The document discusses project selection and solicitation planning for project management. It describes the process of project selection where projects are assessed and the highest priority project is chosen based on benefits and feasibility. Reasons for project selection include limited resources. Common project selection methods include quantitative methods like cost-benefit analysis and qualitative methods. The document also outlines the solicitation planning process which involves developing procurement documents like the procurement management plan, statement of work, and request for proposal to solicit bids from sellers for project needs. Key solicitation documents include requests for bids, quotes and proposals.

1. PROJECT SELECTION
AND SOLICITY
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2. PROJECT SELECTION
 It is a process to assess each project idea and
 select the project with the highest priority.
 Projects are still at suggestions stage, so the selection is
often made based on only brief descriptions of the project.
Selection of projects is based on:
1) Benefits: A measure of the positive outcomes of the
project.
"the reasons why you are undertaking the project".
2)Feasibility: A measure of the likelihood of the project being
a success, i.e. achieving its objectives.
Projects vary greatly in complexity and risk.
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3. Why Do Project Selection?
 Often you will have a number of suggested projects but not
enough resources, money or time to undertake all of the
projects.
 For the better experience of organisation
 The Project Selection Stage will assist you by providing a
process to compare the importance of the projects and
select the most suitable project to undertake.
o The benefits of completing the Project Selection are:
 a transparent and documented record of why a particular
project was selected
 a priority order for projects
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4. WHEN TO DO ?
 Undertake a Project Selection when you have more
ideas than the number of projects you can undertake
and need to select the project that should be given
priority.
 Note: If you only have 1 project, it may still be useful
to score the project against a set of criteria to identify
the strengths and weaknesses of the project. The
results may be useful later in the Feasibility Study
Stage.
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5. Planning process for project selection
 Strategic planning, determine the organization’s
strategy, goals and objectives.
 Business area analysis, analyze the business process to
achieve strategic goals such improvement of sales,
manufacturing, engineering, or IT.
 Project planning, define projects that address the
strategies.
 Resource allocation, choosing which projects to do
and assigning resources for working on them.
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6. Project Management6

7. Step:
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8. Project Management8

9. Project Management9

10. Measurement of project effect
 INTANGIBLES
 Difficult to measure cost and benefits
 HIDDEN OUTCOMES
 time, budget subject to great error
 CHANGE of Information technology
 technology changes rapidly
 outdating many good project idea
 Technology is highly dynamic
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11. Project Selection Methods
Organizations invest huge sums of money on new projects and it is important for
organizations to ensure that these investments are safe and will result in good returns
and benefits for the organizations . Hence it is important to analyze all new project
opportunities to justify the decisions for making the needed monetary investments.
There are two major categories of project selection methods as below.
QUANTITATIVE METHODS:-
 Benefits Measurement Methods
 Constrained Optimization Methods
QUALITATIVE METHODS
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12. Quantitative Methods
Benefits Measurement Methods
 Cost Benefit Analysis : A cost-benefit analysis (CBA) is
the process used to measure the benefits of a decision
or taking action minus the costs associated with taking
that action. A CBA can also include intangible benefits
and costs or effects from a decision such as employee
morale and customer satisfaction
 Payback Period : The payback period refers to the
amount of time it takes to recover the cost of an
investment. Simply put, the payback period is the length
of time an investment reaches a breakeven point. The
desirability of an investment is directly related to itsProject Management12

13.  Net Present Value : Net present value (NPV) is
the difference between the present value of cash
inflows and the present value of cash outflows
over a period of time. It is assumed that an
investment with a positive NPV will
be profitable, and an investment with a negative
NPV will result in a net loss.
 Internal Rate of Return (IRR) : The internal rate
of return is a discount rate that makes the net
present value (NPV) of all cash flows from a
particular project equal to zero. Assuming the
costs of investment are equal among the various
projects, the project with the highest IRR would
probably be considered the best and be
undertaken first.
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14.  Economic Value Added : EVA, or Economic Value
Added, is the performance metric that calculates the
worth-creation of the organization while defining the
return on capital. It is also defined as the net profit after
the deduction of taxes and capital expenditure. If there
are several projects assigned to a project manager, the
project that has the highest Economic Value Added is
picked. The EVA is always expressed in numerical
terms and not as a percentage.
 Opportunity cost : Opportunity Cost is the cost that is
given up when selecting another project. During project
selection, the project that has the lower opportunity
cost is chosen.
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15. Constrained Optimization Methods
Constrained Optimization Methods, also known as the Mathematical
Model of Project Selection, are used for larger projects that require
complex and comprehensive mathematical calculations. The techniques
that are used in Constrained Optimization Methods are as follows:
 Linear programming
 Non-linear programming
 Integer programming
 Dynamic programming
 Multiple objective programming
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16. Qualitative Methods
Many times project selection is done based on non-
financial considerations. These may include political
reasons, personal biases, safety and security
considerations, investor and customer requests etc.
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17. Solicitation Planning
 Solicitation is an act or instance of requesting or seeking bid,
business, or information. Unlike an offer, a solicitation is not a
clear indication of the intention to enter into a binding agreement.
 Solicitation planning is the process of preparing to solicit sellers
to provide products the project needs.
 There are three inputs to solicitation planning:
Procurement
Management Plan
Statement of Work Other planning outputs
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18.  Procurement Management Plan This subsidiary
plan sets out the methodologies and expectations of
procurement within the performing organization.
 Statement of Work The SOW provides detailed
information on what the seller will be providing for
the performing organization. Recall that this
document allows the seller to determine if it can
provide the product and meet the requirements of
the project team.
 Other planning outputs Other details within the
project plan, such as the schedules, estimates,
constraints, and assumptions, are referenced as
their values may have direct influence on the
solicitation process.
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19. Solicitation planning relies on the outputs of procurement planning.
The Procurement Management Plan will guide the process as the
project team has planned, as the performing organization requires,
or under the guidance of a procurement office within the performing
organization.
There are two primary tools used for solicitation planning:
 Standard form Within the performing organization, there may be
many different standardized forms for contracts, descriptions of
procurement items, bid documents, and other procurement-
related documents.
 Expert judgment Expert judgment may be needed to review and
help the project manager select the best source for the procured
product.
Organizing Solicitation Materials
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20. These are some terms project manager should be familiar with:-
Bid From seller to buyer. Price is the determining factor in the
decision-making process.
Quotation From seller to buyer. Price is the determining factor in the
decision-making process.
Proposal From seller to buyer. Other factors-such as skill sets, reputation,
idea for the project solution-may be used in the decision-making
process.
Invitation for Bid
(IFB)
From buyer to seller. Requests the seller to provide a price for
the procured product or service.
Request for Quote
(RFQ)
From buyer to seller. Requests the seller to provide a price for
the procured product or service.
Request for
Proposal (RFP)
From buyer to seller. Requests the seller to provide a proposal
to complete the procured work or to provide the procured
product
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21. Request for Proposal (RFP)
 A request for proposal (RFP) is a document
given to prospective sellers to encourage
them to bid on an opportunity to provide
products or services. An RFP would not be
used for all of a company's projects. Typically
an RFP is used when a company does not
have the in-house expertise or capacity to
produce needed goods or services.
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22. Example –
 Bobbly Baubles, Inc. is a small company that sells novelty
games and gift items. Its accounting records are currently
maintained via a series of manual worksheets. Over the
last couple years, the company's business has grown
significantly and maintaining the accounting books has
become difficult.
 Barbara, the company's head bookkeeper has decided it is
time to purchase a computerized accounting system. To
assist with this purchase, Barbara contacts Ron, a
purchasing specialist from the procurement department.
Ron decides to issue a request for proposal (RFP) to solicit
companies (vendors) that sell and install retail accounting
systems.
 No one at Bobbly Baubles has the experience selecting or
installing computerized accounting systems. An RFP can
help sellers submit proposals touting their ability to
implement a state-of-the-art, computerized accounting
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23. RFP Components
The structure of an RFP is designed to
communicate needs for specific products or
services to potential sellers.
The major components of an RFP are:
 Background information
 Statement of work (SOW)
 Evaluation criteria
 Submission requirements
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24. Solicited proposals
Solicited business proposals are written when customers themselves ask for
proposals. The requirement may be asked verbally or published through
media outlets. The solicited proposal comes with a description of what the
client or buyer wants. It can also come with formatting instructions, and the
criteria that will be used to make a selection.
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25. How solicited proposals work?
 Invitation to Bid(IFB): This is a competitive process of awarding contracts. The
customers clearly know the products or services that they want to purchase. Hence,
they are very clear about the scope of work and what they expect to be delivered. An
IFB is typically used when there is no substantive difference in the products or
services that meet the set specifications
 Request for proposal: Here, the customer doesn’t clearly know the solution they
want. This prompts the buyer to go to market for solutions-oriented approaches to
service or product delivery. You’ll have to develop them and provide a cost estimate.
Hence the proposal you submit will include the details of your solution, your plans,
drawings, personnel information and any other kind of information that demonstrate
your capability to complete the contract.
 Request for quote: This is mainly used to determine the prevailing market rates.
The customer wants to find the best pricing of the product or services they are
seeking.
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26. THANK YOU
Adarsh
Bhanu Tanwar
Gourav Rajput
Madhurima Chatterjee
Nitish
Ritik GargProject Management26