CBA may also be referred as Optimum Utilization of Resources.
It is all about getting optimum out of the cost (capital) invested & knowing the benefit from any additional cost to be incurred.
It takes into consideration the long term outcomes from the cost being incurred.
Three Major aspects are:
(1) Hard Dollar Savings(2) Soft Dollar Savings
(3) Cost Avoidance
(1) Hard Dollar Savings - It keeps into consideration Short Term Objectives
(2) Soft Dollar Savings - It takes into consideratio Long Term Objectives
(3) Cost Avoidance - It takes into both the above concepts, focusing more on the future reduction in cost.
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