The Custom Bike Company has set up a weighted scoring matrix for evaluation of potential projects. Below are five projects under consideration. Using the scoring matrix below, which project would you rate highest? Lowest?
If the weight for “Strong Sponsor” is changed from 2.0 to 5.0, will the project selection change? What are the three highest weighted project scores with this new weight?
Why is it important that the weights mirror critical strategic factors?

CriteriaStrong SupportSupport Business StrategyUrgency10% of Sale From New ProductsCompetitionFill Market GapWeighted Total (a)Weighted Total (b)
Weight254313??
Project 1952025??
Project 2372025??
Project 3682368??
Project 41051069??
Project 531010180??

4. Two new software projects are proposed to a young, start-up company. The Alpha project will cost $150,000 to develop and is expected to have annual net cash flow of $40,000. The Beta project will cost $200,000 to develop and is expected to have annual net cash flow of $50,000. The company is very concerned about their cash flow. Using the payback period, which project is better from a cash flow standpoint? Why?