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Learning Objectives
After the completion of this chapter, the learner will be able to:
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Describe the process of Close Project Or Phase Explain the various project selection methods
Explain the components of a project management plan
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Is it going Well?
Is this request Worth doing? Have we Delivered everything?
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Project Charter
The approved Project Charter formally initiates a project. The Project Manager should be preferably assigned during creation of the Project Charter. Project Charter gives the project manager authority to spend and commit corporate resources It provides high-level requirements for the project.
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Outputs
Project Charter
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Sacred cow
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approach )
Payback Period Cost Benefit Analysis Scoring Models Net Present Value (NPV) Internal Rate of Return (IRR)
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Mathematical Models
Involves complex mathematical formulas to predict success rate Also called as Constrained Optimization Use linear, dynamic, non-linear, multi-objective programming to solve problem
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Benefit Cost Ratio (BCR) or profitability Index . This is the ratio of project benefit and the project cost.
BCR = Revenue / Cost
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Net Present value (NPV) is the sum total of the Present Value of Cash Inflows Cash Outflows
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Internal Rate of Return (IRR): The rate of interest at which the revenues and costs are equal. Select the project with a higher IRR. Return On Investment (ROI) A return ratio that compares the net benefits of a project/ product, verses its total cost. ROI = Operating Income / Investments
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Net Present value (NPV) is the sum total of the Present Value of Cash Inflows Cash Outflows
TIME PERIOD 0 1 2 3 INCOME/REVENUE 0 50 100 300 PRESENT VALUE AT 10% INT RATE 0 45 83 225 COSTS 200 100 0 0 PRESENT VALUE AT 10% INT RATE 200 91 0 0
TOTAL
353
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Scoring Model
Payback Period Benefit Cost Ratio
17
24 Months 3.5
20
25 months 4.5
B
A B
95,000
9.5%
80,000
11.5%
A
B
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Outputs
Project management plan
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Outputs
Deliverables Work performance information Change requests Project management plan updates Project document updates
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Outputs
Change requests Project management plan updates Project documented updates
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Any approved changes may required adjusting the scope, time, and resource requirements
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Configuration Management
Configuration management system provides a standardized, effective, and efficient way to centrally manage approved changes and baselines within the project.
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Outputs
Change request status updates Project management plan updates Project document updates
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Outputs
Final product, service or results transition Organizational process assets update
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1. The project management plan is the collection of ______ Plans 2. Work Culture and company policies are called Enterprise__________ Factors 3. ___________ is a document that gives the project manager authority over the team
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1. The project management plan is the collection of Subsidiary Plans 2. Work Culture and company policies are called Enterprise Environmental Factors 3. Project Charter is a document that gives the project manager authority over the team
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Assessment Examination
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