Opinion about the cost-benefit analysis process

Express your opinion about the cost-benefit analysis process. Why do you think the business managers prefer to use Benefit-Cost Analysis (BCA)?

 

Sample Solution

Opinion about the cost-benefit analysis process

Companies often need to weigh one project against another with the help of cost benefit analysis to make better business decisions. Evaluating potential costs and benefits that can be generated from a project is vital for businesses to make robust decisions. A cost benefit analysis is a methodology used by companies to estimate the likely costs and benefits of potential projects. Performing cost benefit analysis allows companies to measure the benefits of a decision (benefits of taking action minus the costs associated with taking that action). This offers companies the opportunity to identify and evaluate each upcoming expenditure.

ork these days are more and more demanding and companies need to develop products of high quality in a short span of time. The technology is shifting rapidly and the industry is globalizing where with the help of this technology it’s easier for smaller and medium size companies to reach the international market. On the other hand the bigger companies are continuously improving their processes, products and services are likely to survive in the changing market where medium sized and startup companies are booming at a very rapid speed. This is why the industry has started to hire more and more interdisciplinary teams for the product development. An interdisciplinary team consists of specialists of their own fields. A typical interdisciplinary team includes specialists of research and development, engineering, manufacturing, marketing, economics, arts, business, and design. By combining individuals’ strengths in a group will add value to the product and eventually to the company. Usage of interdisciplinary teams has accelerated the product development cycle which will result fast launch of the product into the market, lowered the production costs as those teams will evaluate each and every aspect of the product before sending it to the manufacturing phase, it is usually noticed that time spend in research and development phase before sending the product to manufacturing stage will decrease the cost of the product and avoid unnecessary breaks, and even doubled the estimated sales. The value of interdisciplinary teams is that every member has their own expertise and viewpoint from their own field. The diversity of the group increases access to different types of information. A group with the members all from different backgrounds can sometimes solve the problems which will take months within a week or even the problems which feel impossible to crack. The group members also learn from each other and might get some important contacts from the other fields. The good thing is that every person know their role in the group according to their own skills set so they must contribute their maximum effort. This lets them to focus on the parts they’re really good at and the other members will balance them in the areas where they don’t have the core skills. This will creates a positive atmosphere and that increases productivity. A team with different expertise ensures that all the tasks of a project are completed. Even after this the interdisciplinary teams has to have the talent, knowledge, experience and technical know-how to get the job done. The team needs also a unified goal and a good leader who will lead them to the right way in the process of development. Team work is difficult, especially in a group with different skills and expertise. The group members might have opposing viewpoints which can lead to conflicts, waste of time, and it may cause damage decisions or the team’s relationships. Collaboration is sometimes problematic, because every profession has its own language and it can lead to misunderstandings. Sometimes the group members use stereotypes and do not understand the value of the other ones skills and knowledge. Everyone should be valued and listened to in the team. The situation where a team member does not feel at ease and is scared to share his or her views may cut down the amount of ideas and expertise that can be crucial for the accomplishment of the project. Due to the differences in skills, interests and trainings, the team members are likely to observe the project or problem from different point of views. The group will think outside the box and that will lead to breakthrough innovations.
Source: IPD Handbook ver1.0
There is a right way and a wrong way to run a brainstorm or ideation meeting. A little preparation is required at the initial stage of the product development. It is very important to separate the two phases. The

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