M2 Project Initiation and Integration

The (a)______ the ROI, the (b)_______

(a) higher (b) better

The (a)_______ the NPV, the (b)_______

(a) higher (b) better

What are the four perspectives of the balanced scorecard approach?

1. Innovation and Learning Perspective 2. Financial Perspective 3. Internal Processes Perspective 4. Customer Perspective

What are the inputs in a Project Charter?

1. Project Statement of Work 2. Business Case 3. Agreements 4. Enterprise Environmental Factors 5. Organizational Process Assets

Discounted Cash Value (Time Value of Money)

DCV = (Cash flow "n" years from today) / (1+r)n

Stakeholder Roles: What is the role of a customer?

Defines product requirements and funds the project

Stakeholder Roles: What is the role of a project manager?

Defines, plans, implements and controls project

Internal rate of return (IRR)

Finding the discount rate that makes the NPV equal to zero

Define Internal Rate of Return (IRR)

IRR is the rate of growth a project is expected to generate. It is an indicator of the efficiency or quality of an investment.

4.6 Close Project or Phase

Is the process of finalizing all activities across all the Project Management Process Groups to formally complete the project or phase.

4.3 Direct and Manage Project Work

Is the process of performing the work defined in the project management plan to achieve the project's objectives.

4.5 Perform Integrated Change Control

Is the process of reviewing all change requests, approving changes and managing changes to the deliverables, organizational process assets, project documents and the project management plan.

4.4 Monitor and Control Project Work Is the

Is the process of tracking, reviewing, and regulating the progress to meet the performance objectives defined in the project management plan.

What is Balanced Scorecard Approach?

It is a performance management approach that involves measuring a company's vision and strategy via four perspectives. By balancing internal process measurement and financial results with customer feedback, the performance picture becomes complete.

Net Present Value Formula

Net Present Value = Σ DCF - Initial Investment

Net Present Value Analysis

Net present value (NPV) analysis is a method of calculating the expected net monetary gain or loss from a project by discounting all expected future cash inflows and outflows to the present point in time.

When does payback period occurs?

Payback occurs when the net cumulative discounted benefits equals the costs.

Project Integration Management

Project Integration Management includes the processes and activities needed to identify, define, combine, unify and coordinate the various processes and project management activities.

Stakeholder Roles: What is the role of a functional manager?

Provide the organization's policies and sector-specific knowledge and experience

Stakeholder Roles: What is the role of a sponsor?

Provides approval, authority & guidance

Stakeholder Roles: What is the role of a project team?

Provides the knowledge and skills and performs the work to implement & control project

Return on investment (ROI)

ROI = (total discounted benefits - total discounted costs) / discounted costs or ROI = (Average Annual Profit / Original Investment) x 100

Internal Rate of Return formula

The Internal Rate of Return is the Value of the Discount Rate at which the NPV is equal to zero, or at which ΣDCF equals the Initial Investment. Σ CF/ (1 + IRR)n = Initial Investment

What is the payback period?

The payback period is the amount of time it will take to recoup, in the form of net cash inflows, the total dollars invested in a project.

4.2 Project Management Plan

The process of documenting the actions necessary to define, prepare, integrate and coordinate all subsidiary plans.

What is the purpose of a Project Kickoff Meeting?

The purpose of the kickoff meeting is to formally notify all team members, clients, and stakeholders that the project has begun.

What is the main goal of Project Initiation?

To formally select and kick-off projects.

4.1 Develop Project Charter

Working with stakeholders to create the document that formally authorizes a project.

Project Initiation: What are the key outputs?

• Assigning the project manager • Identifying key stakeholders • Completing a business case • Completing a project charter and getting signatures on it

What is the project selection criteria?

• Generation of alternative ideas for project • Estimation of investment costs and benefits • Analysis of the cost/benefits of each alternative • Selection and implementation of appropriate Strategy • Evaluation of outcome of implemented investment

What is a Project Charter?

• Process of formalizing projects after deciding what project to work on • A project charter is a document that formally authorizes the existence of a project and provides direction on the project's objectives and management • Key project stakeholders should sign a project charter to acknowledge agreement on the need and intent of the project