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Project Management Email-Piper Industries

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Submitted By yellowtang
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Project Management Email-Piper Industries
OPS 571

Dear Mr. Gritsch,

I would like to thank Piper Industries for allowing our team to analyze your projects. Our team has carefully reviewed all three projects for a best fit to your business needs. Included you will find our analysis and recommendations of the Project Proposal that most benefits your company.
Based on the review of the three projects, it appears that the Juniper project which is an enhancement of a current widget being offered will not be profitable option. It requires a cost of $350,000 to bring the product to market with a ROI of 76.9% of the initial cost at its 3 year life span. With advancements in technology ending the life of this product, it is recommended not to pursue this project.
The Palomino project may appear to be more attractive with enhancements using existing technology. Upon reviewing the figures, $655,000 start-up costs to bring to market and a predicted $90,000 return each year for 7 years and factoring a ±5% margin, this project takes a different spin that presents a risk of loss to the organization. With a potential -5% (-$31,500) ROI, it becomes obvious that this project is not worth the risk.
The ideal project that our team recommends is the Stargazer project. With an initial research and development cost of $450,000, it will only require an additional $125,000 to bring this product to market. Factoring a product life forecast of 7 years, your organization will earn a 30.4% ROI by the third year which leaves the additional years with a positive return.

There are six product development phases that must be considered in order to bring the Stargaze project to success. Phase 0 is the planning phase which includes a product approval and launch of the actual product development process. With the initial R&D conducted it is clear that new…...

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