Midterm Makeup — Chapter 3 (Slides & Textbook)

Question 1

What Is a Problem?

Answer 1

A problem is a gap between where you are and where you want to be, with obstacles existing that prevent easy movement to close the gap

Question 2

What Is a Vision?

Answer 2

A vision is an organization’s purpose

Question 3

What Is a Mission?

Answer 3

A mission clarifies what an organization does.

For whom? How? Why do they do it?

Question 4

What Is Strategy?

Answer 4

What the organization does to support the vision and mission. The project should support the organization’s strategy.

Question 5

Project Objectives…

Answer 5

... support the MOV and include:
Scope (the project work to be completed)
Schedule (time)
Budget (money)
Quality (conformance  or fitness for use)

Question 6

What does MOV stand for?

Answer 6

Measurable Organizational Value

Question 7

The MOV must:

Answer 7

be some characteristics that can be objectively measured, to prove the project provided real value to the organization

Question 8

MOV proves _______ of the project.

Answer 8

success or failure

MOV proves success or failure of the project.

Question 9

All key stakeholders must _____ on MOV.

Answer 9

agree

All key stakeholders must agree on MOV.

Question 10

MOV must also support the org’s _____.

Answer 10

strategy

MOV must also support the org’s strategy.

Question 11

There are six steps to defining MOV:

Answer 11

1. Identify desired area of impact
2. Identify desired value of the project
3. Develop an appropriate metric
4. Set a time frame for achieving MOV
   5 .Get agreement from stakeholders
   6.Summarize MOV in a statement

Question 12

How-to: Identify desired area of impact

Answer 12

Ask yourself: Where will this project affect the organization?

Strategic: New markets, products & services
•Customer: Better products & services, better
loyalty, higher satisfaction
•Financial: Increased profits, profit margins
•Operational: lower costs, higher efficiency
•Social: Education, health, safety, environment

Question 13

How-to: Identify desired value of the

project

Answer 13

Ask yourself: Ok, now within each area of impact, what
will the project do to provide value?
Will it help you do something:

•Better? (e.g. quality, effectiveness)
•Faster? (speed, efficiency, cycle
time)
•Cheaper? (reduce cost!)
•Or do more in some way? (new
markets, products)

Question 14

How-to: Develop an appropriate metric

Answer 14

Ask yourself: So how will you measure that value?

•$$ - generate $x in new sales
•Percentage - reaching at least a certain number
(customer satisfaction > 95%)
•Numbers – have at least y new customers

Don’t get fancy – simple, clear measures are often
the best and Make it clear how the measure will be
collected

•Might need surveys, competitor data, etc.

Question 15

How-to: Set a time frame for achieving MOV

Answer 15

Determine how long it’ll take to achieve the MOV

• Could have multiple time objectives – reach x
by 6 months, y by 12 months, etc.

Question 16

How-to: Get agreement from stakeholders

Answer 16

Yup, easy to say, much harder to achieve
Everyone (project manager, sponsor, etc.) needs to
agree the MOV is realistic

Question 17

How-to: Summarize the MOV in a clear, concise statement

or table.

Answer 17

This project will be successful if _________________.

MOV: There is an increase in awareness for healthy
living by having 250 new subscribers sign up for a
weekly newsletter within 6 months.

MOV: The web site will provide a 20% return on
investment and 500 new customers within the first
year of its operation

Question 18

MOV is

Answer 18

the project goal.

Question 19

What is a Business Case?

Answer 19

An analysis of the organizational
value, feasibility, costs, benefits,
and risks of several proposed
alternatives or options.

Question 20

A Good Business Case…

Answer 20

Thorough in detailing all possible
impacts, costs, and benefits
Clear and logical in comparing the
cost/benefit impact of each alternative
Objective through including all relevant
information
Systematic in terms of summarizing
findings

Question 21

The Business Case

Step 1:

Answer 21

Define the MOV

Question 22

Define the MOV involves:

Answer 22

• The project’s goal, the measure ofsuccess
• Must be measurable
• Must provide value to the organization,align
with the organization’sstrategy and goals
• Must be verifiable at the end of the project
• Must be agreed upon
• Guides the project throughout its life cycle

Question 23

The Business Case

Step 2:

Answer 23

Form Cross-Functional CoreTeam

Question 24

Form Cross-Functional CoreTeam involves:

Answer 24

• Credibility (quality of being trusted)
• Alignment with organizational goals
• Access to the real costs
• Ownership
• Agreement
• Bridge building

Question 25

The Business Case

Step 3:

Answer 25

Identify Alternatives

Question 26

Identify Alternatives involves:

Answer 26

Most problems can be solved more than one
way, so your job is to brainstorm and find
several* plausible ways to address
the problem
•One can be the ‘change-nothing’ answer
•Change processes but keep the existing systems
•Reengineer an existing system
•Buy something off the shelf to replace an existing
system
•Start over, and make a new system

Question 27

The Business Case

Step 4:

Answer 27

Define Feasibility and Assess Risk

Question 28

Define Feasibility involves:

Answer 28

• Feasibility (“doable and worth doing?”)
• Economic feasibility
• Technical feasibility
• Organizational feasibility
• Other feasibilities

Question 29

Assess Risk involves:

Answer 29

• Risk Identification –What can go wrong? What
must go right?
• Assessment –What is the impact of each
risk?
• Response – How can the organization avoid
or minimize the risk?

Question 30

The Business Case

Step 5:

Answer 30

Define Total Cost of Ownership

Question 31

Determine the Total Cost of Ownership
(TCO) of each alternative, which is the sum
of…

Answer 31

direct or up-front costs, ongoing costs, and indirect costs

Question 32

what are direct or up-front costs?

Answer 32

the cost of implementing the project

Question 33

what are ongoing costs?

Answer 33

the cost of maintaining the

system

Question 34

what are indirect costs?

Answer 34

the cost of lost productivity
during development, unexpected system down
time, etc.

Question 35

The Business Case

Step 6:

Answer 35

Define Total Benefits of Ownership

Question 36

Determine the Total Benefits of Ownership
(TBO); what are the benefits of each
alternative?

Answer 36

• Increasing high-value work
• Improving accuracy and efficiency
• Improving decision-making
• Improving customer service

Question 37

The Business Case

Step 7:

Answer 37

Analyze the proposed alternatives

Question 38

Analyze the proposed alternatives involves:

Answer 38

Analyze alternatives to see which has the

most value for the organization

Question 39

There are five cash flow metrics most
often used to answer that ‘most value’
question:

Answer 39

payback, breakeven, ROI, NPV,

and scoring models

Question 40

Payback:

Answer 40

• Payback method determines how long it will

take to recover the initial investment

Question 41

Break Even:

Answer 41

Similar to Payback, it determines the point at which

a project would begin to recoup its original investment.

Question 42

Return on Investment (ROI):

Answer 42

It describes the percent

Project ROI = (total expected benefits – total expected costs) DIVIDED BY total expected costs

Question 43

The Business Case

Step 8:

Answer 43

Propose and Support the Recommendation

Question 44

Propose & Support Recommendation involves:

Answer 44

Once the alternatives are identified and
analyzed, the last step is to recommend one of
the options.

Question 45

The Business Case is

Answer 45

an investment proposal.