KWAME NKRUMAH UNIVERSITY OF

SCIENCE AND TECHNOLOGY (KNUST)

NAME: ERNEST OBENG ASANTE
PROGRAMME: MSC LOGISTICS AND SUPPLY CHAIN MGT
INDEX NUMBER: 20364260 (PG2602914)
COURSE: PROJECT MANAGEMENT
COURSE CODE: MLSC 556

QUESTION 1

Screening models are usually employed to select projects that have high potential
payoffs/returns. From the case, although the two (2) selection models (The Scoring
model and the Net Present Value analysis (NPV) are all geared towards achieving
high returns; for sustainability and profitability, it would be appropriate for Nova
Western, Inc. to combine the two selection models but they are unable to do so due
to funding constraints. So employment of any one of the two selection models has
a high probability of bringing up divergence opinions.
For instance, whereas as the Scoring model (key strategic categories) seek to use
numbers as inputs for its decision making process; NPV rely on other data
(Financial matrix) in its decision process. Selections based on the scoring model
are usually subjective or objective inclined. That is, employing internal or external
values during selection process but this is not always consistent. For example, an
experts opinion on an issue may be subjective but very accurate. On the other
hand too, an incorrectly calibrated surveyors level can give objective but wrong
data.

STRENGHTS AND WEAKNESSES OF THE SCORING MODEL

STRENGHTS

The scoring model is real because it reflects on the project managers decision
situation and that of the firms capabilities.
The model also enables the firm to identify its weakness. For instance, by using
a project selection checklist, a firm is able to identify area of weakness.

WEAKNESSES

The model does not take into consideration the current financial standing of the
firm and its effect on the project.
Also, the model does not give valid results before projection but rather after the
project has been concluded.
Difficult to modify situations if the project has already commenced.

STRENGHTS AND WEAKNESSES OF THE NPV ANALYSIS

STRENGHTS

 The NPV analysis is able to stimulate both internal and external situation of the
project. For example changes in interest rate etc. This helps project managers to
optimize their decisions.
With the NPV analysis, one is able to project the financial standing (revenue)
should the project see a successful end.
The NPV analysis also makes it easy to modify certain matrixes in the course of
executing the project should there be a change in the project environment.
The analysis is flexible because it is able to give valid results within a range of
conditions that the firm/project might be experiencing.

WEAKNESSES

This analysis is not realistic because projections are in the future and not what
is currently pertaining in the project/organization.
Also, the analysis initially is profitable but becomes problematic when any of
the financial metrics changes or unstable to the project environment.

QUESTION 2

i.

Project selection methods are undertaken to assess identified project idea; the
project idea with the highest priority is then selected and executed. Most firms
are usually bombarded with varying opportunities to which they do not have the
resources available to be able to pursue those opportunities that present
themselves. From the case study, it was acknowledged that because of funding
issues Nova Western, Inc was unable to combine the two (2) selection models

that the evaluating teams identified. This suggests that to ensure increase in
organizational profits and enhancement of sustainability, it is imperative on
project managers to develop priority systems that would help select viable
projects that suit their organizations in terms of budget, scope and time.
ii. Successful screening models used by most organizations are often complex, multifaceted and comprehensive.
The key strategic categories used by the evaluators in the case shows the
strength/capabilities of Nova Western Inc. to complete the project. Therefore, to
resolve this contradiction, one simple solution is, to use the results of the NPV
analysis as an additional factor to the scoring model. That is, using the NPV as
an additional selection criterion to serve as a guide to the successful completion
of the project.

QUESTION 3

Although Project Janus offers a higher Net Present Value for the initial
investment, the payoff period is however much longer than Project Gemini,
suggesting that if Nova Western Inc. does not wish to tie its money up too long
then Gemini might be a reasonable alternative choice. But for the case study,

Project Gemini seem a more viable project because the resources and
capabilities needed to successfully complete the project is available and is also
ranked high in Nova Western Inc.; unlike Project Janus where project success is
based on future projections which does not take into consideration how to
manage the changes/shocks like inflationary rate, changes in interest rate,
changes in the weather patterns etc. that might occur in the project environment.

REFERENCES
Block, R. (1983), The Politics of Projects. New York: Yourdon.
Daft, R. L. (2001), Organization Theory and Design, 7th ed.
Fisher, R. and Ury, W. (1981), Getting to Yes: Negotiating Agreement Without Giving In. New
York:

Houghton Mifflin.

Frame, J. D. (1987), Managing Projects in Organizations. San Francisco, CA: Jossey-Bass.

Grundy, T. (1998), Strategy implementation and project management.

Meredith, J. R. and Mantel, Jr., S. J. (2003), Project Management, 5th ed. New York: Wiley
Jeffrey, k. Pinto. Project Management. Achieving Competitive Advantage 2nd ed.