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Project Initiation and Execution

Project Initiation and Execution

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Published by: Daisy on Nov 17, 2008
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6.1.1 Project Selection Considerations
Although a project manager is usually not directly involved in the selectionprocess of projects to support enterprise purposes, he or she should havea general understanding of some of the approaches that are used to deter-mine which project to initiate. Senior managers have the responsibility tomake the selection of such projects regarding:
New or modified products
New or modified services
New or modified organizational processes to support product and servicestrategies
Projects that are used to do basic and applied research in a field of potential interest to the organizationA major concern of the senior managers should be to gain insight intothe probable promise that projects hold for future competition. Seniormangers, in their evaluation of projects, need to find answers to the ques-tions outlined in Table 6.1.As the senior managers consider the alternative projects that are alreadyunderway in the organization, as well as new emerging projects, the abovequestions can help the review process and facilitate the making of deci-sions for which senior managers have the responsibility.In addition, as senior managers review and seek answers to these ques-tions, an important message will be sent throughout the organization: Proj-
Downloaded from Digital Engineering Library @ McGraw-Hill (www.digitalengineeringlibrary.com)Copyright © 2004 The McGraw-Hill Companies. All rights reserved.Any use is subject to the Terms of Use as given at the website.
Project Selection Questions
Will there be a ‘‘customer’’ for the product or service coming out of theproject?
Will the project results survive in a contest with the competition?
Will the project results support a recognized need in the design and executionof organizational strategies?
Can the organization handle the risk and uncertainty likely to be associatedwith the project?
What is the probability of the project being completed on time, within budget,and at the same time satisfying its technical performance objectives?
Will the project results provide value to a customer?
Will the project ultimately provide a satisfactory return on investment to theorganization?
Finally, the bottom-line question: Will the project results have an operational orstrategic fit in the design and execution of future products and services?
ects are important in the design and execution of our organizational strat-egies!
6.1.2 Strategic and Operational Fit
Senior managers of an enterprise are expected to act as a team in selectingthose projects whose probable outcome will enhance the competitivenessof the organization. Managers need to be aware of the general nature of project selection models and processes.There are two basic types of project selection models—numerical andqualitative.The numerical model uses numbers to indicate a value that the projectcould have for the organization, whereas the non-numerical uses subjectiveperceptions of the value likely to be created by the project.Project selection models do not make decisions, people do. Such mod-els can provide useful insight into the forces and factors likely to impactthe value that the project can provide to the organization. However so-phisticated the model, it is only a partial representation of the factors likelyto impact the selection of a project. A selection model should be easy tocalculate and easy to understand.
6.1.3 Other Factors
The factors to consider in the selection of a project will differ accordingto the organization’s mission, objectives, and goals. In addition to the
Downloaded from Digital Engineering Library @ McGraw-Hill (www.digitalengineeringlibrary.com)Copyright © 2004 The McGraw-Hill Companies. All rights reserved.Any use is subject to the Terms of Use as given at the website.
above questions that need to be asked about the project, other factors canserve as a starting point:
Anticipated pay-back period
Return on investment
Potential contribution to organizational strategies
Support of key organizational managers
Likely impact on project stakeholders
Stage of the technical development
Existing project management competency of the organization
Compatibility of existing support by way of equipment, facility, andmaterials
Potential market for the output of the projectManagers should use some techniques to facilitate the development of data bases to facilitate the decision process, such as:
—or the process of getting new ideas out by a group of people in the organization.
Focus groups
—where groups of ‘‘experts’’ get together to evaluate anddiscuss a set of criteria about potential projects, and make recommen-dations to the decision makers.
Use of consultants
—to provide expert opinions concerning the poten-tial of the project, such as the availability of adequate technology tosupport the project technical objectives.
6.1.4 Project Selection Models
The use of appropriate numerical and qualitative models is dependent onthe information available, the competency of the decision managers tounderstand that information, and their ability to understand what the proj-ect-selection models can do. There are a few selection models that can beused to guide the decision about project selection made by the managers.
Qualitative methods
—when there is general information that can beused in the model.
—technique to rank-order projects based on a pre-selected setof criteria.
 Decision-tree model
—where a series of branches on the decision treeare used to determine which project best fits the needs of the enterprise.
Downloaded from Digital Engineering Library @ McGraw-Hill (www.digitalengineeringlibrary.com)Copyright © 2004 The McGraw-Hill Companies. All rights reserved.Any use is subject to the Terms of Use as given at the website.

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