Friendly Medical Center strategic planning retreat project selection

User Generated

xnnyn5

Engineering

Description

Just do paraphrasing.








Unformatted Attachment Preview

1. Identify as well as you can the three iron triangle constraints for this project: cost, time, and scope. Cost: $11 million; Time: start after Nov 20X6, finish by July 20X7; Scope: construct a project plan, purchase land, purchase furnishings, purchase materials and contract labor to construct building and connection, and train staff in the new facility services. 2. Identify the expected benefits of this project for Friendly Medical Center. • • • • • A profit program for the Center but under their control that would gain net cash flow of $1.5 million/year; Improve the local image of Friendly Medical Center; Gain additional referrals to the Center’s outpatient therapy programs; Increase the census in the hospital’s inpatient units, and Provide better care for the community in terms of reimbursable preventive and wellness programs. 3. Comment on the strategic initiatives resulting from the Board’s major strategic planning retreat. Would you consider this a productive retreat? The outcomes of the retreat were rather shallow. Better would have been to have come up with these two initiatives at a special board meeting and then collect data to decide at the retreat what areas to focus on for improving the cost effectiveness of patient care delivery and what alternatives to explore in more detail for new programs and services that would capitalize on their excellent staff and reputation. 4. What “project selection” procedure was used here? How common do you think this is? How wise do you think it is? This was basically a “sacred cow” approach by the CEO, probably not that uncommon. Although the idea sounds like it could be a success, we don’t see any risk analysis being considered, or the consideration of other alternatives that might have been even more promising. 1. ( 2.5pts) Using the cash flow on Page 15 in your text generate an Excel sheet using your assigned k values K (%) NPV ($) 6 141557 7 119,604 8 99296 9 80494 10 63072 11 46916 12 31,932 13 17997 14 5054 15 -6985 16 -18189 17 -28624 18 -38349 19 -47417 20 -55877 21 -63775 2. Plot of NPV Versus Interest rate NPV ($) 180000 120000 60000 0 0 6 11 17 22 28 -60000 -120000 2. (2.5pts)Do Exercise 1 on page 28 in the text. A Four year financial forcast to have a net cash inflow of $20,000, $25,000, $30,000, and $50,000 in the next four years. It will cost $75,000 to implement the project, payable at the beginning of the project. If the required rate of return is 20% conduct a discounted cash flow $50K calculation to determine the NPV. $30K $20K $25K NPV = -$75K + $20K(P/F, 20%,1) + $25K(P/F, 20%,2) + $30K(P/F, 20,3) + $50K(P/F, 20, 4) NPV = -$75K + $20K(0.8333) + $25K(0.6944) + $30K(0.5787) +$50K(0.4823) NPV = -$75K + $ 16.666 + $ 17.36 + $ 17.361 + $ 24.115 = $ 0.496K = $496 In order to answer this question, the student needs to discount the cash flows in years 1 through 4 ($20,000, $25,000, $30,000 and $50,000 respectively) to the present using a 30% discount rate and compare this value with the initial outflow of $75,000. Using the NPV Excel formula gives the following analysis: 4.(5pts) A company which uses austenitic nickel chromium ions to manufacture resistance heating wire is considering a new annealing drawing process to reduce cost. If the new process will cost $1.75 million dollars now, how much must be saved each year to cover the investment in ten years at an interest rate of 12%? A = $1.75M(A/P, 12%,10)= $1.75M(0.12((1.12)10)/((1.12)10 -1) = $1.75M(0.12(3.105)/( 3.10584 -1) = $1.75M(0.37270/2.10584) = $1.75M(0.176985)= $309723.75 5. (5pts) A construction company invests $55,000 in a new bulldozer. If income from temporary leasing of the bulldozer is expected to be $11,000 per year, when will it take to recover the investment at an interest rate of 15% ? P = A [(1 +i)n -1]/i(1 +i)n $55,00 = $11,000[1.15)n -1]/ 0.15(1.15)n (5.0)(0.15) = 1 – 1/1.15n 0.75 = 1 – 1/1.15n 0.25 = 1/1.15n 1.15n = 1/0.25 = 4.0 Nlog 1.15 = log 4.0 N = log4.0/log 1.15 = 9.918 years
Purchase answer to see full attachment
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Explanation & Answer

Hello

1.

Identify as well as you can the three iron triangle constraints for this project: cost, time, and scope.

Cost: $11 million;
Time: start after Nov 20X6, finish by July 20X7;
Scope: construction of a project plan, land purchase, purchase of furnishings, materials’ purchase and
contracting labor for building construction and connection, and staff training in the new facility services.
2. Identify the expected benefits of this project for Friendly Medical Center.






A profit generating program controlled by the management of the Center gaining upto $1.5 million
per year.
Improving the Friendly Medical Centre local image
Gaining more referrals to the therapy programs of the outpatient in the medical Centre;
Increment of census in the outpatient units in the hospital
The community is provided with better ca...


Anonymous
Great study resource, helped me a lot.

Studypool
4.7
Indeed
4.5
Sitejabber
4.4

Similar Content

Related Tags