Project Recommendation Email

Project Recommendation Email
OPS/571
28 April 2014

Dear Mr. Gritsch,
Of the three projects, our team is recommending one based on our consideration of each project’s scope, its ability to meet desired outcomes, and whether it will meet constraints.   We also considered the degree of risk involved in regard to on-time completion, the critical path time and cost, the forecasted ROI and life cycle, and whether it will generate revenue in 12 month following the PMO Review.   Our team also considered the five project management phases, which I will review at the conclusion of our analysis.
Basis of Team Recommendation
The time for Project Juniper’s critical path is 6 months, or October 2014.   At $325,000 to bring the project to market, it costs less than the others.   However, it would cost more than its potential revenue streams of $250,000 if ROI is reached at the two year mark, and it has a break-even point of a little under 3 years with a forecasted product   life cycle of only 2 -3 years.   Given the above, our team does not recommend that our company invest in it.  
The time for Project Palomino’s critical path is 9 months, or January 2015, which is shorter than what we project for Project Stargazer, and it costs less at $655,000.   With a 5% margin of error, the product may generate profits with a break-even point at a little under 7 years.   However, the break-even point is at or near the forecasted end of its 7 year life cycle and its revenues streams could be as little as $450,000, creating a deficit.   Therefore, our team does not recommend that our company invest in it.
Like the Palomino and Juniper projects, when our team considered Project Stargazer, we excluded R&D costs, and only considered the $575,000 estimate to bring it to market.   R&D is already working on the new widgets, and we project that the critical path will be at 10 months, or February 2015, which fits well with the 12 month time constraint noted in your email.   The company forecasted a...