Techniques to assess project feasibility

Because projects are the building blocks in the design and execution of strategies, those senior managers who are responsible for selecting projects which realize enterprise strategies need a project selection process that evaluates a project's performance and assesses its strategic contribution. This article describes a project selection technique that helps decision-makers evaluate the profitability of alternative projects, one that is influenced by the length of a project's life cycle. In doing so, it discusses the basic concepts for evaluating alternatives, a method for evaluating change in profitability when the life cycle is shortened or lengthened, and a process for comparing alternatives to different interest rates cycles. It identifies eight questions for evaluating a project's potential strategic contribution and two parameters for calculating an engineering project's economic feasibility. It then explains two approaches--the variant and the generative--for developing project time estimates and outl