Module 2: Project selection Flashcards
SWOT
Strength, weaknesses (internal), opportunities and threats (external)
Project planning process (Traditional)
1) strategic planning - identify organization goals and objectives.
2) Business analysis - SWOT, value chain analysis or both.
3) Project planning - all potential projects.
4) Resource allocation - choose which project(s) you can afford to take on.
Value chain analysis
Breaks a firm down into its various activities to help understand ways that resources are used.
Ways to select a project
- Identifying the organization’s competitive strategy
- Performing a net present value analysis, return on investment, internal rate of return, payback period, etc.
- Implementing a balanced scorecard
- Using a weighted matrix model
- Addressing immediate problems and opportunities
NPV
Net present value. Determine financial feasibility. Calculating expected net financial gain or loss from a project over a period of time by discounting all expected future cash flows to present time.
The higher the better.
Discounting
Process of determining the value of future expected money to today’s value.
ROI
Return on investment. How efficient it is to invest in a particular project. Deduct product costs from benefits and divide by costs. (1200-1000)/1000 = 0.2; 20% return.
Payback period
Considered in conjunction with NPV. When the project starts to deliver more benefits than costs.
Iterations
work is split into small sections. Part of agile approach. Then reviewed by client/stakeholder and then work is changed, or continued.
Benefits of agile approach
Quick response time to smaller components of work. Able to catch errors quickly and make modifications instead of costly ones down the road.
QBR
Agile approach; Quarterly business reviews, link business strategy to quarterly planning.
Strategy implementation circle
Strategy, objectives, projects, products, value, feedback, benefit. Selects appropriate projects based on this information.
Roadmap
Sets a strategic plan and goals for completing an undertaking or a product in a project. Roadmaps focus on high-level plans without looking at details. They also communicate strategic thinking and objectives behind the plans. A roadmap defines why the project is being done. The roadmap comes before the Gantt chart.
Gantt
Displays project schedule information. The Gantt chart represents each task and the duration for each task within the project. The Gantt chart is much more detail-oriented.
Weight decision matrix
AKA weighted scoring model. Helps choose from various projects based on multiple criteria (cost, time, customization). Each criteria carries a different weight.
Balanced scorecard
Looks at an organization’s value drivers (finances, customers, internal processes, and learning and growth) into a series of defined metrics. Finance = cash flow, ROI, operating income, revenue growth. Customer -satisfaction. Internal processes: how well business is running. Learn and growth - looks at people, skills, knowledge and leadership.
Program selection
When determine what to pursue also choose how many. Potentially coordinator activities and tasks together.
Project portfolio selection
Best projects to maximize success of organization. Ensure all the necessary resources available. Manage risks.
Portfolio fit
1) No duplication.
2) Prioritize your projects.
3) Categorize the projects in terms of organizational goals.
4) Automate the list (compile in spreadsheet)
5) apply portfolio management tools to support project (risk analysis, ROI, etc).
Lean project portfolio management
Instead of creating a set of structural projects with short lived teams to execute them.
Defines desired outcomes for an organization, focuses on value and revisits past decisions at least every quarter.
Benefits of grouping projects into programs
Increasing authority
Saving money
Saving time
