Project-Integration-Management：项目集成管理课件

ProjectIntegrationManagementInformationTechnologyProjectManagement,

FourthEdition1

ProjectIntegrationManagemenLearningObjectivesDescribeanoverallframeworkforprojectintegrationmanagementasitrelatestotheotherprojectmanagementknowledgeareasandtheprojectlifecycle.Explainthestrategicplanningprocessandapplydifferentprojectselectionmethods.Explaintheimportanceofcreatingaprojectchartertoformallyinitiateprojects.Discusstheprocessofcreatingapreliminaryprojectscopestatement.2LearningObjectivesDescribeanTheKeytoOverallProjectSuccess:GoodProjectIntegrationManagementProjectmanagersmustcoordinatealloftheotherknowledgeareasthroughoutaproject’slifecycle.Manynewprojectmanagershavetroublelookingatthe“bigpicture”andwanttofocusontoomanydetails.(Seeopeningcaseforarealexample.)Projectintegrationmanagementisnotthesamethingassoftwareintegration.3TheKeytoOverallProjectSucFigure1-2.ProjectManagementFramework4Figure1-2.ProjectManagementFigure3-1.LevelofActivityandOverlapofProcessGroupsOverTime5Figure3-1.LevelofActivityFigure3-1.LevelofActivityandOverlapofProcessGroupsOverTime6Figure3-1.LevelofActivityProjectIntegrationManagementProcessesDeveloptheprojectcharter:Workwithstakeholderstocreatethedocumentthatformallyauthorizesaproject—thecharter.Developthepreliminaryprojectscopestatement:Workwithstakeholders,especiallyusersoftheproject’sproducts,services,orresults,todevelopthehigh-levelscoperequirementsandcreateapreliminaryprojectscopestatement.Developtheprojectmanagementplan:Coordinateallplanningeffortstocreateaconsistent,coherentdocument—theprojectmanagementplan.7ProjectIntegrationManagementProjectIntegrationManagementProcesses(cont’d)Directandmanageprojectexecution:

Carryouttheprojectmanagementplanbyperformingtheactivitiesincludedinit.Monitorandcontroltheprojectwork:Overseeprojectworktomeettheperformanceobjectivesoftheproject.Performintegratedchangecontrol:Coordinatechangesthataffecttheproject’sdeliverablesandorganizationalprocessassets.Closetheproject:Finalizeallprojectactivitiestoformallyclosetheproject.8ProjectIntegrationManagementStrategicPlanningandProjectSelectionStrategicplanninginvolvesdetermininglong-termobjectives,predictingfuturetrends,andprojectingtheneedfornewproductsandservices.OrganizationsoftenperformaSWOTanalysis:Strengths,Weaknesses,Opportunities,andThreatsAspartofstrategicplanning,organizationsshould:Identifypotentialprojects.Userealisticmethodstoselectwhichprojectstoworkon.Formalizeprojectinitiationbyissuingaprojectcharter.9StrategicPlanningandProjectIdentifyingPotentialProjectsManyorganizationsfollowaplanningprocessforselectingITprojects.It’scrucialtoalignITprojectswithbusinessstrategy.Researchshowsthat:SupportingexplicitbusinessobjectivesisthenumberonereasoncitedforinvestinginITprojects.CompanieswithconsolidatedIToperationshavea24percentloweroperationalcostperenduser.TheconsistentuseofITstandardslowersapplicationdevelopmentcostsby41percentperuser.* *CosgroveWare,Lorraine,“BytheNumbers,”CIOMagazine()(September1,2002).10IdentifyingPotentialProjectsFigure4-1.InformationTechnologyPlanningProcess11Figure4-1.InformationTechnoMethodsforSelectingProjectsThereisusuallynotenoughtimeorresourcestoimplementallprojects.Methodsforselectingprojectsinclude:Focusingonbroadorganizationalneeds.Categorizinginformationtechnologyprojects.Performingnetpresentvalueorotherfinancialanalyses.Usingaweightedscoringmodel.Implementingabalancedscorecard.12MethodsforSelectingProjectsFocusingonBroad

OrganizationalNeedsItisoftendifficulttoprovidestrongjustificationformanyITprojects,buteveryoneagreestheyhaveahighvalue.“Itisbettertomeasuregoldroughlythantocountpenniesprecisely.”Threeimportantcriteriaforprojects:Thereisaneedfortheproject.Therearefundsavailablefortheproject.Thereisastrongwilltomaketheprojectsucceed.13FocusingonBroad

OrganizationCategorizingITProjectsOnecategorizationassesseswhethertheprojectprovidesaresponseto:AproblemAnopportunityAdirectiveAnothercategorizationisbasedonthetimeitwilltaketocompleteaprojectorthedatebywhichitmustbedone.Anothercategorizationistheoverallpriorityoftheproject.TimeOverallpriority(High,Medium,andlow)14CategorizingITProjectsOnecaFinancialAnalysisofProjectsFinancialconsiderationsareoftenanimportantaspectoftheprojectselectionprocess.Threeprimarymethodsfordeterminingtheprojectedfinancialvalueofprojects:Netpresentvalue(NPV)analysisReturnoninvestment(ROI)Paybackanalysis15FinancialAnalysisofProjectsNetPresentValueAnalysisNetpresentvalue(NPV)analysisisamethodofcalculatingtheexpectednetmonetarygainorlossfromaprojectbydiscountingallexpectedfuturecashinflowsandoutflowstothepresentpointintime.ProjectswithapositiveNPVshouldbeconsiderediffinancialvalueisakeycriterion.ThehighertheNPV,thebetter.16NetPresentValueAnalysisNetF

gure4-2.NetPresentValueExampleNotethattotalsareequal,butNPVsarenotbecauseofthetimevalueofmoney.NPV=∑t=1..nA/(1+r)t17F

ReturnonInvestmentReturnoninvestment(ROI)iscalculatedbysubtractingtheprojectcostsfromthebenefitsandthendividingbythecosts.ROI=(totaldiscountedbenefits-totaldiscountedcosts)/discountedcostsThehighertheROI,thebetter. Manyorganizationshavearequiredrateofreturnorminimumacceptablerateofreturnoninvestmentforprojects. Internalrateofreturn(IRR)canbycalculatedbysettingtheNPVtozero.

18ReturnonInvestmentReturnonPaybackAnalysisAnotherimportantfinancialconsiderationispaybackanalysis.Thepaybackperiodistheamountoftimeitwilltaketorecoup,intheformofnetcashinflows,thetotaldollarsinvestedinaproject.Paybackoccurswhenthecumulativediscountedbenefitsandcostsaregreaterthanzero.ManyorganizationswantITprojectstohaveafairlyshortpaybackperiod.19PaybackAnalysisAnotherimportFigure4-4.ChartingthePaybackPeriodExcelfile20Figure4-4.ChartingthePaybaWeightedScoringModelAweightedscoringmodelisatoolthatprovidesasystematicprocessforselectingprojectsbasedonmanycriteria.Stepsinidentifyingaweightedscoringmodel:Identifycriteriaimportanttotheprojectselectionprocess.Assignweights(percentages)toeachcriterionsotheyaddupto100percent.Assignscorestoeachcriterionforeachproject.Multiplythescoresbytheweightstogetthetotalweightedscores.Thehighertheweightedscore,thebetter.21WeightedScoringModelAweightFigure4-5.SampleWeightedScoringModelforProjectSelection22Figure4-5.SampleWeightedScImplementingaBalancedScorecardDrs.RobertKaplanandDavidNortondevelopedthisapproachtohelpselectandmanageprojectsthatalignwithbusinessstrategy.Abalancedscorecardisamethodologythatconvertsanorganization’svaluedrivers,suchascustomerservice,innovation,operationalefficiency,andfinancialperformance,toaseriesofdefinedmetrics.Seeformoreinformation.23ImplementingaBalancedScorecProjectChartersAfterdecidingwhatprojecttoworkon,itisimportanttolettherestoftheorganizationknow.Aprojectcharterisadocumentthatformallyrecognizestheexistenceofaprojectandprovidesdirectionontheproject’sobjectivesandmanagement.Keyprojectstakeholdersshouldsignaprojectchartertoacknowledgeagreementontheneedandintentoftheproject;asignedcharterisakeyoutputofinitiationprocess.24ProjectChartersAfterdecidingFigure4-6.ProjectIntegrationManagementOverview25Figure4-6.ProjectIntegratioPreliminary

ScopeStatementsAscopestatementisadocumentusedtodevelopandconfirmacommonunderstandingoftheprojectscope.Itisanimportanttoolforpreventingscopecreep:Thetendencyforprojectscopetokeepgettingbigger.Agoodpracticeistodevelopapreliminaryorinitialscopestatementduringprojectinitiationandamoredetailedscopestatementastheprojectprogresses.26Preliminary

ScopeStatementsAContentsofaPreliminaryScopeStatementProjectobjectivesProductorservicerequirementsandcharacteristicsProjectboundariesDeliverablesProductacceptancecriteriaProjectassumptionsandconstraintsOrganizationalstructurefortheprojectInitiallistofdefinedrisksSummaryofschedulemilestonesRoughorderofmagnitudecostestimateConfigurationmanagementrequirementsDescriptionofapprovalrequirements27ContentsofaPreliminaryScopProjectManagementPlansAprojectmanagementplanisadocumentusedtocoordinateallprojectplanningdocumentsandhelpguideaproject’sexecutionandcontrol.Planscreatedintheotherknowledgeareasaresubsidiarypartsoftheoverallprojectmanagementplan.28ProjectManagementPlansAprojAttributesofProjectPlansJustasprojectsareunique,soareprojectplans.Plansshouldbe:DynamicFlexibleUpdatedaschangesoccurPlansshouldfirstandforemostguideprojectexecutionbyhelpingtheprojectmanagerleadtheprojectteamandassessprojectstatus.29AttributesofProjectPlansJusCommonElementsofaProjectManagementPlanIntroductionoroverviewoftheproject.Descriptionofhowtheprojectisorganized.Managementandtechnicalprocessesusedontheproject.Worktobedone,schedule,andbudgetinformation.30CommonElementsofaProjectMTable4-1.SampleContentsforaSoftwareProjectManagementPlan(SPMP)31Table4-1.SampleContentsforWhattheWinnersDo“Thewinnersclearlyspelloutwhatneedstobedoneinaproject,bywhom,when,andhow.Forthistheyuseanintegratedtoolbox,includingPMtools,methods,andtechniques…Ifaschedulingtemplateisdevelopedandusedoverandover,itbecomesarepeatableactionthatleadstohigherproductivityandloweruncertainty.Sure,usingschedulingtemplatesisneitherabreakthroughnorafeat.Butlaggardsexhibitedalmostnouseofthetemplates.Rather,inconstructingschedulestheirprojectmanagersstartedwithacleansheet,aclearwasteoftime.”**Milosevic,DraganandAndOzbay,“DeliveringProjects:WhattheWinnersDo,”ProceedingsoftheProjectManagementInstituteAnnualSeminars&Symposium(November2001).

32WhattheWinnersDo“ThewinStakeholderAnalysisAstakeholderanalysisdocumentsimportant(oftensensitive)informationaboutstakeholderssuchas:Stakeholders’namesandorganizations.Theirrolesontheproject.Uniquefactsabouteachstakeholder.Theirlevelofinfluenceonandinterestintheproject.Suggestionsformanagingrelationshipswitheachstakeholder.33StakeholderAnalysisAstakeholTable4-2.SampleStakeholderAnalysis34Table4-2.SampleStakeholderProjectExecutionProjectexecutioninvolvesmanagingandperformingtheworkdescribedintheprojectmanagementplan.Themajorityoftimeandmoneyisusuallyspentonexecution.Theapplicationareaoftheprojectdirectlyaffectsprojectexecutionbecausetheproductsoftheprojectareproducedduringprojectexecution.35ProjectExecutionProjectexecuCoordinatingPlanningandExecutionProjectplanningandexecutionareintertwinedandinseparableactivities.Thosewhowilldotheworkshouldhelptoplanthework.Projectmanagersmustsolicitinputfromtheteamtodeveloprealisticplans.36CoordinatingPlanningandExecLeadershipandaSupportiveCultureProjectmanagersmustleadbyexampletodemonstratetheimportanceofcreatingandthenfollowinggoodprojectplans.Organizationalculturecanhelpprojectexecutionby:Providingguidelinesandtemplates.Trackingperformancebasedonplans.Projectmanagersmaystillneedtobreaktherulestomeetprojectgoals,andseniormanagersmustsupportthoseactions.37LeadershipandaSupportiveCuWhatWentWrong?Manypeoplehaveapoorviewofplansbasedontheirexperiences.Topmanagersoftenrequireaprojectmanagementplan,butthennoonefollowsuponwhethertheplanwasfollowed.Forexample,oneprojectmanagersaidhewouldmeetwitheachprojectteamleaderwithintwomonthstoreviewtheirprojectplans.Theprojectmanagercreatedadetailedscheduleforthesereviews.Hecancelledthefirstmeetingduetoanotherbusinesscommitment.Herescheduledthenextmeetingforunexplainedpersonalreasons.Twomonthslater,theprojectmanagerhadstillnotmetwithoverhalfoftheprojectteamleaders.Whyshouldprojectmembersfeelobligatedtofollowtheirownplanswhentheprojectmanagerobviouslydidnotfollowhis?38WhatWentWrong?ManypeoplehaImportantSkillsforProjectExecutionGeneralmanagementskillssuchasleadership,communication,andpoliticalskills.Product,business,andapplicationareaskillsandknowledge.Useofspecializedtoolsandtechniques.39ImportantSkillsforProjectEProjectExecutionToolsandTechniquesProjectmanagementmethodology:Manyexperiencedprojectmanagersbelievethemosteffectivewaytoimproveprojectmanagementistofollowamethodologythatdescribesnotonlywhattodoinmanagingaproject,buthowtodoit.Projectmanagementinformationsystems:Hundredsofprojectmanagementsoftwareproductsareavailableonthemarkettoday,andmanyorganizationsaremovingtowardpowerfulenterpriseprojectmanagementsystemsthatareaccessibleviatheInternet.Seethe“WhatWentRight?”exampleofKualaLumpur’sIntegratedTransportInformationSystem.40ProjectExecutionToolsandTeMonitoringandControlling

ProjectWorkChangesareinevitableonmostprojects,soit’simportanttodevelopandfollowaprocesstomonitorandcontrolchanges.Monitoringprojectworkincludescollecting,measuring,anddisseminatingperformanceinformation.Twoimportantoutputsofmonitoringandcontrollingprojectworkincluderecommendedcorrectiveandpreventiveactions.41MonitoringandControlling

PrMediaSnapshotThe2002OlympicWinterGamesandParalympicstookfiveyearstoplanandcostmorethan$1.9billion.PMIawardedtheSaltLakeOrganizingCommittee(SLOC)theProjectoftheYearawardfordeliveringworld-classgames.FouryearsbeforetheGamesbegan,theSLOCusedaPrimaverasoftware-basedsystemwithacascadingcolor-codedWBStointegrateplanning…TheSLOCalsousedanExecutiveRoadmap,aonelistofthetop100Games-wideactivities,tokeepexecutivesapprisedofprogress.Activitiesweretiedtodetailedprojectinformationwithineachdepartment’sschedule.A90-dayhighlightershowedwhichmanagerswereaccountableforeachintegratedactivity.FraserBullock,SLOCChiefOperatingOfficerandChief,said,“Weknewwhenwewereonandoffscheduleandwherewehadtoapplyadditionalresources.Theinterrelationofthefunctionsmeanttheycouldnotruninisolation—itwasasmoothlyrunningmachine.”*

*Foti,Ross,“TheBestWinterOlympics,Period,”PMNetwork(January2004),p.23.

42MediaSnapshotThe2002OlympicIntegratedChangeControlThreemainobjectivesare:Influencethefactorsthatcreatechangestoensurethatchangesarebeneficial.Determinethatachangehasoccurred.Manageactualchangesastheyoccur.Abaselineistheapprovedprojectmanagementplanplusapprovedchanges.43IntegratedChangeControlThreeChangeControlonInformationTechnologyProjectsFormerview:Theprojectteamshouldstrivetodoexactlywhatwasplannedontimeandwithinbudget.Problem:Stakeholdersrarelyagreedbeforehandontheprojectscope,andtimeandcostestimateswereinaccurate.Modernview:Projectmanagementisaprocessofconstantcommunicationandnegotiation.Solution:Changesareoftenbeneficial,andtheprojectteamshouldplanforthem.44ChangeControlonInformationChangeControlSystemAformal,documentedprocessthatdescribeswhenandhowofficialprojectdocumentsandworkmaybechanged.Describeswhoisauthorizedtomakechangesandhowtomakethem.45ChangeControlSystemAformal,ChangeControlBoards(CCBs)Aformalgroupofpeopleresponsibleforapprovingorrejectingchangesonaproject.CCBsprovideguidelinesforpreparingchangerequests,evaluatechangerequests,andmanagetheimplementationofapprovedchanges.CCBsincludestakeholdersfromtheentireorganization.46ChangeControlBoards(CCBs)AMakingTimelyChangesSomeCCBsonlymeetoccasionally,soitmaytaketoolongforchangestooccur.Someorganizationshavepoliciesinplacefortime-sensitivechanges.A“48-hourpolicy”allowsprojectteammemberstomakeadecisionandhave48hourstoseekapprovalfromtopmanagement.Iftheteamdecisioncannotbeimplemented,managementhas48hourstoreverseadecision;otherwise,theteam’sdecisionisapproved.Anotherpolicyistodelegatechangestothelowestlevelpossible,butkeepeveryoneinformedofchanges.47MakingTimelyChangesSomeCCBsConfigurationManagementEnsuresthatthedescriptionsoftheproject’sproductsarecorrectandcomplete.Involvesidentifyingandcontrollingthefunctionalandphysicaldesigncharacteristicsofproductsandtheirsupportdocumentation.Configurationmanagementspecialistsidentifyanddocumentconfigurationrequirements,controlchanges,recordandreportchanges,andaudittheproductstoverifyconformancetorequirements.48ConfigurationManagementEnsureTable4-3.SuggestionsforManagingIntegratedChangeControlViewprojectmanagementasaprocessofconstantcommunicationandnegotiation.Planforchange.Establishaformalchangecontrolsystem,includingachangecontrolboard(CCB).Usegoodconfigurationmanagement.Defineproceduresformakingtimelydecisionsonsmallerchanges.Usewrittenandoralperformancereportstohelpidentifyandmanagechange.Useprojectmanagementandothersoftwaretohelpmanageandcommunicatechanges. 49Table4-3.SuggestionsforManClosingProjectsTocloseaproject,youmustfinalizeallactivitiesandtransferthecompletedorcancelledworktotheappropriatepeople.Mainoutputsinclude:Administrativeclosureprocedures.Contractclosureprocedures.Finalproducts,services,orresults.Organizationalprocessassetupdates.50ClosingProjectsTocloseaproUsingSoftwaretoAssistinProjectIntegrationManagementSeveraltypesofsoftwarecanbeusedtoassistinprojectintegrationmanagement:Wordprocessingsoftwarecreatesdocuments.Presentationsoftwarecreatespresentations.Spreadsheetsordatabasesperformtracking.Communicationsoftwaresuchase-mailandWebauthoringtoolsfacilitatecommunications.Projectmanagementsoftwarecanpulleverythingtogetherandshowdetailedandsummarizedinformation.51UsingSoftwaretoAssistinPrChapterSummaryProjectintegrationmanagementincludes:Developingaprojectcharter.Developingapreliminaryprojectscopestatement.Developingaprojectmanagementplan.Directingandmanagingprojectexecution.Monitoringandcontrollingprojectwork.Performingintegratedchangecontrol.Closingtheproject.52ChapterSummaryProjectintegra

ProjectIntegrationManagementInformationTechnologyProjectManagement,

FourthEdition53

ProjectIntegrationManagemenLearningObjectivesDescribeanoverallframeworkforprojectintegrationmanagementasitrelatestotheotherprojectmanagementknowledgeareasandtheprojectlifecycle.Explainthestrategicplanningprocessandapplydifferentprojectselectionmethods.Explaintheimportanceofcreatingaprojectchartertoformallyinitiateprojects.Discusstheprocessofcreatingapreliminaryprojectscopestatement.54LearningObjectivesDescribeanTheKeytoOverallProjectSuccess:GoodProjectIntegrationManagementProjectmanagersmustcoordinatealloftheotherknowledgeareasthroughoutaproject’slifecycle.Manynewprojectmanagershavetroublelookingatthe“bigpicture”andwanttofocusontoomanydetails.(Seeopeningcaseforarealexample.)Projectintegrationmanagementisnotthesamethingassoftwareintegration.55TheKeytoOverallProjectSucFigure1-2.ProjectManagementFramework56Figure1-2.ProjectManagementFigure3-1.LevelofActivityandOverlapofProcessGroupsOverTime57Figure3-1.LevelofActivityFigure3-1.LevelofActivityandOverlapofProcessGroupsOverTime58Figure3-1.LevelofActivityProjectIntegrationManagementProcessesDeveloptheprojectcharter:Workwithstakeholderstocreatethedocumentthatformallyauthorizesaproject—thecharter.Developthepreliminaryprojectscopestatement:Workwithstakeholders,especiallyusersoftheproject’sproducts,services,orresults,todevelopthehigh-levelscoperequirementsandcreateapreliminaryprojectscopestatement.Developtheprojectmanagementplan:Coordinateallplanningeffortstocreateaconsistent,coherentdocument—theprojectmanagementplan.59ProjectIntegrationManagementProjectIntegrationManagementProcesses(cont’d)Directandmanageprojectexecution:

Carryouttheprojectmanagementplanbyperformingtheactivitiesincludedinit.Monitorandcontroltheprojectwork:Overseeprojectworktomeettheperformanceobjectivesoftheproject.Performintegratedchangecontrol:Coordinatechangesthataffecttheproject’sdeliverablesandorganizationalprocessassets.Closetheproject:Finalizeallprojectactivitiestoformallyclosetheproject.60ProjectIntegrationManagementStrategicPlanningandProjectSelectionStrategicplanninginvolvesdetermininglong-termobjectives,predictingfuturetrends,andprojectingtheneedfornewproductsandservices.OrganizationsoftenperformaSWOTanalysis:Strengths,Weaknesses,Opportunities,andThreatsAspartofstrategicplanning,organizationsshould:Identifypotentialprojects.Userealisticmethodstoselectwhichprojectstoworkon.Formalizeprojectinitiationbyissuingaprojectcharter.61StrategicPlanningandProjectIdentifyingPotentialProjectsManyorganizationsfollowaplanningprocessforselectingITprojects.It’scrucialtoalignITprojectswithbusinessstrategy.Researchshowsthat:SupportingexplicitbusinessobjectivesisthenumberonereasoncitedforinvestinginITprojects.CompanieswithconsolidatedIToperationshavea24percentloweroperationalcostperenduser.TheconsistentuseofITstandardslowersapplicationdevelopmentcostsby41percentperuser.* *CosgroveWare,Lorraine,“BytheNumbers,”CIOMagazine()(September1,2002).62IdentifyingPotentialProjectsFigure4-1.InformationTechnologyPlanningProcess63Figure4-1.InformationTechnoMethodsforSelectingProjectsThereisusuallynotenoughtimeorresourcestoimplementallprojects.Methodsforselectingprojectsinclude:Focusingonbroadorganizationalneeds.Categorizinginformationtechnologyprojects.Performingnetpresentvalueorotherfinancialanalyses.Usingaweightedscoringmodel.Implementingabalancedscorecard.64MethodsforSelectingProjectsFocusingonBroad

OrganizationalNeedsItisoftendifficulttoprovidestrongjustificationformanyITprojects,buteveryoneagreestheyhaveahighvalue.“Itisbettertomeasuregoldroughlythantocountpenniesprecisely.”Threeimportantcriteriaforprojects:Thereisaneedfortheproject.Therearefundsavailablefortheproject.Thereisastrongwilltomaketheprojectsucceed.65FocusingonBroad

OrganizationCategorizingITProjectsOnecategorizationassesseswhethertheprojectprovidesaresponseto:AproblemAnopportunityAdirectiveAnothercategorizationisbasedonthetimeitwilltaketocompleteaprojectorthedatebywhichitmustbedone.Anothercategorizationistheoverallpriorityoftheproject.TimeOverallpriority(High,Medium,andlow)66CategorizingITProjectsOnecaFinancialAnalysisofProjectsFinancialconsiderationsareoftenanimportantaspectoftheprojectselectionprocess.Threeprimarymethodsfordeterminingtheprojectedfinancialvalueofprojects:Netpresentvalue(NPV)analysisReturnoninvestment(ROI)Paybackanalysis67FinancialAnalysisofProjectsNetPresentValueAnalysisNetpresentvalue(NPV)analysisisamethodofcalculatingtheexpectednetmonetarygainorlossfromaprojectbydiscountingallexpectedfuturecashinflowsandoutflowstothepresentpointintime.ProjectswithapositiveNPVshouldbeconsiderediffinancialvalueisakeycriterion.ThehighertheNPV,thebetter.68NetPresentValueAnalysisNetF

gure4-2.NetPresentValueExampleNotethattotalsareequal,butNPVsarenotbecauseofthetimevalueofmoney.NPV=∑t=1..nA/(1+r)t69F

ReturnonInvestmentReturnoninvestment(ROI)iscalculatedbysubtractingtheprojectcostsfromthebenefitsandthendividingbythecosts.ROI=(totaldiscountedbenefits-totaldiscountedcosts)/discountedcostsThehighertheROI,thebetter. Manyorganizationshavearequiredrateofreturnorminimumacceptablerateofreturnoninvestmentforprojects. Internalrateofreturn(IRR)canbycalculatedbysettingtheNPVtozero.

70ReturnonInvestmentReturnonPaybackAnalysisAnotherimportantfinancialconsiderationispaybackanalysis.Thepaybackperiodistheamountoftimeitwilltaketorecoup,intheformofnetcashinflows,thetotaldollarsinvestedinaproject.Paybackoccurswhenthecumulativediscountedbenefitsandcostsaregreaterthanzero.ManyorganizationswantITprojectstohaveafairlyshortpaybackperiod.71PaybackAnalysisAnotherimportFigure4-4.ChartingthePaybackPeriodExcelfile72Figure4-4.ChartingthePaybaWeightedScoringModelAweightedscoringmodelisatoolthatprovidesasystematicprocessforselectingprojectsbasedonmanycriteria.Stepsin