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Project Feasibility

and
Initiation

By Walter Maner

With information borrowed from presentations


given by Sylnovie Merchant and T. H. Tse

✳✳
Is it feasible?
Feasibility

 The reasonable likelihood that


constraints on time and other
resources will not prevent a
project from meeting its key
objectives
 Synonym: ?
 Synonym: Achievability
Dimensions of Feasibility
 Economic Feasibility
 Organizational and Cultural Feasibility
 Technical Feasibility
 Schedule Feasibility
 Resource Feasibility
 Human-factors Feasibility
 Legal and Regulatory Feasibility
Feasibility Analysis
Existing and
Perceived and Available
Real Needs Resources

Decision Outcome
• Accept project
List of Potential Project • Reject project
Selection • Delay project
and Ongoing • Refocus project
Projects Decision • Outsource project
• Proof of concept only

Current
Evaluation
Organizational
Criteria
Environment
Needs Analysis
 Is the need significant enough to
justify the proposed project?
 Will the need still exist by the time
the project is completed?
 Is there another way to satisfy the
need?
 What impacts will the project have?
 economic
 social
 environmental
 political
Feasibility Process

Identify Initiate Define scope,


problem or feasibility identify constraints
opportunity study and objectives

Make Evaluate Carry out


recommendation alternatives Feasibility study

Accept project
Reject project
Delay project
Refocus project
Outsource project
Proof of concept only
Project Identification

 Projects
are undertaken
because either …
 We see a problem
… or …
 We see an opportunity
Project Identification
 Problems are undesirable
situations that prevent the
organization from fully achieving
its purpose, goals and objectives
 Opportunities are chances to
improve the organization even in
the absence of specific problems
0

Problems and Opportunities


IT Job Search App

 What problems are we


addressing?
 Very difficult to match my skill set with
available jobs
 Very difficult to find jobs in specific locations
 Very difficult to find jobs in unfamiliar
locations
 Very difficult to find a company that coincides
with my career goals
0

Problems and Opportunities


IT Job Search App

 What opportunities are we


exploiting?
 Opportunity to find a better-paying job
 Opportunity to find a better-fitting job
 Opportunity to find a better work environment
0

Problems and Opportunities


IT Career Development App

 What problems are we


addressing?
 IT workers get stuck in dead-end careers
because of devalued job skills
 IT workers can’t afford high-cost training, need
low-cost alternatives
 Next project demands skills I don’t have
0

Problems and Opportunities


IT Career Development App

 What opportunities are we


exploiting?
 Opportunity to improve my chances for
advancement
 Opportunity to increase my job security
 Opportunity to find obscure or unusual career
development avenues
 Opportunity to change fields or careers
0

Objectives and Constraints

A project is guided by
objectives and limited by
constraints
0

Objectives and Constraints


 An objective is something that you
expect to achieve, if given sufficient
resources
 Measurable somehow
 Examples
• Reduce the number of uncollectible customer accounts by 50
percent within the next year
• Increase by 25 percent the number of loan applications that can be
processed during an eight-hour shift
• Decrease by 50 percent the time required to reschedule a
production lot when a workstation malfunctions
 A constraint is something that will limit
your flexibility in defining a solution to
your objectives
 Essentially, constraints are fixed and cannot be changed.
0

Objectives and Constraints


IT Job Search App

 What are our objectives?


objectives
 Speed job search process
 Reduce job-search frustration
 Others ??
0

Objectives and Constraints


IT Job Search App

 What are our constraints?


constraints
 December 1 deadline
st

 New iteration every 14 days


 Limited staffing
 Others ??
0

Objectives and Constraints


IT Career Development App

 What are our objectives?


 Increase worker marketability
 Increase worker flexibility
 Identify training opportunities that can lead to
career advancement
 Become more promotable
 Keep current with relevant technology
 Others ??
0

Objectives and Constraints


IT Career Development App

 What are our constraints?


 [Same as for IT Job Search App]
Initial Feasibility Report
 Prepare feasibility report
 Current situation
 Future expectations
 Favourable plan(s) of action
 Underlying rationale for management decision
 For selected plan, prepare system
proposal
 Project description Not part of agile
 Resource requirements methodology
 Development schedule
 Acceptance criteria
Assumption:
Initial
Feasibility
Established
Project Initiation
 Organize the team
 Establish management policies
and procedures
 Continue to refine project
scope
 Investigate alternatives
 Carry several alternatives
forward either …
 as “competing” sibling projects
or
 as contingencies
Project Initiation …
 Consider building an early-stage
prototype as “proof of concept”
 Continue feasibility analysis
 Harden estimates
 Weigh costs or risks
 Weigh benefits
 Review contractual requirements
 Develop timeline and schedule
 Establish unambiguous progress
criteria
Output of Project Initiation
Process
 Refined Statement of Scope
[detailed on next slide]

 Refined Feasibility Assessment


 “Hardened” Estimates
 money
 effort
 time
 Project Timeline and Schedule
 Alternatives and Contingencies
 Progress Criteria
Refined Statement of Scope
 General project information
 Problem and opportunity statement
 Project objectives
 Project description
 Identification of users
 Benefits and risks
 Constraints
 Duration
 Costs
Benefits and Constraints
 Tangible benefits  Constraints
 cost reduction  schedule: project must be
 error reduction completed before
12/8/98
 increase efficiency
 increase sales  cost: the system cannot
cost more than $100,000
 ....  technology: the system
 Intangible benefits must be on-line, use DB2,
 improved planning and run on a Novell network,
control etc.
 improved decision making  policy: the system must
 improve employee morale use double-entry
accounting
 more timely information
 ....
Costs
 Tangible  One-time
 hardware  system development
 labor  hardware/software
 operational  user training
 ....  site preparation
 data conversion
 Intangible  Recurring
 loss of customer goodwill  maintenance
 employee morale  data storage expense
 ....  communications expense
 software licenses
 supplies (paper, toner,
etc.)
Select a Design Strategy
 Generate a comprehensive set of
alternative design strategies.

 Select one* that is most likely to result


in the desired information system given
all of the organizational, economic, and
technical constraints that limit what can
be done.
* In a large organization, several
competing designs might be
carried forward in parallel
Select a Development Strategy

 These are the standard choices:


 Keep the old system as-is
 Reengineer the old system
 Purchase off-the-shelf software
 Design a new system
• in-house
• outsource
Comparing Alternatives

 Compare tangible and


intangible benefits
 Compare tangible and
intangible costs
 Weigh costs against
benefits
•0

•Intangible Benefits
 Improved employee morale  Increased strategic or
competitive advantage
 Improved corporate image
 Improved public and
 Increase in perceived community relations
quality of products or  Improvements in addressing
services environmental concerns
 Perceived decrease in time  Reduced employee turnover
to market by customers  Increased quality of work
 Improved decision making for employees
 More timely information  Proactive attention to
ethical issues
 Increased organizational  Proactive addressing of
flexibility legal issues
 Improved resource  Increased workplace and/or
allocation and control community safety
 Lost customers (stop using
email) or sales
 Survival in the market
0

Our Intangible Benefits


IT Job Search App


0

Our Intangible Benefits


IT Career Development App


0

A “Benefits Grid”
Tangible Intangible
Enhancement
Improve Profitability of New Business Cross-Selling Opportunities

Less Paperwork and Administrative Costs Improved Member Retention


Revenue

Increase in Prospecting of New Business Higher System Availability

Elimination of Duplicate Data Entry Accurate Rating (Single-Rating


Reduction

Engine Concept)
Multiple Proposal/Improved
Communication Improved Audit Process
Cost

Rekeying of Proposals in Word Improved Speed of Turnaround


Miscellaneous 0

Other Factors
 Functionality
 Firm’sculture
 Connectivity
 Vendor credentials
 Maintenance
 Adaptability
0

Comparing Alternative Designs:


One Possible “Naïve” Model

 Select primary comparison factors


(usually includes cost, among others)
 Assign relative weights
 For each factor …
 select sub-factors
 allocate sub-factor weight
 Rate each alternative on each sub-
factor
 for example, a scale of 1 (bad) to 5 (good)
Comparing Alternative Designs:
0

One Possible “Naïve” Model …


 Do the math:
 Multiply sub-factor rating times sub-
factor weight
 Sum sub-factor scores for each
alternative
 Compare scores among alternatives
 Favor alternative with highest score
PREVIEW
0

Confirming Project Feasibility


 Economic Feasibility
 Cost/benefit analysis
 Cash flow analysis
 Organizational and Cultural
Feasibility
 Technological Feasibility
 Schedule Feasibility
 Resource Feasibility
 Human-factors Feasibility
 Legal and Political Feasibility
0

Disclaimer

 Costsand benefits cannot always


be measured
 Why? There are many intangibles
0

Intangibles
 Improved employee morale  Increased strategic or
 Improved corporate image competitive advantage
 Increase in perceived  Improved public and
quality of products or community relations
services  Improvements in addressing
 Perceived decrease in time environmental concerns
to market by customers  Reduced employee turnover
 Improved decision making  Increased quality of work
 More timely information for employees
 Increased organizational
 Proactive attention to
ethical issues
flexibility
 Proactive addressing of legal
 Improved resource issues
allocation and control  Increased workplace and/or
 Lost customers or sales community safety
 Survival in the market
0

Organizational and Cultural


Feasibility

 Each company has own culture


 New system must fit into
culture
0

Technological Feasibility
 Doessystem stretch the state-
of-the-art?
 Leading edge or bleeding edge?
 Does sufficient expertise exist
in-house for development?
 Does sufficient technology exist
in-house for development?
0

Schedule Feasibility
 Can project be completed on time?
 What is the risk of schedule slippage?

 When we answer these questions,


what assumptions are we making?
0

Schedule Feasibility
 Our Assumptions:
Everybody will work hard
Necessary software gets installed
Increasing amounts of time will be
available as the project nears
completion
Specs that cannot be met will be
dropped (time-boxing)
0

Schedule Feasibility
 Our
Assumptions:
Others ??
0

Resource Feasibility
 Availability of project leaders
 Availability of team members
 Team skill levels
 Equipment
 Support staff
 Physical facilities
 Communication and collaboration
facilities
0

Human-factors Feasibility
 Ease of use
 How easy is the system to use within the
context of the day-to-day activities of the
intended end-user?
 Perceived usefulness
 Does the system support the job the end-user
needs to do?
 Overall satisfaction
 Will the end-user like using the system?
Who is our intended end-
0

user?
 IT Job Search App
 A graduating senior with an IT degree who only wants a part-time job
because they are going to grad school
 A college senior searching for his/her first post-graduation IT job
 At IT-majoring college grad who wants to pursue an IT career working
from home
 A female senior IT major looking for jobs of special interest to women
 A recent college graduate who majored in IT
 A recent college graduate, with a so-so IT job offer already in hand,
who wants to find an even better job before a decision is required on
the offer (so … not much time for search)
 A recent college graduate, with an IT job offer already in hand, who
wants to determine what the going rate is for such IT jobs in order to
negotiate a starting salary
 A recent graduate with the intention of finding an entry-level IT job
with their required specifications
 A recent IT graduate who wants to start an IT consulting business,
where work would be done for companies under contract
Who is our intended end-
0

user?
 IT Career Development App
 A company that wishes to organize in-service training for its
IT employees
 A person with a dead-end IT skill who wants to “switch horses”
 A person with at least an associate’s degree in an IT related
field
 A self-taught freelance IT professional who needs to establish
credibility with prospective clients
 A working professional with 3 or more years of experience in
the IT field, but is looking for ways to further their expertise
 Already experienced person looking to advance in career or
change jobs
 An IT professional seeking to advance their technical skills
 An IT professional with at least 1 year minimum experience
Legal and Political Feasibility

 Legal
 Will the solution violate any contracts, licenses,
copyrights, non-disclosures, laws or regulations?
 Policy and Procedures
 Will the solution violate corporate policies or
procedures?
 Political
 Who might resist migration to the new system?
 What measures are in place to overcome this inertia?
Estimation
 Typically, we estimate resource
(human effort, time, and cost) requirements
 We associate numbers with resources
based on …
 past experience
 industry experience and standards
 detailed analysis
 guesswork
 Estimation is extremely difficult and
almost always inaccurate to some
degree
Estimation Interactions and
Trade-offs
 Size of project
affects

 Size of team
affects

 Length of Schedule
affects

 Size of budget
Schedule Estimation:
Task Identification
 Top-down approach
 Identify highest level tasks
 Break them into increasingly smaller
units
 May rely on standard list of tasks
Top Down Task Identification

Phases Sub-phases

Work Plan Deliverables Estimated Actual Assigned


hours hours To

*
*
*
*
Top Down Task Identification

Phases Sub-phases

Okay, let’s make a list of


phases and subphases
for our project
Our phases and subphases

 Phase 1
 Phase 2
 Phase 3
 Phase 4
 Phase 5
 Phase 6
Did you include a
planning phase?
Time Estimation
Estimating a Project Based on Industry
Information

Planning Analysis Design Implementation

Industry
Standard
For Web 15% 20% 35% 30%
Applications

Time
Required 4 5.33 9.33 8
in Person
Months
Time Estimation:
Murphy’s Rule of Thumb
 Very early, estimate how long
the project will take
 Double this number
 Raise the number to the next
order of magnitude
 Example
3 weeks  6 weeks  6 months
Cost Estimation When done by
experienced estimators

Type of Estimate When Done Why Done How Accurate


Rough Order of Very early in the Provides rough –25%, +75%
Magnitude (ROM) project life cycle, ballpark of cost for
often 3–5 years selection decisions
before project
completion
Budgetary Early, 1–2 years out Puts dollars in the –10%, +25%
budget plans
Definitive Later in the project, < Provides details for –5%, +10%
1 year out purchases, estimate
actual costs
Four Basic Techniques for
Cost Estimation

1.Analogous or Top-down
Use the actual cost of a previous, similar
project as the basis for the new estimate

2.Bottom-up
Estimate individual work items and sum
them to get a total estimate
Four Basic Techniques
for Cost Estimates …
3. Parametric
Use project characteristics in a
mathematical model to estimate costs

4. Computerized
Use spreadsheets, project
management software, or other
software to help estimate costs
Constructive Cost Model
(COCOMO)*
 Barry Boehm helped develop the
COCOMO models for estimating
software development costs
 Parameters include source lines of
code or function points
 COCOMO II is a computerized model
available on the web
 This model is also used to estimate
time and effort * Not to be confused
with the Beach Boys
1980 hit of the same name
Final Caveats

 Many people doing estimates have


little experience doing them
 Many people doing estimates have a
poor track record
 People have a strong bias toward
underestimation (over-confidence)
 Management often wants a number for
a bid, not a real estimate