Business Decisions (Question #19 of 35)

Business / Entrepreneurship

What’s the potential upside? What’s the effort involved? What’s the likelihood of success? What’s the strategic value?

To those of you who may not be aware I have started my own Personal Training business (EnMotion Training) and prior to starting any business or pursuing a new opportunity a cost-benefit analysis should be done. Simply put the cost-benefit analysis is just a way to quantify how much benefit you receive from a particular pursuit in comparison to what has to be given to receive said benefit; every opportunity has a cost associated with it and it’s not always measured in dollars and cents. 

The formula I am using is [(A x B) / C] x D:

·         A = Potential Upside: 1-5 pts

·         B = Likelihood of Success: 1-10 pts

·         C = Effort Involved: 1-10 pts

·         D = Strategic Value: 1-3 pts