Project Selection Methods

Rarely an organization has unlimited resources to go after all available opportunities. In most cases, they have limited resources and they have to select the best option.

In project management, organizations have many techniques for project selection. They make a decision as the stakes can be high and wrong ones are costly.

假设您的组织有许多建议，但由于资源限制，他们无法承担所有建议。因此，他们将选择一个风险最小的项目，并可以为他们提供最大利润。通常，认识也是一个因素。

作为项目经理，您可能在项目选择过程中没有任何角色，但是您应该知道为什么选择该项目以及如何适应组织的战略目标。

Project Selection Methods

您可以将这些技术分为两类：

1. 益处测量方法
2. Constrained Optimization Methods

但是，这些技术的复杂性各不相同，目标是相同的：为您的组织提供最大的利润和认可。每个组织都有一个定义的过程，可以帮助他们选择与其战略目标保持一致的项目。

Who Selects the Projects?

Upper management, the steering committee, the project management office (PMO), the project selection committee or any other equivalent group of stakeholders uses these methods and selects the project.

他们将使用各种标准，例如：

• Whether they have the technical expertise to complete it
• 如果他们有所需的资源b0b体育app
• If it will help them achieve their objectives

Now, we will discuss each type of project selection method.

益处测量方法

This is the most popular technique for project selection and is based on the present value of estimated cash inflow and outflow. Here, you calculate the cost and benefits of all projects and compare them.

以下是一些好处测量方法：

• Benefit/Cost Ratio
• Economic Value Added
• 评分模型
• Payback Period
• Net Present Value
• Discounted Cash Flow
• Internal Rate of Return
• Opportunity Cost

在讨论这些技术之前，对您了解折扣现金流非常重要。

Discounted Cash Flow

The value of money received today is greater than the money received in the future.

For example, the value of 10,000 USD after ten years will be far lower than the current value of 10,000 USD.

这种现象被称为折现现金流。

Therefore, consider Discounted Cash Flow while calculating the return on investment.

Now, let’s get back to benefits measurement methods.

福利成本比

Many experts call this technique the成本效益比.
It is the ratio between the present value of inflow (cost invested in the project) and the present value of outflow (value of return from the project). You will select the project with a higher Benefit-Cost Ratio (BCR).

Economic Value Added (EVA)

经济增值（EVA）是一个绩效指标，可计算组织的价值创造并定义资本回报率（ROC）。扣除所有税收和资本支出后，这是净利润。

If you have many projects, you will select the one with the higher EVA. Please note that EVA is expressed in dollar value, not a percentage.

This technique is also knowns as Economic Model.

评分模型

Here, the project selection committee will list a few relevant criteria and weigh them according to their importance. Then they will assign marks for these parameters for each project. Finally, they will add the marks and get the final score.

They will select the project with the highest score.

Payback Period

This is the time required to recover the cost invested in the project.

If other parameters are the same, you will select the project with the minimal payback period.

Net Present Value (NPV)

这是现金流入的当前价值与项目现金流出的当前价值之间的差异。

Net Present Value should always be positive, and the project with the highest NPV is the better option.

内部收益率（IRR）

This is the interest rate at which the Net Present Value becomes zero. In other words, it is the rate at which the present value of the outflow is equal to the present value of inflow.

You will select the project with the highest IRR if you have many to choose from.

Opportunity Cost

This is what you lose by choosing another project. You will choose the project with the lower opportunity cost if you have many options.

These are a few of the benefits measurement techniques used in the selection of projects.

Now we come to the constraints optimization methods.

Constraints Optimization Methods

This is also known as the Mathematical Model of project selection and is used for large projects requiring complex calculations.

The following are a few constraints optimization techniques:

• 线性规划
• Nonlinear Programming
• Integer Programming
• Dynamic Programming

这些主题的详细讨论不在PMP认证考试的范围之内。对于PMP考试，知道这些技术的名称就足够了。

Summary

项目选择是任何组织的最重要过程。正确的项目帮助组织发展业务并获得认可。但是，一个糟糕的人可能会阻碍进度并损害信誉。项目选择技术可帮助您以更好的投资回报率选择合适的项目。福利衡量方法足以让大多数组织能够做出决定。您将对大型和复杂项目使用约束优化方法。

Were you ever involved with the project selection process? If yes, please share your experiences in the comments section.

This is an important topic for the PMP exam. You may see a few questions on it.