Introduction To Project Management

Ir. Dr. Shafishuhaza Sahlan

SHAS 4542 Sem1 Session 2022/23 - Chap 3b
Ref:
Chap 1 & Chap 3
Pinto

2
Project Selection Souder

Realism Screening models help

managers pick winners from a
pool of projects. Screening
Capability models are numeric or
nonnumeric and should have:
Flexibility

Ease of use

Cost
effectiveness

Comparability
Project Selection Souder
Flexible to respond
to changes to
Realism projects carried out

Capability Easy to modify if

applications
Affective model require changes
with firm Flexibility
objectives and
goals Simple
to Use
Ease of use
Should be cost
effective Cost
effectiveness

Broad enough to
apply to different Comparability
projects
 Risk – • Technical
unpredictability • Financial
to the firm • Safety
Screening •
•
Quality
Legal exposure
& Commercial – • Expected return on investment
market potential Payback period
Selection •
• Potential market share
Issues •
•
Long-term market dominance
Initial cash outlay
• Ability to generate future business/new
markets
All models only Internal • Need to develop/train employees
partially reflect reality operating – • Change in workforce size or composition
and have both
changes in firm • Change in physical environment
objective and
subjective factors operations • Change in manufacturing or service
imbedded. operations
Additional • Patent protection
• Impact on company’s image
• Strategic fit
Approaches to Project Screening
A project screening model
that generates useful

Project Screening Model

information for project Checklist Model
choices in a timely and
Simplified Scoring
useful fashion at an
Models
acceptable cost can serve as
a valuable tool in helping an
Analytic
Hierarchy Process
organization make
optimal choices among Profile Models
numerous alternatives
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 Approaches to Project Screening
Checklist Model

✓Simplest method of project screening

✓A checklist is a list of criteria applied to possible projects.

✓Requires agreement on criteria

✓Assumes all criteria are equally important

Checklists are valuable for recording opinions and

stimulating discussion.

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Copyright ©2016 Pearson Education, Ltd.
 Approaches to Project Screening
Simplified Scoring Models
Each project receives a score that is the weighted sum of
its grade on a list of criteria. Scoring models require:
• agreement on criteria
• agreement on weights for criteria
• a score assigned for each criteria
Score =  (Weight  Score)

Relative scores can be misleading, not accurate

Depends on the relevance criteria & the accuracy of the
weight given
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Copyright ©2016 Pearson Education, Ltd.
Approaches to Project Screening
Analytic Hierarchy Process
The Analytical Hierarchy Process (AHP) was developed by Dr.
Thomas Saaty to address many of the technical and managerial
problems frequently associated with decision-making through scoring
models.
The AHP is a four steps process:
1. Construct a hierarchy of criteria and sub-criteria.
2. Allocate weights to criteria.
3. Assign numerical values to evaluation dimensions.
4. Determine scores by summing the products of numeric evaluations
and weights.

Copyright ©2016 Pearson Education, Ltd.

Approaches to Project Screening
Analytic Hierarchy Process
Identifying clear criteria for selection to
1. Construct Hierarchy –
guide project selection, identifying their
criteria & sub-criteria
relation to one another

Allocating weights to previously developed

2. Allocate Weights to
criteria and where necessary, splitting
criteria
overall criterion weight among sub criteria

3. Assign numerical Yields a better understanding of both the

values to evaluation company’s goals and methods to achieve
dimensions these goals

Multiply numeric evaluation of project by

4. Determine scores weights assigned, then add results for all
criteria
Copyright ©2016 Pearson Education, Ltd.
Sample AHP with Rankings
for Salient Selection Criteria
(Figure 3.1)

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Approaches to Project Screening
Profile Models
Allows managers to plot risk/return options for various
alternatives and select projects with maximize return.

Example: Choosing between Project Saturn or Project Mercury

Project Risk Return Potential

Project Saturn 10 23%
Project Mercury 6 16%

Chart them on the company’s profile model relative to other

projects

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Approaches to Project Screening
Profile Models
Within max risk
limit but does not
perform as well as
other projects

Offers lower level

of risk – chosen
project

3-13
Proactive Portfolio Matrix
Involve evolutionary
improvements to current
Represents revolutionary
products and services
commercial advances using
proven technical advances

Projects that at one time

showed promise but are no
longer viable
Involve technological
breakthroughs with high
commercial payoffs

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Project Manager Responsibilities
1. Selecting a team

2. Developing project objectives and a

plan for execution

3. Performing risk management

activities

4. Cost estimating and budgeting

5. Scheduling

6. Managing resources
Project Manager Responsibilities
Based on the case study in 6th Ed Pinto, (p14 and p15)
Project Managers in Practice, Theresa Hinkler, R. Conrader
Company
In your group, using the 'sticky note' in the Jamboard, identify a project
manager's responsibilities based on the following (where applicable):
-Selecting a team
-Developing project objectives and a plan for execution
-Performing risk management activities
-Cost estimating and budgeting
-Scheduling
-Managing resources

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Role of Project
Manager
 Keys to Successful
Project Portfolio Management
❖Flexible structure and freedom of communication

❖Low-cost environmental scanning

❖Time-paced transition

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 Problems in Implementing
Portfolio Management

• Conservative technical communities

• Out-of-sync projects and portfolios

• Unpromising projects

• Scarce resources
PM Summary
1. Understand why project management is becoming such a
powerful and popular practice in business.
2. Recognize the basic properties of projects, including their
definition.
3. Understand why effective project management is such a
challenge.
4. Differentiate between project management practices and more
traditional, process-oriented business functions.
5. Recognize the key motivators that are pushing companies to
adopt project management practices.
6. Understand and explain the project life cycles, its stages, and the
activities that typically occur at each stage in the project.
7. Understand the concept of project “success,” including various
definitions of success, as well as alternative models of success.
PM Summary

8. Understand the purpose of project management maturity models and

the process of benchmarking in organizations.
9. Identify the relevant maturity stages that organizations go through to
become proficient in their use of project management techniques.
10. Explain six criteria for a useful project selection/ screening model.
11. Understand how to employ checklists and simple scoring models to
select projects.
12. Use more sophisticated scoring models, such as the Analytical
Hierarchy Process.
13. Learn how to use financial concepts, such as the efficient frontier and
risk/return models.
PM Summary
14. Employ financial analyses and options analysis to
evaluate the potential for new project investments.
15. Recognize the challenges that arise in maintaining an
optimal project portfolio for an organization.
16. Understand the three keys to successful project portfolio
management.

Pinto, J.K. (2016), “Project Management: A Managerial

Approach,” 4th Edition, Global Edition, Pearson. Chapter 1 & 3

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