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(Question)

Describe the impact of realism, capability, flexibility, ease of use, cost, and comparability of Non-Financial Consideration Method.

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(Working on selection models and project screening)

Realism. An effective model must reflect organizational objectives, including a firm's strategic goals and mission. Criteria must also be reasonable in light of such constraints on resources as money and personnel. Finally, the model must consider both commercial risks and technical risks, including performance, cost, and time. Capability. A model should be flexible enough to respond to changes in the conditions under which projects are carried out. It should be robust enough to accommodate new criteria and constraints, suggesting that the screening model must allow the company to use it as widely as possible to cover the greatest possible range of project types. Flexibility. The model should be easily modified if trial applications require changes. It must, for example, allow for adjustments due to changes in exchange rates, tax laws, building codes, and so forth. Ease of use. A model must be simple enough to be used by people in all areas of the organization, both those in specific project roles and those in related functional positions. Further, the screening model that is applied, the choices made for project selection, and the reasons for those choices should be clear and easily understood by organizational members. Cost. The screening model should be cost-effective. A selection approach that is expensive to use in terms of either time or money is likely to have the worst possible effect, causing organizational members to avoid using it because of the excessive cost of employing it. The cost of obtaining selection information and generating optimal results should be low enough to encourage use of the models rather than diminish their applicability. Comparability. The model must be broad enough to be applied to multiple projects. If a model is too narrowly focused it may be useless in comparing potential projects, or foster biases toward some over others. A useful model must support general comparisons of project alternatives.