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NPV stands for Net Present Value. NPV is used in capital budgeting to
analyze the profitability of an investment or project. NPV is the difference
between the present value of cash inflows and the present value of cash
outflows (Ittelson, 2009)
The NPV in this project is: Discounted Costs Discounted benefits
: 3154,000 2712,000
= 442,000
The NPV in this project represents a negative NPV as discounted benefits
are less than discounted costs.
b. What do we mean by payback period? In which year does
payback occur?
No, I would not recommend investing in this project because the NPV of
this project is Negative NPV and the financial analysis represents that the
project is going in loss.
Concept
Development
Implementation
close-out
1. Project Initiation
The initiating process signals the beginning of the project or phase.
Initiating processes include defining and authorising a project or project
phase (Schwalbe, 2010). To initiate a project, someone must define the
business need for the project, someone must sponsor the project, and
someone must take on the role of project manager. Project charter and
business case are the key outputs of project initiating phase
2. Project Planning
The planning process includes creating and maintaining a practical
framework to ensure that the project addresses and organisations needs.
There is normally no single project plan but a series of sub-plans such as
the scope management plan, cost management plan, procurement
management plan etc (Schwalbe, 2010). Key Output of Planning process
includes schedules, budgets, resources required, risks, and staffing (Gray
& Larson, 2008).
3. Project Executing
The executing process group includes coordinating people and other
resources to carry out the project plans and produce the products,
services, or results of the project (Schwalbe, 2010). There are some project
4. Project Controlling
The controlling process group also known as the monitoring and controlling
process group includes regularly measuring and monitoring project
progress to ensure that the project team meets the project objectives
(Schwalbe, 2010). In the controlling stage, project management related
outputs include scope control, change control, schedule control, budget
control, quality control, and communications plan execution.
5. Project Closing
The closing process group includes formalizing acceptance of the project
or project phase and ending it efficiently (Schwalbe, 2001).Closure of a
project should include contract closure or administrative closure. Contract
closure ensures that all of the deliverables and agreed upon terms of the
project have been completed and delivered so the project can end.
Administrative closure involves documenting and archiving all project
documents. In the closing stage, project management related outputs
include closing out contracts, documenting lessons learned, receiving
formal acceptance, final report, and project presentation.
4. Which process should take the project team the most time?
Why?
1. Project Initiation
project charter
business case
2. Project Planning
team contract
scope statement
project schedule
Gantt charts
3. Project Executing
work results
deliverables
baseline changes
4. Project Controlling
o
work results
change requests
schedule updates
budget updates
risk updates
status reports
5. Project Closing
project archives
Project Initiation
Project Planning
Project Executing
Project Controlling
Project Closing
Title Page
Executive Summary
Background
Project Description
Strategic Alignment
Environment Analysis
Alternatives
Implementation Strategy
The purpose of the business case is to outline the rationale for undertaking
the project, and to define the parameters and management factors involved
in the project itself. It provides the project manager with a tool to guide the
design, management and evaluation of the project. The business case serves
three purposes: it provides the project manager the opportunity to think
through the project in a systematic, step-by-step manner; explains why the
project should be undertaken; and provides a framework for completion of
the project on time and on budget.
8. Outline justification
technology project?.
for
investment
in
this
information
The investment in this project is very much justified because this project
will reduce cost and will increase the profits. This project is providing the
online digital media library through which customers can locate and copy
digital files of scanned images in real-time. For National Geographic
customers, this means better service.
Secondly for National Geographic this project will eliminates almost all rescans and will provide storage for thousands of valuable images that can
be retrieved quickly and at a reduced cost, generating extra revenue that
can then be re-invested back into the technology. The project also
enables the users to search access and analyze thousands of media
assets. The e-commerce software and the servers used for this project are
also fully scalable and self-healing with 24x7 availability. So overall the
investment in this project will be very beneficial.
Bibliography
Matta, N.F., & Ashkenas, R.N. (2003). Why good project fail anyway.
Harvard Business Review, 81(9), 109-114.