Project

Management

Project
Feasibility
& Stakeholder
Management
Joe Houghton
© Joe Houghton

Tel 086 384 3670 Email joe.houghton@ucd.ie IM joe.houghton@gmail.com

LinkedIn https://www.linkedin.com/in/joehoughton/
 The Module Overall
© Joe Houghton
 Learning Objectives
 By the end of this session you should:
 Understand the key issues around evaluating a project’s
feasibility & the need for clear Return on Investment
projections
 Be able to use the Feasibility Framework
 Know how to identify, classify and manage Stakeholders
and why this is critical to project success
© Joe Houghton
 Key Articles
 The following are all key readings which
should have been read prior to this class:

 Agarwal and Rathod - 2006 - Defining success for software

projects - An exploratory revelation
 Fortune and White - 2006 - Framing of project critical
success factors by a systems model
© Joe Houghton
 What we’ll cover today
Morning Afternoon

 Recap on Day 1  Student presentations

 Student presentations  Learning Objectives
 Learning Objectives

 Planning your project  Feasibility assessment

 Per Una video  Stakeholder management
 Work Breakdown  Group workshop
Structures
 Network Diagrams
© Joe Houghton
 Project
Selection
© Joe Houghton
 Project Stages Framework
Proposal FS Initial Investigation Gate

Feasibility
FR1 Detailed Investigation Gate
Investigation

Detailed
FR2 Development & Test Gate
Investigation

Develop
FR3 Trial Gate
& Test

FR4 Ready
Trials for Use
Take note of the red Complete
diamonds Release
These are Stage Gates
© Joe Houghton

Learning
review
 StageGate :
Robert Cooper
 Cooper’s book “Winning at New Products
is one of the most influential business books ever
 It details his StageGate process, where projects must pass
through clear objective testing between stages before
being allowed to continue

 Those projects which don’t pass the tests

are killed off, enabling re-allocation of
resources to more viable projects and
raising the number of projects likely to
come to profitable completion
© Joe Houghton
 Outline of Work throughout the Project
Pre-project work to
Discovery discover & uncover
opportunities

Stage 1 - An Initial
Investigation of
Scoping Project Feasibility

Stage 2 – Building the

Business Case : Full
Business Case,
Product Definition,
Business Case Feasibility Study : Project Details

Design of
Stage 3 - Detailed product
design &
Manufacturing
process for the
Development development.
product

Stage 4 – In-House Product,

with potential
Testing & customers and in
the manufacturing
Validation plant
© Joe Houghton

5 P’s - Position,
Stage 5 Application of the
full Marketing
Place, Price and
Promote the
Launch Mix
Product
 Ref: Buttrick – The Project Workout 2nd ed.
Checklist
© Joe Houghton
 Steps leading up to the Initial Investigation Stage

1 Originator

Check previous proposals 2 Originator

Prepare a Proposal
Confirm who will be Project Sponsor

Review & Pre-screen Proposal 3 Sponsor

Identify & select a Project Manager 4 Sponsor

for the Initial Investigation Stage

Register the Proposal 5 Project Manager

© Joe Houghton

Initial
Initial Investigation Gate If Yes Investigation
 Weighted Factor Scoring Model

• Provides an objective way to

assess options

• Allows management to
participate by setting the options
& / or the weightings

• Allows a decision to be defended

later if questioned
© Joe Houghton

Ref: Heerkens – Project Management p64

 Project Stages Framework – The Initial Investigation

Proposal FS Initial Investigation Gate

Feasibility
FR1 Detailed Investigation Gate
Investigation

Detailed
FR2 Development & Test Gate
Investigation

Develop
FR3 Trial Gate
& Test

FR4 Ready
Trials for Use
Complete
Release
© Joe Houghton

Learning
review
 Tasks in the Initial Investigation Stage
Undertake the Initial Investigation 2 Project Manager

Prepare a Plan for the main Project 3 Project Manager

Prepare Initial Business Case for project 4 Project Manager

Review with Stakeholders : amend if needed. 5 Project Sponsor

Finalise Business case
Submit for Management decision

Feasibility Investigation
Initial Investigation Gate
© Joe Houghton

If Yes Stage
 The Feasibility Investigation Framework
© Ken Meates 2003
© Joe Houghton
 The Feasibility Investigation Framework
© Ken Meates 2003
© Joe Houghton
 The Feasibility Investigation Framework :
Market Feasibility

Opportunities

 Is there an identified consumer

need or desire for the product ?
 What features and benefits would
the product provide ?
 What would consumers be willing to pay for the
product ?
 What total sales and revenues could be achieved ?
© Joe Houghton
 The Feasibility Investigation Framework :
Market Feasibility

Risks

 What would be the risk of

consumer disinterest in the
product?
 What would be the risk of
consumer confusion about the
product’s functions and benefits ?
 What would be the risk of a superior competitor
© Joe Houghton

product?
 The Feasibility Investigation Framework :
Technical Feasibility

Opportunities

 Would it be technically possible to design

a product with the required functionality ?
 Would it be technically possible to mass produce the desired
product ?
 Would the product or the manufacturing process require
breakthrough technology or is the technology currently
available?
 How different is this technology from that which the company
© Joe Houghton

currently employs ?
 The Feasibility Investigation Framework :
Technical Feasibility

Risks

 What would be the risk of

technical over-complexity?
 What would be the risk of developing a technically
fragile product?
 What would be the risk of the project being a
technical failure?
© Joe Houghton
 The Feasibility Investigation Framework :
Organisational Feasibility

Opportunities

 Do we have the right know-how

and people in the organisation ?
 Are we organised in the best way to undertake this
type of product development ?
 Do we have the right planning and control systems
for this type of product development ?
 Do we have the right competences to be in this
© Joe Houghton

product market ?
 The Feasibility Investigation Framework :
Organisational Feasibility

Risks

 What would be the risk of a failure

of teamwork in the organisation ?
 What would be the risk of a failure
of leadership or judgement ?
 What would be the risk of a failure to support and resource
the project ?
 What would be the risk of failing to have the organisational
© Joe Houghton

ability to design, produce and market this type of product ?

 The Feasibility Investigation Framework :
Financial Feasibility

Opportunities

 How much would we have to spend up

front before any sales revenue?
 What would be the net cash flows in the
first five years ?
 What would be the Net Present Value and Internal Rate of
Return on the project ?
 What would the NPV and IRR under different sets of
© Joe Houghton

assumptions on volume, price, costs and capital investment ?

 The Feasibility Investigation Framework :
Financial Feasibility

Risks

 What would be the risk of an escalating

initial investment?
 What would be the risk of sluggish
sales and revenues?
 What would the risk be of above-average rates of product
returns?
 What would be the risk of above-planned product costs in
manufacture?
© Joe Houghton

 What would be the risk of insufficient profits?

 Session Summary
 Lots of ideas, but few make it to success
 Efficient companies filter out
non-viable ideas as early in the process as possible
 Cooper’s StageGate is the most widely used method
 The Feasibility Framework provides a good base set of
questions to ask when reviewing project viability
© Joe Houghton
© Joe Houghton
© Joe Houghton
 What is a Stakeholder?
 Stakeholders are people or organisations …
 With an interest in the project
 Who can affect a project
 Who may be affected by a project

 Stakeholders may be within the organisation, or external

to it.
 Internal stakeholders may be managers, staff, other dept.
heads, your own team, subject matter experts
 External stakeholders may be from anywhere – other
companies, public bodies, legislative bodies, competitors
© Joe Houghton
 Key Articles
 The following are all key readings which
should have been read prior to this class:

 Kadefors - 2004 - Trust in project relationships - inside the

black box
 Petter - 2008 - Managing user expectations on software
projects - Lessons from the trenches
 Toor and Ogulana - 2010 - Beyond the iron triangle -
Stakeholder perception of key performance indicators KPIs
for large-scale public sector development projects
 Vaaland - 2004 - Improving project collaboration - start
with the conflicts
© Joe Houghton
 Niccolo Machiavelli
 Machiavelli was an Italian politician who
lived in Florence in the 14 & 1500’s and
founded the area of Political Ethics
 His classic treatise on power –
“The Prince” basically puts forward the
idea that “the end justifies the means”
 Although not a politically correct
philosophy today, the need to focus on
delivery of your goals is a key message
which still has considerable relevance

“The end justifies the means.”

© Joe Houghton
 Why do we need to identify Stakeholders?
 Stakeholders can affect a project because they have an interest in it.
 If we don’t know who is in a position to affect the project, how can
we plan to either use or guard against their influence?

 If we don’t identify Stakeholders and they have negative attitudes, it

can lead to problems or failure in the project.
 If we miss a pro-project Stakeholder, we miss the opportunity to
have a helping hand assist us in delivering the project output(s)
© Joe Houghton
 Stakeholder Context
Media
Standards Bodies
Government

Management Board
Sponsor
Suppliers End Users

Contractors
PM Customers
Project Team

Stock Market Lobby Groups

Analysts Competitors
General Public
© Joe Houghton
 Porter’s 5 Forces
 Michael E. Porter. "The Five Competitive Forces that Shape
Strategy", Harvard Business Review, January, 2008, p.86-104
 See http://hbr.org/2008/01/the-five-competitive-forces-that-shape-
strategy/ar/1 for a 13 minute video interview with Porter
© Joe Houghton
 How can we classify Stakeholders
 In various ways :
 Positive, negative or neutral to the project
 By the degree of influence they may wield :
 Strong, Medium, Weak, None
 By their ability to stop or veto the project
 Decision maker, Influencer, Consenter, Interested

 KEY POINT
 Stakeholder influence may well change
as the project develops, so this analysis
should be done at the start then
revisited periodically.
© Joe Houghton
 How can Stakeholders Affect a Project?
 They can pull their support, which may be :
 Political
 Financial
 Resource Provider
 Influencer – political, media, morale
 Not buying the product (customers)
 Advocate against the project / product
(pressure groups such as McDonalds
protesters, Greenpeace, lobby groups)

 Or they can support in all the above ways

© Joe Houghton
 How do Stakeholders Need to be Managed?

Carefully!
 Identify them, classify them, build a picture of how they
feel towards your project and why.
 Monitor and constantly update your awareness…

 Use this knowledge to create and maintain :

 Your Communications Plan
 Your Risk Management Plan
 Your Overall Project Plan
© Joe Houghton
 Examples of Stakeholders Affecting Projects

 Microsoft Xbox Games Online only - 2013

 Microsoft has reversed plans to implement a number of
features on its upcoming Xbox One gaming console after
a wave of criticism online.
 The company has initially suggested that the Xbox One could block the use
of second-hand games, stopping users from trading in old games or
swapping software with friends.
 Gamers also expressed distaste for a requirement that the console be
connected to the internet once every 24 hours, as well as the decision to
restrict the use of games to certain countries.
 However Don Mattrick, president of Microsoft's Interactive Entertainment
business, said in a blog post yesterday evening that an internet connection
will no longer be required to play games after its initial setup. He also said
that users will be able to share and play games like they have on the
company’s previous consoles.
© Joe Houghton

 Mr Mattrick said the changes are in response to feedback Microsoft

received since unveiling plans for the console in May.
 Examples of Stakeholders Affecting Projects

 Shell Corrib Pipeline – 2004 onwards

 At start of project, Shell were “blissfully unaware” of the
potential issues in running their pipeline.
 Or were they aware but figured they could get away with
it?
 They were soon to discover that the local farmers would
not roll over without a fight.
 Millions of dollars later, court
battles, prison sentences for
locals, Shell had to back off and
accommodate the local demands.
 Better to have involved them
early and gained agreement and
© Joe Houghton

consensus…
 Protests affect Shell Project
© Joe Houghton
 Examples of Stakeholders Affecting Projects

 Ryder Cup - 2006

 Multi-national planning joined

 up all the complex aspects into a well run event
 Planning way back several years
 Locals, organisations, garda, government, tourism all
consulted and involved throughout
 Optimistic momentum achieved throughout the
development overcame even potentially difficult issues like
cell-phones not being allowed – excellent expectation
setting & communications.
© Joe Houghton
 Examples of Stakeholders Affecting Projects

 Manapouri Project – New Zealand

 (ref: http://en.wikipedia.org/wiki/Manapouri_Power_Station )
 The original plans for the power station development in the 1960s involved raising Lake
Manapouri by up to 30 metres, and merging lakes Manapouri and Te Anau. A dam at the
outlet of Lake Manapouri would have achieved this. As power station construction work
progressed, the reality of the planned ecological damage became apparent to many New
Zealanders, and protest became widespread and passionate. The Save Manapouri
Campaign became an early New Zealand manifestation of the international awareness of
the "environment" that came with the prosperity of the sixties.
 "At its simplest, the issue was about whether Lake Manapouri should be raised by as
much as 30 metres. But there was much more at stake than that. There were strong
economic and engineering arguments opposing lake raising, and there were also legal
and democratic issues underlying the whole debate. What captured the public's
imagination across the country was the prospect that a lake as beautiful as Manapouri
could be interfered with, despoiled and debased", writes Neville Peat.

 In 1970, 264,907 New Zealanders, almost 10 percent of the population, signed the Save
Manapouri petition. In the 1972 general election Manapouri was a significant election
issue, and the Labour Government of Norman Kirk was elected on a platform that
© Joe Houghton

included a strong endorsement of the Save Manapouri ideals.

 Lake Manapouri
© Joe Houghton
 Now it’s your turn!
 In your groups, perform a Stakeholder Identification and
Classification using the project you have chosen to
present and write your report on.
 Use the Stakeholder Analysis spreadsheet on Blackboard

1. Pick a specific point in time (perhaps the start of the

project or another key moment)
2. Now identify ALL the stakeholders
3. Then classify them and categorise them by role,
relationship to the project (+/-/~)
4. Finally create a Stakeholder Influence Map showing all
the data you have created – be prepared to present
© Joe Houghton

this!
 Session Summary
 Now you should know what Stakeholders are, and why
they are so important
 You now have a clear way to identify, classify and then
communicate with Stakeholders to set your project up
for the best chance of success

Media
Standards Bodies
Government

Management Board
Sponsor
Suppliers End Users

PM
Contractors Customers
Project Team

Stock Market Lobby Groups

© Joe Houghton

Analysts Competitors
General Public