RIIBEF604A - Conduct Feasibility Study by Precision Group (Australia)

Introduction (continued)

This manual is broken up into four sections. They are: Element 1

Identify and research organisation’s needs

Element 2

Carry out environmental investigation

Element 3

Assess feasibility

Element 4

Prepare report and present findings / recommendations

There are activities throughout this workbook. These require the Learners to think about their experience or reactions, or to try and complete some research through reading or accessing the Internet. The activities will also help Learners towards completing the Assessment Task by assisting them to think about issues involved in the Assessment Tasks. Learners will then be asked to complete an Assessment Pack for this unit of competency. The information contained in this workbook will assist them. These tasks can be completed as they work through the workbook, rather than leaving it all to be completed at the end of their study. Finally, at the end of this workbook you will find a list of useful resources that you may use for further information. You will need to have access to an Internet terminal. Throughout the text, there are references to websites for further information and for some activities. This unit contributes the attainment of National Certificates. Feasibility is the state or degree of being easily or conveniently done. So a Feasibility Study is conducted to objectively and rationally uncover the strengths and weaknesses of the existing business or proposed venture, opportunities, and threats as presented by the environment, the resources required to carry through, and ultimately the prospects for success. They are usually conducted before commencing a technical development and project implementation. A Feasibility Study is designed to discover if a business is ‘feasible’ or not. It will answer questions such as ‘will your idea work?’ It is an essential first step before spending money and time on more detailed plans. The information gathered is not wasted as it can be incorporated into the Business Plan. A Business Plan is a more detailed and indepth document that incorporates the information gained from a Feasibility Study plus specific timelines, detailed budgets with forecasts, and a detailed financial strategy.

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

2. Preliminary Feasibility

These are ‘pre-Feasibility Studies’ and are used to choose the preferred operating options. The list of potential options would have been taken from the Scoping Study. These are used to build a case committing to the large expenditure and effort involved in a subsequent definitive Feasibility Study or to withdrawing. Known costs and estimated gross dimensions or quantities after the preliminary engineering has been completed are costed in to this document.

3. Detailed Feasibility

These are the most detailed study and allow the final decision whether to proceed. On the basis of this study, capital is organised using the budget figures for the project provided in the previous report.

Detailed Feasibility Studies are often used to support external financing requirements. There is a significant amount of formal engineering work required and usually reflect an accuracy of to within 10-15%. Therefore they are also used to refine the ‘best’ operating plan and whether to move forward on the project to design and construction. They are expensive, often between ½-1½% of the total estimated project cost but do assist strongly with providing a basis for the decision on whether in fact further study is required.

A Feasibility Study is not as detailed as completing a full business plan but still requires a great deal of research and collection of primarily technical information because this will be the basis of the decision whether to ‘go ahead’ to the next step on a project or to ‘give it a miss’.

Access, Interpret, and Apply Compliance Documentation Relevant to the Work Activity Compliance requires knowledge and action on many documents. These can range from authority documents (laws, contractual obligations, international and national standards, audit guidelines, etc.) which are conveyed either as ‘do this or don’t do that’, or step-by-step instructions such as Reporting Guidelines. Compliance is a process, and definitions are used to define a common language as well as to define the actions or operations that lead to a particular outcome or result. Compliance defines the actions we must take or not take, or what we must achieve. Usually it does not define how to get there.

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

Large mining operations are likely to be regulated by a ratified agreement, sometimes also called a ‘state agreement’, an ‘agreement act’, a ‘government agreement’, or a ‘special agreement act’. The basis of such an agreement is that the State contracts with the miner in the form of a written agreement which is ratified by a statute of that State or Territory Parliament. This ratification ensures that its provisions override any inconsistent provisions under the general mining legislation or any other statutes of that State or Territory. Exploration and mining cannot be undertaken either on Crown or private land unless in accordance with the provisions of the following Acts and Regulations: • Mining Act 1971, Mining (Miscellaneous) Amendment Bill 2010 and Mining Regulations 2011 made under the Act • Offshore Minerals Act 2000 • Opal Mining Act 1995. Depending on the nature and location of the tenement, approvals and/or consultation may be required pursuant to legislation covering environmental, planning, and Aboriginal issues. For further information in each State or Territory, go to: South Australia

http://www.pir.sa.gov.au/minerals

Western Australia http://www.dmp.wa.gov.au/ Tasmania

http://www.iris.tas.gov.au/resource_industry/mining

Victoria

http://www.vic.gov.au/business-industry/industry-business-

sectors/mining-industry.html New South Wales http://www.dpi.nsw.gov.au/minerals Queensland

http://mines.industry.qld.gov.au/

Northern Territory http://www.nt.gov.au/d/Minerals_Energy/ • Australian Standards Standards are published documents setting out specifications and procedures designed to ensure products, services, and systems are safe, reliable, and consistently perform the way they were intended to. They establish a common language which defines quality and safety criteria. These documents are practical and don’t set impossible goals. They are based on sound industrial, scientific, and consumer experience, and are constantly reviewed to ensure they keep pace with new technologies. They cover everything from consumer products and services, construction, engineering, business, information technology, human services to energy and water utilities, the environment, and much more. The mining industry is covered by standards for reporting as discussed earlier and further information can be found at http://www.jorc.org/ There are a number of other standards, both national and pertaining to each State. Information can be accessed at http://catalogue.nla.gov.au/Record/494010

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

There are many other Codes of Practice and other standards. These and their current status may be found at: • http://www.dpi.nsw.gov.au/__data/assets/pdf_file/0003/211692/10-AS-updateDEC-.pdf • http://sdpp.standards.org.au/ActiveProjects.aspx?CommitteeNumber=ME018&CommitteeName=Mining%20Equipment The Australian industry has adopted a strong focus on OHS management for a number of intersecting reasons, including: • Legal requirements: The shift from compliance to management requirements of mining and general OHS legislation has required companies to invest significant resources in appropriate systems. • Financial incentives: There is a business case for a safe workplace, including the minimisation of Workers Compensation premiums and reduction in the costs of managing injuries and illness. • Corporate commitments: Many companies have introduced corporate policies that commit them to eliminating injuries and harm in the workplace. • Additional benefits: Proactive management of OHS can create a positive work environment, which in turn can lead to increased productivity. The major mining states - WA, NSW, and QLD – are keeping their specific mining OHS legislation. In NSW, this will be applied in addition to the general OHS legislation, whereas in QLD and WA, the mining OHS legislation will replace the general OHS legislation. In all cases the individual pieces of legislation will embody the essential features of the model legislation, bringing much more consistency across Australia. Other special legislation may also be applicable to specific aspects of mine safety – for example, regarding management of dangerous goods, including explosives. • Risk Management Risk management is a careful examination of what could cause harm to people in your workplace and: • Weighing up whether you have taken enough precautions, or • Should do more to prevent harm, and • Controlling exposure to prevent harm. The aim is to make sure that no one gets hurt or becomes ill – that a person returns home safely after work. The Australian Standard for Risk Management has been superseded by the new International Standard for Risk Management. The International Organisation for Standardisation (ISO) developed a new standard, ISO31000, based on the original Australian Standard for Risk Management – AS4360, because of its effectiveness.

RIIBEF604A Conduct Feasibility Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

There are two key differences between the two:

1. ISO31000

defines risk as the ‘effect of uncertainties on objectives’. The

previous standard defined it as ‘the chance of something happening that will have an impact on objectives’. This change impacts primarily on formal risk assessments.

2. The

ISO31000 standard introduces a set of principles that organisations

need to follow in order to implement truly effective risk management. These principles say that a great risk management program has the following attributes: • Creates value • Integral part of organisational processes • Part of decision making • Explicitly addresses uncertainty • Systematic, structured, and timely • Based on the best information available • Tailored to the organisation • Takes human and cultural factors into account • Transparent and inclusive • Dynamic, iterative, and responsive to change • Facilitates continual improvement and enhancement of the organisation. The risk management process itself remains the same, i.e. establish context, identify risks, analyse risks, evaluate risks, treat risks. There is a much greater emphasis now on how risk management should be implemented in the workplace and in organisations, with particular reference to continuous improvement.

Another change is in what is referred to as ‘enhanced risk management practices’. These are the key stages for risk management:

1. Continual Improvement Through setting goals and managing against them

2. Full Accountability Designating specific individuals and holding them to account for actions assigned to them

3. Application in All Decision Making Risk management practices should be applied in some way in every level of decision making, no matter the level of importance

4. Continual Communications Frequent reporting and communication with all stakeholders.

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

• Statutory Compliance Statutory means “of or related to statutes”, or what we normally call laws or regulations. Compliance just means to comply with or adhere to. So statutory compliance means you are following the laws on a given issue. The term is most often used with organisations, which must follow lots of regulations. When they forget or refuse to follow some of those regulations, they are out of statutory compliance. A company that follows all the rules is in statutory compliance. • Development Approval, Mining Licences (or equivalent), which may include: • Occupational health and safety • Environmental • Quality • Purchasing • Contract management. Development approval refers to the regulatory approvals that must be obtained prior to commencing a development. Most development activities are subject to Regulation. Examples include: land clearing, agriculture, forestry, mining, fishing, building, urban development, transport and infrastructure corridors, and water use in addition to those listed above. Further information relating specifically to mining can be found at http://www. derm.qld.gov.au/ecoaccess/business_and_industry/development_approvals. html • Employment and Workplace Relations Legislation The Commonwealth Act dealing with employment and workplace relations is the Fair Work Act 2009: This Act creates a national workplace relations system that is fair to working people, flexible for business, and promotes productivity and economic growth. Detailed information can be found at http://www.fwa.gov.au/ • Equal Employment Opportunity and Disability Discrimination Legislation Discrimination occurs when someone is treated unfairly because they belong to a particular group of people. Commonwealth laws relating to this include: • Racial Discrimination Act 1975 • Sex Discrimination Act 1984 • Affirmative Action (Equal Employment Opportunity for Women) Act 1986 • Human Rights and Equal Opportunity Commission Act 1986 • Disability Discrimination Act 1992 The Commonwealth and State laws say that it is against the law to discriminate against people or treat them unfairly in various areas of public life. One of these areas is employment.

RIIBEF604A Conduct Feasibility Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

Under the laws, employers (including managers and supervisors) must not discriminate against employees or harass them because of their: • Sex (including pregnancy and breastfeeding) • Race, colour, ethnic or ethno-religious background, descent or nationality • Marital or domestic status • Disability (including physical, intellectual, psychiatric learning or cognitive disabilities, and any virus or bacteria that can cause disease, such as HIV. It also includes any disability a person had in the past, has now, or may have in the future) • Homosexuality (male or female, actual or presumed) • Age (including not forcing people to retire at any particular age) • Transgender (transsexual) status • Carers’ responsibilities. It is also unlawful for employers to discriminate against or harass employees because of the sex, race, marital or domestic status, disability, homosexuality, age, transgender status or carers’ responsibilities of any of their relatives, friends, associates, or work colleagues. This means that all employees are entitled to equal opportunities, whether they are male or female, from one ethnic group rather than another, married or not, older or younger, and so on. Employers must not allow any prejudices or stereotyped views they have about any groups of people to influence who they hire, how they treat people while they are employed, and who they dismiss or make redundant. Further information relating specifically to mining can be found at http://www. hreoc.gov.au/about/legislation/index.html • Mining Legislation in Australia Minerals-related activities in the six States and the Northern Territory (NT) are normally administered by the Department of Mines, Minerals, and Energy, or equivalent, in each jurisdiction. While all States and the NT have their own laws governing mineral activities, in content and administration, they are very similar. The administration of exploration and mining titles in Australia is able to be accessed in the States and the NT to obtain current tenement information, through online information systems. This enables quick identification of tenement status and title-holders, improved identification of available prospective ground and immediate registration of applications for new titles. Information is also readily available on previous exploration activity and data availability.

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

For further information in each State or Territory: South Australia

http://www.pir.sa.gov.au/minerals

Western Australia http://www.dmp.wa.gov.au/ Tasmania http://www.iris.tas.gov.au/resource_industry/mining Victoria http://www.vic.gov.au/business-industry/industry-businesssectors/mining-industry.html New South Wales http://www.dpi.nsw.gov.au/minerals Queensland http://mines.industry.qld.gov.au/ Northern Territory http://www.nt.gov.au/d/Minerals_Energy/ One final word on legislation, you will need to consider before collecting any information, how you will keep it securely and confidential. You may collect information that is ‘business sensitive’, that is, it may be of advantage to businesses other than yours. Likewise, collection of information, opinions, and facts about others must be kept confidential. Consider carefully who is able to access particular information and how you can ensure that the information is secure and confidential. All of these areas and possibly many more will have to be addressed during this study. You will need to determine which apply and which are missing from this list. Other areas to be explored will be revealed as we progress with the study.

Analyse Organisation Goals, Objectives, and Strategies to Gain Direction as to the Type of Research to be Undertaken The vision, mission, and values of any organisation are the guiding lights of the strategic planning. They are the star by which organisations set their course and align their priorities. Well-written vision, mission, and values statements signal to the staff of the organisation and the world, a confident intent and direction. They allow employees the freedom to put their own mark on the implementation which is essential to motivated execution and good governance. The vision statement describes the ideal future and reflects the essence of the organisation’s mission and values. It unites the organisation in a common, clearly understood strategic direction and addresses how the organisation wants to impact on society. It conveys the ‘bigger picture’ of the purpose of the organisation so that employees see themselves as builders of a mansion rather than just laying stones. The mission statement describes the overall purpose of the organisation. It states what the organisation does, who it is done for, how it is done, and why it is done. The mission is the starting point in developing a strategic vision and establishes the boundaries for the organisation’s current activities.

RIIBEF604A Conduct Feasibility Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

The values reflect the core ideology of an organisation, the deeply held values that do not change over time and answer the question “How do we carry out our mission?” They must be the values that your organisation lives by, not the ones that it would be nice to have. The objectives are the quantifiable criteria that must be met for the project to be considered successful. Objectives must include, at least, cost, schedule, and quality measures. The objectives, goals, and tasks are what are required to be done and achieved to accomplish the objectives.

Analyse Strategic Documents to Identify Targets Once you understand the mission, vision, and values of the organisation, you are in a position to start to analyse them to work out the strategic direction that they indicate should be taken. If the strategic planning was done well, the plan provided a useful focus that energises and moves the organisation toward its mission objectives and goals, plus it provides a document to recruit others to the mission. Once you have established an understanding of the meaning and intent of these documents, it is time to confirm that you are clear and that they do, in fact, still represent the organisation in an honest way. This should be done in conjunction with the guardians of the strategic direction – the senior management team. This team may include a Board of Directors, Chief Executive Officer, and other Senior Managers. It must be those who have the authority to change the mission, vision, and values. These are the individuals who probably established them in the first place. If they have not been reviewed in a while, they may welcome the opportunity to conduct this analysis. As you conduct your analysis, consider the following in relation to the projects you have chosen. Will they: • Match the needs of your customers? • Match the markets your business operates in? • Incorporate technology appropriate to your organisation? • Show potential for survival, growth, and profitability? • Contribute to the organisational economic objectives and goals? • Match the organisational beliefs, aspirations, and values? • Maximise the organisational competitive strengths? • Respond to concerns for public image, social community, and environment feelings? • Reflect the value of the organisational employees?

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

During the planning stage the realities of funding and resource constraints are brought to bear in selecting the best ideas for the plan. It is here that decision making tools, based on desired criteria, are used to select options for the final strategic plan. For example, criteria can be: • Costly to set up • Time required completing the new service offering • Fit with current products and services • Potential for growth and profitability.

SWOT (Strengths, Weaknesses, Opportunities, and Threats) In planning, the traditional steps come into play, to include analysing strengths and weaknesses, opportunities and threats, competition, and available resources. These latter aspects further guide the decision making, providing a different set of constraints. Note that many of the opportunities in the SWOT will have been considered in the think and explore stage. Here are some questions for this stage:

1. Which of the ideas fit your mission immediately, short term, and long term? 2. What are the time, talent, and resource requirements for the ideas? 3. Which of the ideas have the highest return-on-investment (ROI) once implemented? 4. What does one have to do to implement the plan, as it pertains to people, skills, technology, and funds? The SWOT Analysis is an extremely useful tool for understanding and decision-making for all sorts of situations in business and organisations. SWOT is an acronym for:

S trengths W eaknesses O pportunities T hreats The SWOT analysis headings provide a good framework for reviewing strategy, position, and direction of a company or business proposition. A SWOT analysis is a subjective assessment of data which is organised by the SWOT format into a logical order that helps understanding, presentation, discussion, and decision-making. The four dimensions are a useful extension of a basic two heading list of pro’s and con’s

RIIBEF604A Conduct Feasibility Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

Groups of inter-related processes create systems. Changing one process can have positive or negative effects in other parts of the system. It is important when changing processes to consider unintended consequences. For example, marketing of services may increase demand beyond capacity. An increase in demand may apply more pressure on the system such as more telephone calls – will there be the ability to cope with increased telephone traffic? Next, consider the resources you currently have or need, to provide health services in your area. List the various people required. Do you have the right human resources? An important resource is the facility layout and physical workflow. Is your business designed to deliver to the standard required in the objectives? Do you have suitable technology and equipment? After developing your list of capabilities and resources, and analysing the external environment, consider the following questions: • What can we do? • What do we want to do? • What do others want us to do? These questions inform the next step in distinguishing organisational capabilities and resources as a strength or weakness. They also help assess the external environment for opportunities and threats. The SWOT analysis template is normally presented as a grid, comprising four sections, one for each of the SWOT headings: Strengths, Weaknesses, Opportunities, and Threats. Following is an example with questions to start you thinking about what you need to ask to discover the information you need. In the mining industry, these could concentrate on: • Strengths: characteristics of the business or team that give it an advantage over others in the industry. • Weaknesses: characteristics that place the organisation at a disadvantage relative to others. • Opportunities: external chances to make greater sales or profits in the environment. • Threats: external elements in the environment that could cause trouble for the business. To ensure that the circumstance of the exploration and mining is fully considered, a SWOT may be created for each of the following areas: • Landscape analysis • Risk management planning • Recovery planning

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

Any mine that is to be developed will require an environmental impact assessment (EIA). The EIA consists of mitigation, management, monitoring, and institutional measures to be taken to eliminate adverse environmental and social impacts. The EIA and subsequent permitting will always be on the critical path and can be more expensive and time consuming than the feasibility itself. Due to the critical nature of the EIA and permitting, it is advisable to begin environmental studies during the late stages of exploration. Typical areas that should be reviewed include: • Implementation of baseline studies, including routine sampling of active drainages to assess water quality before and after drilling • Implementation of general flora and fauna baseline surveys • Monitoring of local water wells, dams, and other drill holes to determine seasonal variations in the water table • Multi-element soil geochemistry and details of mineralogical work • Establishment of a weather station capable of measuring rainfall, wind direction, wind velocity, and temperature. Then the process itself follows these steps: • Exploring the landscape using field reconnaissance techniques • Air borne geophysics, follow-up with ground geophysics • Geochemistry • Field geology, mapping, surface sampling, etc. • Identification / discovery and acquisition of property rights. The discovery of what appears to be worth further investigation would require further investigation, usually in the form of: • Geophysical delineation, geochemical testing • Drilling and identification of a preliminary resource • Sampling and scoping level metallurgical test work. The next stage is to start analysing the situation and deciding the big picture issues: • Open pit vs. underground mine • Flow sheet • Product selection and marketing. But there are other critical elements that must be examined as well which include: • Power supply options – power line versus no site and the various types • Access and transportation options • Political risks, labour quality, and supply • Environmental issues.

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

The Feasibility Study phase begins when there is evidence of sufficient resources in a viable quantity and a suitable process to support development. Often organisations will commence the feasibility process without conducting adequate project definition and trade-off studies that should have been done at the Scoping Study or Prefeasibility phase. From the point of view of cost estimation and project evaluation, it is useful to describe the four main types of estimates usually prepared, and their purposes. • Scoping – for project evaluations, definition, and trade off studies • Prefeasibility – for final selection of project configuration • Feasibility – for demonstration of project economic viability • Definitive – for control of a project that has been approved and financed • Reclamation. The feasibility will need to include investigations of and information on: • Project Location including the Engineering Effort and Engineering Cost – in detail • Land position, claims and tenure; this may entail getting a legal opinion • Geological Setting – final information • Data Compilation and Analysis – final information • Spatial (Variographic) Analysis – final information • Geological Model – final information • Geological Resource – final information • Mineable Reserve – must be based on the results of the study • Mine Design – final • Mining Method – defined • Ore Body Access and Conveyance Conceptual – final design • Mine Development, Ore, and Waste Circuits – final information • Mine Ventilation Preliminary – yes • Mine Services Preliminary – defined & estimated • Ground Conditions and Hydrogeology Mine Services – definitive • Operating Costs – detailed estimates. At each point during your planning and preparation, investigations and analysis of the environmental impact must be made and results noted. This will involve testing and the results will require mitigation processes to be applied.

RIIBEF604A Conduct Feasibility Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

Mitigation is when measures are taken to reduce undesired effects in the environment. There are three types of mitigation that can be applied:

1. Prevention and Control Measures

If a technique is altered, or the site changed, or the use of different operating practices applied, the anticipated damage will be avoided. An example could include siting wells a minimum distance from toilets.

2. Providing Compensation

This is usually done in the form of completing improvements to compensate for damage to an area. An example could be tree planting in an area different to the mine site.

3. Remediation

This is the repair or restoration of the environment after damage has been done. An example could be extensive landscaping to a closed site.

A methodology to assess the environmental impact must be developed to allow monitoring of the environment and application of mitigation where necessary. The methodology that is used must take into consideration various indicators related to air, water, land, human health, and biodiversity. The goal is to develop specific methodologies for the various ecosystems. The draft methodology should be well discussed by focus groups, others with experience, and experts to ensure that all areas are included which allow the most efficient and cost effective methods are chosen. The environmental components include: • Water: Quality, quantity, reliability, accessibility • Soils: Erosion, crop productivity, fallow periods, salinity, nutrient concentrations • Fauna: Populations, habitat • Flora: Composition and density of natural vegetation, productivity, key species • Environmental Health: Disease, pathogens • Special Ecosystems: Key species. Indicators can be tested on site or in specialist laboratories depending on what is being tested and how deep the analysis is required to be. If water is being tested, water for heavy metals, then the laboratory is the required option. However, in the case of surface sewage contamination, a visual inspection around the area of the toilet and the septic tank may be all that is required to detect a leak or seepage, or groundwater levels can be measured in shallow wells with a rope and bucket. Monitoring is the systematic measurement of indicators to understand the impacts of the mining activities from other factors that may be impacting the site. It requires decisions about: • Location of measurement • Timing and frequency of measurement • Other factors dependent on the subject of the testing.

RIIBEF604A Conduct Feasibil ty Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

The design of the monitoring is dependent on what is being monitored. There are often many choices and the decision must be made on efficiency and cost effectiveness of each. The analysis is an essential element of the monitoring. The data collected is referred to as ‘raw’ or ‘unprocessed’ and is not useful to decision makers or project managers. It must be analysed first.

Analysing Data Analysis is usually conducted when the data is collected, summarised (in charts and tables) and the researcher examines these charts and tables, and attempts to draw meaning from them. This means that in some regards, analysis is much easier for those researchers who are less mathematically gifted. Qualitative information and data is generally gathered and then interpreted using the impressions and opinions of the researcher. That is, the researcher begins by examining the data and forming an impression or idea on what the data is showing. This is then used to report findings. This process generally begins with a process known as ‘coding’. Coding is the process of taking qualitative data and find demarcations within it. These demarcations or segments are labelled with a code. For example, you may have a set of information describing people’s opinions of your brand. People may use 40 or 50 different words to describe your brand. However, for the most part, they will be using different words to describe the same things. So, by summarising their responses into thematic groups you will have less data to analyse. The next step in analysing qualitative data is noticing trends within the responses. Once the data is coded, it can be summarised into various forms - such as graphs and tables. This may be produced as a bar chart summarising the number of responses to various categories of response to a question such as ‘how do you feel about Brand XYZ’. This graphical representation can then be used to draw conclusions about the data. The degree to which the data is analysed will be strongly influenced by the coding that has been created. The better the coding, the more useful the summaries will be.

Developing Options, Strategies, and Anticipated Outcomes The seven key stages in option appraisal are:

1. Stakeholder

analysis which identifies the people who need to be involved and

how to involve them

2. Defining both current and future strategic / service objectives and direction 3. Prioritising objectives 4. Generating options including a ‘do nothing’ plan or a ‘do the least’ option 5. Identifying, quantifying, and valuing costs and benefits 6. Assessing uncertainty and risk 7. Recording process and developing a baseline for measurement of success. RIIBEF604A Conduct Feasibility Study Trainer Manual © Precision Group (Australia) Pty Ltd

Element 1: Identify and Research Organisation’s Needs

The Senior management must: • Identify the organisational objectives and establish a strategic direction • Understand the legislative or national policy requirements as they relate to the objectives under consideration • Understand the current asset position taking account of performance and how it contributes to product / service delivery • Understand where the organisation and product / services are going in the next one, three, and five years, including how product / service provision may change and how this will affect organisational need • Develop a strategy to reflect and challenge this on a regular basis • Sign up to the strategy. The development of a clear understanding of these issues and corresponding organisational approach will provide an essential foundation for developing options. It is only when an organisation understands the real need in supporting product / service delivery that it can develop truly effective objectives to support this. Consult widely: Step 1 Stakeholder Analysis

1. List All Stakeholders

Identify an encompassing list of stakeholders who could potentially be involved in the option appraisal.

2. Assess Their Strengths and Prioritise

Reduce the list down to those who need to be involved or consulted. Prioritise them by importance to the option delivery and potential input into the option appraisal along with potential contribution.

3. Establish the Available Resources

It is important to decide how the consultation will be conducted because it can be very expensive. The resources that are available will determine both the number of stakeholders who can be included and the methods selected.

4. Decide How to Involve or Engage

The methods used to consult with the various stakeholders will vary. The numbers involved, their interests, and motivation will all determine the best method for each group.

5. Consult and Feedback

Conduct the consultation and record the outcomes. Feedback to the participants must be included in this planning. Decide when the feedback will be given. It could be given during the option appraisal or after this is completed depending on the stakeholders involved.

The following schedule is a simple stakeholder Matrix indicating involvement, each group’s ‘power’ to define / influence the process and how ‘interested’ they are likely to be in getting involved.

Element 1: Identify and Research Organisation’s Needs

Consultation can be conducted in a number of ways. Some of the methods including: • Surveys A data collection tool used to gather information. Surveys are commonly used to collect self-report data from study participants. A survey may focus on factual information or it might aim to collect the opinions. A survey can be administered in different ways. In one method, known as a structured interview, the researcher asks each participant the questions. In the other method, known as a questionnaire, the participant fills out the survey on their own. Surveys are generally standardised to ensure that they have reliability and validity. • Public Meetings A public meeting is used to gather information, listen to the views of local people, or build support for a campaign. • Focus Groups Focus groups are indepth, qualitative interviews with a small number of selected people. They are brought together to discuss many different topics. Focus groups generate data through group discussion. They listen, share, and compare their points of view. This provides much information about what they think and do. • Individual or Face-To-Face Interviews These are purposeful discussions between two or more people that can help gather valid and reliable data. Face-to-face interviews allow for personal communication and make it possible to gather information. The research interview is a general term for several types of interviews. Some may be highly formalised and structured, or they may be informal and unstructured conversations. • Paired or Small Group Interviews Instead of doing the more traditional one-on-one interviews with end users, the researcher asks end users to interview one another, while moderating their discussion. The end result is a research findings artefact, commonly in the form of a prioritised list of story cards or a story map, created by the session participants during the session, rather than by the researcher after the session. • Stakeholder Workshops This method is a workshop for invited customers of the service together with local stakeholders, in order to engage them in the review process. • Mystery Shoppers Mystery shopping is a tool used by organisations to measure quality of service or compliance to regulation, or to gather specific information about products and services. The mystery consumer’s specific identity is generally not known by the establishment being evaluated. Mystery shoppers perform specific tasks such as purchasing a product, asking questions, registering complaints or behaving in a certain way, and then provide detailed reports or feedback about their experiences.

Element 1: Identify and Research Organisation’s Needs

Objectives should be separated into: • Essential The potential option must contain all of these criteria. If one or more of these is not met, then it would be rejected. These could relate to Health and Safety in relation to buildings, Equal Opportunities, Access, or even a particular cost saving. These criteria should not be scored as part of an option appraisal process, but more as a pass or fail tick list for options if they really are essential to future arrangements. • Desirable These criteria will ultimately decide which option is successful. The balance will be between quality and cost, and will be more variable. A priority rating should be given to positive criteria to show the importance of each element. Key stakeholders with different views will need this done. • Flexible There will probably be criteria that are not worth considering for option appraisal. These should be abandoned because if there are too many criteria the complexity and costs increase substantially. Savings is an element which must be carefully considered. If it was essential that there be a cost saving of 5%, then it would fall into the essential category. If the cost saving must be made, but there is no margin, it could be in the desirable category, the only essential part is that a saving of some sort should be achieved. Another important consideration are the Inputs and Outputs. Try to ensure that Outputs are desirable or essential, and Inputs as flexible. Early in the planning, a list of objectives should be created from the organisational aims and objectives, and the views of key stakeholders. Importance will be determined by specific priorities and the local situation.

Element 1: Identify and Research Organisation’s Needs

Scoring Pairwise Comparison • If both objectives are equally important they both score ‘1’ • If one is slightly more important than another it scores 2 and the other scores 0.50 • If one is clearly more important than another it scores 3 and the other scores 0.33 • Finally if one is significantly more important it scores 4 and the other scores 0.25 This approach amplifies the scoring for significant objectives by comparing them to the ones of lesser importance. If you compare the result of the three methods you will see that in the paired comparison ‘G’ is rated almost ten times greater than ‘H’. If you look at the Simple Score Method and the Weighted Method, this was not nearly as obvious. Step 4 Generating Options There are three stages to the generation of Options:

1. Generate ideas involving the most appropriate stakeholders to generate a wide range of options, all of which will be considered more closely later. Workshops are another useful way of generating ideas. However, traditionally applied brainstorming or the use of the Charette Procedure are probably the most effective and because they can be a ‘fun’ process, are inclined to produce a higher result. The purpose is to produce a list with many, many options ranging from traditional and practical to wildly impractical. Brainstorming Brainstorming is a blending of group problem solving and discussion. It operates on the idea that the more ideas you generate, the greater the chance for finding a workable solution. You should begin by breaking up your meeting participants into smaller groups, each of which should elect a recorder. Each group should then generate as many possible ideas as they can. Once all the ideas have been found, the meeting participants should then begin discussing them. Charette Procedure The Charette Procedure is a group idea generating and prioritising tool. Its strength is its ability to address several issues at once in a highly interactive meeting setting. The Charette Procedure involves several small groups simultaneously discussing parts of the ‘big picture’. The ‘secretary’ then takes the ideas of that group and moves to the next group to discuss, and add. This is repeated until all groups have discussed all of the ideas of the other groups. This way all ideas are discussed by all groups for refinement, enlargement, and eventually, prioritisation. The Charette Procedure is especially useful when a group has decided what they want to do, but is unsure of all the details involved in how to do it.

Element 1: Identify and Research Organisation’s Needs

Other bias can include: • Neglecting to assess completely the performance strengths and weaknesses of an option. This can alter existing expectation of the quality of service and performance to justify a specific method. • Inaccurate estimation of the capacity of an organisation to achieve an alternative option. • Inadequate or selective research such as using figures, examples, or case studies that support a preconceived view The elimination of bias is not possible but it can be reduced if a systematic process is employed. Keeping the costs involved in each option confidential until the quality evaluation has been completed may help. All inclusions should be evidence-based to help combat the preconceived perspectives. Step 7 Recording Process and Developing a Baseline for Measurement of Success All elements of the Option Appraisal must be recorded for future reference. This will provide a basis for measurement and for learning. If an Option Appraisal is conducted and then discarded and the project does not meet its objectives, referring to the original documentation may enable recoveries, or at least greater understanding of how to avoid the same mistakes. Conversely, if there is great success, examination of documents may reveal how to repeat the success in another venture.

Element 1: Identify and Research Organisation’s Needs

Prepare a Research Brief Writing a research brief is an essential first step in any Option Appraisal. It will help the organisation choose a relevant and appropriate action. The more time spent planning the research, the better the outcomes are likely to be. Ultimately, it helps you clarify your objectives and prioritise what you want from the research. The brief helps the research agency develop the most appropriate research solution, and to derive the best value from the available research budget. The starting point is always the business objectives. Involving relevant units at the outset will save time by ensuring all key business objectives are included in the brief. There is often a tendency to include ‘nice to have’ issues. The more focused the objectives, the more focused the result! Key Headings in the Brief A brief should be concise, yet outline key information. The following headings provide a general template. • Cover Page The name of the person for whom the brief is being prepared, the organisation, the organisation address, organisation telephone, and website. If this is being prepared for distribution outside of the organisation of the Learner, or as part of a joint venture, then the same details for those with a vested interest should be included. However, it would probably be best to clarify this with your Manager first. The name or identifier of the subject of this brief should also feature if available. • Background to the Subject of the Brief An overview of the business, relevant issues to this investigation, and details of recent studies provides valuable background. Although time consuming, one of the most useful pieces of background information (particularly for organisation to organisation) is accurate information on the size and structure of the customer base or target audience. If appropriate, this should include who the most appropriate contact points are (e.g. particular job functions). Include the address of the subject of the report or all addresses of sites if more than one is included in this brief. If information about the investment in dollars is available, include it here. This could be the total amount to be invested in this project, the initial funding to be provided and what incremental payments will be made. Discuss the details included such as whether this is an acquisition or exploration. • Business Objectives Business objectives should be summarised separately from research objectives. For example, an organisation seeking to launch a new product (business objective) might consider a research program to measure the level of market interest and estimate likely revenue levels at the optimum price point.

Element 1: Identify and Research Organisation’s Needs

• Research Objectives Provide a summary of the research objectives. For example, in the new product launch initiative above, detailed information objectives might include determining optimum pricing levels of different customer or market segments, and identifying the most attractive product features. It is not necessary to produce a comprehensive list of detailed information requirements, but defining the core information objectives necessary to meet the wider business objectives is an essential component of the research brief. • Methodology Review the methods used to select Options and if necessary, make additional recommendations for the most appropriate method. • Outcomes Discuss the findings and requirements for provision of information. What are the required outputs e.g. raw data, interim reports, complete answers to survey, recommendations etc. • Contact Names Include details of relevant contacts, including the preferred or primary contact. • Proposal Submission Information Specify when the proposal must be submitted, to whom and where. If hard copies are required in preference to electronic documents, specify the number of copies required. Proposals can be presented to assist with the clients’ evaluation.

Develop and Implement Strategies To effectively implement strategies into plans, you require five things even before you begin:

1. Full and active executive support 2. Effective communication 3. Employee involvement 4. Thorough organisational planning and competitive analysis 5. Widespread perceived need for the strategic planning. Initiatives Initiatives are the actions the organisation will take to implement its strategy, based on issues, opportunities, or challenges that surfaced during the Options Appraisal and contribute to the achievement of the strategic objectives. They must be clearly described during the implementation process. Initiatives are not just new organisational efforts you’re taking on in addition to the work you are already doing. These initiatives may involve redesigning current programs or phasing out others in order to engage in work that is more directly aligned with your strategy.

Element 1: Identify and Research Organisation’s Needs

To do this, define the following elements for each initiative: • Deliverables What will be the results of the initiative? How will ‘success’ be measured? • Initiative leader and team Who is responsible and involved in the work? • Key activities What action steps need to be undertaken to achieve the deliverable? • Resource requirements

What investments (people, equipment, time, finances) will be needed to carry out the initiative?

• Interdependencies How will the initiative impact other functions or areas of the organisation? How will it affect other initiatives? • Milestones What are the major events, accomplishments, or key decision points that are anticipated? How will you know when and if your initiative is on or off track? • Performance metrics What will you measure to gauge progress on your initiative? How will you utilise these performance metrics to tell if your initiative is on or off track? • Timeline When will the initiative begin and end? At what milestone will you judge if your initial timeline is correct? You will find an example on the following page.

Element 1: Identify and Research Organisation’s Needs

Implementation When the strategies have been translated into initiatives, check that the scope, length and required effort of each are realistic and in an appropriate order. You are creating a blueprint to which all of the managers in the different units can refer and understand how their efforts connect with those of the other units. This will assist in allowing everyone to see the ‘big picture’. To create your blueprint, ask the following questions: • Do any initiative timelines need to be shifted due to interdependencies or pinch points? • Does one initiative need to reach a milestone or finish before another can start or continue? • Are timelines realistic considering current workloads? • Do you have sufficient financial resources to complete the initiative? • If planned progress is made on each individual initiative, is the organisation on track to achieve the strategic priorities? • Are any critical pieces or phases missing? Coordinating and integrating initiatives is challenging and will require tradeoffs because some initiatives will need to be completed before others are started. Integration ensures that critical choices are framed by the strategy, rather than by staff interests and advocacy, or other pressures.