Studying feasibility for an alternative financing program is the process of discovering whether there is market need and demand for a loan program as defined by specific products and services, and if it is likely to succeed. Feasibility studies can be used to assess an existing program or determine whether starting an activity is warranted. Studying feasibility is a formal process to guide in decision making so stakeholders can determine whether to proceed with, alter, or drop a plan of action. There are no right or wrong answers in a feasibility study - only informed evidence. In other words, a feasibility study answers the question: Does/Will the return generated justify the activity? In this case, return references the need and demand for the activity, an alternative financing program.
Assessing Feasibility for Potential Alternative Financing Programs
For stakeholders that are not operating a program, a feasibility study should:
A major component is surveying the community of individuals with disabilities who might benefit from a resource dedicated to financing assistive technology (AT). Beginning with the assumption that people with disabilities are the target market, a survey should ask a minimum of two questions: who could benefit from a statewide lending program and what type of financial products and/or services would benefit them?
The end result studies the perceived market opportunity and then either supports or denies it. Practically speaking, the feasibility study affirms a selection of "choices" and may also identify alternatives. In this case, "choices" equate to markets, products, and services and alternatives to better ideas prioritized for further consideration. Table 1 shows how potential target markets and types of products/ services can be affected by the results of a study.
Table 1. Types of Products by Audience that will Benefit
Potential Target Markets who could Benefit
Potential Products and Services that would be Beneficial
SampleTarget Markets May Include:
1. Individuals with disabilities
2. Families with young children with disabilities
3. Families with school age children with disabilities
SampleProducts / Services May Include:
Direct Loans, Loan Guarantees, Interest Buy Down/AT Product Evaluation, Credit Counseling, Loan Packaging, Financing Literacy Education, Financial Planning
4. Senior Adults
4. Direct Loans with extended amortization to accommodate fixed income, Loan Guarantees, Interest Buy Down / AT Product Evaluation
5. Students with Disabilities in Post Secondary Training/School
5. Direct Loans with Deferred Payback/ AT Product Evaluation, Credit Counseling, Loan Packaging, Financial Literacy Education
6. AT Vendors
6. Lease Financing for Purchases of AT Made by Individuals and Families
Assessing Feasibility for Existing Alternative Financing Programs
For existing programs, a feasibility study acts as a means to:
Whether it is an existing State AT Loan Program or Alternative Financing Program, the process of studying feasibility evaluates the effectiveness of the existing set of loan products, services and the processes involved, informs of alternative options, and compares them with A) the initial intent for offering the products/services, and B) the requirements as established by the source of funding i.e. federal regulations or other resources. The report is evaluative in content and often has a recommendation component. In business practices, this type of feasibility is typically implemented when a set of products and/or services are not performing as anticipated and change is imminent. For example, Table 2 indicates products and services and how their effectiveness could be measured.
Table 2. Loan Program Products and Outcomes of Effectiveness
Existing Products and Services
Outcomes/Measures of Effectiveness
a. Direct Loans
b. Loan Guarantees
c. Interest Buy Down
Loan Portfolio Performance, Loan Quality, Deployment Rate, Loan Loss Reserve Capacity, Organizational Mission
a. AT Product Evaluation
b. Credit Counseling
c. Loan Packaging
d. Financing Literacy
e. Financial Planning
Requests for Service, Cost of Service, Impact of Service on Loan Quality, Organizational Mission, Organizational Capacity
Types of Feasibility Studies
There are a number of ways to study feasibility. They are variously called feasibility, recommendation, evaluation, and assessment studies. Regardless of the name, they all do roughly the same thing assess feasibility by providing carefully, systematically studied opinions and, sometimes, recommendations. There are some subtle differences among these types of studies.
For Potential Programs
For those states that do not have an alternative financing program, there are typically two types of studies. An initial assessment study and then a recommendation study.
Initial Assessment Study. An Initial Assessment Study evaluates a situation, often times a perceived opportunity, such as the need for a financing system, and a plan for addressing it then determines if the plan is "feasible" whether it is practical in terms of community needs, economics, social needs, current technology, etc. The feasibility study answers a question such as "Should we implement the plan for starting a statewide financing system" by stating yes, no, or sometimes maybe. It not only makes a recommendation, but gives the rationale behind the recommendation.
This type of study is fundamental to key stakeholders engaged in initial exploration. The study lays a framework for researching potential program products, services and processes.
Recommendation Study. A Recommendation Study starts from a stated need, a selection of choices, or both and then recommends one, some or none. For example, a state may intend to create a loan program. The Recommendation study provides for the research and recommendation of the program design and financial products for approval by review boards, grantee organizations, or other governing bodies. When information is collected, strengths and weaknesses are identified. A comprehensive recommendation study compiles the information and answers the question "Which option(s) should we choose" because it assumes that the stated need is, in fact, valid and all that is left to do is operating design.
This type of study is ideal for organizations that have already completed an Initial Assessment Study, but continues to a second phase where they engaged in further exploration as they determine markets to be pursued, products and services to meet market needs and demands, and processes.
For Existing Programs
For those states that do have an alternative financing program, there is typically one type of study, an Evaluation Study. However a Recommendation Study could also be used by existing programs as a means to discover the potential for program changes i.e., new markets, products and services for new and existing markets and processes.
Evaluation Study. An Evaluation Study typically provides an opinion or judgment rather than a yes-no-maybe answer or a recommendation. It provides a studied opinion on the value or worth of an existing program and its set of services. For example, when a financing system exists and its effectiveness is questioned by the grantee and/or funder, an Evaluation Report asks: Does it Work? and Is it Worthwhile? This type of study compares the financing system to requirements or criteria, i.e. Federal regulations and/or outcome measures, and determines if it has or how it will meet those requirements. There could also be a recommendation component that acknowledges "next steps" such as continuing the project, ending it, or changing it. If so, this could warrant additional feasibility assessment for new products/services/processes. Evaluation Studies are only applicable to existing financing systems.
Distinctions Among Studies Blur
The distinctions among the studies are sometimes rather fine, and they overlap. It is possible, and often practical, to combine elements of all these studies. There is no rule to how a feasibility report should be organized. Rather, it should reflect the status of information available to stakeholders and guide them in decision-making.
States will need to A) identify the goal and the type of study or studies that address their current need for information, B) develop a plan for assessing the elements of program feasibility, C) conduct the study and gather data and information, D) develop conclusions based on the data, and E) summarize the information into a readable and usable report. In doing so, a clearer, deeper understanding of program feasibility will be evident.
Planning and Conducting a Needs Assessment
Designing and implementing a needs assessment includes two phases: planning and organizing for data collection followed by the actual data collection.
Planning for Data Collection
The planning and organizing phase begins with establishing partnerships between organizations that have a stake in the potential outcome of the needs assessment and that may be involved in future decision-making. During this first phase, partners work together to develop specific goals and objectives for the needs assessment process. This strategy is particularly effective for organizations that are initially studying the potential for an Alternative Financing Program as it affords them the opportunity to inform their colleagues of their interest and knowledge on the subject. For existing organizations looking to either justify program products/services or refine them, collaborations may be newly established or reaffirmed.
The following steps outline activities that should be completed before moving on to the next phase:
1. Identify Relevant Stakeholders. Stakeholders could include public and private community rehabilitation programs, Centers for Independent Living, publicly funded programs such as Veterans Administration, Services for the Blind, and Vocational Rehabilitation, disability-specific programs such as mental health service providers, youth services, and other non-traditional lending systems such as microlenders, etc.
2. Conduct Planning Meetings. It is important to learn more about the stakeholders, their perceptions of the concept of Alternative Financing Programs, and the constituencies they serve.
3. Develop Plan for Needs Assessment. This plan should include:
Needs Assessment Questions
1. Categories of Questions. Needs assessment surveys for individuals and service providers should be based on a minimum of four categories of information, including:
- Generally categories of assistive technology
- Current status/availability of assistive technology
- Frequency of use of AT
- Experience acquiring assistive technology
- Eligibility for assistance from public & private programs/services
- Status of past and present loan applications
- Experience with credit
- Need for credit
- Categorized according to target populations
2. General Guidelines for Developing Assessment Tools. When developing content for surveys in general, make sure that
3. Sample Needs Assessments. Samples of needs assessment surveys designed by Alternative Financing Programs are presented for the following programs
Once needs assessment questions are determined, methods need to be identified for collecting the data, followed by the actual collection of the data. Methods commonly used are focus groups, a printed needs assessment survey of individuals, and online survey of relevant stakeholders.
Focus groups are small groups that share a common situation and are representative of the target markets. For example, organizing a focus group in which participants are similar to each other, such as families of youth with disabilities, will ensure a free flowing exchange of ideas and opinions.
For more information about planning for and implementing focus groups, visithttp://www.managementhelp.org/evaluatn/focusgrp.htm
Online surveys are a particularly effective when surveying service providers and relevant stakeholders. With the availability of services from companies such as Zoomerang and SurveyMonkey, well organized and professional-looking online surveys are easy to achieve. Both services provide the following:
Information about implementing online surveys may be viewed athttp://www.surveymonkey.com/ and http://info.zoomerang.com/
If printed surveys are used, it is necessary to determine how data will be collected. For example, will printed surveys be mailed and, if so, how will mailing list be derived, what will the cost be for mailing, and what resources are available. If stakeholder organizations choose to implement surveys among their constituents, what protocol will be used when collecting data?
General information on the steps for designing a print survey is available athttp://www.umdnj.edu/qualityweb/qualitycorner/qc97sum.htm.