The financial manager is faced with the challenge of choosing the projects withotential of yielding positive returns for the organization

The financial manager is faced with the challenge of choosing the projects withotential of yielding positive returns for the organization

The financial manager is usually faced with the challenge of choosing the projects that have the potential of yielding positive returns for the organization. The management is required to be vigilant while selecting projects. This is because they entail the commitment of a massive amount of organization finance. The organization is required to embrace the best appraisal techniques such as net present value, internal rate of rates, among others. Net present value is commonly utilized methods, and the organizations highly prefer the projects that yield positive returns. An example of projects that failed is NHS civilian IT projects. The health system of England funded the National Health Service. The projects aimed at unifying all the health records system for all British citizens. The projects were expected to be the largest IT projects globally. The project failed. There was a high expectation, and they did not conduct effective research about the project returns. The forecasting of the projects was wrong since it was not well formulated during the inception stages. They failed to document the expected returns out of the projects as well as the hindrance that could have affected the implementation of the projects. The environmental changes also contributed to the project’s failure, especially those emanating from changes in technology. Public and private sectors are hence required to adopt the best appraisal and forecasting technique to ensure that the organization chooses the right projects which have the potential of yielding positive returns. This is essential since it contributes to project success in the ever-changing environment.

Hi Herbert Ellison,

The management of both public and private sectors is required to embrace the best tools to appraise all projects before commercialization. This is important since it contributes to investing in a project that has the potential to yield positive returns. Effective appraisal of projects contributes towards the minimization of project failure. This is essential since it saves the entity a significant amount of funds. The public and private sectors are required to embark on research, which aids in identifying the problems that might affect the implementation of a given project in the competitive environment. This will aid in preventing entities from being declared bankrupt in the market place.