Cost Benefit Analysis

Cost-Benefit Analysis Template

Assess pros and cons and improve your informed decision-making.

About the Cost Benefit Analysis Template

What is a cost benefit analysis?

Every business decision comes with potential rewards, as well as potential risks. Your decision might expand the business, introduce a new product, or tap into a new supply chain, but it also might cost the organization precious time, money, or social capital. Without a systematic way of analyzing costs and benefits, you may find making decisions an arduous task.

Cost benefit analysis (CBA) is an analytical tool that helps your team assess the pros and cons of moving forward with a business proposal. This technique helps you decide the best course of action to take with a new project by analyzing each option.

When to use a cost benefit analysis

You can use a CBA to compare completed or potential processes, or to estimate the value against the risks of decisions, projects, or processes. Your team can use this powerful, efficient tool in commercial transactions, business decisions, and project investments. 

Advantages of using a cost benefit analysis

Organizations make high-stakes choices all the time. Chances are high that your competition is weighing many of the same factors that you are. That’s why it’s crucial to approach decisions in a systematic, methodical way.

A cost benefit analysis allows you to weigh the potential costs of a decision without having to actually incur those costs. It helps your team decide whether the benefits outweigh the costs. If you have no choice but to incur costs, the analysis can provide an estimate for the time it will take to repay those costs.

Perform your own cost benefit analysis

Miro’s whiteboard tool is the perfect canvas to create and share your team’s cost benefit analysis. Get started by selecting this Cost Benefit Analysis Template. Then, follow these steps:

Step 1: Brainstorm costs and benefits. Make a list of each. Try to think of unexpected costs or benefits that your team might not have immediately anticipated. Once you have a list of costs and benefits, think about whether those costs and benefits are likely to change or grow over time.

Step 2: Figure out the monetary value of the costs. Will you need to hire employees? Train them? Will you experience a decrease in productivity while new hires get up to speed? If you introduce a new feature, will your system experience an outage that impacts your customers

Step 3: Now assign a monetary value to the benefits. Do your best to estimate potential revenue, but don’t confine yourself to cash. Think about “soft” benefits like positive word-of-mouth, employee satisfaction, or environmental preservation.

Step 4: Compare your costs and benefits. Which seems greater? How long would it take to repay any costs?

Cost-Benefit Analysis Template

Get started with this template right now.

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