Decision support and strategic assessment

Research output: Book/ReportCompendium/lecture notes

Abstract

The appraisal process is in this compendium outlined as a step-by-step process that is adaptable to all types of infrastructure-related problems and can be used for decision support on both the administrative and the political level. However, with examples often related to infrastructure decision-making, it should be observed that the outlined appraisal process is generic, and it can be applied to other areas of the management and technology area as well. In the administrative decision process, the socio-economic analysis provides a foundation for a systematic examination of which project types or initiatives are socio-economically most suitable for handling a specific infrastructure problem. Hence, the socio-economic appraisal can help undertake a proper selection of the possible solutions that should be examined further. The socio-economic analysis is as well an essential element in the political decision process. The analysis provides information about how the society’s resources – from an economic viewpoint – are used in the best possible way and how costs and benefits are distributed between, e.g., the state, the users, and the environment. Society does not have unlimited economic resources. Thus, it is necessary to prioritize between the many projects and initiatives discussed in the public sector. To conduct such a comprehensive prioritization (across different sectors or within the same sector), it is a precondition that a systematic evaluation of the projects/proposals/initiatives’ advantages and disadvantages is carried out. For many years, cost-benefit analysis (CBA) has been the primary tool for economic comparison in Denmark and many other countries worldwide. Investment projects prepared thoroughly and evaluated to have a high socio-economic return seem to obtain political acceptance more easily than projects that have not been considered through this type of assessment. On the other hand, socio-economic assessments can also be used to turn down projects that do not show a satisfactory return. However, sometimes projects are implemented despite in-satisfactory socio-economic return rates as political considerations may weigh higher. In the political prioritization process, other political, environmental, or economic factors may influence decision-making. These are not traditionally part of the socio-economic assessment but instead used as supplements in the final decision phase. The socio-economic evaluation strives towards valuing all advantages and disadvantages of a project. On the background of this, the project’s value for society is calculated. This value can afterward be compared to the values for other projects. The socio-economic appraisal is one of the most basic and tangible contributions to the planning and decision process within the transport sector when an initiative’s advantages and disadvantages are evaluated. The appraisal can be used both for political decision-making and internally in organizations with planning-related tasks.
Original languageEnglish
Number of pages176
Publication statusPublished - 2021

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