Identification of Profitable Projects : A Survey among Firms in IT and Telecommunications Industry

Abstract: The purpose of the thesis project is to discuss and to prove the following hypothesis: Firms employ the same methods and use the same criteria as a basis for identifying projects to invest in irrespective of the nature of the project The thesis project therefore investigates how firms in the IT and Telecommunications industry analyse and value potential investment projects with respect to their profitability and contribution to a firm’s wealth. In addition to the investigation, the thesis project tries to identify the criteria, attributes and methods that contribute to a firm’s investment decision making. The value added by this thesis is twofold. Firstly, according to the author’s knowledge a similar comprehensive study in the IT and Telecommunications industry currently does not exist. Secondly, the thesis is not limited to just discussing financial criteria of investment project evaluation. The thesis project also considers non-financial criteria as well as discusses the investment decision process, all together in one project.