Assessment of Project Feasibility Study Practice and Challenges: The case of Industrial Project Services (IPS)
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Date
2023-06
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Addis Ababa University
Abstract
An effective feasibility study ensures the viability and practicability of a proposed project. Even
when a feasibility study has been conducted and theoretically proven viable, projects may not
succeed. In IPS, among 50 projects whose feasibility was studied, then implemented and status
known, 11 projects faced variances in cost, 27 projects faced variances in time and cost, and 12
projects failed to achieve their objectives. As a result, the feasibility study by itself should be
reviewed independently for its practice, and challenges. Thus, this project research work is to
assess the project feasibility study practice and challenges in the case of Industrial Project
Services (IPS). An extensive literature review identified 7 kinds of feasibility studies, 5 elements
to be considered to ensure the quality of projects feasibility study practice, and 5 challenges that
are usually faced during project feasibility studies. Primary and secondary sources were used to
gather data, and a descriptive research design was applied. Qualitative and quantitative
research approaches were utilized to collect and analyze data. A total of 39 judgmentally
selected respondents, whose activities are directly related to the project feasibility study,
participated in the study. The data collected through a close-ended questionnaire was analyzed
quantitatively using SPSS version 26, and the data collected through interviews, an open-ended
questionnaire, and feasibility study reports were analyzed qualitatively. The analysis results
revealed that the firm has given more emphasis to technical, financial, and market feasibility
study practices. In contrast, less attention is given to the legal, economic, operational, and
scheduling feasibility study practices. As a result activities such as evaluating various scheduling
techniques relevant to a specific project, estimating operational costs, and measuring how well a
proposed method solves problems and meets requirements were rarely considered during the
study. The most significant element that ranked first among the elements to be considered to
ensure the quality of projects feasibility study practice was the level of experience and expertise
of the Feasibility Study Team members. Furthermore, among the challenges faced by the firm
during the feasibility study, gathering and analyzing all the necessary data was the major
challenge that ranked first. Lastly, two major recommendations were forwarded. First, the firm
should at least arrange an additional independent team/expertise for project scheduling, legal
and operational feasibility studies. Secondly, financial and market feasibility study practices
should be improved
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Keywords
Project Feasibility Study, Practices