Technology Planning Process - Human Resource - Lecture Slides, Slides of Human Resource Management

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Figure 4-2: Information

Technology Planning Process

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Best Practice

 Only one in seven product concepts comes to fruition  Companies like Proctor & Gamble, Johnson and Johnson, Hewlett Packard, and Sony are consistently successful in NPD because they use a disciplined, systematic approach to NPD projects based on best practices  Four important forces behind NPD success include the following:

1. A product innovation and technology strategy for the business
2. Resource commitment and focusing on the right projects, or solid portfolio management
3. An effective, flexible and streamlined idea-to-launch process
4. The right climate and culture for innovation, true cross-functional teams, and senior management commitment to NPD

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Focusing on Broad

Organizational Needs

 It is often difficult to provide strong justification for

many IT projects, but everyone agrees they have

a high value

 “It is better to measure gold roughly than to count

pennies precisely”

 Three important criteria for projects:

 There is a need for the project  There are funds available  There’s a strong will to make the project succeed

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Categorizing IT Projects

 One categorization is whether the project

addresses:

 A problem  An opportunity  A directive

 Another categorization is how long it will take to

do and when it is needed

 Another is the overall priority of the project

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Net Present Value Analysis

 Net present value (NPV) analysis is a method of

calculating the expected net monetary gain or loss

from a project by discounting all expected future

cash inflows and outflows to the present point in

time

 Projects with a positive NPV should be considered

if financial value is a key criterion

 The higher the NPV, the better

Figure 4-3: Net Present Value

Example

Note that totals are equal, but NPVs are not because of the time value of money

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NPV Calculations

 Determine estimated costs and benefits for the life

of the project and the products it produces

 Determine the discount rate (check with your

organization on what to use)

 Calculate the NPV (see text for details)

 Note: Some organizations consider the investment

year as year 0, while others start in year 1; some

people enter costs as negative numbers, while

others do not

 Check with your organization for their preferences