Should We Spend The Money?

Managers are often faced with hard financial decisions. Is the cost of a new production machine justified by the benefit received? Is it cheaper to buy a customer management software package or build one ourselves? Should we close one location or cut all locations by 15%? The easiest way to answer those questions is with a cost benefit analysis. Here's how to do a cost benefit analysis and to avoid some of the common mistakes.

Although a cost benefit analysis is most commonly done on financial questions it can be used for almost anything. Not sure whether that proposed marketing campaign is a good idea? Do a cost benefit analysis. Worried about which health care plan to select for your employees? Do a cost benefit analysis. Should we outsource our call center to India, Jamaica, or Canada? Do a cost benefit analysis. It's a great tool. This article tells you how to do a cost benefit analysis right.