It is very important for an organization to select an appropriate project that aligns to its business objectives. In a moderate to big organization, you get several ideas waiting to be converted into a project. However, not every idea is worth pursuing as a project because running a project not only needs resources but also financial investments to support it.
In your personal life, you have various options available to make a decision when making a choice among various options available, such as your past experience, advice from your family and friends, and suggestions from some experts. In your personal life, you have the luxury of going wrong and changing your decision.
However, in a professional life, an incorrect decision might be sufficient enough to throw you out of the business. Therefore, you have take utmost care when selecting a project. As a result, you must follow some tried and tested rules to select a project to minimize chances of selecting a wrong project, and select a project that is less risky and ensures maximum returns for the investment.
One of the techniques you can use to select a project is a benefit measurement method of project selection. The main objective of a benefit measurement method is to select a project with an aim to realize benefits against the investment you make in a project. In this method, you collect, consolidate, and analyze data to measure if the project yields the expected benefits.
By using a benefit measurement method, you select a project depending on the present value of the investment and revenue generated by the project. You calculate the cost and benefits of each project and then compare the same to decide on the project that provides highest benefits.
You can use the following benefit measurement methods to select a project:
- Murder Board Method: In this method, you constitute a murder board. The board comprises of senior managers and subject matter experts. The murder board scrutinizes the project to find reasons why the project should not be selected. You must defend the project and counter all the queries. To know more about this method, refer Murder Board Method of Project Selection.
- Peer Review Method: In this method, you select peers from a wide range of project management fields. These peers review the project and then recommend some best practices adopted in other projects. The peers also check for the viability of the project. To know more about this method, refer Peer Review Method of Project selection.
- Scoring Model: In this method, you create a committee that lists the relevant criteria to select a project. The committee weighs the list according to the importance and priorities of each project under consideration. The committee then adds the weighted values and selects a project with highest score. To know more about this method, refer Scoring Model of Project Selection.
- Economic Models: In this method, you scrutinize the project for its economic returns and viability. To know more about these models, refer An Overview to Economic Model of Project Selection.
- Economic Value Added: In this method, you create a performance metrics for the project that calculates the worth created for the organization. To know more about this method, refer Economic Value Added.
- Opportunity Cost: In this model, you calculate the opportunity you give up by selecting a project over the candidate projects. To know more about this model, refer Opportunity Cost.