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Feasibility study and tailoring PRINCE2 

 December 9, 2023

By  Dave Litten

Feasibility study and tailoring PRINCE2

Feasibility Study – Tailoring PRINCE2

A feasibility study is an example of an evolving project since a precise specification of what is required has been known initially. As a result of the investigations carried out within such a project, the clarity of requirements only emerges once the final report.

A feasibility study is an analytical tool to help define problems and opportunities leading to a successful outcome. A feasibility study does not deliver the solution, merely the recommendations, and as such, it does not provide benefits directly. Such projects are called ‘enabling projects’ since their project product is used as a trigger to deliver the solution.

A feasibility study is a very efficient way of determining and delivering solutions to business problems or opportunities since they indicate the need for running resource-heavy investment projects.

This fact is also applicable to the business case. Since the feasibility study determines precisely what is feasible, the business case may only contain the reasons for the undertaking, the known risks, and an agreement on the likely costs and time scales. A range of benefits may be articulated, but at this point, they can be no more than a wish list.

The feasibility study business case should articulate the entire lifecycle of the business opportunity even though the feasibility study is a means to an end rather than the end itself.

Within a PRINCE2 project, the PRINCE2 business case is used to justify why the feasibility study should be carried out in the first place. As refined, it is used as an essential project board control to decide whether the feasibility study should continue, revise its scope, or stop.

Much like estimates, a business case will typically contain information in the form of a comprehensive range forecast (for example, a benefit may be stated as a potential 40 to 80% increase in our market share).

The investment appraisal section of the business case must include some form of cost-benefit analysis based on the range of costs and benefits for each potential alternative to solve the business problem.

Feasibility Study Sequence

Because of the range of options and the uncertainty of which would be recommended, embedding a feasibility study within the delivery project would give rise to many problems. For example, each option would require a different project plan and business case, and it would not be easy to create the project initiation documentation without knowing which option would be chosen.

For this reason, current wisdom suggests that a feasibility study is being conducted as a standalone project, with the project deliverable or end-product as the final report. This would then be used by corporate or programme management to act as a mandate to trigger the delivery project that would implement the feasibility recommendations:

Like any project, the delivery project would be based on a tailored version of PRINCE2, as would the feasibility study itself. By definition, every project that uses the PRINCE2 methodology must be tailored somehow.

We are tailoring the feasibility study project.

Feasibility studies can range from short, small, simple and low risk to long, large, complex and high risk. There is no such thing as ‘one size fits all’. However, due to the nature of a feasibility study, it is possible to suggest various approaches when tailoring PRINCE2.

PRINCE2 recommends applying it to each project by following the ‘lightness of touch’ principle. A key consideration here is the amount of control needed within a typical feasibility study that should act as the driver to applying and tailoring PRINCE2.

Here are some design considerations when tailoring PRINCE2 for a feasibility study:

  • Senior management (corporate or programme management) must take ownership of underwriting a feasibility study. Still, since the project’s main product will be a report, the structure of the project board will likely consist of part-time roles.

    The project board executive will be focused on setting the criteria for the involved business case and ultimately be the owner of the final report.
  • The project board executive will likely be actively involved in two key points: the first is to agree and approve a simplified PID, and the second is to accept the final report and close the project.

    Because of the nature of the feasibility study, the benefits management approach and follow-on action recommendations will probably be embedded within the final report.

    Because of the open-ended nature of a feasibility study, regular highlight reports should have greater emphasis as the frequency and formality of the end-stage assessments will be generally reduced within a feasibility study.
  • The senior user and senior supplier roles will take an online proactive approach and are likely to act more as consultants, particularly during the investigation and development of options within a feasibility study.

    They should take full ownership and, where appropriate, provide strong influence to ensure that the final recommendation meets the user community’s needs and that the solution path has technical integrity. For further information, refer to the PRINCE2 organisation theme.
  • The starting up of a project and initiating processes would be combined within the initiation stage end result with the definition of the problem and the project initiation documentation. Smaller feasibility studies may be structured to have one delivery stage within which the investigation option developments and a recommendation from the main products.
  • Where a single delivery stage is used, work packages will be used informally, focusing on generating a highly interactive communication environment. This suggests that a senior investigation team member could use a project manager/team manager.

The approach used by DSDM Atern when running an Agile project would be an excellent model to adapt here within a feasibility study. As such, tolerance becomes increasingly important in that it should be as comprehensive as possible while acknowledging the management and business risks of doing so.

Much like a research and development project, the data gathering and investigation phase is, by its very nature, an open-ended activity. Placing tight time and cost tolerances may thwart the quality and richness of data gathering and option development.

For small and straightforward feasibility projects, only one PRINCE2 Delivery Stage must be used. The dates, options, and report activities and products would then be managed as separate Work Packages:

For more formal and complex feasibility studies, it may be best to run the project in four management stages:

There may be a temptation to combine the options and recommendation stages, but this may lead to a premature recommendation once all four options have been evaluated and clarity obtained about the criteria to be used that would lead to a recommendation.

Application of the various PRINCE2 Themes will also need a lightness of touch (the business case and organisation themes have already been discussed ). Still, the following guidelines should be considered as a starting point:

The quality theme.

Since there is only one project deliverable, only the project product description may be required; in particular, the acceptance criteria for determining the final recommendation must be clearly stated. The quality management strategy document could be embedded within the project plan and lay down relevant quality standards and procedures that may need to be followed.

Importance should be placed on defining processes, techniques, tools and methods (derived from the project approach) for the feasibility study. Despite the informal approach, the options and final recommendations should be subject to a formal quality review.

The plans theme.

The only aspects of Product-based planning that may be used are the creation of the project product description and product descriptions for the above option and recommendation reviews, particularly the quality criteria and those to be involved. The use of a product breakdown structure and product flow diagram is unlikely.

Similarly, a combined project/stage plan will be simple in structure and content and focus only on providing a cost and time framework for sufficient control.

The risk theme.

Identifying risks and their appropriate management and responses becomes even more critical because of the nature and investment of a feasibility study. In particular, the feasibility study ultimately leads to the realisation of a business opportunity, and these should be articulated along with the harmful threats.

A risk management workshop would be recommended because of the project’s team-driven and open communication nature. Determining the total risk environment would typically use such techniques as SWOT Analysis, Porter’s Five Forces, and PESTLE Analysis.

The change theme. 

An Agile approach would be an advantage here, and the mindset of almost encouraging change is good. The PRINCE2 approach to change tends to be more formal, only implementing changes once the appropriate authority has approved them.

While an excellent principle, this should be tempered by the need for the investigation and option generation to be conducted openly and freely, suggesting that the change management approach, change authority and decision-making criteria be fast and flexible.

The progress theme. 

All projects consume resources, so progress controls are still required. I have discussed the use of stages already. Regular reports, such as informal checkpoint reports and a brief regular highlight report to the project board and corporate or programme management, should be agreed upon.

As already mentioned, tolerances should be given careful thought to allow reasonably free rein to the feasibility investigation while at the same time providing a clear metric for when escalation via an exception report is needed. The need and creation of an exception report will often be done verbally and followed up with minimum supporting documentation.

Summary.

Whenever feasibility studies are conducted, senior management must buy into the concept of a feasibility study and the delivery project being run as separate entities.

This means that business justification and the business case, in particular, need careful thought and structure. In particular, the business case benefits, costs, time and risk are seen as evolving throughout the feasibility study. In addition, the feasibility studies recommendation may suggest that no further action be taken, negating the need for a delivery project.

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Dave Litten


Dave spent 25+ years as a senior project manager for UK and USA multinationals and has deep experience in project management. He now develops a wide range of Project Management Masterclasses, under the Projex Academy brand name. In addition, David runs project management training seminars across the world, and is a prolific writer on the many topics of project management.

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