Hesham Khalafallah
In my work on feasibility studies and on founding and developing projects, I have learned a lesson that has come up again and again: a good study is a necessary condition for success, but it is not enough on its own. The clearest example is an experience I lived through myself in Kuwait.
A story from Kuwait: when success arrives before readiness
A Kuwaiti factory specializing in Italian pastries and baked goods asked me for marketing consultancy to expand and grow its presence in the Kuwaiti market. By the grace of God, within just three months its product became one of the best on the market, and demand rose sharply.
Then came the surprise. The factory’s original feasibility study had been excellent, and it had secured financing on the strength of it. But it had not accounted for rapid success and rising demand. The production lines had a fixed capacity that could not be exceeded, and there was no time to train the new workers. As a result, the factory was unable to meet market demand and missed a major opportunity to capture a large share of the market.
When the feasibility study was revisited for expansion, it turned out that the existing line’s efficiency could not be increased, and that expanding meant buying an entirely new production line — a decision that required time and additional financing.
I succeeded in my marketing mission, but I came away with an important lesson: I should have reviewed the factory’s technical capabilities, especially its operating and production lines, before pressing the expansion button. And from the start, the owner should have commissioned a feasibility study with a forward-looking dimension, one that answers a question rarely asked: what if we succeed faster than expected?
Capital gives you the chance to enter the market; readiness, the team and disciplined execution give the project the chance to stay.
Five lessons from the field
1. A study is the start of a decision, not a guarantee of success
A study is built on the information available when it is prepared, and markets change. A good study does not stop at an optimistic or a pessimistic scenario; it also tests the rapid-success scenario: can production capacity, the team and cash flow handle higher demand than expected?
2. Production capacity and people before marketing
A successful marketing campaign means little if equipment and staff cannot keep up. The plan should therefore cover the limits of production capacity, the possibility of expanding it, and a plan to recruit and train staff before demand rises, not after.
3. You don’t need to be a specialist, but you do need to understand
You can invest in a factory, a school or a hospital without being an engineer, an educator or a doctor. But you need to understand how the business earns revenue, the limits of its operations, and the indicators to follow. This is what I call “oversight literacy”: asking the right questions and telling a justified delay from a recurring failure.
4. Governance and readiness before launch
When the roles of investor, management and adviser overlap, accountability is lost. A project needs clear decision rights, an approved budget and regular reports comparing performance with the plan. And a finished building or installed equipment does not mean operational readiness; that is why I always recommend a limited pilot run that tests procedures, people, supply and cash flow before a full launch.
5. Use experts, and keep reviewing your plan
Bringing in experts matters, but knowledge must be transferred into the organization, and no expert should work on an isolated island: marketing, production and finance are links in a single chain. The study should become an execution plan with stages and decision points, where assumptions are tested again: has demand changed? Have costs changed? Are we ready for the next stage?
Before you start: six questions I ask every investor
• Do I understand how this business makes a profit, and what its key success indicators and risks are?
• Have the study’s assumptions been tested in less optimistic scenarios, and in a faster-than-expected success scenario?
• What are the limits of current production capacity, and how much would expanding it cost?
• Is there a realistic plan to recruit and train talent before demand increases?
• Are the roles of ownership, management, advice and accountability clearly defined?
• Do we have a cash reserve and a review mechanism that allow us to correct course early?
Conclusion
A successful project needs more than capital, and more than a study. It needs an investor who knows the limits of their knowledge, a team that is ready, and a plan that prepares for success as carefully as it prepares for failure. Then the feasibility study becomes the start of a well-considered journey, not the end of the thinking.
If you are preparing to execute or expand a project, I would be glad to review your execution plan and operational readiness with you, so that your project is ready for success before it arrives.
