presented the draft business case to the PMO for finalisation, and to top management for authorisation to proceed to the next stage. To their surprise, the PMO Director insisted that the team must make all assumptions explicit and do a sensitivity analysis before he could consider carefully reading the business case. He pointed out that the current high cement price as assumed in the feasibility study was the result of a booming Chinese construction industry that could decline significantly in the foreseeable future. Another member of the PMO added: "And what if assumed costs rise and we can't stick to the proposed budget, as was the case with several of our recent projects?" a. Based on the case study, explain why a business case should consider alternative scenarios for the important variables. b. Discuss issues that are not mentioned in the case but should be considered before the projects gets the go-ahead. c. What purpose do sensitivity analysis serve in project selection? Discuss within the context of PPC's business case. d. Once top management has approved the "Proposed Cement Factory" project, and it has been admitted to the project portfolio, how is it monitored thereafter? Under what circumstances might it be cancelled? e. Do you think the team proposing the cement factory in the case should have included in the business case, bubble charts for risk versus reward illustrations in order to convince the PMO Director, his team and top management? Motivate with evidence from the case in quotations (wi). (10) Read the following case study on PPC CEMENT and answer the questions at the end of the case: PROPOSED CEMENT FACTORY FOR PPC CEMENT Background PC exports cement to other African countries and the Indian Ocean islands. The company was founded in 1892. PC is the leading supplier of cement in Southern Africa, with eight manufacturing facilities and three milling depots in South Africa, Botswana and Zimbabwe. The Business Case The first sentence in the executive summary of the draft business case reads, "The proposed cement factory would be the perfect answer to top management 's goal to grow PPC'S product base while remaining a low-cost producer of building materials." Geological work performed as part of the feasibility study had pointed to a site containing high-quality limestone-a key resource in the production of cement-that could be exploited very economically. The site, already owned by PC, was under- utilised and could suitably house a new plant located right next to the proposed limestone pit. It afforded ample and cost-effective access to all essential logistics and resources, including other materials needed for the manufacture of high-quality cement. The business case and feasibility study also indicated a high return on investment for the project-well above the hurdle rate set by the company for a new project to be considered for inclusion in its project portfolio. Given the company's competency in cement production, the technical and production risks were assessed as low. Everything seemed in order, and the team proposing the project was optimistic that approval of the next phase of the proposed project would be a mere formality. They