Rapid Economic Justification (REJ)

Rapid Economic Justification (REJ) is a financial analysis methodology designed to provide a quick and easy way to determine the financial viability of a proposed project. It is commonly used in the IT industry to assess the economic feasibility of potential projects. The REJ methodology involves a five-step process as follows:

1. Define the project scope and objectives: The first step is to define the scope and objectives of the proposed project. This includes identifying the business problem the project intends to solve and any constraints or limitations that may impact the project’s success.
2. Identify the costs and benefits: The second step is to identify all the costs and benefits associated with the proposed project. This includes direct and indirect costs and benefits and any intangible benefits that may be difficult to quantify.
3. Analyze the costs and benefits: The third step is to analyze the costs and benefits identified in step two. This involves determining the net present value (NPV), internal rate of return (IRR), payback period, and other financial metrics that will help determine the economic feasibility of the proposed project.
4. Conduct sensitivity analysis: The fourth step is to conduct sensitivity analysis to determine how changes in key assumptions or variables may impact the project’s financial viability.
5. Make recommendations: The final step is to make recommendations based on the results of the analysis. This may involve recommending that the project move forward as planned, recommending changes to the project scope or approach to improve its financial viability, or recommending that the project be canceled or delayed.

The REJ methodology is designed to be a quick and easy way to assess the economic viability of a proposed project. It benefits projects with short timelines or where a quick decision is needed. However, it is important to note that the REJ methodology is not a substitute for more comprehensive financial analysis and should be used with other financial analysis methods.

The Rapid Economic Justification (REJ) category within our CIO Reference Library is a curated collection of resources, articles, and insights focused on the practical aspects of evaluating and justifying IT investments using a rapid economic justification approach. 

In this category, you will find valuable information on a wide range of topics related to REJ, including:

• An overview of the fundamental principles, techniques, and benefits of using REJ for IT investment decision-making.
• Best practices for developing a comprehensive REJ approach that aligns with your organization’s unique requirements, objectives, and technology landscape.
• Strategies for conducting rapid assessments of IT investment proposals, including guidance on identifying and quantifying the costs, benefits, and risks associated with proposed projects.
• Techniques for prioritizing and ranking IT investment proposals based on their economic value, strategic alignment, and risk profile.
• Insights into leveraging REJ-specific tools and technologies to optimize the performance, security, and cost-efficiency of your organization’s IT investments.
• Case studies and real-world examples of organizations that have successfully implemented REJ approaches highlighting the challenges, successes, and lessons learned along the way.

By exploring the Rapid Economic Justification (REJ) category, IT leaders can better understand the principles, techniques, and strategies underpinning effective IT investment decision-making. This knowledge will enable you to develop and execute a robust REJ approach for your organization, ensuring the successful evaluation and justification of IT investments and maximizing the benefits of your organization’s IT portfolio.