UNIT:1 CONCEPT AND FORMULATION

Projects are the specific schemes or action units designated

for the investment of given
resources and skills with an aim of attaining some
predetermined objectives. A project starts
from the scratch. It has a specific objective. It has a well-
defined life span divided into a life
cycle. It involves a set of activities within a schedule and
budget. It integrates human and non human resources.
According to Harold Kerzner:
A project is any series of activities and tasks that:
 have a specific objective to be completed within certain
specifications
 have defined start and end date
 have funding limits, and
 consume resources.
• A project is one-time job that has defined starting and
ending dates, a clearly specified objective, or scope of
work to be performed, a pre-defined budget, and usually a
temporary organization that is dismantled once the project
is complete. The project Manager’s desk Reference , James
Lewis)
• A group of multiple interdependent activities that require
people and resources is the
• Project.
• Projects generally originate from plans. They serve as the
building blocks for development
• planning. A Plan(yojana), Programme(karyekram) and
Project(pariyojana) are different concepts yet
complementary to one another.
 Characteristics of Project
Despite the different types and natures of projects we observe(niriksyan) in different
sectors and in different levels, all of those necessarily reflect a set of common
characteristics. A project has the following characteristics:
a) Objective : Each and every project needs to be guided to achieve an objective or
a set of objectives. It ceases(close) to exist when the objective is achieved.
b) Life Span : A project has beginning and end. It cannot continue forever.
c) Constraints : A project has a schedule. It operates within the constraints of time,
cost and quality. Every project requires certain investment of resources.
d) Unique : Every project is unique. No two projects are exactly similar.
e) System : All projects need to undergo a system of inputs-process - Outputs.
f) Life Cycle : Every project will have its own phase-based cycle.
g) Teamwork : A project has many participants. It requires teamwork under the
leadership of the Project Manager.
h) Organization Structure : A project is a temporary organization. A project usually
has its own budget and management.
i) Planning and Control System : A project requires information, planning and
control system. The actual performance is compared with the planned targets.
j) Collection of Activities : A project is a collection of activities that are linked
together to constitute(gathan) a system
 CONCEPT OF PLAN,PROJECT ,PROGRAMMEAND PROJECT
ENVIRONMENT

• PLAN
• A plan is an image, map or vision to represent the forms and/or features of desired
• situation(s). It is a process of setting future goals for country or organization and choosing the
Actions to achieve these goals.

• Plans may be Community Development Plan, District Development Plan or Regional Development
Plan depending upon the area it serves and its magnitude.

• Similarly, depending upon different sectors (agriculture, education, Health and so on) there may be
different sector-specific plans known as Sectoral Development Plan. National Development Plan.
In Plan document, we can find only the level or sector-specific Broad Decisions indicating what and
how much is to be achieved with the investment of given resources.

• A plan itself is static(sthir). In other words, a plan representing only an imagination or vision will
have no meaning unless it is put into operation to achieve its set objective/s.

• A Plan is a set of Programmes.

• PROGRAMME
• A Program is the extensive(byapak/bistrit) and consistent set of action units stating
the needs of interrelated activities to achieve the plan’s objectives and goal. There
could be several programs within a plan or development plan.
•
• PROJECT
• A project is a unique group of tasks designed to attain a specific objective within the
constraints(kami) of time, cost and quality based on planning and control through
the use of a variety of resources in a dynamic(gatisil) environment.

• Development Plan
• Agricultural Programme Health Programme
Roads Programme Other Programme
 Wheat Project
 Potato Project
 Fertilizer Project
 Livestock Project
 Other Projects
• Plan Five-Year Plan

• Programme Health Programme

• Project Hospital Construction

• Work Package Electrification Package

• Activity/ Task Preparation of Drawing

 Project Terminology

• Goal: Goal is what exactly needs to be accomplished(pura) after

completion of the project.

• Project Scope: Documented set of standards and criteria that the customer
defines as successful completion.

• Objective: A combination of tasks that concern specific functional groups or

structural areas.

• Tasks: A combination of activities that lead to the achievement of a

definable result.

• Activity: A time consuming piece of work with a definite beginning and end.

• Duration: The elapsed time from the beginning to the end of an activity,
task or objective.
 Project Environment
Environment consists of forces that influence the project’s ability to achieve its objective. Projects operate in a
dynamic environment. Project environment can be classified into:
Internal Environment: (PCRS)
• Internal environment is located within the project. It is Controllable by the project. It
• provides strengths and weaknesses to the project. The forces in the internal environment
• consists of:
 Project Objective
 Constraints
 Structure
 Resources
Task Environment: (4C,GFSL)
•The task environment of a project is made up of stakeholders. They are either involved in the project or
their interests are affected by the project. The elements of task environment are:
 Customer
 Contractor
 Consultants
 Suppliers
 Government
 Financiers
 Competitors
 Labour Unions
External Environment (PETS)
• It is located outside the project. It cannot be controlled by the project. The project can
• indirectly influence it. It provides opportunities and threats to the project. The forces in the external
environment are
 Economic
 Technological
 Political-Legal
 Socio-cultural
Projects’ Life Cycle and Project Phases
• A project is time bound. It has beginning and end. The life of a project is divided into
several phases to provide better management control and appropriate links to the
ongoing operation of the performing organization.
• Every project has a life span. It has definite starting and ending points. No product
can continue indefinitely. All projects are temporary. Collectively, the project phases
are known as Project Life Cycle . Project life cycle generally defines:
• What technical work should be done in each phase?
• Who should be involved in each phase?
• Each phase defines the work outcomes or deliverables of the project. The phases
are arranged in a sequence. Every project has a life cycle. It consists of:
 Formulation phase: It develops objectives and outputs of the project. Pre-
estimation of time schedule, costs and resource needs are done.
 Planning Phase: It involves doing of feasibility(probability) study. Resource
utilization is planned through detailed estimates of time, cost and quality.
Detailed designs are also prepared.
 Implementation phase: It involves doing of actual project work. Project
organization is set up. Resources are mobilized. Project team is formed control
is done.
 Termination Phase: The project is completed. It is handed over to the client or
beneficiaries. The project organization is disbanded(bhanga).
 Appraisal
• It is the Evaluation of the project’s ability to succeed. Appraisal is based on the
findings of the feasibility analysis. It addresses -
 Ability of the project to achieve its objectives
 Comparability of the project with other projects (in terms of investment,
cost/benefits, job creation, profit etc.)
• The competent authorities appraise the project against a list of criteria (policy,
technical, economic, financial, social, etc.) before giving approval and formally
approve the project selected through appraisal. Approval involves finalization of
funding proposals and agreements and allocation of resources to the project.
• Detailed design
• It is concerned with :
 Preparation of blueprints of engineering design and specifications for
construction, facilities, equipments etc.
 Preparation of detail implementation plans and work schedules.
• The design task establishes:
 Operating plans and performance standards
 Allocates responsibilities
 Determines activities and resources
 Sets down work schedules
 Project Appraisal
• Critical examination of the project from all
aspects is Critical examination of the project from
all aspects is called appraisal called appraisal.
• Analysis of prospective costs and benefits that
leads to Analysis of prospective costs and
benefits that leads to desirability for committing
resources desirability for committing resources.
• It is carried out at two stages: It is carried out at
two stages:
• Internal Appraisal
• External Appraisal
 ECONOMIC ASPECTS

• Determination of the projects contribution to the

development of economy.
• Justification of investing scarce resources to the project.
• Social cost–benefit analysis
• Impact on level of savings and investments Impact on level
of savings and investments in society
• Impact on fulfillment of national goals Impact on
fulfillment of national goals :
• Self sufficiency
• Employment
• Social order
SOCIETAL Aspects
PROJECT CLASSIFICATION
Procedure of developing project proposal
 Procedures of developing project proposal
• A proposal is a request for financial assistance to implement a project. The
proposal outlines the plan of the implementing organization about the project,
giving extensive information about the intention, for implementing it, the ways to
manage it and the results to be delivered from it.
• Project proposal are documents designed to present a plan of action, outline the
reasons why the action is necessary , and convince the reader to agree with and
approve the implementation of the actions recommended in the body of the
documents
In short '' The set of the documents submitted by evaluation of project is called
project proposal ''
• The steps involved in the procedure for developing a project proposal are
• a. Project brief: It summarizes all the relevant facts about the project. The
contents includes
· Need for the project
· Scope of project
· Benefits of project
· Objective and outline of project
· Estimated budget
· Estimated time table
· Procedures of task
b. Prefeasibility study: It is a preliminary study of the implement ability of the
project. It does not deal with details. The area for which information is
collected and analysed is:
· Technical analysis: it analysis the feasibility of meeting technical
specifications of the project and technical resources required for project
implementation.
· Financial analysis: It analysis the capital requirement of project, project's
capacity to meet financial obligation and cost aspect of the project
· Economic analysis: Benefit/cost analysis is done to analyse the net
contribution of the project to the economy and the society.
· Marketing analysis: It analyses project capacity, market demand, sales
forecasts, revenue generation and competition.
· Management analysis: it analyses the adequacy of management system to
direct and control the project.
· Environment analysis: it analyses the impact of project on the
environment.
• c. Preliminary Design: it is an elaboration of project idea and is based on
the requirements of prefeasibility study. It includes
· Technical aspects consisting of preliminary surveys and engineering design
etc.
· Preliminary project schedule and implantation plan
· Estimated project cost
• Proposal Development: the project proposal is
developed. It should contain following
information:
· Project objectives and outputs
· Project activities
· Project implementation: project organization,
parties involved, implementation strategy
· Project schedule: Bar chart with milestones
for formal review of project progress
· Project budgets: it is itemized in expense
heads
· Project monitoring and evaluation including
verifiable performance indicators and assumption
risk.
 Role of Project Manager

– Takes ownership of the whole project

– Is proactive not reactive
– Adequately plans the project
– Is Authoritative (NOT Authoritarian)
– Is Decisive
– Is a Good Communicator
– Manages by data and facts not uniformed optimism
– Leads by example
– Has sound Judgement
– Is a Motivator
– Is Diplomatic
– Can Delegate
 Stakeholder
• “A person or group of people who have a vested
interest in the success of an organization and the
environment in which the organization operates”.
Types of stakeholder
• Sponsor
• Funding Body
• Customer
• Suppliers
• End User
• HSE/Environmental Agency
• Maintenance Team
• Neighbours/Community/Shareholders
• Fusion Community
 Stakeholder Engagement process

• Identify Stakeholders
• Assess needs
• Define actions
• Establish communication channels
• Gather feedback
• Monitor and review
Key Points in Project Set-up and Definition

 Create Project Management Plan (PMP)

 Be clear of scope and objectives
 Establish clear statement of what is to be
done (WBS)
 Establish Risks to be Managed
 Establish Costs and Durations
 Establish Resources Required
 Project management Plan - PMP

 Master Document for Project

 Defines the following:-
 Project Objectives, Scope, Deliverables
 Stakeholders (Internal & External)
 Work to be done (WBS)
 Project Organisation and Resources (OBS)
 Project Costing (CBS)
 Project Schedule
 Procurement/Contract Strategy
 Risk Management
 Quality management
 Change Management
UNIT: II Project identification and procedure of project
formulation

• Project identification: Project identification is the first

step in the strategic planning process. Before spending
significant time and resources on a project, restoration
practitioners should be able to identify the biological
importance and likelihood of restoration success at
potential project sites (Battelle 2003).
• Clear project identification allows you to answers
questions like:
• How do the projects come about?
• Where do projects come from?
• Why are projects where they are?
 Process of project identification

• Define objectives and constraints: identify

customer needs
• Develop project ideas : situation survey,
internal sources, external sources
• Preliminary analysis of ideas: Risk analysis
• Select ideas for project formulation
Methods of information collection
• Data collection methods:
• One-on-One Interviews
• Focus Group Discussion
• Collaborative Workshop Mode
• Surveys
• Observation
 Analysis and need assessment
• A needs assessment is a systematic process for determining and addressing needs, or "gaps"
between current conditions and desired conditions or "wants". The discrepancy between the
current condition and wanted condition must be measured to appropriately identify the need. The
need can be a desire to improve current performance or to correct a deficiency.
• Needs assessments can be used to:
• Improve the quantity and quality of services available
• expand access to and use of existing services by survivors
• enhance the knowledge and skills of individuals
• Align existing (or lacking) national legislation
• Develop, update or expand national policies and plans
• Improve the information and data available by surveying existing data collection and analysis
systems
• Enhance the capacities of organizations to implement their programmes
• There are three perspectives on need in a needs assessment; perceived need, expressed need and
relative need.
• Perceived needs are defined by what people think about their needs, each standard changes with
each respondent.
• Expressed needs are defined by the number of people who have sought help and focuses on
circumstances where feelings are translated into action. A major weakness of expressed needs
assumes that all people with needs seek help.
• Relative needs are concerned with equity and must consider differences in population and social
pathology
 Stakeholder analysis
• Stakeholder analysis in conflict resolution, project management,
and business administration, is the process of identifying the
individuals or groups that are likely to affect or be affected by a
proposed action, and sorting them according to their impact on the
action and the impact the action will have on them.
• According to the Project Management Institute (PMI), the term
project stakeholder refers to, 'an individual, group, or organization,
who may affect, be affected by, or perceive itself to be affected by a
decision, activity, or outcome of a project' (Project Management
Institute, 2013).
• Stakeholder analysis is a tool for clearly defining key stakeholders
for a project or other activity, understanding where stakeholders
stand, and developing cooperation between the stakeholders and
the project team. The main objective is to ensure successful
outcomes for the project or the changes to come.
 The benefits of using a stakeholder-based approach are that

• You can use the opinions of the most powerful stakeholders to

shape your projects at an early stage. Not only does this make it
more likely that they will support you, their input can also improve
the quality of your project
• Gaining support from powerful stakeholders can help you to win
more resources – this makes it more likely that your projects will be
successful
• By communicating with stakeholders early and frequently, you can
ensure that they fully understand what you are doing and
understand the benefits of your project – this means they can
support you actively when necessary
• You can anticipate what people's reaction to your project may be,
and build into your plan the actions that will win people's support.
 Types of stakeholders include
• Primary stakeholders: are those ultimately
affected, either positively or negatively by an
organization's actions.
• Secondary stakeholders: are the ‘intermediaries’,
that is, persons or organizations who are
indirectly affected by an organization's actions.
•
Key stakeholders: who can also belong to the
first two groups have significant influence upon
or importance within an organization.
 Problem analysis, Objective analysis
• Before we can start to design the project, we need to analyze the
problem identified during project identification.
• Problem analysis helps primary stakeholders to identify the causes
and effects of the problems they face. It involves drawing a problem
tree, from which project objectives can be identified. Use the
stakeholder analysis to identify those who should help to construct
the problem tree, making sure there is a mix of people from the
community with local knowledge, technical knowledge and so on.
• Problem analysis can be carried out with different stakeholder
groups in order to see how their perspectives vary.
• To help stakeholders think through all the causes and effects, check
that they have considered social, environmental, political, economic
and technical factors. The problem tree should help to reinforce our
findings during the research phase of the planning. It might also
raise new issues that we had not previously considered.
• Problem trees enable stakeholders to get to the root of their
priority need and to investigate the effects of the problem.
• The objectives analysis describes a future
situation that would exist if all the problems were
solved. The instrument of objectives analysis calls
for conversion of negatively stated problems into
positive statements or objectives. It must be
noted that not all problems can be transformed
into positively formulated objectives.
• In group work, the statements of the tree were
turned into positive statements which
are desirable and realistically achievable.
 Unit: III Logical framework and project cycle

• The Logical Framework Approach (LFA)

• The Logical Framework Approach is a systematic method of developing a Project Concept and
selecting a Project Strategy.
• The Logical Framework Approach (LFA) is a highly effective strategic planning and project
management methodology with wide application. It is particularly valuable for water
management and sanitation projects, especially because water ― the resource base ― has diverse
and competing uses. It comprises an integrated package of tools for analysing and solving planning
problems and for designing and managing their solutions (the approach). The product of this
analytical approach is the logframe (the matrix), which summarises what the project intends to do
and how, what the key assumptions are, and how outputs and outcomes will be monitored and
evaluated.
• LFA incorporates four main analytical elements to help guide this process:
• Problem Analysis: involves identifying what the main problems are and establishing the cause and
effect relationships which result in, and flow from, these problems (see also problem and
preference ranking, or problem tree analysis as methods for problem identification).
• Stakeholder Analysis: having identified the main problems and the cause and effect relationship
between them, it is then important to give further consideration to who these problems actually
impact on most, and what the roles and interests of different stakeholders might be in addressing
the problems and reaching solutions (see also stakeholder identification).
• Analysis of Objectives: objective trees should be prepared after the problem tree has been
completed and an initial stakeholder analysis has been undertaken. This will give an image of an
improved situation in the future.
• Analysis of Strategies: comparison of different options to address a given situation.
• The Logical Framework Matrix (Logframe)
• The results of the stakeholder, problem,
objectives and strategy analysis are used as
the basis for preparing the Logical Framework
Matrix. The Logical Framework Matrix (or
more briefly the logframe) consists of a matrix
with four columns and four (or more) rows,
which summarise the key elements of a
project plan and should generally be between
1 and 4 pages in length. However, this will
depend on the scale and complexity of the
project.
• How to Prepare the Logical Framework Matrix?
• First Stage ― TOP DOWN
• Second Stage ― Work Across
• Third Stage ― BOTTOM UP:
•
• Application
• The logframe is applied when planning, implementing and
evaluating specific projects and programmes within an action plan.
• It is valuable for carrying out logical checks during project design as
well as for monitoring progress and reviewing activities and output
during project implementation (PHILIP et al. 2008).
• Using LFA for project or program design imposes rigor in assessing
what is to be achieved and the assumptions behind what
interventions and activities will be required.
• Many international donors, such as the Asian Development Bank
and the European Commission, require projects they fund to be
designed according to an LFA (WAGENINGEN UR 2010).
• PCM reflects the decision-making and
implementation process; the methodology
applied for planning, managing, evaluating
projects is the Logical Framework
Approach.
• The logical framework approach follows a hierarchical results oriented
planning structure and methodology which focuses all project planning
elements on the achievement of one project purpose. Represented
graphically the log frame approach is as follows.
• LFA has been designed with the following principles as its
base:
 Responsibilities are defined
 Change is the aim
 Iteration is encouraged
 Flexible control of projects and processes
 Transparency is enhanced
 the method is participatory
• The Approach also tries to build in a close link between the
external project environment and the internal project
planning elements.
• The Project elements in LFA are recorded and presented
according to a matrix format. This format is called the
Project Matrix (PM), or Project Planning Matrix (PPM), and
allows for a complete project to be represented in a clear
and related manner. The PPM allows for ease of
understanding and sets the basis for Project Cycle
Management to occur.
 Project cycle

• The phases are:

• Programming
• Identification
• Formulation
• Implementation
• Monitoring
• Evaluation
• Often, implementation and monitoring are combined in one step.
Some donor agencies add an additional step of ‘Financing’ or
‘Approval of the proposal’ between ‘Formulation’ and
‘Implementation’. From the point of view of the NGOs that want to
introduce a project, negotiating or lobbying is another step that
could be added between programming and identification or
between identification and formulation.

• The first three steps can be seen as the design phase of the project.
This can easily take up to two years before the final approval is
given and work (or practical preparations) can begin. The duration
of the project itself depends on its activities and the needs of the
beneficiaries, but more often than not also on budgetary restraints
or the regulatory framework of the donor. That is why consecutive
projects (sometimes called actions) are combined into a larger
programme. Again, in such a programme it is important to learn
from previous actions, but in reality this may not always be the case
(or only to a limited extent)
 Unit: IV Project budgeting
• Project appraisal is the process of assessing and questioning
proposals before resources are committed. It is an essential tool for
effective action in community renewal. It’s a means by which
partnerships can choose the best projects to help them achieve
what they want for their community.
• But appraisal has been a source of confusion and difficulty for
projects in the past. Audits of the operation of Single Project
Budget schemes have highlighted concerns about the design and
operation of project appraisal systems, including:
• Mechanistic, inflexible systems
• A lack of independence and objectivity
• A lack of clear definition of the stages of appraisal and of
responsibility for these stages
• A lack of documentary evidence after carrying out the appraisal
• Project appraisal helps project initiators and designers to;
• Be consistent and objective in choosing projects
• Make sure their program benefits all sections of the community, including
those from ethnic groups who have been left out in the past
• Provide documentation to meet financial and audit requirements and to
explain decisions to local people.

• Key issues in appraising projects include the following.

• Need, targeting and objectives
• Context and connections
• Consultation
• Options
• Inputs
• Outputs and outcomes
• Value for money
• Implementation
• Risk and uncertainty
• Forward strategies
• Sustainability
 Methods of project appraisal
Economic Analysis:
Under economic analysis, the project aspects highlighted include requirements for
raw material, level of capacity utilization, anticipated sales, anticipated expenses
and the probable profits. It is said that a business should have always a volume of
profit clearly in view which will govern other economic variables like sales,
purchases, expenses and alike.

• Financial Analysis:
Finance is one of the most important pre-requisites to establish an enterprise. It is
finance only that facilitates an entrepreneur to bring together the labour of one,
machine of another and raw material of yet another to combine them to produce
goods.

• Market Analysis:

Before the production actually starts, the entrepreneur needs to anticipate the
possible market for the product. He/she has to anticipate who will be the possible
customers for his product and where and when his product will be sold. There is a
trite saying in this regard: “The manufacturer of an iron nails must know who will
buy his iron nails.”
 SIGNIFICANCE OF CAPITAL BUDGETING

• Capital budgeting is an essential tool in financial

management
• Capital budgeting provides a wide scope for financial
managers to evaluate different projects in terms of their
viability to be taken up for investments
• It helps in exposing the risk and uncertainty of different
projects
• It helps in keeping a check on over or under investments
• The management is provided with an effective control on
cost of capital expenditure projects
• Ultimately the fate of a business is decided on how
optimally the available resources are used
• Long term investments involve risks
• Huge investments and irreversible ones
• Long run in the business
• Payback Period measures the time in which the initial
cash flow is returned by the project. Cash flows are not
discounted. Lower payback period is preferred.
• Net Present Value (NPV) is equal to initial cash outflow
less sum of discounted cash inflows. Higher NPV is
preferred and an investment is only viable if its NPV is
positive.
• Accounting Rate of Return (ARR) is the profitability of
the project calculated as projected total net income
divided by initial or average investment. Net income is
not discounted.
• Internal Rate of Return (IRR) is the discount rate at
which net present value of the project becomes zero.
Higher IRR should be preferred.
• Profitability Index (PI) is the ratio of present value of
future cash flows of a project to initial investment
required for the project.
 formula
• Payback period = Cash outlay (investment) / Annual cash
inflow
• The equation for the net present value, assuming that all
cash outflows are made in the initial year (tg), will be:
• Where A1, A2…. represent cash inflows, K is the firm’s cost
of capital, C is the cost of the investment proposal and n is
the expected life of the proposal. It should be noted that
the cost of capital, K, is assumed to be known, otherwise
the net present, value cannot be known.
• NPV = PVB – PVC
• where,
• PVB = Present value of benefits
• PVC = Present value of Costs
 Internal Rate of Return

• It is called internal rate because it depends

solely on the outlay and proceeds associated
with the project and not any rate determined
outside the investment.
• It can be determined by solving the following
equation:
• If IRR > WACC then the project is profitable.
• If IRR > k = accept
• If IR < k = reject
 Profitability Index (PI)

• It is the ratio of the present value of future cash

benefits, at the required rate of return to the
initial cash outflow of the investment. It may be
gross or net, net being simply gross minus one.
The formula to calculate profitability index (PI) or
benefit cost (BC) ratio is as follows.
• PI = PV cash inflows/Initial cash outlay A,
• PI = NPV (benefits) / NPV (Costs)
• All projects with PI > 1.0 is accepted.
 UNIT:IV PLANNING AND IMPLEMENTATION
• Gantt charts are useful for planning and
scheduling projects. They help you assess how
long a project should take, determine the
resources needed, and plan the order in which
you'll complete tasks. They're also helpful for
managing the dependencies between tasks.
• Gantt charts are useful for monitoring a project's
progress once it's underway, too. You can
immediately see what should have been achieved
by a certain date and, if the project is behind
schedule, you can take action to bring it back on
course.
 To create one for your project, follow these steps, using our
example as a guide.

• Step 1: Identify Essential Tasks

• Step 2: Identify Task Relationships
• Step 3: Input Activities Into Software Or a
Template
• Step 4: Chart Progress
 In Gantt charts, there are three main relationships between
sequential tasks:

• Finish to Start (FS) – FS tasks can't start before a

previous (and related) task is finished. However,
they can start later.
• Start to Start (SS) – SS tasks can't start until a
preceding task starts. However, they can start
later.
• Finish to Finish (FF) – FF tasks can't end before a
preceding task ends. However, they can end later.
• A fourth type, Start to Finish (SF), is very rare.
 CONCEPT OF CPM/PERT
• CPM and PERT are charts used to determine the sequence and maximum
and minimum timing of activities in a project.

• PERT is a project management technique, whereby planning, scheduling,

organising, coordinating and controlling of uncertain activities is done.
• CPM is a statistical technique of project management in which planning,
scheduling, organising, coordination and control of well-defined activities
takes place.
• PERT is a technique of planning and control of time. Unlike CPM, which is a
method to control costs and time.
• PERT is set according to events while CPM is aligned towards activities.
• A deterministic model is used in CPM. Conversely, PERT uses probabilistic
model.
• There are three times estimates in PERT i.e. optimistic time (to), most
likely time ™, pessimistic time (tp). On the other hand, there is only
one estimate in CPM.
• PERT technique is best suited for a high precision time estimate, whereas
CPM is appropriate for a reasonable time estimate.
• PERT deals with unpredictable activities, but CPM deals
with predictable activities.
• PERT is used where the nature of the job is non-repetitive.
In contrast to, CPM involves the job of repetitive nature.
• There is a demarcation between critical and non-critical
activities in CPM, which is not in the case of PERT.
• PERT is best for research and development projects, but
CPM is for non-research projects like construction projects.
• Crashing is a compression technique applied to CPM, to
shorten the project duration, along with least additional
cost. The crashing concept is not applicable to PERT.
• Use the formula below to calculate the time to use for
each project stage:
Shortest time + 4 x likely time + longest time
----------------------------------------------------------
6
 Feasibility Study
• During the process of project appraisal a feasibility study may be
undertaken to establish the justification of the identified project in all of
its relevant dimensions, including its technical design, economic and
financial viability, environmental compliance and social acceptability; as
well as its conformity with the national development objectives and
priorities and the relevant policy, legal and regulatory framework. The aim
of a feasibility study is to initially identify the following aspects:
• Development objectives against which the project proposed conforms
• Policy framework and detailed project objectives
• Technical soundness of the project
• Administrative feasibility of the project
• The economic and financial viability of the project proposal
• The status of demand for the project beneficiaries
• Considerations of customs and traditions of project benefactors, issues of
compatibility
• Other important policy and cross cutting issues (gender, environment,
HIV/AIDS)
• The results of a feasibility study influences decisions to commit or not
commit scarce resources to a given project proposal
 System approach

• A systems approach to project management

enables the project manager to constantly
evaluate the needs of the customer and the
end results that are needed to be achieved in
terms of resources, budget and time.
• The systems approach to project management
has several aspects that would require to be
taken into consideration.
• All elements within a project are dependent on each other and each one of them
would have their own special needs or characteristics. Every element would have
its own complete properties that are unique and would need to be properly
understood.
• There have to be goals or end results even for intermediate stages of a project,
and the project manager would always have to be working towards these and fully
understand the importance of these results.
• All inputs into a project would have to be determined and kept constant or added
to whenever necessary. Some inputs may be external to the project and would
have to be kept in mind as they could have an impact on the end result in terms of
quality, money and time. Inputs get transformed into outputs and result in
progress of a project towards the end result.
• Every project would have some sort of disorder or a state of randomness in certain
elements which a project manager would have to be aware of. A project also
requires that there is some sort of ordered feedback which allows the monitoring
of project as it proceeds to its predictable end.
• A project would have a number of specialized units performing specific functions,
and could also be composed of a number of smaller projects or subsystems which
would add up to a whole for the project. Different approaches may be needed for
such specialized functions or subsystems.
• A project manager would always keep in mind a number of alternative methods to
complete and achieve each objective.
• It may also be possible for a project manager to visualize different objective using
common inputs in order to achieve some economy of effort.
• Using a systems approach to project management enables a project manager to
keep the objectives and end results constantly in mind so that the end results are
as desired by the client.
 Linear responsibility chat
• Linear Responsibility Charts (LRC): A chart that is in the form of a matrix with project tasks listed in
rows and individuals and departments in the columns. LRC is also referred to as
a responsibility matrix.
• A Linear Responsibility Chart (LRC) identifies team participant's clients, and/or line managers and
the degree to which an activity is to be performed or a decision is to be made on the project. The
LRC attempts to clarify the authority and working relationships in the project team. In a typical
linear responsibility chart, rows (or columns) indicate activities, responsibilities, or functions
required which can be all or just a few of the tasks in the work breakdown structure or elements or
data and information within tasks of the WBS. Columns (or rows) identify positions, titles or people
themselves. The symbols indicate the degrees of authority, responsibility or activity existing
between the rows and columns.
• In a well developed team, all will participate to some degree. Nevertheless, on a project it is
essential for the project manager to identify who will be accountable for initiating, conducting and
concluding each and every task.
• The charts illustrate how:
• Every task can be identified and assigned to a single point responsibility
• The project can and should be divided into phases and stages, each separated by a financial 'control
gate' or decision point for control purposes
• This process builds on the standard project management generic life cycle, and
• Project management can and should be distinguished from the management of the project's
technology.
•
It is worth noting that experience shows that any omissions or errors of judgment in one phase can
cost an order of magnitude higher (i.e. approximately ten times as much) to conduct or rectify in
each succeeding phase. This is typically due to the likely need to suspend, back track and rework
other related activities that would normally follow.
 Team building
• Team building is an ongoing process that helps a work
group evolves into a cohesive unit. The team members not
only share expectations for accomplishing group tasks, but
trust and support one another and respect one another's
individual differences.
• Building a good team is the single most important thing a
Project Manager can do to achieve a successful project.
With the right attitude, a team will overcome almost any
difficulty to succeed in its goals. In most projects there will
be times when only the determination of the team can
overcome the difficulties and carry the initiative through to
success. Even when there is no pressure, the team's spirit
and enthusiasm will be reflected in the quality of the
solution and the extent to which other people buy-in to it.
• There is a whole area of academic study and practical experience
about building good teams. Business psychologists present many
theories concerning the way in which people interact. A world-class
Project Manager needs to be an amateur psychologist and a
manipulator of human behaviour. Here are some of the factors
which generally lead to a good team:
• shared belief in the value and achievability of the team's goals,
• awareness of the value of the individual's own role and
contribution,
• recognition of the value of other team members (whether they are
key specialists or just non-specialist, junior assistants),
• desire to work collaboratively, sharing thoughts, ideas, concerns,
etc,
• friendship - enjoying working together with a common purpose,
• supporting each other in recognition that the team's success
requires all members to be successful,
• coaching junior members rather than bossing them,
• listening to ideas and advice from other team members,
• making time to communicate with other team members,
 Role of Project Manager
• The role of the project manager encompasses many activities including:
• Planning and Defining Scope
• Activity Planning and Sequencing
• Resource Planning
• Developing Schedules
• Time Estimating
• Cost Estimating
• Developing a Budget
• Documentation
• Creating Charts and Schedules
• Risk Analysis
• Managing Risks and Issues
• Monitoring and Reporting Progress
• Team Leadership
• Strategic Influencing
• Business Partnering
• Working with Vendors
• Scalability, Interoperability and Portability Analysis
• Controlling Quality
• Benefits Realization
Procedure/guideline for project implementations

• Preparation for Project Implementation

• Engaging a Project Information System
• Contracting for civil works
• Procurement of Goods, services, Equipment
• Supervision of equipment installation and civil
works
• Receiving project budget
• Monitoring and controlling
• Controlling project changes
Brief introduction to Time Management
• Time management is a key responsibility of a project
manager. The project manager should equip with a
strong skill and sense for time management.
• There are a number of time management techniques
that have been integrated into the management
theories and best practices.
• As an example, Agile/Scrum project management style
has its own techniques for time management.
• In addition, if you are keen on learning time
management into greater depths, you can always get
into a training course of one of the reputed and
respected time management trainers.
 The Steps of the Time Management Process
• Following are the main steps in the project time management process.
Each addresses a distinct area of time management in a project.
1. Defining Activities
When it comes to a project, there are a few levels for identifying activities.
First of all, the high-level requirements are broken down into high-level
tasks or deliverables.
Then, based on the task granularity, the high-level tasks/deliverables are
broken down into activities and presented in the form of WBS (Work
Breakdown Structure).
2. Sequencing Activities
In order to manage the project time, it is critical to identify the activity
sequence. The activities identified in the previous step should be
sequenced based on the execution order.
When sequencing, the activity interdependencies should be considered.
3. Resource Estimating for Activities
The estimation of amount and the types of resources required for activities
is done in this step. Depending on the number of resources allocated for
an activity, its duration varies.
Therefore, the project management team should have a clear
understanding about the resources allocation in order to accurately
manage the project time.
4. Duration and Effort Estimation
This is one of the key steps in the project planning process. Since estimates are all
about the time (duration), this step should be completed with a higher accuracy.
For this step, there are many estimation mechanisms in place, so your project
should select an appropriate one.
Most of the companies follow either WBS based estimating or Function Points
based estimates in this step.
Once the activity estimates are completed, critical path of the project should be
identified in order to determine the total project duration. This is one of the key
inputs for the project time management.
5. Development of the Schedule
In order to create an accurate schedule, a few parameters from the previous steps
are required.
Activity sequence, duration of each activity and the resource
requirements/allocation for each activity are the most important factors.
In case if you perform this step manually, you may end up wasting a lot of valuable
project planning time. There are many software packages, such as Microsoft
Project, that will assist you to develop reliable and accurate project schedule.
As part of the schedule, you will develop a Gantt chart in order to visually monitor
the activities and the milestones.
6. Schedule Control
No project in the practical world can be executed without changes to the original
schedule. Therefore, it is essential for you to update your project schedule with
ongoing changes.
 Conflict management in Project
• The practice of recognizing and dealing with disputes in a rational, balanced and effective way.
Conflict management implemented within a business environment usually involves effective
communication, problem resolving abilities and good negotiating skills to restore the focus to the
company's overall goals.
Conflict management is the process of limiting the negative aspects of conflict while increasing the
positive aspects of conflict. The aim of conflict management is to enhance learning and group
outcomes, including effectiveness or performance in organizational setting
•
• Which of these sources of project management conflict have you faced?
• 1) Different Stakeholder Interests
• The manufacturing stakeholder advocates for a simple, standardized product that will be easy to
manufacture reliably. The marketing stakeholder advocates for a complex product that allows for
extensive customization by customers. At first glance, these stakeholders appear locked in conflict.
• 2) Project Manager Management Style
• Consider the case of a project manager who takes a disciplined approach to managing projects and
holds staff accountable. Depending on HOW this management style is communicated, unproductive
tension and conflict could threaten the project`s success.
• 3) Project Team History
• Have you ever worked with someone that puts you on edge? Or perhaps a person who has a very
confrontational, zero sum world view on work? In these cases, conflict is part of the project team
from day one.
• 4) Scope Changes
• Imagine you have put three weeks into building a plan to install network infrastructure in a new
office building. Then you receive a scope change specifying you need to switch to a new type of
equipment (and vendor). Your first reaction may well be anger at the stakeholder – after all, you
now have to redo all of the work!
• 5) Schedule Changes
• What comes to mind when you read the word “crashing?” Perhaps you imagine carnage on the
road or your computer failing you at an important moment. Yet, “crashing” is a best practice
defined in the PMBOK Guide glossary: “a technique used to shorten the schedule duration for the
least incremental cost by adding resources.” In practice, crashing can mean overtime work. Absent
support and planning, a crashing schedule changes will trigger conflict.
• 6) Project Failure (or Cancellation)
• Working on a doomed project is discouraging! Even if a project fails or is cancelled due to external
conditions (e.g. regulatory change, change in financing costs), recriminations and blame are
inevitable. Project cancellation may cause significant conflict between the sponsor and the project
manager.
•
• 7) Declined Change Requests
• Change requests are an important tool in managing projects. What if somebody on the project
team submits a change request to request additional resources and it is declined? That team
member may be angry at having to make do with limited resources.
• 8) Disagreements with Vendors
• Many projects rely on vendors to deliver vital products and services. In many cases, the vendor and
project team have different interpretations. Resolving these disagreements is time consuming and
throws the project behind schedule. Whether you disagree about quality requirements, warranties
or liability, vendor disagreements are a common source of project conflict.
• 9) Disputes over Project Management Methodology
• Successful project management usually entails employing a framework. The project manager may
be using the excellent framework defined in the Project Management Body of Knowledge (PMBOK).
In contrast, stakeholders may be unfamiliar and unwilling to submit change requests and interpret
standardized status reports. Over time, this disagreement on process leads to stakeholder
disengagement.
• 10) Disagreement over communication methods
•
For many professionals, there is a sharp line between listeners, who prefer obtaining information
through conversation, and readers, who prefer written communication. Disagreements over how
often, style and content of communication can be a major source of project conflict
 Unit: VI Monitoring and Evaluation
•
“Monitoring is collecting, recording and reporting information concerning
any and all aspects of project performance that the project manager or
others in the organization wish to know.” – Meredith and Mantel
• Monitoring and evaluation (M&E) is a process that helps improving
performance and achieving results. Its goal is to improve current and
future management of outputs, outcomes and impact. It is mainly used to
assess the performance of projects, institutions and programmes set up by
governments, international organisations and non-governmental
organizations. It establishes links between the past, present and future
actions.
• Monitoring is a continuous assessment that aims at providing all
stakeholders, with early detailed information on the progress or delay of
the ongoing assessed activity. It is an oversight of the implementation
stage of the activity. Its purpose is to determine if the outputs, deliveries
and schedules planned have been reached so that action can be taken to
correct the deficiencies as quickly as possible.
 Importance of M&E
 M&E for Better Planning
 M&E for Performance Assessment
 M&E for Input-output Assessment
 M&E for Upholding Transparency
 M&E for research works
 M&E for Improvement of Management Sysrem
 M&E for Good Governance
 M&E for Serving the Information Need of
Stakeholders
Monitoring and evaluation helps in
 Conventional Vs Participatory
• In Conventional method, M&E is conducted by external experts, while in
Participative method, M&E activities are closely participated by different
stakeholders of the project. (who?)
• The second question is what context in M&E. In Conventional method, M&E
contents are predetermined indicators to measure input and output, while in
Participative method the indicators identified by stakeholders are taken for the
studies in terms to measure input-output, their effects and impacts.
• Another distinct feature in between these two methods is in terms of
methodology, or in how question. In Conventional method, M&E survey is
conducted by external experts with research methodological questions, while
participative M&E involves stakeholders with simple qualitative and quantitative
questionnaires.
• The fourth field of differentiation between two methods is in terms of reasoning,
or in why question.
• To ensure accountability of project staff is the main reasoning in conventional
method of M&E, while it is empowering stakeholders for corrective actions.
 Result Based Monitoring

• A results-based monitoring and evaluation is an exercise to assess the

performance of an institution and/or a programme or a project, on the basis of
impacts and benefits that the institution and/or the programme/project is
expected to produce
• A results-based monitoring system is set up in parallel, to observe the results
achieved throughout the project term. Partner structures are particularly
important in this context: where possible, RBM should be integrated into existing
structures and make use of available potential. In order to do this, it uses existing
analytical instruments, monitoring tools and data that have already been collected
by the partner and by other donors, where applicable.
•
Using the results framework, indicators are defined that measure the results of the
projects and programmes. Once implementation of a commission starts, data are
continuously collected that provide information on the degree to which indicators
are being met. These data allow the responsible project officers to steer the
project and to make managerial and strategic decisions
Seven Phases of RBM
• 1 Formulating objectives Strategic Planning
Performance Measurement Results-based
Management
• 2 Identifying indicators
• 3 Setting targets
• 4 Monitoring results
• 5 Reviewing and reporting results
• 6 Integrating evaluation
• 7 Using performance information
• (Source: Annette Binnendijk, Results Based
Management in the Development Co-operation
Agencies: A review of Experience Background
Report, 2001)
 Monitoring & Evaluation Criteria and Process
• Relevance: The appropriateness of project objectives to the
problems that it was supposed to address, and to the physical and
policy environment within which it operated.
• Efficiency: The fact that the project results have been achieved at
reasonable cost, i.e. how well inputs/means have been converted
into Activities, in terms of quality, quantity and time, and the
quality of the results achieved. This generally requires comparing
alternative approaches to achieving the same results, to see
whether the most efficient process has been adopted.
• Effectiveness: An assessment of the contribution made by
results to achievement of the Project Purpose, and how
Assumptions have affected project achievements.
• Impact: The effect of the project on its wider environment,
and its contribution to the wider policy or sector objectives (as
summarized in the project’s Overall Objective).
• Sustainability: An assessment of the likelihood of benefits
produced by the project to continue to flow after external funding
has ended, and with particular reference to factors of
ownership.
Project Control Process and Techniques (Time, Quality,
cost)

• “Controlling is the measurement and correction

of performance in order to make sure that
enterprise objectives and the plans devised to
attain them are accomplished. – Koontz and
Weihrich
• “control is the process of monitoring, evaluating,
comparing planned results with actual results to
determine the status of the project costs
,schedule and technical performance objectives.”
– David I. Cleland
• Types of Project Control
• Pre –control (Feed –forward control)
• Concurrent Control
• Post Control(Feedback Control)
• Project Control Process
• Setting Project Standards
• Performance Monitoring
• Find Performance Deviations
• Corrective Actions
 Quality control
• Quality control involves monitoring specific project results
to determine if they comply with relevant quality standards
and identifying ways to eliminate causes of unsatisfactory
results. Quality control should be performed throughout
the project. Project results include both product results
such as deliverables and management results such as cost
and schedule performance. Quality control is performed by
the Quality Engineering (QE) unit at DIS. Each project
should have a QE representative assigned to it. The QE
representative will work with the Project Manager to
develop a Quality Management Plan specific for that
project using agency quality guidelines with input from the
customer and other stakeholders. The project management
team should have a working knowledge of statistical quality
control, especially sampling and probability, to help
evaluate quality control outputs.
• The team should also be aware of the following:
• Prevention (keeping errors out of the process) and inspection (keeping errors out of the hands of the
customers).
• Attribute sampling (the result conforms or it does not) and variables sampling (the result is rated on a
continuous scale that measures degrees of conformity).
• Special cases (unusual events) and common causes (normal process variation). Common causes are also
called random causes.
• Tolerances (the result is acceptable if it falls within the range specified by the tolerance) and control limits
(the process is in control if the result falls within the control limits).
Projects may fail to control cost, or go over budget, for many reasons. Often it is not a single problem but a
series of small problems that combined permit cost control to be sacrificed and prevent the project from
being completed successfully. Cost control contains the following attributes:
• Determine if the Project Budget Estimate has changed.
• Manage the actual change and take corrective action.
• Inform appropriate stakeholders of authorized changes.

Cost control is not simply a reporting process. It includes the searching out of the "why" for both positive
and negative variances between the scheduled and actual costs. It must be thoroughly integrated with the
other control processes. For example, inappropriate responses to cost variances can cause quality or
schedule problems or produce an unacceptable level of risk later in the project. To be effective, all tools
require the reporting of actual performance on a consistent and regular basis for evaluation against
project budget estimates. To prevent significant labor overhead for the maintenance of cost information
during a project, the source and methods of reporting costs must be addressed in the initial phases of
project planning and may be addressed in the Project Budget Estimate.
 Time management
• Time management is a key responsibility of a
project manager. The project manager should
equip with a strong skill and sense for time
management.
• There are a number of time management
techniques that have been integrated into the
management theories and best practices.
• As an example, Agile/Scrum project
management style has its own techniques for
time management.
• In addition, if you are keen on learning time
management into greater depths, you can
always get into a training course of one of the
reputed and respected time management
trainers.
 Project Sustainability
• Sustainability is a systemic concept, relating to the continuity of economic,
social, institutional and environmental aspects of human society. It is
intended to be a means of configuring civilization and human activity so
that society, its members and its economies are able to meet their needs
and express their greatest potential in the present, while preserving
biodiversity and natural ecosystems, and planning and acting for the
ability to maintain these ideals indefinitely. Sustainability affects every
level of organization, from the local neighborhood to the entire planet.
Sustainability can be defined both qualitatively in words, and more
quantitatively rigorous as a ratio. Put in qualitative terms, sustainability
seeks to provide the best of all possible worlds for people and the
environment both now and into the indefinite future.
• Sustainability in project management is about balancing or harmonizing
social, environmental and economic interests in a project.
• Developing Sustainability in Project Management takes into account the
full life-cycle of the project / of the asset / of the product at hand.
• Sustainability in project management is a way to cross the triple bottom
line of business with the golden triangle of project
UNIT: VIII Project Work and Report Writing