Project Management: The Managerial Process (Mcgraw-hill Series Operations and Decision Sciences)
7th Edition
ISBN: 9781259666094
Author: Erik W. Larson, Clifford F. Gray
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 2, Problem 5E
You are the head of the project selection team at SIMSOX. Your team is considering three different projects. Based on past history, SIMSOX expects at least a
Given the following information for each project, which one should be SIMSOX’s first priority? Should SIMSOX fund any of the other projects? If so, what should be the order of priority based on
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Students have asked these similar questions
The chart below shows the initial investment and expected yearly payback for Project A and Project B
Project A
Project B
Initial Investment
$ 300,000
$ 450,000
Expected Yearly PayBack
$ 45,000
$ 90,000
For Project A, There has been a change in the expected yearly payback.
Years 1 and 2 – you are expecting $45,000 each year.
For the next three years, you are expecting $70,000 each year.
What would be the average ROI for this alternative?
The ABC Manufacturing Company has set up a weighted scoring matrix for evaluating some potential projects. Following are five projects under consideration.
Using the scoring matrix below which project would you rate highest? Lowest?
If the weight for “Sponsor Support” is changed from 2.0 to 5.0, will the project selection change? What are the three highest-weighted project scores with this new weight?
Why is it important that the weights mirror critical strategic factors?
Project Screening Matrix
Criteria
Weight
Project 1
Project 2
Project 3
Project 4
Project 5
Sponsor Support
2
9
3
6
1
3
Strategic Alliance
5
5
7
8
0
10
Urgency
4
2
2
2
5
10
Fills a market gap
3
0
0
3
10
1
Sales
3
2
5
6
6
8
Competition
1
5
1
8
9
0
You are the head of the project selection team at Broken Arrow Records. Your team is considering two different recording projects. Based on past history, Broken Arrow expects at least a rate of return of 20 percent. Given the follwoing information for each project, which one should be Broken Arrow's first priority? Should Broken Arrow fund any of the other projects? If so, what should be the order of priority based on return on investment?
Chapter 2 Solutions
Project Management: The Managerial Process (Mcgraw-hill Series Operations and Decision Sciences)
Ch. 2 - Describe the major components of the strategic...Ch. 2 - Explain the role projects play in the strategic...Ch. 2 - How are projects linked to the strategic plan?Ch. 2 - The portfolio of projects is typically represented...Ch. 2 - Why does the priority system described in this...Ch. 2 - Why should an organization not rely only on ROI to...Ch. 2 - Discuss the pros and cons of the checklist versus...Ch. 2 - You manage a hotel resort located on the South...Ch. 2 - Two new software projects are proposed to a young,...Ch. 2 - A five-year project has a projected net cash flow...
Ch. 2 - You work for the 3T company, which expects to earn...Ch. 2 - You are the head of the project selection team at...Ch. 2 - You are the head of the project selection team at...Ch. 2 - The Custom Bike Company has set up a weighted...Ch. 2 - What is our major problem?Ch. 2 - Identify some symptoms of the problem.Ch. 2 - What is the major cause of the problem?
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- Refer to either Case 7.1 Alaska Fly-Fishing Expedition, 7.2 Silver Fiddle Construction, 7.3 Trans LAN Project, and 7.4 XSU Spring Concert of your text. Each of these cases presents you with a project scope statement for a fictional project. You are to pick 1 of these cases on which to perform a risk analysis. After picking a case of your choice, you should address the following: Identify potential risks associated with this project (you must come up with at least 5 different risks).arrow_forwardCan you help me with this problem The Custom Bike Company has set up a weighted scoring matrix for evaluation of potential projects. Following are five projects under consideration. 1. Using the scoring matrix in the following chart, which project would you rate highest? Lowest? 2. If the weight for “Strong Sponsor” is changed from 2.0 to 5.0, will the project selection change? What are the three highest-weighted project scores with this new weight? 3. Why is it important that the weights mirror critical strategic factors?arrow_forwardRefer to either Case 7.1 Alaska Fly-Fishing Expedition, 7.2 Silver Fiddle Construction, 7.3 Trans LAN Project, and 7.4 XSU Spring Concert of your text. Each of these cases presents you with a project scope statement for a fictional project. You are to pick 1 of these cases on which to perform a risk analysis. After picking a case of your choice, you should address the following: Use a risk assessment form to analyze identified risks.arrow_forward
- There are various types of project organizations. Certain types of project organizations work best for certain types of projects. For example, there are pure project organizations, functional project organizations, centrally-organized project organizations, matrix project organizations, and mixed project organizations. Select any one type of project, such as software development, research and development, building construction (commercial, residential, etc.), public sector work, accounting, procurement, or financial, and discuss the best project organization that would suit the project type you selected.arrow_forwardSelect a project based on the definition "A project is a temporary endeavor undertaken to create a unique product, service, or result" What project have you selected? Explain. Provide reasons for selecting the project. What kind of organization or industry does your selected project belongs to? How does the project you selected fit the definition of a project? Is your selected project constrained by performance, cost, or schedule? Why or why not?arrow_forwardInstructions Assume that your class group has been selected and hired by the FAO to manage this FAO Funded Aquaponics Project described in the article (above). Using expressed and implied information in the article, your project team is required to craft/develop some project documents and plans to help in the overall management of the Aquaponics Project, with specific focus on the components and questions/statements listed below. Propose an initial risk register for the Project (with a minimum of 5 risks).arrow_forward
- Any project's success hinges on accurate cost assessment. Explain the various tools and approaches that are used in the cost estimate process.arrow_forwardGiven a project with the following characteristics, answer the following questions:You are the project manager of a project to build fancy birdhouses.You are to build two birdhouses a month for 12 months.Each birdhouse is planned to cost $100.Your project is scheduled to last for 12 months.It is the beginning of month 10. You have built 20 birdhouses and your CPI is 9091. a. Assuming that the COST variance experienced so far in the project will continue, how much more moneywill it take to complete the project? b. If the variance experienced so far were to stop, what is the project's estimate at completion?arrow_forwardI'm unable to answer the following question? What is the total cost of crashing the project from its current duration down to 13 weeks?arrow_forward
- there are two approaches to project cost estimation, the top down and bottom up approaches. These approaches help the project manager to estimate the cost in the project. Differentiate between the different techniques of project cost estimation?arrow_forwardThe project management plan specifies that a predictive development approach has been selected to produce the project deliverables. Suggest when in the project life cycle will the overall project risk be the lowest and demonstrate how it should be donearrow_forwardAlthough project costs are generally estimated on the initial assumption that there will be no modifications in design that would necessitate changes in the physical work or relative changes in domestic or international prices, sound project planning requires that provisions called contingency allowances be made in advance for possible adverse changes in physical conditions or prices that would add to the baseline costs. Discus the two categories of contingency allowances provided for in project planning.arrow_forward
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