expected condition vs obtained condition (in the long term)

This stage completes phase 4: The project planning. It must be noted that during the procurement process to recruit the executing agencies, these agencies will also need to describe the methodology, work plan and resources plan they intend to use to implement the project. It may very well vary from the initial planning of the project that is why expected outputs are very important.  The ‘how’ may vary but the output must remain. In my next blog, I will examine phase 5 of the international project cycle.

Link to my professional website: www.forzaconsultation.com

Understanding the International project cycle

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Having worked in international aid development for 17 years, I realised that the international project cycle is not necessarily well understood by the majority of people not working in international development. Considering this is a topic that could fill books, I have decided to work on a series of blogs dedicated to this subject. In each of these blogs, I will describe in more details each elements of the cycle that I am about to explain. I will also examine multiple angles.

The international project cycle is as follows:

Project Cycle

1. Country profile: Before beginning to envisage any kind of project, it is very important to understand the country’s basic needs and strategic goals. Since, the need for a project can emerge either from the country itself, from past projects and/or from aid development banks such as the World Bank it is important to identify what are the most urgent problems that should be addressed and which ones will have the best impact to resolve the issue.

2. Project description: Once there is some kind of consensus on the issues that should be addressed, then it becomes important to define in more details what the project will in fact be all about.

3. Feasibility Study: Once, the project is described in more details, it is important to conduct a feasibility study to determine if the issues aimed by this project are in fact feasible and if so, how.

4. Project planning: When the feasibility of a project is assured, it is important to prepare a preliminary detail planning of the project. After it is planned, approved and financed, the project is usually advertised. The company that will be selected to conduct the project will actively participate in the actual planning of the project and the execution.

5. Project execution: The project execution phase correspondence to the actual implementation of the project.

6. Project evaluation: Once the executing company or individual has completed the work, the government or the financing company will decide on an evaluation scheme for the project. Some projects are not the subject of any evaluation. This concept is relatively new in comparison to the other aspects of the project cycle as many institutions started to question the inability of projects in alleviating poverty.

It is important to understand that not all projects follow the project cycle described above and some tasks in each phase could vary, overlap or simply be conducted in other phases. In my following blog, I will examine aspects to consider in the country profile.

Link to my professional website: www.forzaconsultation.com