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occurs upon meeting the desired goals and objectives if initial benefit no longer exists if the
contractor defaults on the project, and the settling of financial liabilities (Taylor, 2006).
Analysis of the Projects
Project Junipers risk of completion on time is low. The product plans for this project
show a six-month time span to bring the product to market at a cost of $325,000. The forecasted
return on investment (ROI) is $250,000 for two years (University of Phoenix, 2016).
Advantages:
Disadvantages:
Project Juniper could negatively affect the company because the product will end
the third year.
Project Palomino has a medium risk of completion with a nine-month critical path for
production. This project will cost $655,000 to bring to market with an ROI of $450,000 for five
years (University of Phoenix, 2016). The customer forecasts seven years for the project life of
Palomino.
Advantages:
Disadvantages:
None identified
Project Stargazer, initiated by research and development (R&D) has invested $450,000
with an additional $575,000 needed to bring the product to market. The ROI is $300,000 for the
first year $550,000 for the second, and $750,000 for the third year (University of Phoenix, 2016).
Although this project is tempting because of the amount of revenue it will generate, Piper
Industries Corp. would incur additional costs because of the products derivative. This project
has a high risk of meeting the completion requirements.
Advantages:
Disadvantages:
Key Deliverables
Upon completion, Project Juniper would provide the customer with an enhanced version
of the current widget Piper Industries Corp. currently uses. This project costs $325,000 to bring
to market and will take approximately six months. Project Juniper ends after three years with an
ROI of $350,000 (University of Phoenix, 2016).
Project Palomino will offer a new line of widget products with enhancements using
existing technology. Plans show a nine month completion time at a cost of $655,000, an ROI of
$450,000 with a 5% margin of error for five years (University of Phoenix, 2016). This product is
a custom part for one of Piper Industries most strategic customers, and Wendell Deirelein, the
vice-president, desires to continue the relationship. The customer forecasts project to end after
seven years.
Project Stargazer will deliver an innovative product to the market establishing Piper
Industries Corp. as a leader in the industry. Research and Development have begun production
of the new widgets costing $450,000. Piper Industries will need to provide $575,000 more to
bring the product to market and cover the unknown costs of the derivative. Production plans
show a total ROI of $1.6 million for three years (University of Phoenix, 2016). The report from
sales and marketing states that a few of the companys strategic customers seemed interested in
the product, but the majority of customers raised questions or had concerns regarding the
business.
Recommendation
Based on the analysis of each of the projects the team recommends the company to go
forward with Project Palomino. This project poses a medium risk of completion within the
allotted time, and its advantages outweigh the disadvantages. The new line of widgets includes
enhancements using existing technology, which helps to keep costs down and it serves as a
custom part for one of the companys strategic customers. Project Juniper although feasible and
met the requirements, would end after three years because of new technology. Project Stargazer
reports the highest ROI as well as the greatest risk for completion. The company would incur
more costs to bring this product to market and would need to adjust the scheduling deadlines to
account for several unknown factors. The company may want to consider this project at a later
date because of the $450,000 investment. Otherwise, the costs will be considered "sunk cost."
Conclusion
In response to the email sent by Ray Gritsch, the team conducted an analysis of three
projects. The team used the five phases of project management and included key deliverables of
each in determining which project meets the requirements of the company best. After a careful
analysis and weighing the advantages and disadvantages, the team recommended that the
company implement Project Palomino.
References
Jacobs, F. R., & Chase, R. B. (2014). Operations and supply chain management (14th ed.).
Retrieved from The University of Phoenix ebook Collection.
Taylor, J. (2006). Chapter 12: The development phase. Survival Guide for Project Managers,
215-236
Taylor, J. (2006). Chapter 13: The implementation phase. Survival Guide for Project Managers,
237-273
Taylor, J. (2006). Chapter 14: The termination phase. Survival Guide for Project Managers,
275-287
University of Phoenix. (2016). Project Management E-Mail. Retrieved from University of
Phoenix, OPS571 website.