Project Juniper Essay

* Assemble project teams and make sure everyone is updated on project start dates, and there team responsibilities.

keep the work on track, and can let you know if things are going according to plan.

Congratulations! You have just completed the project charter, scope statement, and WBS. Now that you know what needs to be done, as the Project Manager, you are now ready to begin planning your project.

When all the deliverables, customer requirements and\or goals have been met in a project, in other words, at the closing of a project the Project Manager is responsible for compiling and delivering a Final Project Report, known as a Project Closure Report. A good project closure report will summarize the entire project from the beginning project plan and scope information to the lessons learned from the project. It should also include other information such as the changes to the project scope if there were any, the final project budget reconciliation, and “a recap of the performance metrics taken during the project; the budget and schedule reconciliations will provide the final

The paper is divided into three sections, the first of which will establish a timeline of events. This project background will serve as a case study for the analysis in the following section that will be structured such that each of the previously mentioned facets will be independently analyzed and contrasted with project management principles. Finally the paper will conclude with a summary of the analysis and recommendations based on

7) See Table 1 NPV=42,318.71 IRR = 14% MIRR = 12% Payback period= 2.93 years. Yes the project should be undertaken.

feedback and identify objectives. It is usually the line manager who has to plan, prioritise

Thus, by year three the company will be making a profit off the investment as year three is 86.73 million profit by 55.35 cost giving the company a 31.38 million dollar surplus. Generally, a period of payback of three year or less is acceptable (Reference Entry) causing this project to be viable based off the payback analysis. Although, these calculations are flawed. The reason for this is because the time value of money is not taken into effect when calculating payback periods which is where IRR can further assist in a more realistic financial picture (Reference Entry).

If you invest in the project after five years you will get $ 463,188.77 which is $ 13,188.77 more.

The fifth step is to to schedule checkpoints for reviewing progress. This is done to make sure everything is on track. To make sure that no one is slacking off. The final step is for the manager to follow through by discussing progress at appropriate intervals. Delegation is considered a key aspect of leadership. To quote Woodrow Wilson "I not only use all the brains I have, but all I can borrow." (Blair, 1996) This quote effectively describes delegation.

The present value of the net incremental cash flows, totaling $5,740K, is added to the present value of the Capital Cost Allowance (CCA) tax shield, provided by the Plant and Equipment of $599K, to arrive at the project’s NPV of $6,339K. (Please refer to Exhibit 4 and 5 for assumptions and detailed NPV calculations.) This high positive NPV means that the project will add a significant amount of value to FMI. In addition, using the incremental cash flows (excluding CCA) generated by the NPV calculation, we calculated the project’s IRR to be 28%. This means that the project will generate a higher rate of return than the company’s cost of capital of 10.05%. This is also a positive indication that the company should undertake the project.

The use of an accounting rate of return also underscores a project 's true future profitability because returns are calculated from accounting statements that list items at book or historical values and are, thus, backward-looking. According to the ARR, cash flows are positive due to the way the return has been tabulated with regard to returns on funds employed. The Payback Period technique also reflects that the project is positive and that initial expenses will be retrieved in approximately 7 years. However, the Payback method treats all cash flows as if they are received in the same period, i.e. cash flows in period 2 are treated the same as cash flows received in period 8. Clearly, it ignores the time value of money and is not the best method employed. Conversely, the IRR and NPV methods reflect that The Super Project is unattractive. IRR calculated is less then the 10% cost of capital (tax tabulated was 48%). NPV calculations were also negative. We accept the NPV method as the optimal capital budgeting technique and use its outcome to provide the overall evidence for our final decision on The Super Project. In this case IRR provided the same rejection result; therefore, it too proved its usefulness. Despite that, IRR is not the most favorable method because it can provide false results in the case where multiple negative

5. The project is assumed to end in year 4. Do you think that this is realistic? Can you estimate the value of the project’s operating cash flows beyond year 4? State any assumptions you made.

a. I recommend that we invest $500,000 and let JV run independentlyas it was. Reason being is because 1. It is a minimul investment of only $500,000 vs. an investment of $8.5 million to create a gold standard of manufacturing facility and have the clients order volume not meet projections. In other words “why fix what’s not broken”.

The following paper analyzes a project from financial perspectives using the capital budgeting techniques like Net Present Value (NPV) and Internal Rate of Return (IRR).