The project concept / initiation phase provides the high level determination if the project is worthwhile, via a review of the project charter, business case, cost-benefit analysis, and definition of the team to move the project forward. This phase includes the work that is necessary to determine the feasibility of pursuing defined business strategies as funded programs and projects.

The primary scope of work includes developing a business case, conducting a feasibility study, and performing a cost-benefit analysis. Once those activities are complete, and sponsoring executives have reviewed the analysis and made their final decision to proceed, the project manager will begin to form the project team and review and complete the project initiation checklist.

During this strategic assessment phase, businesses executives will review the mission and past strategies to look for areas of improvement, and possibly assess new market, product or service opportunities. However, there's another level of assessment that must occur before investment decisions can be made on which programs and projects to invest in.

These assessments delve deeper to determine organizational capabilities that are required to support the mission of the entity, and then determine the scope of work required to implement these capabilities, plus the feasibility and cost-benefit of investing in developing those capabilities. Such assessments occur during this phase.

Ideally, the concept phase will be conducted in the fiscal year preceding funding and approval of the actual project. The primary deliverable of this phase is the Business Case. Additional analysis performed during this phase include a cost benefit analysis and a feasibility study. These artifacts and related analysis are necessary for an executive management team to have the data they need to make sound determinations on the risks, return on investment (ROI), and benefits of funding proposed project.

The next activity considered should be the development of a business plan, especially where a new commercial offering is contemplated. The business case helps determine whether there is a unique value proposition that justifies investments in the proposed project idea or initiative, before the organization commits significant time, resources and expenditures.

Assuming the business case analysis indicates there is a unique and viable value proposition, the organization still needs to determine if the project is feasible. Business Analysts conducting a feasibility study assess business and technical information, projected costs and benefits, risks, issues and constraints to determine if the project is practical from an economic and technical perspective. In addition, where alternative solutions are available, the feasibility study will determine which proposed solution best fits the needs of the organization, and documents recommendations made by the business analysts.

In addition, a detailed cost-benefit analysis may be completed in this phase. The purpose of the cost for-benefit analysis is to provide executives and sponsors with the information and metrics they need determine whether the proposed project has sufficient value to justify commitment of time, resources, and funds. While the feasibility study includes some cost-benefit information, the project cost/benefit analysis is more detailed and focused solely on economic value of the proposed solution.

This is not to imply that all risks are removed by including a concept phase. To the contrary, until a detailed functional and technical requirements analysis has been completed, during the Requirements and Design Phases, it is truly difficult to assess the total scope of work that may be involved in any given project.

Nevertheless, the deliverables of the concept phase, as described in the previous paragraphs, help ensure that everyone involved with the project understands the parameters under which the project can be judged a success. From a practical perspective, no executive sponsor or customer is going to open up their checkbooks without some sort of limits imposed in terms of budget, time and resources, and expectations set on the deliverable that are required to make the project a success.