Project Feasibility Study

The term “feasibility study” is used as a convenient description for the output for the work done; users of this tool kit should not apply preconceived notions of what a feasibility study consists of. Stated as simply as possible, the work done here must show that the project:

i. Is in accordance with predetermined needs.

ii. Is the most suitable technical solution to the needs.

iii. Can be implemented within any capacity constraints of the Institution which operates.

iv. Has been subject to a due diligence that shows it is legally, physically and socially compliant.

v. Is fully coasted over the whole life of the project.

vi. Has taken due cognisance of the risks associated with its whole life cycle, and

vii. Is affordable to the institution responsible for the project in the context of the available budget.

The feasibility study guideline set out below is for a comprehensive document that, in many instances simply uses information already collected and set out as part of the steps carried out by the Institution. That said it is necessary to create a study that creates a holistic justification for the project and serves as a living document against which project deliverables are measured during procurement and even after implementation of the project.

A feasibility study needs to be authentic and thorough. It is the basis for government making an important investment decision, not just a bureaucratic requirement. Regardless of the term and scale of a project, there is a great deal at stake when the procurement choice is made, and long-term implications.

1. It provides information about costs (explicit and hidden), and gives an indication of whether costs can be met from within institutional budgets without disruptions to other activities.
2. It allows for the identification, quantification, mitigation and allocation of risks.
3. It prompts institutions to consider how the project will be structured.
4. It identifies constraints, which may cause the project to be halted.
5. It ensures that the project is developed around a proper business plan.

A feasibility study is an evolving, dynamic process. While it is used to justify what is developed and at what cost (the investment decision) it is also used throughout the procurement phase to check that the project is being developed in accordance with the original assumptions and, where change is necessary, it is also used to manage the change.