Project evaluation
Assessing profitability, impact and risks on a sound footing.
Evaluation is the basis of a decision.
Project evaluation combines economic impact, strategic function and operational feasibility into a reliable basis for decisions.
What is project evaluation?
It combines investment volume, running costs, revenue potential, dependencies and risks into a basis for decisions.
Plausibility replaces evaluation
Many projects are started because they seem sensible. The idea fits, the pressure is there, expectations are high. The evaluation stays superficial. Profitability is estimated, risks are implicitly assumed, connections are not fully taken into account. The problem is not a lack of analysis.
Three levels must fit together
Only then does a reliable picture emerge.
Project evaluation is the basis for a decision.
Strategic function
What contribution does the project make to the business model? Does it strengthen the position or run parallel to the strategy?
Operational feasibility
Which resources, systems and organisation are needed? What is realistic, what is not, and with what effort?
Where projects are misjudged
Assumption departs from reality.
Recurring distortions arise in practice. Profitability is viewed in isolation, without taking operational reality into account. Strategic relevance is overestimated because the target picture is convincing. Risks are underestimated or not made concrete. Dependencies remain invisible.
Investment project without a sound evaluation
A company is planning a new platform or a digital offering. The market opportunity exists, the concept is convincing. Monetisation is uncertain. Dependencies on existing systems and the organisation are complex. The consequence is not rejection. Scenarios are calculated, the scope is adjusted, phases are redefined. The project continues, and a decision becomes possible.
Evaluation as a range
Three paths, one expected value.
A reliable evaluation makes impact and consequences traceable. It shows scenarios (pessimistic, expected, optimistic) with sensitivity bands. A decision on a project only becomes possible once the range is visible.
Selection is part of evaluation
Economically viable and strategically sensible.
Profitability, strategy and implementation are brought together. Some ideas remain options. Some initiatives are put on hold. Evaluation is therefore always selection as well.
When project evaluation becomes relevant
Before investments, before decisions.
Project evaluation becomes relevant when investments are due and uncertainty exists. When several options are on the table and priorities are open. When projects have started but their impact is not visible. Or when decisions are postponed again and again.
What distinguishes project evaluation from a profitability calculation?
A profitability calculation answers whether a project pays off. A project evaluation also answers under which conditions, with which risks and with which strategic effects.
What happens if the evaluation turns out negative?
A negative evaluation rarely leads to outright rejection. Scope, phases or assumptions are revised. Sometimes a project is stopped deliberately. Both are sound decisions.
How long does a project evaluation take?
A focused evaluation typically takes four to eight weeks. Complex projects with an incomplete data basis take longer. The effort is defined in the scope.