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Strategic Management and Project Management: Purpose

The document discusses concepts for project initiation including project selection, risk assessment, data gathering and analysis, and proposal development. It describes how a project charter formally recognizes and authorizes a project. It also outlines dimensions of project success, techniques for project selection, how to assess and manage risks, and considerations for measuring project success.

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176 views10 pages

Strategic Management and Project Management: Purpose

The document discusses concepts for project initiation including project selection, risk assessment, data gathering and analysis, and proposal development. It describes how a project charter formally recognizes and authorizes a project. It also outlines dimensions of project success, techniques for project selection, how to assess and manage risks, and considerations for measuring project success.

Uploaded by

surapol
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Chapter 02

Strategic Management and


Project Management
Purpose
To understand and apply project initiation
concepts in the areas of project selection,
risk assessment, data gathering and
analysis, and proposal development.

TOTSAPON SANTITEWAGUN
DR.SASIVIMOL KITTIVORAVITKUL
DANURUS WATTANAVEKIN
Project Charter
Formally recognizes the existence of a project.

Project Charter

• Business need

• Product description It authorizes the


project manager to apply
• Constraints organizational resources
to project activities.
• Assumptions A signed contract may
serve as a project
charter for the seller.

Connecting Pharmaceutical Knowledge ispe.org 2


Project Targets
Dimensions of Project Success

Performance •Project efficiency


•Impact on Customer
•Business impact on organization
Specs •Opening new future opportunities

Target: Customer Satisfaction

Cost
Budget
Limit
Due
Time Date

Connecting Pharmaceutical Knowledge ispe.org 3


Project Selection

Non-numeric techniques
• The sacred cow
• Operating necessity
• Competitive necessity
• Product line extension
• Comparative benefit model

Connecting Pharmaceutical Knowledge ispe.org 4


Project Selection

Numeric Financial Models


• Payback period
• Discounted cash flow (NPV)
• Internal rate of return (IRR)
• Profitability index

Connecting Pharmaceutical Knowledge ispe.org 5


Occasionally, organizations will approve the projects that
are forecast to loose money for the reasons :

• Acquire knowledge concerning a specific or new technology.


• Get the organization’s “foot in the door”.
• Obtain the parts, service, or maintenance portion of the work.
• Allow them to bid on a lucrative, follow on contract.
• Improve their competitive position.
• Broden a product line or line of business

Connecting Pharmaceutical Knowledge ispe.org 6


Risk Assessment

• Define risk and its relationship to uncertainty.

• Explain the relationship between risk and benefit


when making project selection decisions.

• Discuss the relationship between risk and the project


lifecycle.

Connecting Pharmaceutical Knowledge ispe.org 7


• Determine company’s risk status:
➢ Risk averse
➢ Risk accepting
• Utilize Subject Matter Experts to identify risks
• Work out scenarios to counteract risk

Connecting Pharmaceutical Knowledge ispe.org 8


Project Targets
Dimensions of Project Success
•Project efficiency
Performance •Impact on Customer
•Business impact on organization
•Opening new future opportunities
Specs

Target: Customer Satisfaction

Cost
Budget
Limit
Due
Time Date

Connecting Pharmaceutical Knowledge ispe.org 9


Measurement Subject
Project Success
Project is not product
Project is successful but … product fails

Project is not subproject


Subproject is successful but … project fails

Project is not operating phase


Project is successful but … operations fail

Connecting Pharmaceutical Knowledge ispe.org 10

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