TECHNICAL FEASIBILITY: CRITERIA AND ANALYSIS - DUDAS - 2024

The technical feasibility is a study evaluating the logistical or tactical details on how to produce, store and deliver a product or service to customers. You have to think about materials, labor, transportation, where the business will be located and the technology needed to bring all of this together.

It is the complete analysis of a project in terms of contributions, processes, results, programs and procedures. It is a very effective tool for long-term planning and problem solving.

Source: pexels.com

A complete study should be conducted to discover the problems that arise and provide the best solutions to overcome them. It can serve as a flow chart of how products and services move and evolve through the business to physically reach the market.

After establishing the technical feasibility, it is important to also consider the monetary factor. It may happen that developing a particular project is technically possible, but requires a large investment, with a lower profit. To evaluate this, the economic feasibility of the project is carried out.

Criteria for technical feasibility

The technical requirements are established in order to define the feasibility of the project. Assessing technical feasibility can also highlight specific risks to consider in the project.

Specific feasibility criteria should be used, appropriate for the type of infrastructure concerned. These criteria should address the following points:

- Has the proposed technology been tested? Can the associated risks be managed properly?

- Is there a complete evaluation of the conditions that may affect the project, in terms of costs and time?

- Can the project requirements be met?

- Can the project be specified in terms of results?

- Is the scope of the project viable from a regulatory perspective?

- Can the project be adequately measured through performance indicators?

- Can the main technological changes in the provision of the service be satisfactorily estimated?

If the answer to all the above questions is yes, and no other exceptional technical problems are raised, the project is technically feasible.

If the answer to some of these questions is no, the technical feasibility analysis should provide feedback on the technical requirements that must be modified, until a technically feasible project is obtained.

Analysis

Make sure to include all the technical requirements of the business, from production to shipment to the customer. This information will help investors learn more about the operation of the business.

It is not enough to have a great idea for a product or business, but you have to show how you can make money with it. The technical feasibility study addresses its physical and logistical mechanism.

It is essential to reconcile the technical and financial data of the study. If other parts of the feasibility study show growth, the workforce and technical capacity to support that growth will also need to be projected.

The technical feasibility should serve as a written explanation of the financial data, because it provides detailed information on the reasons why high or low spending has been projected.

Many things are considered when doing a technical feasibility study, including materials, labor, transportation, marketing, physical location, and technology.

Executive Summary

The key points of each section that will be included in the technical feasibility analysis should be highlighted. The abstract should appear at the beginning.

Make sure to include a detailed description of the services or products that will be offered and how the business will benefit consumers.

Material requirements

The materials that will be needed to create a product or service should be listed, including things like glue and nails. Also indicate where these materials will be obtained.

Include information such as the availability of volume discounts as the business grows or if the parts are planned to be manufactured at some point.

Labor requirements

In most cases, labor will be one of the largest expenses for the business. It should indicate the number and type of employees that are needed to manage the company now and those that will have to be employed in the future when the company grows.

Work can be divided into categories, such as administrative, clerical, production, or distribution personnel, and professional personnel, such as lawyers, accountants, engineers, and marketing employees.

Transportation and shipping requirements

How will the items be transported if they have to be shipped from one location to another? Smaller items can be shipped via local carriers, DHL, or USPS, but heavy or bulk items must be shipped via a freight or freight company.

If perishable items are being shipped, special handling will be required. Special permissions may also be required to submit certain items.

These are all things that are going to affect the "how" of moving products from one place to another.

Marketing requirements

A crucial consideration is knowing how to reach consumers, because without them the business will fail. It's something investors need to know.

You have to go beyond advertising plans, although this is also important. What type of advertising campaign are you planning to launch? Will you rely more on print media or other options? Which consumer will you target?

Physical location of the business

Where the business operates will have an effect on its success. If a home office is to be started, it must be determined if a physical office will be needed at some point in the future.

Will facilities be needed for the warehouse, or for the factory? Will a retail store or any other purchased or rented facility be needed for the business to operate?

On the other hand, the advantages and disadvantages of where these facilities will be located should be analyzed.

Should they be in a centralized location or off state lines? Are special parking considerations needed for customers or trucks? Does it have to be close to other facilities, like an airport or a shopping center?

Technological requirements

Every business needs at least some type of technology to operate. The technology component should include discussions of telephone systems, computer hardware and software, and inventory management.

Also consider accepting credit cards or processing checks. Special devices may be required to accommodate teleconferencing equipment or facilities.

Cell phones are a necessity for most businesses. Alarm or camera systems and production equipment may also be required.

References

1. Lahle Wolfe (2019). How to Write a Professional Technical Feasibility Study. The Balance Careers. Taken from: thebalancecareers.com.
2. Evirtual Services (2019). Technical Feasibility. Taken from: evirtualservices.com.
3. APMG International (2019). 7 Assessing the Technical Feasibility. Taken from: ppp-certification.com.
4. John Spacey (2017). 14 Types of Technical Feasibility. Taken from: simplicable.com.
5. UMA Virtual (2019). Technical and Operational Feasibility. Taken from: uma.edu.ve.