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Information Management and Project Evaluation Module - Coggle Diagram
Information Management and Project Evaluation Module
Introduction
PROJECT can be defined as a set of interdependent activities oriented to a specific purpose, with a predetermined duration.
Technical dimension: it is necessary to apply the specific knowledge of each work area, complying with a way of working and some requirements (the "know how") that each profession imposes.
Human dimension: a project is a complex web of personal relationships, where a large number of sometimes conflicting interests come together.
Management variable: with this term, adopted by Octave Gelinier, it refers to something that is sometimes underestimated because it is not as spectacular or visible as other elements, but it is the catalyst that allows the rest of the elements to behave properly.
A life cycle for a project is made up of successive phases made up of planning tasks. According to the life cycle model, the succession of phases can be extended with feedback loops, so that what is conceptually considered the same phase can be executed more than once throughout a project, receiving in each execution pass contributions of the intermediate results that are produced (feedback).
Stages in the Development of a Project: Planning phase / Execution phase / Delivery or start-up phase / Initiation phase / Control phase.
Market Study
Current demand situation: of the current volume of consumption Make a quantitative estimate Present them in this way of the current volume of consumption of the good produced.
Demand indicators: Use theoretical indexes and coefficients based on previous statistical series.
Future situation: To estimate it, you must project the future demand for the period of the project's useful life.
Current situation: Present and analyze sufficient statistical data to characterize the evolution of the offer.
Project Study
In this field, a unit of measurement must be registered, with the possibility of including, if necessary, a second unit of measurement, which allows to account for the size or magnitude of the project.
Project Location: At this point, it is important to analyze which is the ideal site where the project can be installed, incurring minimum costs and better access facilities to resources, equipment, etc.
Cost of Transportation of Supplies and Products. It is about determining whether the location will be close to the input or the market. The comparison must be made taking into account weights, distances and current rates.
Availability and Costs of Inputs Considering the quantity of products to satisfy the demand, the availability and costs of the raw material in different areas must be analyzed.
Human resource. There are industries, whose location is determined on the basis of labor, that is when a large percentage of it is used and the cost is very low.
Decentralization Policies They are made in order to decongest certain areas and take advantage of raw material resources offered by the geographic location.
Economic Analysis
They are the set of material resources and human talent necessary to carry out the project. Includes labor, equipment, furniture, materials, supplies, adjustments and others.
The financing granted by the suppliers will be reflected when estimating the volume of investment in working capital, incremental annually.
The costs associated with the operation of the project, such as payment of salaries, rents, equipment maintenance, taxes, etc.
To produce many expenses are involved, so it is necessary to classify them into fixed and variable, according to the relationship they have with the volume of production.
Fixed expenses are those that determine the operation of the company and are independent of the volume of production, for example, employee salaries, rental of premises, etc.
Variable expenses are those that change according to the level of production, for example: inputs, direct labor, etc.
Financial Study
The initial investment includes the acquisition of all fixed or tangible and deferred or intangible assets necessary to start the operations of the company, with the exception of working capital.
Fixed investments have been made up of assets that are not subject to transactions, are obtained during the implementation or execution stage, and are used during the life cycle of the project.
Working capital or operating capital is achieved by subtracting current liabilities from current assets of a going concern.
If the financial resources are not enough to meet the investment needs of the minimum size plant, it is clear that the project is impossible.
Economic Evaluation and Project Administration
Evaluation methods that take into account the value of money over time: The evaluation of projects through mathematical-financial methods is a very useful tool for decision-making by financial managers, since an analysis that Anticipating the future can avoid potential deviations and problems in the long run.
Net Present Value (NPV) method: The Net Present Value method is widely used for two reasons, the first because it is very easy to apply and the second because all future income and expenses are transformed into today's pesos and thus can be seen , easily, if income is greater than expenses
Internal Rate of Return (IRR) method: This method consists of finding an interest rate in which the conditions sought are met at the time of initiating or accepting an investment project.
Uniform Annual Equivalent Cost (CAUE): The CAUE method consists of converting all income and expenses into a uniform series of payments. Obviously, if the CAUE is positive, it is because the income is greater than the expenses and therefore, the project can be carried out; But, if the CAUE is negative, it is because the income is less than the expenses and consequently the project must be rejected.