Project Management ToolBox: Tools and Techniques for the Practicing Project Manager

2

Project Selection

This chapter is contributed by Dr. Joseph P. Martino.

In research the horizon recedes as we advance, … and research is always incomplete.

Mark Pattison, Isaac Casaubon

True as these words may be, managers still need to make choice among possible projects, and either see them through to completion or terminate them when they “turn sour.” This chapter is intended to help managers use the following tools to select project that have a good chance of succeeding and paying off:

• Scoring Models
• Analytic Hierarchy Process
• Economic Methods (Payback Time, Net Present Value, Internal Rate of Return)
• Portfolio Selection
• Real Options Approach

These tools are designed to select projects that maximize the value of project portfolio for the company and are aligned with its business strategy. The assumption is that you have more candidate projects than you can support with available resources. To help you select from your project menu, this chapter provides a collection of tools that account for financial, technical, behavioral, and strategic criteria or factors in evaluating and selecting projects. The project mix will be in a state of constant flux, as management reevaluates its selections on an ongoing basis to respond to changing competitive and other needs. Project selection tools allow management to select projects for initiation and termination as conditions change.

The goal of this chapter is to help practicing and prospective project managers and managers accomplish ...