Chapter 1 Flashcards
a project selection method that compares the benefits between projects by evaluating them using the same criteria. Cost-benefit analysis, scoring model, payback period, and economic models(npv, irr, dcf).
Benefit Measurement Method
share a location or facility with someone (or something) else.
Colocated
a project selection method that uses mathematical models using statistics and other mathematical concepts in the decision process.
Constrained Optimization Model
Compares costs to financial gains.
Cost-Benefit Analysis
a formal method used of project selection that assists with the decision making process with limited resources and budgets.
Decision Model
Analyzes future cash flows in today’s dollars.
Discounted Cash Flows DCF
decision model that uses financial calculations that provide data on the overall financials of the project.
Economic Model
Relies on the expertise of experienced stakeholders, SMEs, or those with previous experience in the project selection process. Usually used with one of the previous models.
Expert Judgement
Determines how doable a project is and if it is likely to succeed.
Feasibility Study
staff is organized along departmental lines and is managed independently. Hierarchical and most common.
Functional Organization
The discount rate when the present value of the cash inflows equals the original investment. Usually a on a X Y axis chart.
Internal Rate of Return
Functional managers assign employees to the project. Project managers assign the tasks to the employees. Three types: strong, weak, and balanced.
Matrix Organization
The difference between the present value of cash inflows and the present value of cash outflows over a period of time.
Net Present Value NPV
decision model that is based on the time it takes for benefits to completely repay all costs associated with the project.
Payback Period
a collection of projects, sub portfolios, and programs that support strategic business goals and objectives. Can consist of unrelated projects
Portfolio
