Project Selection

Project Selection

Posted on by michael598sum14

On Monday morning I start my new job as a Project Manager. In this role I will be in charge of business reviews for different directors across my organization, as well as process improvement, and acting as a systems expert/liaison for my group. This will be my first project management role in my career and I am very excited about it. One of my first on-boarding duties is to be the point person for capital purchases prioritization. This will be my first time dealing with prioritization of capital purchases. Given this fact, I decided that I needed and wanted to look more into selection of projects in general and specifically capital purchases to get up to speed on best practices within my industry.

In our first class, we went over project selection techniques from chapter two of our book. Some of the models that were discussed were:

  • The Payback Model
  • Net Present Value (NPV) Model
  • Checklist Model
  • Multi-Weighted Scoring Model

After learning more about these methods in class, I definitely believe that using just one of these methods to select a project would not be a good idea. However, a mixed approach would be the best course of action in making the best choice for all stakeholders involved. I believe it really comes down to aligning the criteria with the strategic plan of the organization. Some organization’s project selection criteria are going to vary a great deal from others. For example, a nonprofit hospital’s criteria may not value financial criteria as much as other nonfinancial criteria. Obviously, the institution still has to keep the lights on, but the organization may want to do that while providing the best care to all demographics in their community.

So at this point I wanted to take a look at what resources were available online regarding this topic in addition to the guidance our book gave. At first I found multiple presentations and articles regarding systems that could be purchased in order to make the whole capital purchasing selection process run smoother for organizations:

http://nymetro.chapter.informs.org/prac_cor_pubs/Kleinmuntz%2009-08%20Optimizing%20Hospital%20Resource%20Allocation%20INFORMS%20NY%20Sep-08%20for%20Web.pdf

http://www.hfmmagazine.com/display/HFM-news-article.dhtml?dcrPath=/templatedata/HF_Common/NewsArticle/data/HFM/WebExclusives/2011/WebExclusives_Money

Then I found a link or two for consultants who could help in the planning or implementation phase of capital projects.

https://www.ecri.org/Forms/Documents/MS10047.pdf

Finally I came upon a link that gave me some great information regarding what some folks in my industry are currently doing versus what they should be doing regarding capital project selection.

http://www.hfma.org/Content.aspx?id=2691

After taking a look at the various resources available online, I have come to several conclusions regarding the best capital project selection process. First and most importantly, there must be an overall company strategy that Senior Management has set for the company to strive for. Secondly, there are no silver bullets or one process works for all in the capital project selection process. Third, this process should be a living thing that gets discussed throughout the fiscal year, not just when budget season rolls around.

Common Mistakes in Project Management/Selection

Posted on by christopherc599

Our previous class featured much discussion about project selection.  We studied the film prioritization case, choose 4 class projects and shared individual experiences.  So I was curious to learn what a few common mistakes are in selection a project.  Joni Seeber, a project management professional, authored a short article on project selection for the American Society for the Advancement of Project Management (http://www.asapm.org/asapmag/articles/SelectionCriteria.pdf).  The article lists some key mistakes made. 

One common red flag listed is “lack of strategic fit with mission” and the article also discusses leveraging core competencies.  These points resonated with me after working with my group on our course project.  We came up with a great idea but became bogged down in trying to brainstorm additional ways to generate revenue.  Many of these ideas strayed from the stated mission.  Ultimately, one teammate suggested we focus on the core goal and not dilute our resources or become distracted with other ideas/projects.

Another stated mistake was “lack of stakeholder support.”  This is a big one.  In my career, I have worked on a couple process improvement projects aimed at improving ease-of-use and efficiency for users.  However, change can be very painful.  In one instance, the project was less successful because the users were not willing to spend additional time up front and reap the operational rewards later.  The next time we rolled out changes to this group of users, we spent a great deal of time of making the case to the users that the improvements were in their best interest.  Frankly, the case made to users was more thorough than the pitch to management who green lighted the project.

An interesting insight from this article is “studies show early termination of a troubled project can result in a 900% return on investment.”  This statement is fairly intuitive, but 900% is very surprising.  This highlights the important of checkpoints and status updates.  It can be difficult to kill a once-promising project, particularly with political implications.  Essentially, the most profitable decision you can make is not waste additional resources on a failing project.