Project Management Recommendation
OPS/571
September 21, 2014

Project Management Recommendation
Dear Mr. Gritsch, In continuation of your email dated September 15, 2014, the team has completed an analysis of the three projects: Juniper, Palomino and Stargazer. The risk levels in Juniper, Palomino, and Stargazer are low, medium, and high respectively. It is in the best interest of Piper Industries Corporation to move forward with the Stargazer project. As noted by you the selected project should generate revenue within 12 months of next week’s PMO Review, and that we should also consider the degree of risk involved with on-time completion, the critical path requirement and cost and, the effective life cycle and forecasted ROI. Stargazer is selected due to its feasibility and risk level. From market feasibility study, some strategic customers have already indicated interest in the product. Therefore, I would recommend that the board invest in the project, Stargazer; particularly because the company has already invested $450,000 and the ROI is very high. My feasibility study focused on five areas which includes the anticipated Return on Investment (ROI), length of project, break-even analysis, risk level and overall benefit to Piper Industries. Please see below for the results and excel worksheet attached.
Juniper
Cost of the project: $325,000
Critical path: 6 months
Return on investment (ROI): 77% or $250,000 for a period of 2 to 3 years
(Break-even): A little under 3 years if ROI is reached at the two year mark
Length of project: Uncertain
Risk of completion on time: Low
Overall benefit: Enhancement of current product, increased product demand
Palomino
Cost of the project: $655,000
Critical path: 9 months
Return on Investment (ROI): 69% or $450,000 for a period of 5 years
Break-even: a little under 7 years Margin of error: 5%
Length of