How do you know if a project is economically feasible? Why is TCO important?

What will be an ideal response?


A project is economically feasible if the future benefits outweigh the estimated costs of developing or acquiring the new system. A systems analyst determines economic feasibility by calculating a project’s costs and benefits. The analyst then uses various tools and techniques to perform a cost-benefit analysis, which often is called a feasibility study.
A project’s total cost of ownership (TCO) includes ongoing support and maintenance costs, as well as acquisition costs. It is important to stress that after-acquisition costs are substantial, and often are under-estimated. For example, HP found that the majority of total IT costs occur after the purchase, and that nearly half the costs lie outside the IT department’s budget. HP also noted that the most significant cost factor is user support, including peer-to-peer assistance that rarely is documented or measured.

Computer Science & Information Technology

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Indicate whether the statement is true or false.

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