Ds. Remer et al., SURVEY OF PROJECT EVALUATION TECHNIQUES CURRENTLY USED IN INDUSTRY, International journal of production economics, 32(1), 1993, pp. 103-115
Companies use various project evaluation techniques to determine the f
easibility and profitability of a project. We surveyed some of the lar
gest ''Fortune 500'' Industrial and Service corporations in December 1
991 about their use of these techniques. The survey was compared to a
similar 1978 study by the American Association of Cost Engineers (AACE
). Thirty-three (33) companies replied to the 1991 survey. These repli
es show a change in the use of corporate project evaluation techniques
since 1978. There has been a shift from the use of Internal Rate of R
eturn (IRR) to Net Present Value (NPV) and a decrease in the use of th
e Payback Period (PBP). The 1991 survey showed 97% of the surveyed com
panies use NPV, as opposed to only 52% in the 1978 AACE survey. The pe
rcentage of surveyed companies using IRR dropped from 100% in 1978 to
90% in 1991. Also, the percentage of surveyed companies using PBP drop
ped from 78% in 1978 to 64% in 1991.