ChatterBank0 min ago
Cost Worksheet
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How do i prepare a costing template to do a cost benefit analysis ?
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For a simple explanation of what C-B analysis is, look here.
http://www.westerncc.ac.uk/affirm/CostBenefitA nalysis.html
To be honest, all of the problem is contained in the design of the approach to the problem - the turning of it into a template using MS Excel or similar is relatively straightforward.
You can make it as simple or as complicated as you want. For example, an issue occurs when the costs of a possible solution have to be incurred well before the financial benefits accrue. To solve this, many modellers use a Net Present Value (NPV) approach. Google NPV if you need to know how this technique works - it is again easy to programme it into the cost model.
Finally there can be the issue of valuing (in financial terms) the tangible but non-financial benefits. To do that you need a methodology agreed with the customers of the service or project outcome as to how they wish to turn non-financial benefits into a fiancial number.
http://www.westerncc.ac.uk/affirm/CostBenefitA nalysis.html
To be honest, all of the problem is contained in the design of the approach to the problem - the turning of it into a template using MS Excel or similar is relatively straightforward.
You can make it as simple or as complicated as you want. For example, an issue occurs when the costs of a possible solution have to be incurred well before the financial benefits accrue. To solve this, many modellers use a Net Present Value (NPV) approach. Google NPV if you need to know how this technique works - it is again easy to programme it into the cost model.
Finally there can be the issue of valuing (in financial terms) the tangible but non-financial benefits. To do that you need a methodology agreed with the customers of the service or project outcome as to how they wish to turn non-financial benefits into a fiancial number.
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