Managing The Project Selection Process

Managing the Project Selection Process

Source: adapted from: http://www.ittoolkit.com/cgi-bin/itmember/itmember.cgi?file=assess_p

• Every project begins with a proposal, but not every proposal can or should become a project. • Reasons: – having to make choices with limited resources (people, time, money and equipment), – Not every project has viability.

the risks if resources are misapplied: • Resources are "used up" before projects can be completed. • Resources are wasted in projects of lesser value and priority. • Credibility and influence are lost as perceived project failures pile up.

project viability • project viability is the degree to which a given project will provide the expected return on investment. Viability can be measured by three key variables: • Value: The project must provide measurable benefit to the organization, in terms of revenue, cost reduction, productivity, or some other desired result. • Alignment: The project must be consistent with, and supportive of, overall business goals and objectives (including technology goals). • Probability of Success: The project must present a realistic opportunity for success, relating to outcome and process, and as can be measured by business, project management, and technology standards.

Project selection is all about viability…hence, the choice. Viability exists at two levels: • Level 1: Individual Viability. The degree to which a proposed project is viable as an independent initiative. (If a project can't stand on its own, it should not stand with others...) • Level 2: Comparative Viability: The degree to which an individual project retains its viability when compared to other projects. comparative viability will determine project selection priority.

project pool requirement • First, the project pool requirement must be addressed - allowing for the submission and review of multiple project proposals according to a pre-defined schedule. In addition, the project selection process must also allow for the unscheduled, asneeded submission of individual project proposals.

As the project selection process is developed, the following questions must be considered.... • Project Pool Considerations: • How will project proposals be submitted into the "pool" of potential projects? • How often will the project "pool" process be undertaken (yearly, quarterly, monthly)? • Who is responsible for managing the project "pool" selection process? • How will project proposals be reviewed and evaluated? • How will selection decisions be made? • How will selection decisions be approved? • How will selection decisions be communicated? • How will disputes be resolved?

questions must be considered.... • As-Needed Submission Considerations: • Who is responsible for the review of "as-needed" project proposals? (e.g. project selection committee, company management, line of business management, individual business units.) • How will as-needed project proposals be submitted? • How will as-needed project proposals be reviewed and evaluated? • How will selection decisions be made? • How will selection decisions be approved? • How will selection decisions be communicated? • How will disputes be resolved?

structural elements of selection process…needed • In order ensure that these questions are addressed, • Organization • Goals & Objectives • Deliverables • Roles & Responsibilities • Steps • Standards

Process Component #1: Organization •

Any effective project selection process must rely upon a pre-defined "organizational" hierarchy for proposal review and selection. • This organization will likely take a "committee" structure, allowing for a sufficiently diverse membership, designed to ensure that all "perspectives" are considered as projects are reviewed (e.g. business management, project management, finance, human resources, technology, etc.). • the project selection "organization" must also account for "asneeded" project evaluation, where formal committee review may be too cumbersome and ineffective. In these cases, project approval can be farmed out to a committee sub-set (by expertise or business area), or to individual line of business management. Tip: Establish thresholds for project selection - e.g. small projects can be "selected" outside the formal committee organization.

Process Component #2: Goals & Objectives • The project selection process must be designed to meet certain key goals and objectives: – To evaluate proposed projects according to a set of pre-defined criteria. – To weigh proposed projects and make appropriate selections based on comparative viability. – To engage in a collaborative process with all process stakeholders to ensure that all relevant information and perspectives are considered. – To review, approve and/or reject project proposals in a timely manner. – To communicate status, issues, conclusions and justifications in an open and timely manner.

Process Component #3: Deliverables • The project selection process must rely upon, use, and produce specific project selection deliverables, which should have a pre-defined format: – Project Proposal: To provide basic project information, and activate the selection process (pool or individual). – Business Case: To provide the business justification needed to support proposal acceptance. – Project Review Scorecard: To evaluate the proposal according to pre-defined criteria, providing an objective review of the proposal on the merits. – Selection/Rejection Notification: To document and communicate the results of the selection process.

Process Component #4: Roles & Responsibilities • The project selection process must specify the various "roles and responsibilities" to be assigned to process participants and stakeholders: – Management - to lead the process as project proposals are received, reviewed and evaluated. – Participation - to complete assigned tasks for proposal submission, review, analysis, input, and disposition (selection or rejection). – Support - to promote the process within the organization.

Process Component #5: Steps • The project selection process should contain a series of defined steps, combined in sequence, with appropriate decision checkpoints. • The project "Proposal" is prepared and submitted, along with a "Business Case" if needed. The "Proposal" and "Business Case" are evaluated for sufficiency (i.e. Do these documents provide the information needed to evaluate project viability?). If not, the items should be rejected for further edification and revision. • The "Proposal" and "Business Case" are reviewed and evaluated according to the pre-defined criteria. Project selection choices are made (e.g. project proposals are approved, rejected or put on hold).

Process Component #6: Standards •

The project selection process must specify the standards by which project proposals will be evaluated and selected. These standards should be designed to address these four requirements:

– Priority: The "discretionary" nature of the project proposal. Some projects will be mandatory, and others must compete for viability and resources. Projects of a higher priority will set the "pace" for project selection. – Criteria: The specific characteristics for viability measurement. – Score: The "degree" to which the various criteria are met (or not met). – Weight: The comparative ranking of multiple project proposals.

Conclusions: •

The goal of the project selection process is to analyze project viability, and to approve or reject project proposals based on established criteria, following a set of structured steps and checkpoints. • This type of structured process offers several key benefits: – Sets useful standards to guide decisions. – Fosters "challenge" thinking (i.e. to review project proposals with a critical eye). – Saves time and minimizes redundancies. – Minimizes knee-jerk responses to project requests. – Promotes cooperation and collaboration. – Provides a "big picture" perspective, providing context for proposal review. – Promotes priorities, ensuring that resources are applied to projects as needed and based on the expected "return on investment".

• The project selection process must be tailored to suit the needs of the organization and the types of projects faced. • Obviously, large scale, enterprise projects must be reviewed and selected via a formal process. As project size and scope diminishes, process formality can be scaled appropriately, but basic process principles must always apply. • Whether your projects are large or small, every project must make business sense. A well planned selection process will help you achieve that goal.