What is the impact of cost-benefit analysis in decision making?

What is the impact of cost-benefit analysis in decision making?

Cost-benefit analysis helps organizations evaluate the financial implications of decisions, ensuring resources are allocated efficiently.

Can you give me an example of how it's used in a real-world scenario?

Sure! For instance, a city might use cost-benefit analysis to decide whether to build a new park by weighing the costs against the expected benefits like increased property values and community health.

What are some limitations of cost-benefit analysis?

Some limitations include difficulty in quantifying intangible benefits, potential bias in estimating costs, and the challenge of predicting future outcomes.

How can organizations improve their cost-benefit analysis process?

Organizations can improve their process by using accurate data, involving diverse stakeholders, and regularly reviewing and updating their assumptions.