Project Management

Business-Systems Approach

Sensitivity Analysis,

Business Systems Calculator,

Decision Making




Understanding of business systems can help you in making project management decisions by evaluating them based on their effect on economic value.


Growing Value of Systems Thinking for Business




You can use the business systems calculator for three purposes:

① to develop a better understanding of the interactions among the variables in business systems that work to produce economic value;

② to discover which project variables, or factors, are most important for producing economic value and which factors cause the biggest change in that value;

③ to analyze and evaluate the effects of various decisions made during the execution of the project.

Business Systems Calculator


Project duration

Total project salaries

Total project investment

Project investment with capital charge

Market Demand
Length of time until the market for this product begins

Length of time after introduction to peak of market

Length of time after peak of market ends

Sales volume at market maturity






Price deterioration

Expected market share if first to market

Expected market share otherwise


Costs of goods sold

Cost reduction

Selling (variable), general and administration

Selling (fixed), general and administration


Other expenses

Tax rate

Company weighted average cost of capital (WACC)


Approximate time to breakeven

Net Cash Flow (NCF)

Period of time to be considered in NCF calculation

Net cash flow without capital charges

Net cash flow with capital charges

Net present value