Analysis of Failed Project and Critique of Financial Selection Models

General Context

This assignment concerns the case study ‘Great Western Mainline Electrification

You are to research and produce an in-depth analysis on why the project failed (from both a practical and project management perspective). You are also required to propose a strategy that could have been implemented to ensure the success, rather than failure of the project. 

This should follow a report format (see below). You should draw on the various topics covered in the Project Management part of the EAT340 module (e.g. Project specification, feasibility study, selection, estimating, accounting, scope management, project planning, resource planning and scheduling, control, quality etc.). 

Your work should be structured as follows and include the following headings and sections: 

1. Introduction- Introduce the failed project. Your introduction should include some background information on the failed project including the dates during which this project took place, companies and other stakeholders involved, the project location/s, and value. This should be followed by a general overview of why the project is considered to have failed. An outline of what will be discussed within the report should then be provided. 

2.General context –Discuss specific indicators of project failure identified in the academic literature. This should include a consideration of the different problems that can lead to project failure at the various stages of the generic project lifecycle. 

3.Case Analysis – Provide an in-depth analysis of why the project in the case study failed. A description of what went wrong should be provided, and a breakdown of errors and omissions in project management mapped to the part of the project lifecycle at which they occurred should be included in this section. 

4.Proposed solutions- Finally you are required to suggest a strategy that could have been implemented utilising the relevant project management tools and techniques, to prevent the identified issues leading to failure occurring. 

a) Provide a critique of three financial project selection models of your choice by discussing the advantages and disadvantages of each. 

b) A project requires the purchase of a new piece of machinery. You are the project manager and you must choose between two potential machines (Machine A and Machine B), either of which would be suitable. The cost of each machine is identical at £311,000. However, they differ in performance such that the projected future cash flows are different for each machine. Projected cash flows over a 5 year period are as shown in Table Q2a 

i. Show which machine would be the preferred choice based on a Payback Period estimate. 

ii. For each machine calculate Return on Investment.  

iii. For each machine, calculate the Net Present Value (NPV) after 5 years assuming a discount (inflation) rate of 1% for each year of the project. Table Q2b provides a list of discount factors for a range of discount (inflation) rates. 

iv. For each machine, calculate the Internal rate of return after 5 years assuming a discount (inflation) rate of 1% for each year of the project.

v. The project manager decides to purchase Machine A. Suggest why.