How to Determine the Value of a Project

Jeff De Luca's picture

Here's a model proposed by Gardner and Trotta to see what impact a project has on your company's share price. The story is at cioinsight here and there are two PDFs of the model you can download and print for use. Essentially, it's a discounted cash flow on the money expected over the life of the project (future cash flow) taking into account the time and risk associated with doing the project (discounted cash flow) and then mapping that to a potential share price change.

I think it's quite interesting (and admirable) to try and extend a project metric all the way out to a company's share price. This ties in nicely with an article I wrote recently for Australasian Customer Focus and Strategy Magazine where I wrote about project business cases and metrics.