Title: Selection of service expansion projects for a telecommunication organisation

Authors: Husam Othman; Moncer Hariga

Addresses: SHUAA Capital PSC, Emirates Towers, Level 28, P.O. Box 31045, Dubai, United Arab Emirates. ' Engineering Systems Management Graduate Program, College of Engineering, American University of Sharjah, P.O. Box 26666, Sharjah, United Arab Emirates

Abstract: Telecommunication companies are constantly working on supporting the increasing subscriber base by maintaining and upgrading the capacity levels of their back-end systems. In this context, a major local Telecom operator is planning to undertake a major capacity expansion project in its value added services department. The objective of this study is to examine the economic feasibility of the services capacity expansions based on the business forecast. It introduces a formal evaluation approach to select the best capacity expansion projects portfolio. The problem is tackled by generating the detailed cash inflows and outflows for every candidate project. The projects are then identified whether or not they are economically desirable by calculating their net present values. Sensitivity and risk analyses are then applied on the feasible projects. The projects are then ranked using eight ranking procedures in order to assist the decision makers select the preferred option.

Keywords: project portfolio selection; engineering economics analysis; NPV; net present value; telecommunication services; service expansion; telecoms; telecommunications; business forecasting; ranking; sensitivity analysis; risk assessment.

DOI: 10.1504/IJEME.2011.045431

International Journal of Engineering Management and Economics, 2011 Vol.2 No.4, pp.335 - 350

Published online: 07 Feb 2012 *

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