Project Management Skills #1 - Financial Appraisal with NPV

How to decide whether your project is worth doing from a financial perspective

4.18 (699 reviews)

Udemy

platform

English

language

Project Management

What you will learn

Decide whether a project is financial viable by calculating Net Present Value.

Evaluate the key assumptions that underly the calculation and hence business case.

Challenge Return on Investment (ROI) and Internal Rate of Return (IRR) calculation.

Why take this course?

If a project costs $1.2 million in year 1 and generates revenue of $400,000 in each subsequent year, how many years does it take to break even?

If you answered 5 years (including year 1) then you probably need to take this course because it's likely that this project loses money over that five year period.

The problem with break-even analysis and Return on Investment (ROI) calculation is that they usually ignore the fact that $1,000 in one year's time is not equivalent to the same amount today, That's because the money could be invested in a different way, brining interest rates into play.

The only sound way to determine whether a project is financially viable, is by calculating the project's Net Present Value. This project will teach you:

Why Future Value does not equate to Present Value.
How to Calculate Present Value.
How to calculate Net Present Value across a number of year.
Why Return on Investment, Break-even and Internal Rate of Return can be misleading
What other types non-monetary value you can consider.

If you already have a good grasp of Net Present Value, Discounted Cashflow or Time Value of Money then this course is not for you. If, however, any of the terms make your stomach feel queasy then this course is for you.

Net Present Value is one of this things that is obvious when you understand but baffling until that moment when the "penny drops". This course aims to get that penny to drop for you.

Net Present Value is explained in 4 short, core videos (not including introductory and summary videos) using examples and exercises. Each exercise has a downloadable spreadsheet, containing the calculations to get the answers.

In addition, there are 2 additional optional videos, one covering Internal Rate of Return and Return on Investment, and another video on the treatment of inflation.

And there are a further two bonus videos, taken from my Lean Project Management course, that discuss non-financial types of value and the role of emotion in value.

Screenshots

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Reviews

Denis

March 9, 2023

This is an awesome beginning of the course for someone who does not know anything about financial matter.

Jennifer

July 13, 2022

I was already familiar with the concepts so this course provided an excellent, simplistic reminder of what each financial metric represents and how it works.

Jeff

July 11, 2022

I knew how to do the calculation because of my mathematics background, but understanding the decision making process helps apply the math to a business project.

Shirish

May 11, 2022

Content is very practical and useful. Certain parts were explained down to very very basics ... and hence seemed a bit too long! But, overall, a very practical topic for Project team members.

Archit

September 23, 2021

Great Explanation of NPV. But why NPV of 72K is divide by 300K instead of initial investment of 900K ? ROI should be 72K/900K = 8%. Please correct me if I am wrong in understanding the logic.

Waleed

May 7, 2020

NPV Excercise#3 has faulty figures in solution. It needs to be rectified. Plus the publicity of the other course was 25% of the current course content and should be reduced.

Trang

May 7, 2020

Detailed instructions on how to calculate NPV. Instructor gives good insight on financial terms and implication, with reference spreadsheets to download. This will give the attendees a chance to go back and review the materials & calculations.

Ayushi

October 20, 2017

it was good learning of calculating net present value,and making the decision more effective and correct, learning about the lean project management i also get the knowledge of using IRR , ROI , etc i cleared my doubt regarding which method is used,what is more effective,how to apply etc.

Junaid

October 11, 2017

Its really useful course for the beginners.If you are beginners and want to know what does project appraisal means then in this course you can find exactly what you are looking for.Moreover, the bonus lecture is also very useful to having you the idea about lean management.

Indranil

October 8, 2017

I understood about all the Project Management skills and Financial Appraisal with NPV along with how it can be implemented in real world scenarios.

Gaston

September 21, 2017

Its ok. Great introductory to financial decisions but too slow and stretches out on unnecessary items/calculations. Its best viewed on 1.25X or 1.5X speed.

EMAD

July 10, 2017

The course is providing sufficient information for NPV, IRR and ROI financial evaluation of projects and supported with solved problems using manual calculations as well as Excel sheets. It's more suitable for beginners.

Richard

April 11, 2017

Interesting course. Learned a lot of financial information as it relates to calculating the true value of running projects.

Tiago

January 19, 2017

Interesting explanation about NPV, but it could go deeper on the topic (describe what is cash flows and detailed description of the Cost/benefit structure) and not bring other off-topic subject for the course.

Khail

June 23, 2016

Too much repetition. I got bored and started skipping segments which ultimately led me to seek another course.

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