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This chapter is from the book

This chapter is from the book

The Value of Project-Selection Methods

Outside of the project charter, the other topic that is greatly emphasized by PMI within the Initiating process is project-selection methods.

PMI feels strongly that organizations should have a formal process for deciding projects to sponsor and for ensuring that projects are supportive of the organization's strategic objectives. In many organizations, some type of senior management steering committee or Program Management Office (PMO) performs this project-evaluation and -selection process.

Project-selection methods are the techniques used to execute this process, and they are organized into two major categories: benefit measurement methods and constrained optimization methods.

The project-selection method(s) used by an organization should be relevant to the objectives of the company and its managers and should be consistent with the capabilities and resources of the organization.


Project initiation is the first of many processes where PMI expects organizations to leverage historical information (such as past project-selection decisions and past project performance) when authorizing a project or the next project phase. Although this seems like common sense, the issue here is that in the "real world" the collection of reliable project data is rarely done; therefore, it is not a common practice in many organizations today.

Two General Types of Project-Selection Methods

The two methods of project selection are benefit measurement (comparative approach) and constrained optimization (mathematical approach). Table 3.1 summarizes the key points of these two method types.


The exam will require you to know the methods of project selection, their main differences, and examples of each.

Table 3.1 Project-Selection Methods

Method Type



Benefit measurement (comparative approach)

Scoring models, cost-benefit analysis, review board, economic models.

Benefit measurement is the most common approach.

Constrained optimization (mathematical approach)

Linear programming, nonlinear programming, integer programming, dynamic programming, multi-objective programming.

Constrained optimization makes use of math models and complex criteria and is often managed as a distinct project phase.

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