After completing this unit, you should be able to: To understand the concept of the present value of moneys receivable in the future, to learn the various feasibility studies for a project, to learn the common methods used to evaluate projects, to understand the two most popular project management tools. | Project management tools Learning objectives To understand the concept of the present value of moneys receivable in the future. To learn the various feasibility studies for a project. To learn the common methods used to evaluate projects. To understand the two most popular project management tools. 4 key terms activity annuity cash inflow cash outflow cost-benefit analysis critical path depreciation discounted cash flow event net present value network diagram opportunity cost pay back period predecessor activity present value present value factor slack time tax benefit of depreciation time value of money Project feasibility The feasibility study for a project should be undertaken in the following order: technical feasibility operational feasibility economic feasibility Technical feasibility Determining the availability of the appropriate technology for the project Determining its viability in the organisation’s operating environment Consider: computer hardware computer software information from technical and trade journals specialist information technology consultants Operational feasibility Evaluate information provided by the operations of the proposed system to assess user satisfaction Dissatisfaction – system may be ineffective and inoperable Consider for new system: willingness of employees to accept operational changes management support and commitment management input of their system requirements transition into the new system willingness of the organisation to accept resulting organisational changes Economic feasibility Cost-benefit analysis of new project to determine: whether or not the investment provides expected returns and/or recovers the outlay on the project over its useful life Consider: costs involved type of costs timing of costs amount of individual costs expected benefits timing of monetary benefits amount of monetary benefits Timing of costs and benefits Costs incurred today and costs incurred in the future are not comparable because of the . | Project management tools Learning objectives To understand the concept of the present value of moneys receivable in the future. To learn the various feasibility studies for a project. To learn the common methods used to evaluate projects. To understand the two most popular project management tools. 4 key terms activity annuity cash inflow cash outflow cost-benefit analysis critical path depreciation discounted cash flow event net present value network diagram opportunity cost pay back period predecessor activity present value present value factor slack time tax benefit of depreciation time value of money Project feasibility The feasibility study for a project should be undertaken in the following order: technical feasibility operational feasibility economic feasibility Technical feasibility Determining the availability of the appropriate technology for the project Determining its viability in the organisation’s operating environment Consider: computer hardware computer software .
