This is the second in a series of four continuing professional development articles that explain some of the principles of economic assessment (EA) and describe how they may be applied in practice by front line practitioners leading service innovations. It introduces a methodology, with associated tools and templates, that has been used by practising nurses to conduct EAs. Our purpose is to equip readers with the knowledge to develop a technically competent, pragmatic EA that will contribute towards evidence-informed decision making and assure the best use of limited resources.

If you have not already read the first article in this series (McMahon and Sin 2013), we strongly advise you to do so as each article purposefully draws and builds on those that have gone before. The time out exercises in the first article required you to access source material located on the RCN website and identify a service innovation in your workplace. The time out exercises in this article draw in these same sources.

We begin this article by recapping on the points covered in the first article before exploring the implications of the principles of EA and how to apply them in practice. In this article, we refer to and draw on a companion article published in this edition of Nursing Management (pages 38-41) that sets out the most commonly cited approaches to EA in health and social care. We aim to enable readers, along with those they seek to influence, to make an informed decision as to what may be an appropriate EA approach in any specific context.