Cost-Benefit Analysis
in Monitoring & Evaluation

Cost-benefit analysis involves the appraisal of a project proposal. It aims to determine whether or not a project is worth pursuing, based on a comparison between the potential benefits of a project and the anticipated costs or risks it entails. Cost-benefit analysis helps managers and other decision makers understand the cost and expected returns (in monetary terms) of a given decision. It can help them decide whether or not to undertake a proposed activity, or choose between different alternatives. Cost-benefit analysis tools make this analysis easier and more straightforward, for example, by graphing different alternatives or presenting data for comparison. `Social Return on Investment analysis is another technique which is somewhat related to cost-benefit analysis. Although SROI may be associated with CBA to a certain extent, its objectives are quite different. The main aim of SROI is to help an organization make decisions which minimize any negative social or environmental impacts, as well as maximize the positive impact of the company in these areas.