EMI

Welcome!!!

1
EMI

Good Morning

2
EMI
Welcome to the Training on Project
Planning and Implementation

Date: megabit 11 Megabit 22, 2009

Ethiopian Management Institute
Addis Ababa 3
EMI

 Introduction
 Setting Norms
 Time management
 Reporters
 Energizing team
 Expectations

1
EMI

“ Everything begins with project and ends

with another project…”

… now let us start our project…with the

introduction …

1
EMI
Introduction
 Full Name
 Educational Background
 Work experience and current position
 What I like most…
 What I hate most ...
 What is your experience on project
management?
 What do you expect from this training
6
EMI

Facilitator:
Temesgen Dagne (PhD candidate, MBA, MCom, BSc,
PGDHRM, PGDIM, PGDIBO, DIM, CPM, AFP, CML)
Lecturer, Consultant and Trainer
Associate Consultant at Ethiopian Management Institute
Email: teme2112@gmail.com
Cell phone number: 0911103995

7
EMI

 How should we govern our

training?
 What are the Individual
duties and responsibilities?

1
EMI

 Time manager (s)

1.
2.

1
EMI

 Day 2=
 Day 3=
 Day 4=
 Day 5=

1
EMI

 Team members
1. ......................
2. ......................

1
EMI

1
EMI

Session 1: Overview of Development Project Concepts

Session 2: Participation in project planning and management
Session 3: Project Identification
Session 4: Logical framework (logframe) concept and its
application in project Planning and management
Session 5: Project Proposal writing
Session 6: Project Formulation and Preparation
Session 7: Project Appraisal and Funding
Session 8: Project Organization and Implementation
Session 9: Project M&E, close out and sustainability

1
EMI

The general objective of the training is to

enhance the capacity of project planners and
managers and enable them to use the
techniques and tools in planning and
managing development projects.

1
EMI

By the end of the training participants will be able to:

 describe the conceptual framework on project and
project cycle;
 illustrate methods used in project idea generation
 formulate a project proposal;
 understand the concept, importance of stakeholders
and community participation;
 explain approaches and techniques that have been
effective in planning and managing project
implementation
 acquire basic knowledge on project monitoring,
evaluation and reporting

1
EMI

“Our current problems cannot be

solved with the same level of
thinking which created them.”

Albert Einstein

1
EMI Quote

If you can’t fly, then run,

If you can’t run, then walk,
If you can’t walk, then crawl,
But whatever you do,
You have to keep moving forward.

Martin Luther King Jr.

1
EMI

Overview of Development Project

Concepts

1
EMI Learning Objectives

At the end of this session participants will

be able to:
 Clearly understand the concepts that are
closely related to development projects and
planning.
 Understand types of development projects.
 Understand the principles of project planning
and management cycle.

1
EMI 1.1. Introduction
 The basic principle of development project
planning is to maximize the benefits of
individuals and society through efficient
allocation of scarce resources.
 Resources can be utilized in the form of:
 private investment and
 public investment by the government to provide
economic and social services to the society at
large.
 The scarce resources are mostly committed
through projects, which require systematic
preparation and appraisal to ensure efficient
use of resources.

1
EMI Introduction…..

 Projects have rightly been called the

“cutting edge” of development.
 They are powerful means to achieve
blocks of development structure.
 Projects aim mainly, at increasing the
production of goods and provision of
services which are fundamental
components of people’s
welfare….advance social well-being.

21
EMI
Introduction …..

 The current development agenda

of Ethiopia is poverty eradication
… and reach the level of middle
income countries.

22
EMI
Economic development vision of Ethiopia is:
 “ building an economy which has a modern
and productive agricultural sector with
enhanced technology and an industrial
sector that plays a leading role in the
economy, sustaining economic
development and securing social justice
and increasing per capita income of the
citizens so as to reach the level of those
middle – income countries.”

 How can we achieve this?

1
EMI By Designing appropriate Development
Plan and strategy

“ Plans act as a road map of complicated

process to manage projects”

 is a consciously directed activity with

predetermined goals and predetermined
means to carry them out.
 Development planning involves decisions or
choice about alternative ways of using
available resources with aim of achieving
particular goals at some time in the future.

1
EMI
Cont’d…..
 Policies and strategies of the government
are geared towards this end…
 Previous and current Plans of the country
1. Sustainable Development and Poverty
Reduction Program (SDPRP) -
(2002/03 – 2004/05)
2. Plan for Accelerated and Sustained
Development to End Poverty
(PASDEP) - (2005/06 – 2009/10)
3. Growth and Transformation Plan I
(GTP- I) - (2010/11-2014/15)
4. GTP II – 2015/16-2019/20

1
EMI
Development Plans….

 the GTP gives special emphasis to

agricultural and rural development,
industry, infrastructure, social and
human development, good
governance and democratization.

1
EMI
GTP…
 The overall objective of the GTP is to sustain
broad based, fast, and equitable economic
growth so as to eradicate poverty in due course.
The major objectives are:
 real GDP growth rate of 11%
 attain MDGs
 Expand and ensure the qualities of education and
health services and achieve MDGs in the social
sector
 Establish suitable conditions for sustainable
nation building through the creation of a stable
democratic and developmental state; and
 Ensure the sustainability of growth

1
EMI
The strategic pillars of the GTP II
a) Sustaining the rapid, broad based and equitable
economic growth and development witnessed during
the last decade including GTP I;
b) Increase productive capacity and efficiency to reach
the economy’s productive possibility frontier through
rapidly improving quality, productivity and
competitiveness of productive sectors(agriculture and
manufacturing industries);
c) Enhance the transformation of the domestic private
sector to enable them become capable development
force;
d) Build the capacity of the domestic construction
industry, bridge critical infrastructure gaps with
particular focus on ensuring quality provision of
infrastructure services;
e) Proactively manage the on-going rapid urbanization to
unlock its potential for sustained rapid growth and
structural transformation of the economy;

1
EMI Cont’d….
f) Accelerate human development and
technological capacity building and ensure
its sustainability;
g) Continue to build democratic and
developmental good governance through
enhancing implementation capacity of
public institution and actively engaging the
citizens;
h) Promote women and youth empowerment,
ensure their effective participation in the
development and democratization process
and enable them equitably benefit from the
outcomes of development;
i) Building climate resilient green economy;

1
EMI GTP …..

 To fulfill the GTP, the Ethiopian government

is implementing mega projects in different
strategic economic sectors.

 What are these sectors?

……............................................................

30
EMI
Introduction….
 Hydroelectric projects
 the sugar development projects
 Cement projects
 Rail way projects
 Road projects
 Housing development projects
 Higher education projects
 Irrigation projects etc …

31
EMI
Probing …..

 What is the major challenge in

achieving the GTP?
 What can we do with them?

1
EMI
Your reflection!
 What is your organization’s role in the development
effort exerted by the government?

 What are the vision, mission, major goals and

objectives of your organization?

33
EMI
Vision/ራዕይ
 Your vision:

34
EMI Mission/ተልዕኮ
 Your Mission:

35
EMI
Key values /ዕሴቶች
 Your Values:

36
EMI
Goals and Objectives
/ዓላማዎችና ግቦች

 Major Goals and Objectives

37
EMI 1.2. Basic Concepts Related to
Development Project Planning

 Your understanding First!

 What is development?
 How can we achieve development?

1
EMI
I. Development
 is the process of positive change in the entire social system of
a given society. It is a transformation of society, a movement
from traditional way of thinking, a movement from traditional
way of dealing with health and education, and a movement
from traditional methods of production to more modern ways.
 In 1950s & 60s development was conceived in terms of growth
targets such as: GNP and GDP
 But the concept of development involves something more
than economic growth.
 Growth in GDP is not an end in itself. It is a means to improve
living standards and better society with less poverty, better
health and improved educational level.
 Increased GDP per capita should be accompanied by
reduction in poverty.

1
EMI
Cont’d…
 During the 1970s development came to be redefined
in - terms of multidimensional concept such as:
• Reduction/elimination of poverty,
• Reduction of inequality, and
• Reduction/elimination of unemployment,
 Thus, the wider meaning of development is
conceived as a process involving major upward
changes in social and economic structure as well as
meeting the following three main objectives.
 Life sustenance (food, shelter, cloth… )
 Self-esteem (getting jobs, better education,
health…)
 Freedom (expanded social and economic
choices)

1
EMI Cont’d…..

 Development should be Sustainable

which can be defined as development that
‘meets the needs of the present generation
without compromising the ability of future
generations to meet their needs”.

41
EMI
II. Development Policy
 is a statement of intention or aspirations of
a government to improve the living
standards of its people.
 It is a comprehensive statement, which
guides the direction of general
development objectives or goals to be
achieved at various levels of intervention.
 For Example, reduction of poverty,
illiteracy and disease is one of the policy
directions of the government of Ethiopia.

1
EMI III. Development Strategy

 is a general method of achieving specific

objectives.
 It describes the essential resources and
their amounts, which are to be committed
to achieving those objectives.
 It also explains how resources will be
organized and the guiding principles that
will apply for the management of and use
of those resources.
1
 Cont’d…
EMI  A development strategy is formulated following a
development policy that is already in place and
provides a long term perspective and framework for
achieving basic issues which are outlined in the
development policy.
 Development strategies, therefore, are likely to
involve:
 Establishment of sector goals
 Defining the means to achieve the sector goals.
 Determine the feasibility of achieving the stated
goals from the political, technical, organization and
resource points of view.
 Making a preliminary assessment of the likely
financial and/or economic cost and benefits.
 Deterring the priorities against some agreed criteria
1
EMI Example of strategy

 Development strategies could be of various types

such as import substitution, export promotion …
 strategies for poverty reduction may be:
Enhancement of agricultural production.
Increase social service expenditure.
Expansion of employment opportunities.
Direct income transfer.

1
EMI IV. Development Plan
 is defined as a consciously directed
activity with predetermined goals and
predetermined means to carry them out.
 Development planning involves decisions
or choice about alternative ways of using
available resources with aim of achieving
particular goals at some time in the future.
 Example of Development Plans:
Plan for Accelerated and Sustained
Development to End Poverty (PASDEP) I
and II, GTP I (2010/11 – 2014/15) and GTP II
(2015/16-2019/20)

1
EMI
V. Development Program
 is a frame of development activities
with more or less general development
objectives and derived from an
economic development plan.

 Synonymously used with development

plan

1
EMI VI. Development Project
 Projects are planned, formulated and
implemented to realize development policy
objectives and ….. is called policy
instruments and they are:
 Powerful and efficient means to achieve a
development objective,
 Mechanisms with which income distribution is
improved,
 Crucial building blocks of development
structure to create productive assets,
 Mechanisms to solve immediate problems,

1
EMI
Your Reflection!!
 What is a Project?
 What is the difference between
project and program?
 Why project?

1
EMI
What Is a Project?
 “A project is a temporary
endeavor undertaken to
create a unique product or
service”(
service PMI, 2013).
 A project is a series of
activities aimed at achieving
specified objectives within a
defined time period and with
a defined budget (EU, 2002)

50
EMI
What is project?
 A project is a unique
 A project is an endeavor
set of coordinated
in which human, material, activities, with defined
and financial resources starting and finishing
are organized in a novel points, undertaken by
way, to undertake a an individual or
unique scope of work, of organization to meet
given specification, specific objectives
within constrains of cost within a defined
and time, following a schedule, cost, and
standard life cycle, so as performance
to achieve beneficial parameters.
change defined by
objectives.

1
EMI Characteristics of projects
1. A project has a unique Purpose
2. A project is a one-time or temporary activity
3. A projects is unique activity and non- routine
4. A project has a definite beginning and end.
5. Projects have time, cost and quality constraints.
6. Project has a life cycle
7. Projects have a primary customer or sponsor.
8. A project involves uncertainty.

1
EMI Examples of projects …..
 Construction of dam for irrigation
 Constructing a building or facility
 Developing a new product or service
 Effecting a change in structure, staffing, or style of
an organization.
 Designing a new transportation vehicle
 Developing or acquiring a new or modified
information system
 Running a campaign for political office
 Implementing a new business procedure or
process.
 Implementing different development community
projects (health, education, water and sanitation, .)

1
EMI
Types of projects
1. Experimental,
2. Pilot project,
3. Demonstration project and
4. Production project.
or
1. New project
2. Expansion project
3. Up dating project

1
EMI Agricultural projects…..

1
EMI Agricultural projects…..
 Some projects aim to make farms simpler
and more organic, and some want to use
technology and advanced scientific
thought to move agriculture forward
 No matter the aim, the three basic types
of agricultural projects are:
 educational,
promotional and
research.
 Most projects encompass one, if not
more, of these elements to help change
the way farming is done.

1
EMI Road project

1
EMI

1
EMI Water project

1
EMI Approaches for the Implementation of
Development Projects
 Strategies for the implementation of development
objectives generally follow either:
• a sectoral approach (example agriculture, industry,
health, etc.) or
• an area/special based approach (example: region,
woreda or kebele, etc.)
• or both.
 The ultimate meeting point between plan and people is in
the project.
 Therefore, the project gives life and is the visual and
concrete representation of policy, strategy, plan and
program.
 It is for this reason that projects are considered as the
tangible benefits for the target groups.

1
EMI

The difference between the

project and program

1
EMI Programs Vs Projects
Project Program
• has specific in objective/  has got general objective;
purpose;
• has specific location(i.e.,  may not have specific
area/geographical unit; location;
• has a specific target  may not have specific target
group or beneficiaries group or beneficiaries;
• has clearly determined  may not have cleared and
and allocated fund with detailed cost breakdown of
detail cost breakdown; the allocated fund;
• has specific life time  may not have specific time
of ending;
1
EMI Similarities
 Have objectives/purpose.
 Require financial, human, material, etc.
inputs.
 Generate output (goods, service or skill).
 Serve as instruments for the execution of
development plans.

1
 How to define success or failure of a
EMI
project?

 criteria for measuring project success:

The project met scope, time and cost
goals
The project satisfied the sponsors/
customers
The results met its main objectives

1
EMI Project Cycle Management
(PCM)
 Identify and discuss the life cycle
of a project?

1
EMI PCM ….

 Projects of all type move from conception

to reality …. involving many stages
 The main features of this process are:
• information and data gathering and
analysis, and
• making decision on the basis of the
results of the analysis.

1
EMI Project cycle….
 The project cycle concept aims to emphasis
two main points:
project development should pass through a series
of consecutive steps to help ensure that projects
are well planned, properly appraised, adequately
resources and efficiently implemented; and that
lessons learned during implementation should be
feedback into the planning process to improve the
design and implementation of future initiatives.

1
EMI Stages of Project cycle (UNIDO Model)

Phases Stages
I. Pre-investment 1. Identification
2. Preparation
3. Appraisal/Selection
II. Investment 4. Implementation
III. Operation 5. Operation
6. Ex-post Evaluation

1
EMI Phases of the Project Cycle (World Bank)
1. Identification
2. Formulation/preparation/feasibility study
3. Appraisal
4. Implementation
5. Monitoring and Evaluation

1
EMI 1. Identification
 This phase involves finding projects, which could
contribute toward achieving, specified
development objectives.
 It is a process of identifying the problems which
need to be addressed and analyzing the ways in
which they can be solved. This would include:
 Analysis of existing situation
 Problems/needs identification

1
EMI Identification Cont’d …..
 Problem analysis
 Prioritization of issues
 Decision on whether a project is appropriate
 Definition of the project idea
 Consultation with stakeholders
 Establishment of overall objective

1
EMI Identification cont’d ….

 As it is explained in the definition of a project,

problems are the basis for project
formulation/development.
 Problems are deviations from expected results.
It could be an opportunity or a crisis
 We can use problem tree to identify problems,
which shows the cause a cause and effect
relationships

1
EMI 2. Preparation /project formulation
 involves the detailed planning of the project idea,
design alternatives, consider the technical,
economic and financial feasibility

 The result of the preparation stage is a set of

tangible proposals with an associated set of costs
and benefits. These will usually be contained in
pre-feasibility or a feasibility study which may be
undertaken by internal/external consultants.

1
EMI
Cont’d…

The main activities include:

 Specification of objectives and results
 Identifying resources available for the
project
 Identifying resources needed for the project
 Design of the project
 Packaging and planning of the project

1
EMI
3. Appraisal
 Project appraisal can be defined as a second look
at a project report by a person or an institution
that is in no way involved in its preparation.
 This stage involves a systematic review of all
aspects of the project in order that decision can
be made as to whether to proceed.
 The following aspects should be covered in the
appraisal process:
 Technical: is the project design appropriate and
will the project work as expected?
 Financial: has proper provision been made to
cover the financial requirements and obligations
of the project?

1
EMI
Appraisal (cont’d…)
 Economic- is the project advantages form the
point of view of the economy as a whole?
 Social-is the project both advantageous and
acceptable to the people affected by it?
 Institutional-are there suitable organizations in
place to implement and manage the project. Is the
legal frame work appropriate?
 Environmental- have the environmental impacts
of the project been properly considered.
 Sustainable-will the project be sustainable in the
long term both financially- and institutionally.

1
EMI 4. Implementation
 This phase is one of actually performing the
project and ensuring that the objectives are
meet and the outputs made, in as much as this
is possible. This include:
 Mobilization of resources for each task and
objectives
 Project marketing
 Ongoing monitoring and reporting arrangement
 Identifying problems
 Addressing failures
 Modification of the planned results and project
objectives as appropriate

1
EMI 5. Evaluation
 This is the process of reviewing the completed
project to see whether the intended benefits are
likely to be achieved.
 It involves gathering, analyzing, and
interpreting of information of the day today use
of inputs and their conversion in to outputs in
order to enable timely adjustment of the
development program/ project when necessary.
 Evaluation of the results of a project is important
for several reasons, including:

1
EMI Evaluation…..
1. Assessing whether the tasks are truly completed
as planned
2. Identifying best practice for further projects
3. Identifying what resources are required for the
future
4. Identifying the need for future projects

1
EMI
Project Management

What is it?
Why project management?

1
EMI Definition

“Project management is the application

of knowledge, skills, tools, and
techniques to project activities in order
to meet or exceed stakeholder needs
and expectations (PMI, 2013).

1
EMI Cont’d…

 Project management typically consists

of balancing different factors, which
limits the projects success…
constraints.

1
EMI
“Trade Off” Triangle”

e)
BU
PROJECT
im

D
(T RISK

G
ET
LE
U

(C
Y
ED

I T

os
AL
QU
H

t)
SC

SCOPE (Requirements)
EMI Balancing the “Project Success
diamond”
 A clear understanding of customer
priorities
 “People” skills
 Thorough planning
 An organized, structured process

84
EMI Knowledge area/Category
1. Scope Management
2. Time Management
3. Cost Management
4. Quality Management
5. Human resources management
6. Communications management
7. Risk management
8. Procurement management
9. Integration management
1
10. Stakeholder management
EMI
Project Mgt. Framework

Source: Schwalbe, 2015:12

86
EMI

 Whose responsibility is project

management?

1
EMI
Project Manager
“The person who is responsible for the
project and will be held accountable for
its success or failure.”

1
EMI Role of the Project Manager
 Providing direction, leadership, and support to
project team members.
 Monitors progress of implementation
 Manages resources efficiently
 Motivates staff
 Ensures communication (internal and external)
 Providing teams with advice and input on tasks of
the project
 Resolving conflicts affecting the project’s
resources, schedules, etc.

1
EMI
Continued …
 The six sets of management skills required
for project managers:
1. Communication skills: includes listening,
persuading.
2. Organizational skills: includes planning,
goal-setting, analyzing.
3. Team Building skills: includes empathy,
motivation.

1
EMI
Continued …
4. Leadership skills: includes sets example,
energetic, vision (big picture), delegates,
positive.
5. Coping skills: includes flexibility, creativity,
patience, persistence.
6. Technological skills: includes experience,
project knowledge.
 A major part of project management is
related to dealing with "stakeholders”.

1
EMI
Session 2

Participation in Project
Planning and Management

1
EMI
Learning Objective
 To enhance capacity of project
planners to use participatory
approach in planning and managing
programs & projects.

1
EMI Discussion Question …..
Form a group and answer the following
questions and present to plenary.
1. Who are stakeholders?
2. Why participation of stakeholders/community is
required?
3. In which stage of the project cycle
community/stakeholders’ participation is important?
4. What should be the degree of
Community/stakeholder Participation in each stage
of the PCM?

1
EMI
Project Stakeholders and their Role

 What is a project stakeholder?

If you can gain or lose from the
success or failure of a project, you
have a “stake” in the project.

1
EMI Definition
 A stakeholder is someone who has an interest in
the project.
 Any person, group of people or organization who
has a vested interest in the project now or in the
future

 Anybody who is affected by or can affect the

project (… individual, community, group,
organization etc...)

 Includes a much wider set of actors than the

immediate beneficiaries of the project.

1
EMI Types of stakeholders
 Primary Stakeholders: are the direct-
targeted participants and institutions in
the development program/project.
 Secondary Stakeholders: are the
intermediary participants.
 Internal stakeholders:
 External Stakeholders: are individuals
and groups not formally and directly
involved but who may impact or be
impacted by the project.

1
EMI
Stakeholder analysis
 is a process of systematically gathering
and analyzing qualitative information to
determine whose interests should be
taken into account when developing
and/or implementing a policy or program.

1
EMI
Stakeholder analysis Matrix
Stakeholders Interests Potential Project Relative
Impact Priorities
(+, -, ?) (1-5)
Primary
-----------
-----------
Secondary
-----------
-----------
External
-----------
-----------

1
EMI Group Discussion Questions
 Purpose: To clarify stakeholder concept with
practical exercise
 Time: 30 minutes

 Discussion Questions:
 Select one project from your organization
and discuss in your group and identify the
stakeholders. It is preferable if you select a
project currently on progress (at planning or
implementation stage).
 Categorize them in at least two groups
(primary and secondary) and elaborate your
justification for the grouping

1
EMI Identifying stakeholders
 Questions that are helpful to identify relevant
stakeholders:
 Who are likely to be affected by the project?
 Who is responsible for what is intended to be
done?
 Who is likely to mobilize for or against what is
intended?
 Who can make what is intended more effective
through their participation or less effective by
their non-participation or outright opposition?
 Who can contribute financial and technical
resources?
 Whose behavior has to change for the effort to
succeed?

1
EMI Examples of common stakeholders group
 project managers
 project user groups/community
 affected groups/community (if any)
 community based organizations /CBOs/
 project financers and implementers
 concerned local, national and international governmental
organizations and NGOs
 religious and traditional leaders
 informal social net-works which may mobilize or
contribute resources to the project and serve as
channels of communication about the project
 political parties
 the private sector and professional bodies, which may
mobilize or contribute resources to the project; and other
groups who may have an interest on the project.

1
EMI Key Project Stakeholders include:
 Project manager and Project team
 international/donors,
 national political (legislators, governors),
 Public,
 commercial/private for-profit,
 Nonprofit [NGOs],
 civil society organizations (CSO/CBOs),
 Project financers
 users/consumers.
103
EMI

Community
Participation (CP)

1
EMI

 Community:
refers to a group of people living in
geographically defined areas, or to a
group that interacts because of a
common social, economic, or
political interest

1
EMI What is Community Participation?

 Participation is a process through which

stakeholders influence and share control
over development initiatives and the
decisions and resources which affect
them. (World Bank, 1994)
 … involvement in decision-making
process, in implementing programs, their
sharing in the benefits of development
programs and their involvement in efforts
evaluate such programs

1
EMI Participation in development
comprises:
 the involvement of stakeholders in any
or all stages of a project cycle,
 promotion of the role of community and
local agencies,
 facilitation methodologies and
techniques, and
 Decentralized decision makings

1
EMI Need for CP
 To get acceptance
 To make projects sustainable
 To mobilize resources
 To identify needs
 To increase commitment
 To raise awareness

1
EMI
CP cont’d ….
 Participation is an effective means to
mobilize local resources and skills and
energies of the community
 It enable prior identification of community
needs and helps to customize development
activities to meet these needs
 It enables to promote commitment on part
of the people in its implementation and
assures sustainability
 It rises awareness among the community
the causes of their problems and potential
means they have at disposal to tackle the
problems. It therefore, reduces their
dependency on external resources and
skills

1
 Cont’d …
EMI
Procedures to be followed in need identification
1. Approach the community carefully
2. Clearly discuss together with the
community
3. Use different techniques of participatory
methods such as:
 Interview (semi structured/structured)
 Group discussion
 Secondary data from NGOs, community records
 Direct observation
 Key informants discussion

1
EMI Ways/levels of participation
 To be informed
 To be consulted
 To work as partnership
 To be delegated
 To be controlled

1
EMI
Level of participation
1. Informing: telling people about your project.
This might be one of the first things you do
and you should view it as preparation for
more active involvement.
2. Consulting: giving people choices about
what happens in your project and a chance
to shape it.

1
EMI
Level of communication …..

3. Deciding together: creating opportunities for

people to make decisions about and influence
the direction of your project.
4. Acting together: creating opportunities for
people to develop and deliver your project,
taking a role in heritage conservation and/or
learning activities.
5. Control (Supporting others to take the lead):
empowering people to have ownership of the
project, make final decisions and deliver
activities with some independence.

1
EMI Participation Matrix
Infor Consult Partnership Delegate Control
Stage m

Identification

Planning
Implementation

M&E

1
EMI Major Factors Which Influence Participation

 Nature of problem being addressed i.e. severity

of the problem and felt needs addressed or to
be addressed enhance or limit participation
 Quality of leadership i.e. existence of
committed and understanding leadership
 Attitude of development workers i.e. respect for
peoples ideas, culture and felt needs.
 Timing of intervention i.e. in rural areas during
critical farming seasons you will not get the
local people particularly the farmers.

1
 Some Suggestions for Effective
EMI
Participation
 Establish rapport/cooperation with the body concerned
and community concerned.
 Use of team approach and co-operation with other
agencies
 Go for interdisciplinary or multidisciplinary approach.
Development is multifaceted.
 Promote capacity building.
 Go for low-cost, replicable and sustainable
programs/projects.
 Go for smaller and appropriate technology.
 Start where there are no impositions on people.
 Use local resources.
 Ensure local contributions to project (Use influential
leaders, ensure that women's concerns are addressed
through participation)

1
EMI Effective participation
 People, not project centered
 Arises from the people and not imposed from
outside
 Reflects the underlying social norms of the
people
 Transfers decision making to ultimate
beneficiaries
 Involves the community
 Consultation not coercion based action
 Inclusive of identification, design, appraisal and
implementation

1
EMI
Cont’d ….

Positive rather than negative response

Allows for flexibility wherever possible
Translates local ideas into local activities
Institution strengthening
Organizationally simple rather than complex
Natural rather than artificial

1
EMI What do you learn from this?

119
EMI

Project Identification

1
EMI
Activities in this session
 You will identify the project ideas and
develop:
1. SWOT Analysis
2. Problem tree
3. Objective tree
4. Alternative objective tree
5. Project proposal
6. Logical framework
1
EMI

 After completing this session participants

will be able to:
• Distinguish the sources of project
ideas
• Differentiate methods of project
identification
• Understand project ranking and
selection criteria

1
EMI

 Project identification refers to finding

project ideas which can contribute
towards achieving specified development
objectives.
 Project identification is the first and the
most crucial of the stages in the project
cycle.
 Identification is followed by ranking and
selection

1
EMI Cont’d….
 Following project identification, due to
scarcity of resources, projects ideas
should be prioritized for eventual
implementation.
 Therefore, in this session we discuss
about:
 sources of project ideas,
the basis of project identification, and
methods of project identification,
project raking and selection.

1
EMI

There are four key phases of project

identification. These are:
•Actual project identification
•Description of project idea
•Screening
•Prioritization
1
EMI
Discussion Questions

1. Who identifies projects?

2. What are the sources of project ideas?
3. Identify different project ideas related to
your organization?

1
EMI
Who identifies projects ideas?
 Development Projects might be
identified by different stakeholders
including:
Government sector ministries,
Regional and local governments
administration,
Private sector companies (local or
foreign),
State owned enterprises and
organizations,
Development banks,
Bilateral and multilateral agencies,

1
EMI
Project ideas conceived by:
 Individuals
 Groups of individuals (community)
 Local leaders
 NGOs
 Policy makers
 Planners
 International development agencies
 Government pronouncements

1
EMI Sources of Project Ideas

 We can distinguish two levels from

where project ideas are born at: the
micro-level and the macro-level.

1
 Source…
EMI
1. At Micro-level project ideas emanate from:
 unsatisfied demand or needs,
 existence of unused or underutilized natural or
human resources and the perception of opportunities
for their efficient use,
 The need to remove shortages in essential materials,
services or facilities that constrain development
efforts,
 The initiatives of private or public enterprises in
response to incentives provided by the government,
 The necessity to complement or expand investments
previously undertaken,
 The desire of local groups or organizations to
enhance their economic status and improve their
welfare,

1
 Source ….
EMI
2. Macro-level: Project ideas emerge from:
 National, sectoral, or regional plans and strategies
 Constraints in the development process
 A government’s decision to correct social and regional
inequalities or to satisfy basic needs of its people
 Unusual events such as droughts, flood, earthquakes,
hostilities, etc.
 A government’s decision to create local project
implementing capacity in such areas as construction,
etc.
 Project ideas could also originate from foreign firms.
 Workshops and development experiences of other
countries
 Multilateral agencies or bilateral development
organizations

1
EMI The Basis of Project Identification
 The basis for project ideas is a need or demand for the
output of the project and availability of resources
 Demand based projects vs resource based
projects.
 When projects are not undertaken for commercial
profit/objective, the project may be considered as a need
based project. Can you give an example?
 Need or demand for project’s output may be reflected
in terms of:
 Local consumers’ need or demand for the product
or service,
 Export opportunities,
 Demand for intermediate inputs for other
sector/activities,

1
 Basis of project identification …..
EMI

 One way is to explore four types of

need in a community:
• Felt need
• Expressed need
• Normative need
• Comparative need

1
EMI
.

1
EMI

Approaches
of Project
Identification

1
EMI Approaches/methods….

There are two major

approaches to
project identification
(a)Top-down approach
(b)Bottom-up approach

1
EMI 1. Top-Down Approach

 Projects are identified based on demands

from beyond the community.
 This may include directives from:
international conventions (such as Kyoto
Protocol/climate change)
international institutions or NGOs that
have determined particular priorities and
thus projects
national policy makers identifying projects
that pertain to party manifestos and/or
national plans.
1
EMI
Advantages

 It may be a rapid response to disasters like

floods, war outbreak because there is
limited time and chance to consult the
beneficiaries.

 It can be effective in providing important

services like education, health, water, roads
etc.

 It can contribute to wider national or

international objectives and goals

1
EMI Limitations
 Does not help in modifying strongly
established ideas and beliefs of people.
 Assumes external individuals know better
than the beneficiaries of the service.
 Communities have little say in planning
process
 Community develops dependency
syndrome on outside assistance and does
not exploit their own potential.
 The development workers (change agents)
become stumbling blocks to people-led
development … there is a tendency to
impose their own biases, etc. on people.

1
EMI
2. Bottom-Up Approach

 In this approach the community/

beneficiaries are encouraged to
identify and plan the projects
themselves with or without outsiders.

1
EMI Advantages
 Interveners accomplish more with limited
resources since people tend to safeguard what
they have provided for themselves.
 Develops people’s capacity to identify problems
and needs and to seek possible solutions to
them.
 Provides opportunities of educating people.
 Helps people to work as a team and develop a
“WE” attitude - makes project progressive and
sustainable.
 Resources are effectively managed;
dependence reduces, there is increased equity,
initiative, accountability, financial and economic
discipline.

1
EMI Limitations
 Not always effective for projects that
require urgency to implement
 Time-consuming and requires patience
and tolerance.
 The agency using this approach is
never in control and cannot guarantee
the results it would want.
 The priorities of communities may not
fit with national or international
priorities that seek to have a broader
impact

1
EMI

Methods of
Project
Identification

1
EMI Methods of Project Identification
 The methods for project identification include:

1. Analysis of Major Development Problem

2. Analysis of National Development Objectives
3. Economic Analysis
  Statistical analysis of trade reports
 Study of comparative advantage
  Analysis of linkage
4. Socio-spatial Approach to Project Identification
 Participatory Approach
  Area Based Functional Analysis

1
EMI
Methods…

 SWOT Analysis
 Problem analysis and Objective
analysis
 Problem tree and objective tree

1
EMI SWOT Analysis
SWOT analysis is a tool for institutional
appraisal and a brainstorming exercise in which
the representatives of the organization
participate fully.
Purpose:
To assess the performance and capacity of the
participating units, divisions of organization.
Each participating unit has to undertake SWOT
analysis.
EMI SWOT stands for:
• Strengths - the positive internal
attributes of the organisation
• Weaknesses - the negative internal
attributes of the organisation
• Opportunities - external factors which
could improve the organisation’s
prospects
• Threats - external factors which could
undermine the organisation’s prospects
EMI

PROBLEM
ANALYSIS

What is it and why do we use it?

1
EMI

149
EMI Why problem analysis?
 Helps determine real as opposed to
apparent development needs
 Helps to bond program participants
together (identify issues, roles of deferent
partners in resolving the issues, timescale
and resources needed to achieve a given
solution/objective).
 Builds better understanding of underlying
causes of development issues
 Builds stakeholder consensus
 Identifies potential constraints

1
EMI Why….

 Identifies real cause of the problem

 Helps establishment of meaningful
relationship with other implementers
 Helps establish the actual size of the
problem and likely resources needed
 Helps establish organization’s
comparative advantage

1
EMI When and how it should be used?
o Problem analysis can be undertaken at
any stage of the project cycle, but most
useful at the stage of IDENTIFICATION
and DESIGN
o The three main techniques used for PA
are:
 Problem tree analysis workshop
with key stakeholders
 Focus group interviews with key
stakeholders
 Participatory Rural Appraisal (PRA)

1
EMI DEVELOPING A PROBLEM TREE

1
EMI
Developing a problem tree….

 Creating a problem tree helps to separate

the core problem from its cause and
effects.
 The first step in creating a problem tree is
to agree on the nature of the core
problem.
 Once this core problem has been
identified its relationship to causes and
effects can be represented in a diagram.
 It is followed by objective tree.

1
EMI
Steps in developing a problem tree
Step 1. Identify a problem situation
Step 2. Check with stakeholders /planning
group to see if they consider it as a
problem
Step 3. Identify immediate effects
Step 4. Identify immediate causes
Step 5. Establish a cause and effect
relationship between the various problems
and build a problem tree.

1
EMI
 FORMAT OF A PROBLEM TREE
EMI

Secondary Secondary Secondary

Effects Effects Effects

Primary Primary Primary

Effects Effects Effects

FOCAL
PROBLEM

Primary Primary Primary

Cause Cause Cause

Secondary/ Secondary/ Secondary/

Root Cause Root Cause Root Cause

1
 Example 1:
1 Subject of the workshop is
EMI food security, the possible problems
mentioned in relation to this subject
are:
 Food production on hills  Dikes are degraded
decreasing  Soil fertility on hill slopes
 Ethnic clashes in is decreasing
neighboring districts
 Soil erosion on hill
 Food shortages slopes
 High incidence of  Irregular supply of inputs
malnutrition for rice production
 Canals are blocked  High immigration rates
 Rice production in low  Irrigation water does not
lands decreasing reach fields in desired
 Poor maintenance of quantity
irrigation facilities
 High incidence of

EMI
Problem Tree malnutrition

Food shortages

Rice production Food production

in low lands High immigration
on hills decreasing rates
decreasing

Irrigation water does Irregular supply of Soil fertility Ethnic clashes in

not reach field in inputs for rice on hill slopes neighboring
Effect
desired quantity production is decreasing districts

Canals are Dikes are Soil erosion on

blocked degraded hill slopes

Cause

Poor maintenance
system for irrigation
facilities 15
9
EMI

Developing the objective

tree

1
EMI Developing the objective tree
Step 1. Reformulating all elements in the
problem tree into positive desirable
conditions.
Step 2. Review the resulting Means-End
relationship to assure validity and
completeness of the objective tree.
Check if all the statement in the
objective tree makes sense.
Step 3. If necessary, revise the statements
Step 4. Delete the objective statement of the
problem if it appears unrealistic or
unnecessary

1
 Incidence of
EMI Diagram of objectives Malnutrition reduced

Improved Food
situation

Rice production Food production

in low lands Lower
on hills increased immigration
increased
rates

Sufficient irrigation Regular supply of Soil fertility on Less ethnic

water reaches the inputs for rice hill slopes clashes in End
fields production increased neighboring
districts

Canals Dikes are Soil erosion on hill

cleared upgraded slopes reduced

Means

Maintenance
irrigation facilities
improved

162
EMI

Example

1
EMI

Reduction in
patients reporting Decrease in 25%Increased
increase in
Objectives
Effects Angina
syms of angina Heart
prevalence of Dependency on
people living
services & family
heart attacks
attack independent
memberslives

Aim
Core Rising
Reduce
Problem CHD
CHD

Mass media
Increase awareness of
Diet
campaign to Smoking
dangers of smoking via
Causes
Activities promote healthy
campaign
eating

Cookery
Fast Fresh food
Availability of Habit
Nicotine
PeerPeer
education
Classes
Foods delivery in poor Replacement
1
fresh produce
areas Forming
Therapy Pressure
programmes
EMI
Alternative Tree Analysis
 is a technique for identifying alternative
solutions or course of action that can be used
to achieve the same or alternative objectives
and the display of this information in a simple
format.
 is a process in which specific project
strategies are selected from among the
objectives and means raised in Objectives
Analysis, based upon selection criteria.
EMI
 The aim of alternative strategy analysis is division
of the objectives tree into more consistent smaller
sub-units that may, compose the core for a project.
 Each of the sub-units of the objective tree can
represent an alternative strategy for the future
project.
 The project objectives set the framework for the
strategy of the project.
EMI Criteria for selecting the alternative:
1. RELEVANCE: the strategy corresponds to the
needs of the stakeholders.
2. EFFECTIVENESS: the lower level objectives of
the strategy will contribute to achievement of
the project purpose.
3. EFFICIENCY: cost-effectiveness of the
strategy in transforming the means into results.
4. CONSISTENT with development policies
5. SUSTAINABILITY of the project
6. ASSUMPTIONS and RISKS
 Incidence of
EMI Malnutrition reduced
Diagram of Alternatives
Improved Food
situation

Rice production Food production

in low lands Lower
on hills increased immigration
increased
rates

Soil fertility on
Sufficient irrigation Regular supply of hill slopes
water reaches the inputs for rice increased
fields production
Less ethnic
clashes in
neighboring
districts
Canals Dikes are
cleared upgraded Soil erosion on hill
slopes reduced

Maintenance
irrigation facilities
improved
168
EMI Project Concept Note/ Profile Preparation
 Once a project idea has been conceived, the next stage is
to describe the idea so that it can be prioritized and move
on to the next stage in the process.
 This may involve the preparation of a project
identification report or project concept or profile.
 Depending on the type of project it should include the
following components:-
 Justification and purpose
 Beneficiaries and stakeholders
 Resources and institutions
 Polices and plans
 Impacts
 Support
 Risks & Assumptions

1
EMI Prioritization and Ranking
 The limited resources available enforce
that effective project identification and
selection at various levels will be
essential.
 To decide which projects to support it
will be necessary to set priority. This
calls for the ranking of projects using a
set of criteria (which varies from
organization to organization)
 Potential criteria for ranking projects are
given below:

1
EMI Criteria for ranking projects
1. Extent
 Number of people affected by the
project
 Geographic area affected by the project
2. Economic and financial benefit
 Potential economic benefits to the
country or region, community etc

1
EMI criteria for ranking projects……

3. Environmental
Conservation of natural resources and
more sustainable land use
Protection of natural resources such as
forests
4. Social
Poverty alleviation
Assistance to disadvantaged groups

1
 Criteria for ranking projects……
EMI

5. Policy
Is the project in line with national and
regional policies?
6. Resources
Availability of human and other
resources to implement projects
Likely availability of funding from
government, NGO and /or donors

1
EMI criteria for ranking projects……

7. Success or failure (Risk..)

What are the chances of project successfully
meeting its objectives?
What degree of risk are associated with the
project that may affect its implementation?
8. Support
Government and community support and
demand for project

1
EMI
Project Rating Index
 When a firm evaluates a large number
of project ideas regularly, it may be
helpful to streamline the process of
preliminary screening by employing a
project rating index.

1
EMI
Steps in determining the project rating index

 Identify factors relevant for project rating

 Assign weights to these factors
 Rate the project proposal on various
factors, using the suitable rating scale.
(Typically a 5-point or 7-point scale is used)
 For each factor multiply the factor rating
with the factor weight to get the factor score
 Add all the factor scores to get the overall
project rating index.

1
 Rating
EMI VG G A P VP Factor
Factor
5 4 3 2 1
Factors Weight Score
Input availability 0.25  0.75
Technical know-how 0.10  0.40
Reasonableness of cost 0.05  0.20
Adequacy of market 0.15  0.75
Complementary relationship 0.05 0.20

with other products
Stability 0.10  0.40
Dependence on firm's strength 0.20  1.00
Consistency with 0.10 0.30

governmental priorities
Rating Index 4.00
177
EMI
Group discussion
 Identify project ideas/problems of
your own and select one and
develop a problem and objective
tree.

 Time: 30 minutes

1
EMI
Session 4

Logical Framework Analysis

(LFA) and its application

1
EMI Learning Objectives
By the end of this session participants will
be able to:
 Distinguish the vertical logic and the
horizontal logic in the project matrix;
 Use the logframe matrix as a tool for
planning, monitoring and evaluation of any
project.

1
EMI Introduction
 Developed in the 1970s by USAID
 LFA has recently gained popularity in the design,
monitoring and evaluation of project and used by GOs,
NGOs and international organizations
 It links, in a logical way, the objectives of a project,
project activities, assumptions about the project
environment, to the results of the project
 It is an overview of the objectives, the means of achieving
these, and the main assumptions behind a project,
 Can all be presented on a one or two pages statement –a
very effective project summary
 The process is participatory

1
EMI
What is LFA?

 LFA is a systematic planning procedure

for complete project cycle management
 It is a problem solving approach which
takes into account the views of all
stakeholders
 It sets criteria for project success and
lists the major assumptions

1
EMI Where to begin?

 Start by developing a Problem Tree and

objective tree.
 Try to identify what is the real problem the
project is to tackle
 And then, decide whether the original problem is
still going to be the main focus (or goal) of the
project.

1
EMI
LFA ….
 undertake a structured analysis of the existing
situation before designing LF
 LFA incorporates four main analytical elements to
help guide this process:
• Problem analysis
• Stakeholder analysis
• Objectives analysis, and
• Selection of a preferred implementation strategy

1
 Two stages LFA
EMI
Analysis phase Planning Phase
1. Stakeholder analysis - identifying & 1. Developing Logical
characterizing potential major Framework matrix –
stakeholders; assessing their capacity defining project structure,
2. Problem analysis - “Problem Tree”. testing its internal logic &
It consists of identifying key problems, risks, formulating
constraints & opportunities; determining measurable indicators of
cause & effect relationships success
3. Objective analysis – or “Solutions 2. Activity scheduling –
Tree”. It consists in determining the sequence
developing solutions from the identified and dependency of activities;
problems; identifying means to end estimating their duration, and
relationships. assigning responsibility
4. Strategy analysis – identifying 3. Resource scheduling –
different strategies to achieve solutions; or “Budgeting”. from the
selecting most appropriate strategy. activity schedule, developing
input schedules and a
budget
1
EMI
Components of LFA
 Has 4 columns and usually 4 or 5
rows, depending on the number of
levels of objectives used to explain the
means-ends relationship of the
activity.
 The LFA matrix has both a vertical
logic and a horizontal logic

1
EMI
Cont’d….
i) The vertical logic (reading up and down columns 1
and 4 of the matrix) clarifies the causal relationships
between the different levels of objectives (column
1), and specifies the important assumptions and
uncertainties beyond the activity manager’s control
(column 4).
ii) The horizontal logic (reading across the rows of the
matrix) defines how the Goal, Purpose, Outputs)
will be measured (column 2) and the means by
which the measurement will be verified (column 3).
 The following figure shows the overall structure of
the full logical framework

1
EMI Diagonal Logic

188
 LOGICAL FRAMEWORK MATRIX
EMI
Narrative Verifiable Means of Important
Summary Indicators Verification Assumptions
(OVI) (MOV)

GOAL

PURPOSE/out
come

OUTPUTS

ACTIVITIES Inputs

1
 Typical logical framework format
Objectively Means of Assumptions
Narrative summary verifiable indicators verification
EMI
1. Goal – the overall Measures (direct or Sources of Goal Sustainability
aim to which the project indirect) to show the information Important events,
is expected to contribute project’s and conditions or decisions
contribution to the methods used beyond the project’s
goal to control necessary for
show maintaining the progress
fulfillment of towards the goal
goal
2. Purpose /Outcomes – …to show what …. used to Purpose to goal
Description of the progress is being show progress …. necessary if achieving
impact/effect the project made towards against the objectives is going to
is expected to achieve reaching the objectives contribute towards the
as a result of its objectives overall goal
outputs.
3. Outputs – the ..to show if project …..used to Output to purpose
description of the outputs are being show delivery … necessary if producing
results the project is to delivered of outputs the outputs is going to help
achieve in its life time achieve the objectives
4. Activities – the things Inputs  Monitoring .. Activity to output
which have to be done Goods, facilities used to show … necessary if completing
by the project to and/or services that activities activities will produce the
produce the outputs needed to carry out have been required outputs
1 activities.
the stated completed
EMI 1. Objectives (Ends): Goal, Purpose &
Outputs
 Goal, purpose and outputs are all
objectives of the project, but at different
levels.

1
 Objectives Definition Example
EMI

Goal The broader development Improved community health

impact to which the on a sustainable basis
project contributes
Purpose The development A clean, reliable and
outcome or effect sustainable supply of water
expected at the end of the adequate for community needs
project
Outputs The direct measurable 1.1. Plan for water supply
results of the project 1.2. Suitable header tank
(largely under 1.3. Operational pump
management’s control)
Activities The tasks carried out to Conduct site survey; identify
implement the project & local labour sources; build
deliver the outputs header tank; construct pump.

1
EMI
Cause-effect relationship among
objectives at several levels

Goal

Purpose

Outputs

under full control of

Activities
project management

Inputs beyond control of

project management
1
EMI 2. Activities: The Means to the
Ends
 To achieve the expected outputs of a
project, it requires the implementation of
different activities or actions by the project.

 These are the means to achieve the

project’s objectives, its “ends”.
 Activities – outputs - purpose achieved
- Contribution to overall goal

1
EMI Risks, Assumptions and Preconditions

 They are not under the direct influence of

the project.
 A risk is an external factor that may
negatively influence the realization of
objective(s).
 Assumption is the underlying hypothesis
on which the cause-effect relationship is
based.
 Important events, conditions or decisions
outside the control of the project
1
EMI ASSUMPTIONS (cont’d….)

 Assumptions are:
 Important events, conditions or decisions
outside the control of the project which must
prevail the goal.
 Important events, conditions or decisions
outside control of the project management
necessary for the achievement of the purpose.
 Important events, conditions or decisions
outside control of the project management
necessary for the production of outputs.
 Important events, conditions, decisions outside
control of the project management necessary
for the start of the project.

1
EMI Example: Assumptions and Risks
 Assumptions tend to be positive
 e.g. “a supportive piece of legislation is passed”
 Risks tend to be negative
 e.g. “increased pressure on a water resources
as a consequence of a resettlement program”

 Assumptions are generally identified during

project design
 Risks often appear during project
implementation

1
EMI

The horizontal logic

1
EMI Objectively Verifiable Indicators (OVI)
 Different indicators can be identified for the
different levels of objectives: goal, purpose
and outputs.
 Indicators must be valid, reliable, precise,
cost-effective and stated independently from
other levels.
 Indicators should make clear how the target
group will benefit from the realization of
outputs

1
EMI
OVI….
 Indicators should be specific in terms of:
Quality (what?)
Quantity (how much?)
Time (when, how long?)
Target Group (who?)
Place (where?)

1
 OVIs…..
EMI
A good indicator at this level is,
a. Plausible- measuring what is important
in the project
b. Attributable- measuring changes caused
by the project
c. Cost-effective- involving data that may
be collected and analyzed inexpensively
d. Independentnot inherent to the project
e. Targeted- how much.., what kind of.., by
when
f. Verifiable to reach agreement
1
EMI Means of verification (MOV)
 Means of verification give an exact
description of where to find the data to verify
the indicator.
 Before settling on each MOV, the planning
team needs to ask the following questions:
 What information?
 Where can we get it or who will provide it?
 How reliable are the sources?
 Is special data gathering required?
 Is it within our means (in terms of cost, time and
know-how) to get it?
EMI

Hypothetical Example

1
EMI
Example…
1. Goal:
 Contribute to improved Eye Health
2. Purpose
 Contribute to increased utilization of Eye Health
services and knowledge
3. Outputs
1. Increased Access to Eye Health Services
2. Provision of cost-effective, comprehensive and
high quality EH services
3. Increased community awareness and support for
EH.
4. Enhanced planning and management capacity in
MOH.
5. Development of comprehensive eye health
policies and standards of practice.
6. Increased capacity to carry out research on EH, and
to collect, analyze and utilize data.
1
EMI
Cont’d….
4. Activities
1. Training
2. Procurement of Consumables and
equipments
3. renovate clinics/hospitals
4. Organizing seminars for HRD
5. Production of communication materials
6. Organizing data collection activities and
surveys.
7. Development of MIS

1
EMI
LFA
 Example 1
 Example 2

1
EMI
Group Activity

Prepare logical framework for the



project identified.

207
EMI
Day 3
Session 5
Project Proposal Writing

1
EMI
Project proposal writing

 What is project proposal?

 Why we need to write project
proposal?
 What are the components of a
proposal?

1
EMI
What is a Proposal?
 A proposal is a request for financial assistance
to implement a project.
 Funding is sought, in whole or in part, from;
government funding agencies,
charitable foundations,
 businesses,
 individuals, and
other sources.
 Proposal writing is a skill and requires
considerable knowledge
1
 The contents of a standard and acceptable
EMI
document must answer the following eight
key questions:
 What is the problem which the project will try to solve?
 Which group of people will benefit from the solution?
 To which development objective will the project
contribute?
 What is (are) the immediate objective(s) of the project?
 What will the project actually produce (outputs) to enable
the achievement of the immediate objective(s)?
 How will it produce the outputs? What activities will be
undertaken?
 What financial, material and human resources (inputs) are
needed?
 What is the institutional framework or implementing
organization structure?

1
 Cont’d ….
EMI
Points to focus on:
 Clarify the purpose of your project
 Define the scope of work
 Determine the broad project goals and
specific objectives
 Be aware that there are a number of grant
making organizations
 Identify the requirements of the grant making
agency
 Make certain that the resources you seek can
be obtained from the grant making
organization that your contacted
 Know maximum amount available

1
EMI
Writing a Grant Proposal is like Playing a
Game
 You have to play by the Rules
 Get the (most recent) guidelines
 Read the guidelines
 Follow the guidelines

1
EMI A grant proposal is a selling document
written to:
 Influence decision-makers
 Convince them to commit dollars/birr in support
of a specific project

 A winning proposal addresses an important

question with an innovative idea, well
expressed, with a clear indication of methods
for pursuing the idea, evaluating the findings,
and making them known to all who need to
know

214
EMI

What do you think are the

components of a wining
project proposal?

1
EMI
COMPONENTS OF A PROJECT
PROPOSAL

 There is a variations in terminology

and specific requirements form
donor to donor. But the underlying
questions and concepts will be the
same.

1
EMI Cont’d….
1. Cover letter
2. Proposal Title
3. Executive Summary
4. Organization Information/Introduction
5. Background/ Project context
6. Problem/need Statement
7. Beneficiaries
8. Project Goals and Objectives
9. Project Outputs

1
EMI Cont’d ….

10. Activities
11. Inputs
12. Organization and Administration
13. Monitoring and Evaluation
14. Phase Out Strategy and
Sustainability
15. Project Budget

1
EMI 1. Cover Letter
  The cover letter is important because it
is the piece of information about your
project proposal read by donors or
funders. It should:
 quickly gain the reader attention,
 show why the particular agency can be
interested in your proposal,
 convey the importance and urgency of your
project,
 keep the letter short and to the point,
 make it look good

1
EMI 2. Proposal Title
  make the title short and do not forget
to keep the interest of your reader’s
mind.
 As much as possible, make it
persuasive, positive and one that
capture your donor’s attention.

1
EMI 3.  Executive Summary

 Clear and concise summary the entire

proposal
 help the donor understand and
visualize the project.
 1-3 pages

1
 4. Organizational Information
EMI

/Introduction/ 
 Describe the organization that seeks funding.
 Briefly summarize the organization’s history,
mission, clients, track record of achievement
and current programs undertaken
 Include also some background information
about the location, how the organization is
managed and does work, and other details that
build the creditability of the organization
should be included in this part of the project
proposal, i.e. evaluation of your program,
letters of support and referring agents.

1
EMI 5. Background/Context

 Here give some background

information on geographic and
climatic information, political and
administrative scenario and socio-
economic status, etc.

1
EMI
6. Problem Analysis
 The problem/Need statement or situation description
is a key step in grant proposal writing.
 It is where you convince the funder that the issue you
want to tackle is important and shows that your
organization is an expert on the issue.
 In developing problem/Need statement:
 State the problem/Need using facts and figures
 Use statistics that are clear and support your
argument
 If possible use research and comparative statistics
 Don't assume that the funder knows much about
your subject area
 Describe why this need/situation is important
 Describe your issue in as local context as possible

1
EMI 7. Beneficiaries
 The beneficiaries and the satisfaction of
their needs is the major motivating
element to bear in mind when preparing a
project proposal.
 The needs of beneficiaries must be
compatible with the project’s objective.
 Note that terms like “target group”,
“target population”, and “target
audience” are often used instead of
beneficiaries in various project proposal
documents.
1
EMI
8. Development Objective
/General Objective /Goal

 used to describe a desired end, a

solution to national or regional
development.
 In project proposal writing, a
distinction is made between
development objective and
immediate objective.

1
EMI Specific/ immediate Objectives
• are short term:
•S – Specific
• M – Measurable outcomes
• A – Achievable, attainable
• R – Realistic
• T – Time-bound, achievable
in a specified time period

1
EMI 9. Project Outputs
 Outputs are the results of project
activities (services made available,
infrastructure built, financial products,
human resources trained, etc.)
intended to achieve the immediate
objective.
 Outputs are tangible and visible.

1
EMI
10. Project Activities

 Activities are the action taken to

produce the output.
 Activities take place over time and are
coordinated to be complete by the date
required in the description of the
output.

1
EMI
11. Inputs

 are the financial, material equipment,

logistics) and human resources
(project team, partner organization)
necessary for carrying out the
activities.
 Identifying local resource is important
for a project to be “sustainable”,
capable of carrying on after the
completion date

1
EMI 12. Organization and Administration

  The project’s internal organization as

well as its relations to partner
organizations has to be expressed in
hierarchical and operational terms.

 M&E procedure should be described

here

1
EMI 13. Monitoring and Evaluation

 A proposal must include a plan for M&E

and method to be followed
 This is extremely important for funders
 Include the following information: -
Who should monitor and evaluate?
What to monitor and evaluate?
How to monitor and evaluate? And
Resource requirements

1
EMI
14. Phase-out Strategy & Sustainability
 Institutions or communities who will take
over the project have to be identified and
indicated from the outset during the
formulation stage.
 Furthermore, if you continue this project in
the future, how will it be supported? This is a
difficult question to answer effectively since
most funders don't want to support the same
set of project forever. What the funder really
wants to see is that you have a long-term
vision and funding plan for the project. This
is important not only for the funder but for
the success of the project or organization.

1
EMI 15. Project Budget
 Budgets are cost projections.
 Attach a one or two-page budget
showing:
 Expenses:
 Personnel Expenses
 Direct Project Expenses
 Administrative or overhead expenses
 Income:
 Earned income
 Contribution income (cash and in kind)

1
EMI
Some Characteristics of Well-written,
Fundable Proposals

 Innovation
 Relevance
 Demonstrated
Competence/expertise of PI
 Feasibility Study
 Time Schedule
 Enthusiasm
 Simple Straightforward Language
 Complete Literature Search

235
EMI Top 10 Reasons for an Unsuccessful
Proposal
1. Project doesn’t address agency priorities
2. Guidelines not followed
3. Not a compelling idea
4. Ideas not clearly presented
5. Methodology appears to be flawed
6. Overuse of jargon
7. Overly ambitious
8. Narrative and budget don’t correspond
9. Sloppy presentation
10.The work has already been done

236
EMI
If your proposal is rejected. . .
 Don’t give up!
 Get reviews
 Talk to agency contact
 Re-evaluate, revise and
resubmit
 Look for other potential
funders

237
EMI Last notes
 Look at previous grantees
Annual reports
Listing on website
If requesting a brochure (rare with most
foundations having websites, but
possible), request a list of previous
grantees.
Look at others’ titles, how much money
they were awarded, Abstracts if available.
Look at other institutions—where are they
receiving money from. Foundations do
have geographic restrictions.

1
EMI

Example

1
EMI Group Activities:

Form a small group:

 Prepare a project proposal and a
complete project design matrix
using a Logical Framework
Approach for the project that
you have already identified.
 Present the proposal to the
plenary.
1
EMI

Day 4
Session 6
Project
Formulation/Preparation

1
EMI The project cycle

Monitoring and
Identification
Evaluation

Implementation Formulation

Appraisal and
Financing decision
242
EMI
Learning Objective:
At the end of this session participants will be
able to:
• Distinguish technical, institutional and
commercial feasibility analysis.
• Identify principles and techniques of
technical, institutional, financial and
economic feasibility analysis.

1
EMI
Introduction
 This session is concerned with the
methodologies used in the selection and
appraisal of investment decisions in private
and public sector
 Private investment projects aims to maximize
stockholder’s wealth /profit
 Public sector projects + projects (funded by
donors): should have wider society or
economic wide objective

1
 Feasibility Study: The schematic diagram shown below gives

you good looking of your feasibility study .

EMI Generation of ideas

Initial Screening

Is the idea promising?

Yes No
Plan Feasibility Analysis
Terminate

Conduct Market Conduct Technical

Analysis Analysis

Conduct Financial Analysis

Conduct Economic
Analysis
Conduct Ecological
Analysis

Is the project worthwhile?

Yes No

Prepare funding proposal

Terminate
Fig: Hierarchy of feasibility Study

1
EMI

 Why feasibility study?

1
EMI Reasons to do feasibility study
 A feasibility study:
 Give focus to the project and outline alternatives
 Narrow project alternatives
 Surface new opportunities through investigation
 Identify reasons not to proceed
 Enhance the probability of success by addressing
and mitigating factors early on that could affect
the project
 Provide quality information for making decision
 Help to increase investment in the company
 Provide documentation that the project was
thoroughly investigated
 Help in securing funding from lending institutions
and other monetary sources.

1
EMI 1. Pre-feasibility / preliminary
screening
 Some kind of preliminary study is
required to select ideas which are
promising.
 In doing so looking the following
aspects is helpful.

1
EMI Pre-feasibility study ……

1. Compatibility with promoter

2. Consistency with government
priorities
3. Availability of inputs
4. Adequacy of the market
5. Reasonableness of cost
6. Acceptability of risk level

1
EMI Preliminary screening .......

 Compatibility with the Promoter

It Fits the Personality of the Entrepreneur
It is Accessible to Him
It offers him the Prospect of Rapid Growth
and High Return on the Invested Capital

1
EMI Preliminary screening ........

 consistency with the government

priorities
is the project consistent with the national
goals and priorities?
are there any environmental effects
contrary to governmental regulations?
can foreign exchange requirements of the
project be easily accommodated?
will there be any difficulty in obtaining
the license of the project?

1
EMI Preliminary screening ...............

 availability of inputs
 are the capital requirements of the project within
manageable limits?
 can technical know-how required for the project
be obtained?
 are the raw material required for the project
available domestically at a reasonable cost? if
the raw materials have to be imported, will there
be problems?
 is the power supply for the project reasonably
obtainable from external sources and captive
power resources

1
EMI Preliminary screening ..........

 Adequacy of Market
Total present domestic market
Competitors and their market share
Export markets
Sales and distribution system
Projected increase in consumption
Barriers to the entry of new units
Economic, social and demographic
trends
Patent protection
1
EMI
Preliminary screening ..........

 Reasonableness of Cost
Cost of material inputs
Labour costs
Factory overheads
General administrative expenses
Selling and distribution cost
Service cost
Economies of scale

1
EMI
Preliminary screening

 Acceptability of Risk Level

Vulnerability of business cycles
Technological changes
Competition from substitutes
Competition from imports
Governmental control over price and
distribution

1
EMI

 What are the differences

between pre-feasibility and
feasibility study?

 What the various

aspects/components of project
feasibility study?

1
EMI 2. Feasibility study
 Follows viable identification and pre-
feasibility studies
 provide all data necessary for an investment
decision.
 is an analysis of the viability of an idea.
 focuses on helping answer the essential
question of “should we proceed with the
proposed project idea?”

1
EMI Feasibility studies….

 It is multidisciplinary activity involving

engineers, economists, and specialists
in areas such as agronomy, soils,
geology, hydrology, manufacturing
processing etc
 feasibility studies are not always free
from vested interests

1
EMI
Group Discussion

 What are the factors that affect the

feasibility of a project? (what aspect of
a project should be
checked/assessed….)

1
EMI
Types of Feasibility studies
 There are seven important aspects of
project feasibility study. These are:-
1. Market and demand analysis
2. Technical feasibility
3. Institutional feasibility
4. Social feasibility
5. Financial (commercial profitability)
analysis
6. Economic (national profitability)
analysis
7. Environment Impact Analysis

1
EMI 1. Market/demand Analysis
 In most cases, the first step in
project analysis is to estimate the
potential size of the market
 It addresses two broad issues:
1. What is the likely aggregate demand
for the product/service?
2. What share of the market will the
project enjoy?

1
 Demand analysis….
EMI

The key steps in demand and market

analysis are:

a) Situational analysis
b) Collection of secondary data
c) Characterization of the market
(description)
d) Demand forecasting (time series
/causal techniques)

1
EMI Steps in DD and Market Analysis

Collection of
Collection of
Demand
Demand
secondary
secondary
Information
Forecasting
Forecasting
Information

Situational
Situational
Analysis and
Analysis and Characterization
Characterization
Specification of
Specification of of the
of the market
market
Objectives
Objectives

Conduct of
Conduct of
Marketing
Marketing
Market
Market
Survey
Planning
Planning
Survey

1
EMI Major Dimensions of the Demand & Market
Analysis
 It should cover the following aspects:
1. General characteristics of the economy:
 Economic potential
 Production structure
 Foreign trade
 Economic policy
  

2. Product
 Characteristic features
 Substitutes and complementary goods  

3. Demand
 Sales and orders
 Buyer's characteristics
 Demand determining factors
 Purchasing power
  

1
EMI DD analysis….

4. Supply
 Supply potential
 Local production
 Imports and exports
 Competitor's position
  

5. Marketing environment (marketing strategy,

marketing mix)
 Price levels and tendencies
 Distribution channels
 Physical distribution network
 Promotion
  

6. Legal and political environment

1
EMI
Projections of Sales Revenue (Sales
Forecasts)
 Sales are the quantity of a product that is actually
purchased at specific price and under specific marketing
strategy in a particular market at a given point in time. 
 The projection of sales revenues is essentially an
extension of marketing research (initial demand analysis)
on the basis of which a project is developed also in terms
of specific sales volumes during different periods after
the project goes into production. 
 Estimating sales revenue is an iterative process that
should also take into account the optional plant capacity,
appropriate technology, a technically feasible production
program and alternative marketing strategies.
 The final determination of sales revenues may, therefore,
only be possible once technology and plant capacity are
more clearly known.

1
EMI
Sales forecast….

1
EMI
Production program
 After projecting of sales during
different stages of production, a
feasibility study should define the
detailed production program.
 A production program should define
the levels of output to be achieved
during specified periods

1
EMI 2. Technical analysis
 The following are some of the general
technical aspects that a project manger
must be aware of:
1. Technology package
 Has the package been well
researched and field tested?
 What are the costs and benefits of
alternative package?
 Is the machinery or equipment
appropriate to the current situation

1
 Cont’d ….
EMI

2. Location
 What is the optimum area to be covered by
the project in terms of resources
management?
 What are the minimum catchment area?
 What is the scale of operations?
 Are there significant economies of scale?
 At what point do diseconomies set in?

Question:
What are the factors affecting commercial
project location decision?

1
 Cont’d …
EMI

3. Land use
 Does the physical layout of the
facilities pay adequate attention to
land use planning considerations?

1
EMI Cont’d….
6. Plant Capacity
 Plant capacity refers to a volume or
number of units that can be
manufactured during a given period.
Several factors have a bearing on the
capacity decision.
 Technological requirement
 Input constraints
 Investment costs
 Market conditions
 Resource of the firm
 Governmental policy

1
EMI
3. Environmental Impact Analysis
 Is very important
 “Environmental Impact Assessment – EIA is a
systematic process that examines the environmental
consequences of development actions, in advance.”
Example:
 If a dam is to be constructed what are the
environmental effects on upstream and
downstream of the dam? How bad effects be
mitigated?
 If insecticides, pesticides, etc are to be used in
large quantities in irrigation projects, what will
be the effects on fishing, farming?
 What is the effect of use of pills on health of
women?

1
EMI
EIA….
 EIA serves many purposes:
1.For The decision--‐maker It Informs The
Setting Of Environmental Terms And
Conditions For approving proposals.
2.For The Developer It Provides information
That Can Improve The Design Of The
Proposal And Ensure That Resources Are
used appropriately and efficiently.
3.For the residents it ensures that possible
negative impacts Are Considered And
that appropriate Measures for mitigating
them are identified.

1
EMI
Example
 A leather factory constructed around
Sululta is one of the projects that have
environmental problems.

1
EMI
4. Institutional feasibility Analysis
 Some of the relevant factor that needs to
be considered when institutional feasibility
study is conducted are:
 Sound internal organizational structure of the
project?
 Competent management and supervisory
personnel
 Adequate technical and skilled manpower
 Provision of any necessary training
 Effective channel of communication
 Good relationship with contributing
agencies/donors

1
EMI
5. Financial Analysis
 Relevance
It is relevant only for commercial projects
but not for social service projects that
provide public goods that are provided
“free”
It is concerned with assessing the
feasibility of a new proposal for
investment on the basis of financial
requirements and their availability.
The project’s direct benefits and costs are
estimated at the prevailing market prices
to appraise the viability of the project as
well as to rank projects on the basis of
profitability
1
 Financial analysis (Cont’d …)
EMI

 To assess financial viability of a

project, a range of tools and methods
can be used and various types of
financial statements can be prepared.
These includes:
Resource flow statements
Profit and loss statement
Cash flow statements
Balance sheet

1
EMI
Resource flow statement
 Investment cost
 Operating cost
 Working capital

1
EMI
Resource flow…

1. Initial Investment Cost estimate: This

include
Land and Site Development
Buildings and Civil Works
Plant and Machinery
Technical know-how and engineering fees
Miscellaneous Fixed Assets
Pre-operative Expenses
Provision for Contingencies

1
EMI 2. Financial Evaluation Techniques
 Once the stream of costs and benefits for a
project is defined in the form of cash flows, the
project’s financial viability can be decided.
 Different techniques can be employed to
examine the financial viability of the project.
However, the most common methods for
evaluating financial viability of a project are:
 Return on Investment
 Payback Period
 Net Present Value
 Internal Rate of Return

281
EMI i. Return on Investment
 Ratio of net profit in normal years to
the initial investment or equity.
 Selection criteria:
ROI > the prevailing interest rate
When comparing 2 or more than 2
projects, select the one with the higher
ROI

1
EMI ii. Payback Period
 The Payback period is the time taken
to gain a financial return equal to the
initial investment.

 Payback period = Initial Investment

Accumulated annual cash flows

283
EMI Example
 A project whose initial investment outlay is
Birr 50,000 is expected to have a uniform
annual cash flow of Birr 10, 000 for 8 years.
How many years will be required to get back
the initial investment?

 Solution:
Payback period = 50,000
10,000
= 5 years
 Thus, the payback period is 5 years.

284
EMI Payback period ….

1
EMI Cash-Flow (Birr)
Year Machine A Machine B

0 (35,000) (35,000)
1 20,000 10,000
2 15,000 10,000
3 10,000 15,000
4 10,000 20,000
Payback period 2 years 3 years
1
EMI

Discounting Methods

1
EMI
Discounting methods
Concept of discounting / compounding
 Money has time value
 One birr received today is more than one
birr received in 2 years. Why?
1. Psychological explanation
2. If invested, can generate positive return
3. During inflation the future purchasing power
decreases

1
EMI
iii. Net Present Value (NPV)
 NPV is a measure of the value or worth added to
the company by carrying out the project.
 Is the present worth of cash flow streams
generated by an investment.
 Takes into account the fact that money values
change with time
 Value of money is affected by interest rates.
 NPV helps to take these factors into
consideration.
 Shows you what your investment would have
earned in an alternative investment regime.

1
 NPV of Machine A
EMI

Column 1 Column 2 Column 3 = (2) x (3)

Years Cash Flow Discounting Present
Factor @20% Value
0 (35,000) 1 (35,000)
1 20,000 0.8333 16,666
2 15,000 0.6944 10,416
3 10,000 0.5787 5,787
4 10,000 0.4823 4,823

1
Total NPV 2,692
 NPV of machine B
EMI

Column 1 Column 2 Column 3 = (2) x (3)

Years Project Cash Discounting PV

Flow Factor @ 20%
0 (35,000) 1 (35,000)
1 10,000 0.8333 8,333
2 10,000 0.6944 6,944
3 15,000 0.5787 8,681
4 20,000 0.4823 9,646
1
Total NPV (1,396)
EMI
NPV…

 Selection criterion for NPV:

We accept all independent projects with

NPV greater than zero.
For mutually exclusive projects, project
with higher NPV will be accepted.

1
EMI
iv. Internal rate of Return
 The IRR is the return to the capital invested or
allocated or investment in the project.
 It is the discount rate that makes the present value
of cash inflows is equal to the present value of
cash outflows, i.e., NPV is zero. Helps measure
the worth of an investment
 Allows the firm to assess whether an investment in
the machine, etc. would yield a better return based
on internal standards of return
 Allows comparison of projects with different initial
outlays
 Set the cash flows to different discount rates

1
EMI IRR

 To get the IRR we will be looking for ‘r’ in

the above formula which makes NPV
equals zero.
 However, the exact calculation of the IRR
requires some computation or trail and
error process or you can use software.
 IRR is the maximum interest rate a
project could pay for the resources used
if the project is to recover its investment
and operating costs and still break even.

1
EMI
Steps in approximating the IRR
1. Choose two different discount rates, one
leading to a positive NPV, the other to a
negative NPV.
2. Interpolation between these two NPV’s
using the formula.

1
EMI
IRR = ri + (rh - ri) x NPV (ri)
/NPV (ri)/ + /NPV (rh)/

Where

ri = is a lower interest rate

rh = is a higher interest rate
NPV (ri) = is NPV calculated at lower interest rate
NPV (rh) = is NPV calculated at higher interest rate
/ / = is a symbol representing absolute value

1
EMI Example
 The first step consists of a trial and error process
to reach the IRR. That is in deciding the IRR; firstly,
we try with a discount rate and calculate the NPV.
Secondly, if the NPV is negative, we have to try
with a lower discount rate because a lower
discount rate will increase the NPV. If the NPV is
positive, on the other hand, we have to try with a
higher discount rate so that the NPV will be
reduced. Thus, we try with different discount rates
to reach the IRR.
 Once we have two discounting rate which one
gives a positive NPV and the other gives a
negative NPV we can use the above formula to
approximate the IRR value.

1
EMI IRR….

 Selection criterion for IRR

We accept all independent projects having
an IRR equal or grater than the opportunity
cost of capital.
For mutual exclusive projects, a project
with higher IRR is accepted.

1
 Table : Machine A : Discount Factor 22 %
EMI Column 1 Column 2 Column 3 = (2) x (3)
Years Cash Flow Discount Factor Present
22% Value
0 (35,000) 1 (35,000)
1 20,000 0.8197 16,394
2 15,000 0.6719 10,079
3 10,000 0.5507 5,507
4 10,000 0.4514 4,514
Total 1,494
NPV

1
EMI Column 1 Column 2 Column 3 = (2) x (3)

Years Cash Flow Discount Present

Factor 24% Value
0 (35,000) 1 (35,000)
1 20,000 0.8065 16,130
2 15,000 0.6504 9,756
3 10,000 0.5245 5,245

4 10,000 0.423 4,230

NPV @ 24% 361
1
EMI Column 1 Column 2 Column 3 = (2) x (3)
Years Cash Flow Discount Present
Factor 25% Value

0 (35,000) 1 (35,000)
1 20,000 0.80 16,000
2 15,000 0.64 9,600
3 10,000 0.512 5,120
4 10,000 0.4096 4,096
Total NPV (184)
1
EMI
The exact IRR can be computed using the
following formula.

IRR =ri + (rh - ri) x NPV (ri)

/NPV (ri)/ + /NPV (rh)/

= 0.24 + (0.25 – 0.24) x 361

/361/ + /-184/

= 0.24 + 3.61 = 0.2466 = 24.7%

545

Thus, the IRR is 24.7 %.

1
EMI 6. Socio-Economic feasibility
Analysis
 Needed when the financial feasibility
fails to provide clear idea about the
project due to market price
imperfection
 Needed to make sure that the
investment on the project contributes
to the national economy

1
 Financial Vs Economic analysis
EMI
Financial
 Appraise the project from the
view point of an
entrepreneurs, investor or
financier.
 Covers only private costs and
benefits
 Taxes are treated as costs
and subsidies as a return.
 Interest paid to external
suppliers of money may be
deducted to obtain the stream
of benefit available to the
owner of the project.
 The overriding objective is
financial viability (i.e. making
profit) based on market price.
Economic
 Appraise the project from the
view of macro or national
economy or its contribution to
the society.
 It takes into account social costs
and benefits.
 Taxes and subsidies are treated
as transfer payments.
 Interest on capital is never
separated and deducted from
gross return because it is part of
the total return to the capital
available to the society as a
whole.
 The objective is economic
viability [social benefits] based
on shadow price. 30
4
EMI

Session 7
Project Appraisal & Funding
decision

1
EMI What is project Appraisal?
 The process of assessing and questioning
proposals before resources are committed.
 offers significant benefits to partners and to
local communities because:

It justifies spending money on a project

Is a tool for decision making
Lays a foundation for delivery

1
EMI Appraisal is an important decision making
tool:

 This helps ensure that projects selected for

funding:
 will help a partnership achieve its objectives for
its area
 are deliverable
 involve local people and take proper account of
the needs of people from ethnic minorities and
other minority groups
 are sustainable
 have sensible ways of managing risk

1
EMI What can Project Appraisal Deliver?

Project appraisal helps a project to:

be consistent and objective in choosing

projects
make sure its program benefits all
sections of the community,
Provide documentation to meet financial
and audit requirements and to explain
decisions to local people.

1
EMI
Who?
 Internal staff
 External experts/consultants

1
EMI

 The following aspects should be covered in

the appraisal process:

1. Technical - is the project design appropriate

and will the project work as expected?
2. Financial - has proper provision been made
to cover the financial requirements and
obligations of the project?

310
EMI
Appraisal (cont’d…)
3. Economic - is the project advantages form the
point of view of the economy as a whole?
4. Social - is the project both advantageous and
acceptable to the people affected by it?
5. Institutional - are there suitable organizations in
place to implement and manage the project. Is
the legal frame work appropriate?
6. Environmental - have the environmental impacts
of the project been properly considered.
7. Sustainable - will the project be sustainable in the
long term both financially- and institutionally.

311
EMI

Session 8
Project Organization and
Implementation

312
EMI
Reflection Questions
1. How do you describe program/project organization and
implementation?
2. What major challenges you have observed during the
implementation stage of the projects you have mentioned?
3. What were the major reasons for the problems you have
mentioned?
4. What measures were taken to solve the problems?

313
EMI
Introduction
 Implementation is a project stage which covers the actual
development or construction of the project up to the point
at which it becomes fully operational.
 It includes monitoring of all aspects of the work or
activity as it proceeds.
 It is a stage where the earlier preparations, designs, plans
and analyses are tested in the harsh light of reality.
 The project’s objectives are realized only when it is
successfully implemented.
 Actual project implementation begins when we started
committing our scarce resources to a particular
investment.

314
EMI
Introduction… cont’d
 Project analysts generally divide the implementation
phase into three different periods.
1. The Investment Period: When the major investments are
undertaken.
2. The Development Period: When the project’s
production/benefits build up.
3. The life/full operation of the project: When full
development is reached.

315
EMI
Project Organization
 A mismatch between project design and objectives
on the one hand and the implementation capacity
of an agency or institution assigned on the other
has often been the most important reason for poor
performance of projects.
 Routine and repetitive jobs are often carried out within the
regular line organization; hence they do not need to be
organized as projects. However, development objectives
cannot always be achieved within regular organizational
structures.

316
EMI

31
7
EMI Functional structure
• Is a structure where authority rests with the
functional heads; the structure is sectioned by
departmental groups based on division of work.
 Staff members are divided to groups (e.g. financial,
planning, public relations, engineering, legal etc)
according to their specialized knowledge.
• Some of these groups can be further subdivided into
smaller functional groups.

31
8
EMI

31
9
EMI

 The main advantage of this organizational structure

is that each functional group has complete control
over its segment of the project, enforcing in this
way the application of standards across projects.

320
EMI
 The disadvantages of the functional organization are
that of speed, flexibility and communication when
attempting cross functional projects. Since in a
functional organization the work is divided between
the departments, any query or request must be
passed among department heads for approval,
causing in this way delays.
 In addition, the responsibility of managing the
project is shared among the functional managers
(head of the departments) and this may cause lack
of ultimate responsibility for project management.

321
EMI Projectized Organization
 Projectized organization is an organizational
structure that focuses on projects.
 Projectized organizations derive their name from
the fact that they are built to do project work.
 The project organization structure supports the
completion of project activities and provides an
adequate level of oversight, review and
contribution from necessary parties.

32
2
EMI
 Project managers are given both the authority, and
the responsibility, to manage virtually all aspects of
the project. They have the same authority as
functional managers, and project team members are
the project managers’ subordinates.

323
EMI

32
4
EMI
 The main advantages of the projectized organization
are speed and flexibility. Since the experts are
concentrated within the team and fully committed to
the project, it is easier to react to changing
requirements and complete the project on time.
Responsibility for the success of the project is
clearly identified and lies on the Project Manager.

325
EMI
 The main disadvantage of the projectized structure is
the high resource costs, since the organization often
has to hire extra staff with certain expertise in order
to implement different projects simultaneously.
 In addition this type of structure burdens the
administrative overhead since there may be periods
where not all project teams are occupied.

326
EMI
Matrix Organizations
 Matrix organization is a blend of functional and
project organizations.
 It is an attempt to combine functional and project
structures in order to take advantage of the strengths
of both structures.
 In matrix organization, project team members report
to both a functional manager and a project manager.

32
7
EMI

 The most common form is that team members have

connected to project managers by dotted lines and
connected to their functional managers by solid
lines.
 Since team members report to multiple managers, a
clear communications plan is essential.

328
EMI

32
9
EMI
 The main advantage of the matrix organization is
that it retains the benefits of both functional and
projectized structures.
 It also facilitates the effective resource allocation to
different projects.
 For these reasons, the matrix structure is considered
as the most effective structure for implementing and
managing projects and therefore is widely used.

330
EMI

 The main disadvantage of the matrix structure is the

potential for conflict between the Project Manager
and the functional manager regarding the resource
assignment, since the functional manager has to
staff multiple projects with the same experts.

331
EMI

Project Implementation planning

Tools

332
EMI
 Activity Schedule
• Milestones
• Gantt chart
• Work breakdown Structure
• Network Techniques
– The Critical Path Method (CPM) or Critical Path
Scheduling(CPS)
– Program Evaluation and Review
Techniques/PERT/
– Project Time- Cost Analysis
 Resource plan
 Cost Plan

333
EMI

 Quality Plan
 Issue Management Plan
 Change Management Plan
 Risk Plan
 Setting up Performance Indicators
 Communication Plan

334
 Roadmap to Project Success
EMI Statement Work Responsibility Network Gantt Resource Budget
of Work Breakdown Matrix Plan
Form Purpose Structure
Project Project Background R

A
A

Team Project Deliverables

S
S
R
TIME

P LA N
E B OOK
OT ME

N
Perform

ET
CT
Tasks

ING
PROJE

S
Conduct
Close-Out
LEADERSHIP
Meeting
COMMUNICATION

S
Track
LES
CL

RT
T
Progress

EN
SO

PO
OS

S RE
N

-O LE

M
A RN E
E

U T
ED
PL
Share IM Update Resolve Manage
Evaluate
Lessons Success Plan Issues Change
Learned

335
EMI Activity Scheduling
 A schedule is a list of things usually to do with
times when should be done.
 Activities Schedule is the backbone of every
project and is essential for a successful outcome.
 It gives all personnel involved in the project
common understanding of what is required, how
this will be achieved, when it will be achieved and
who will be responsible for the successful outcome
of each activity.

33
6
EMI
Activity Scheduling Involves:

 Application of Work Breakdown Structure in

order to subdivide the major project deliverables
into smaller, more manageable component based
on the project scope.
 Identification of the activities needed in order to
produce the project deliverables and if necessary
breaking down the activities into more
manageable tasks which can then be assigned to
individuals

337
EMI  Determination of activities’ sequence (i.e. in what
order should related activities be undertaken?) and
dependencies (i.e. is the activity dependent on the
start up or completion of any other activity?)-
Network
 Estimation of activities/ tasks duration
 Scheduling of activities by defining the start up and
completion dates of each activity/task.

338
EMI A. Milestones
 In this technique we simply use a tabular format to
show the project activities in the first column, the
starting and finishing times in the subsequent
columns.
 Example:
Work Item Start Finish
A. Clear Site March 28 April 2
B. Level Site April 2 April 10
C. Excavate Foundation April 10 April 16

339
EMI B. Work Breakdown Structure (WBS)
 It represents a systematic and logical breakdown of
the project into its component parts.
 It is constructed by dividing the project in to its
major parts, with each of these being further
divided in to sub parts.
 This is continued till a breakdown is done in terms
of manageable units of work for which
responsibility can be defined.
 

34
0
EMI
Thus, the work breakdown structure helps in:
• Effective planning by dividing the work in
to manageable elements which can be
planned, budgeted and controlled.
• Assignment of responsibility for work
elements to project personnel and outside
agencies.
• Development of control and information
system.

34
1
EMI
Ways of doing WBS
 Hardware orientation (identification of basic work
packages)
 Agency orientation (based on assignment of
responsibility to different agencies)
 Functional oriented (e.g. deign, procurement,
construction and commissioning)

342
EMI Illustrative WBS for Construction Projects

Foundation Exterior Interior Finish

Heating/air Electrical Paint Fixtures

Frame conditioning
Layout Form & install Roof
window
s
Pour & Finish
insulate Dry wall
Floor Clean up
Install siding Painting covering
Doors & trim

34
3
EMI
C. Gantt Chart
A Gantt chart is a graphical representation of the


duration of tasks against the progression of time.

A Gantt chart is a useful tool for planning,


scheduling and monitoring projects.

The advantages of the bar chart are:
• It is simple to understand
• It can be used to show progress
• It can be used for human resource planning

344
EMI Bar or Gantt Chart

34
5
EMI The disadvantages of the bar chart are:
 It cannot show interrelationship among
activities on large , complex projects;
 There may be a physical limit to the size of
the bar chart, which may limit the size of the
project; and
 It cannot easily cope with frequent changes
or updating.

34
6
EMI D. Network Techniques
 In this technique, the
• activities,
• events, and
• their relationships
are presented by a network diagram, also
called an arrow diagram.  

34
7
EMI
Why Project Network?
 It is a convenient way to show activities and
precedence in relation to the whole project.
 It is a basis of project planning:
 responsibility allocation
 definition of subcontracting units
 role of different players
 It is the base for scheduling and establishment of
work time tables

348
EMI • Facilitate critical path determination for
management control
– deterministic Vs probabilistic activity times
• Facilitates resource planning for projects
– Project crashing with time cost trade offs
– Resource aggregation
– Resource leveling
– Limited resource allocation
• It can handle very large and complex projects and
it can be easily computerized and updated

349
EMI  Uses for project implementation
Time table for implementation
Monitoring and reporting progress
 updating schedules and resources
Coordination of work with different agencies
 The project network is thus a common vehicle for
planning, communicating and implementing the
right from inception.

350
EMI Drawbacks of network technique

 Being more complicated than the traditional bar

chart it is not easily understood by the project
personnel, and
 It does not define an operational schedule which
tells who does what and when.

35
1
EMI Basic Network terminologies

 An activity is a task or a job that takes time and

resources
 It is represented in a network by an arrow.
 The arrow doesn’t have any relationship with a
scale.
 Example: Excavate the land, Dig foundations, Lay
foundations, Build a wall, etc.

35
2
EMI In a network analysis, it is important to establish:
 The activities involved in the project,
 Their logical relationship, e.g. Building a
wall comes after laying the foundation.
 An estimate of the time that an activity is
going to take

35
3
EMI
 An event is a point in time and indicates the start
or finish of an activity or activities, e.g. wall built,
foundations dug, etc.
 An event is represented in a network by a circle.

 The establishment of activities automatically

determines events because they are the start and
finish of activities.

35
4
EMI  Dummy activity: an activity that does not consume
time or resources.
 It shows merely the dependencies or proper
relationship between activities.
 A dotted arrow represents dummy.  

35
5
EMI
Network: this is the combination of activities,
dummy activities and events in logical sequence
according to the rules of drawing networks. Example:

35
6
EMI Rules for drawing networks:
 A complete network should have one point of
entry – a start event, and one point of exit – a
finish event.
 Each activity must have one preceding (tail)
event and one succeeding or head event.
 Many activities may have the same tail event
and many may have the same head event.
 No activity can start until its tail event is
reached.

35
7
EMI
 An event is not complete until all activities leading
in to it are complete.
 A series of activities which lead back to the same
event are not allowed.
 All activities must be tied in to the network; all
must contribute to the progress of the project,
danglers are not allowed.

35
8
EMI Activity Identification
 Short description: example, Lay foundation, erect
frame, etc.
 Alphabetic or numeric code: example, A, B, C,
etc., or 100, 101, 108 etc.
 Using tail and head event numbers: example, 1-
2, 2-3, 3-4, 3-6, etc

35
9
EMI Example 1: Organizing a one day seminar
Generate the list of jobs to be done:
a. Decide date, budget , venue for seminar
b. Identify speakers, participants
c. Contact and finalize speakers
d. Print seminar brochure
e. Mail brochures to tentative participants
f. Estimate number of participants
g. Decide menu for lunch, tea and coffee
h. Arrange for catering
i. Arrange projection facilities at venue
j. Receive guests at registration
k. Conduct seminar as per brochure
l. See off guests
360
EMI Code Activity Predecessors
A Decide date, budget , venue for seminar -
B Identify speakers, participants -
C Contact and finalize speakers B
D Print seminar brochure A, C
E Mail brochures to tentative participants D
F Estimate number of participants E
G Decide menu for lunch, tea and coffee F
H Arrange for catering G
I Arrange projection facilities at venue F
J Receive guests at registration E
K Conduct seminar as per brochure H, I, J
L See off guests K
36
1
EMI
Network of A one day
seminar on PM
10
L

9
K
J 8
A D E
1 5
3 4
I H
B F 6
2 C 7
G

36
2
EMI Example 2: Complex Construction
Project
A = Lay foundation
B = Erect framework
C = install millwork
D = install wiring
E = install plumbing
F = plaster walls
G = install siding
H = decorate the interior
I = finish the exterior
363
EMI
The interrelationship among these activities is as
follows:
• A should precede B
• B should precede C, D, E, F, and G
• C, D, E and F should precede H
• G should precede I

36
4
EMI
Network diagram of the project:
4
C

H
1 2 3
D
7 9
A B
E

F 5

I
G 6

8
36
5
EMI Activity Duration

 Deterministic [as in CPM]

When previous experience yields fairly accurate
estimates of activity duration, [e.g., construction
activity, market surveys]
 Probabilistic [as in PERT]
 when there is uncertainty in times, as for
instance in R & D activities, new activities
being carried out for the first time.

366
EMI  Deterministic time estimate:
 A single time estimate is used for each activity.
This is taken from experts who have prior
knowledge and experience of the activity.
 Probabilistic time estimate:
Multiple time estimates -Three time estimates
[Optimistic, Most Likely and Pessimistic] are
commonly used for each activity based on the
consensus of the group.

O  4 ML  P
ExpectedTime
6

367
EMI Critical path
 Is the longest path in the network
 Lower bound on the project duration [the shortest
time in which the whole project can be completed]
 Selective control for management of the project
 Can be determined by:
Enumeration of all paths in the network
Event based computations [forward pass and
backward pass]

368
EMI
 There may be two critical paths and the critical
path can pass through a dummy.
 The Critical path is determined by selecting the
chain of activities where their ESTs are equal to
their LSTs.
 The other activities with differences in their ESTs
and LSTs are non-critical activities.

36
9
EMI

 Earliest start time (EST): the earliest possible time

at which a succeeding activity start. Calculating the
EST is called the forward pass.

 Latest start times (LST): is the latest possible time

at which a preceding activity can finish without
increasing the project duration. Notes on
calculating LST (termed the backward pass)

37
0
EMI
Example 1 2

B D

2 4

0 1 3 4 5
A C E F

1 3 1 2

• The Critical paths of this project are A, B, D and F.

• The total duration of this project is 9 days.
• The non-critical paths are C and E.

37
1
EMI
Example
Activity Preceding Activity Activity durations (Weeks)
A - 9
B _ 3
C A 8
D A 2
E A 3
F C 2
G C 6
H C 1
J B, D 4
K F, J 1
L E, H, G, K 2
M E, H 3
N L, M 4

Required: Find the critical path and the duration for this project.

37
2
EMI Answer 3
M (3)

7
E (3) 8

N (4)
A (9) H (1)
1
L (2)
C (8)
G (6)
4 6
D (2)

B (3) F (2)

2
K (1)
J (4)
5

Critical path : A, C, G, L and N

Project duration : 29 Weeks
 

37
3
 Exercise 1
EMI
Activity Predecessors Duration (days)

A - 2
B - 3
C A 1
D A, B 4
E D 5
F D 8
G C, E 6
H C, E 4
I F, G, H 3

Draw the network and find the critical path?

37
4
EMI  Float: Float or spare time is associated with non-
critical activities. There are three types of floats:
total floats, free float and independent float.
float
 Total float is the amount of time a path of activities
could be delayed with out affecting the overall
project durations.
 Total Float = Latest finish time – Earliest Start
time – Activity duration
 For example total float for activity C and E is 7-1-4
= 2 days.

37
5
EMI  Free float is the amount of time an activity can be
delayed without affecting the commencement of a
subsequent activity at its earliest start time, but may
affect float of a previous activity.
 Free float = Earliest Finish Time- Earliest Start Time
– Activity Duration
 For example free float for activity E is 7-4-1 = 2 days

37
6
EMI  Independent Float is the amount of time an activity
can be delayed when all preceding activities are
completed as late as possible and all succeeding
activities completed as early as possible.
Independent float therefore does not affect the float
of either preceding or subsequent activities.
 Independent Float= Earliest Finish Time-latest
Start Time-activity Duration
 Example, Independent float for activity E is 7-6-1 =
0 days.

37
7
EMI Activity Duration EST LST EFT LFT TF FF IF

A 1 0 0 1 1 - - -

B 2 1 1 3 3 - - -

C 3 1 1 4 6 2 - -

D 4 3 3 7 7 - - -

E 1 4 6 7 7 2 2 -

F 2 7 7 9 9 - - -

37
8
EMI
Uncertain activity duration [PERT]
 For each activity in the project three time estimates
are obtained:
 Optimistic times, a
 Most likely time, m
 Pessimistic time, b

379
EMI PERT time estimates

• Mean of activity duration:

= (a + 4m + b)/6
• Variance of activity duration:
=( (b-a) /6 )2
• Standard deviation of activity duration:
= sq. roots of variance = (b-a )/6

380
EMI Basic PERT Procedure

 Compute mean and variance of all jobs

 Conduct forward and backward pass on the project
network with expected times of all activities
 Identify the critical path
 Obtain variance of critical path by adding variance
of activities.
 Obtain the distribution of the project duration

381
EMI
 Make probability statements about the project
 Chances of meeting the target date
 Probability of exceeding A given ceiling date
 Probability that the project duration is confined to
an interval of time.
 Z (standard normal deviate) = [x-q]/SD

382
EMI Multiple time estimate

1
3

C
A D F

0.5, 1, 1.5
2, 3.5, 4 5.6, 7, 15 3, 4.5, 5.4

2
0 4
E
B

5,6,8
4,5,6

38
3
EMI Activity Expected duration
 a  4m  b 
 ED 
 6 

A 3.33
B 5.00
C 1.00
D 8.10
E 6.17
F 4.40

The critical path B, D and F

Project duration = 5+8.1+4.4 = 17.5

38
4
EMI
 To calculate the probability that the project can be
completed within 19 days:
 Calculate the SD of each activity on the critical path
using the formula:
b a
6
64
– Activity B = 6  0.33
15  5.6
1.57
– Activity D = 6

5.4  3
– Activity F = 6 0.4

38
5
EMI
 Find the combined standard deviation of all
activities on the critical path.

0.33  1.57  0.4 1.65weeks

2 2 2

 Find the number of standard deviations that the

scheduled date is away from the expected
duration.

19  17.5
 0.91
1.65

38
6
EMI

 Look up this value in a table of areas under the

normal curve to find the probability.

 In this case the probability of achieving the

scheduled date of week 19 is 82%.

38
7
 Exercise 2
EMI
Activity Predecessor Time estimates
s a m b

A - 2 4 8
B - 4 6 10
C A 6 6 6
D A 2 8 14
E A 6 8 12
F B,C 9 3 15
G D,F 8 16 20
H D,F 4 4 4
Draw
I the network? Find the CP?
E, H 4 8 10
What is the probability of completing the project by 36 days?
What is the probability of finishing the project by 28 days?
38
8
EMI Cost scheduling

 The overall objective is to calculate the cost of

various project durations and to find the cheapest
way of reducing the overall duration

38
9
EMI
Multiple Objectives
 Project cost and time are undoubtedly the two
major objectives that project managers strive
to minimize and control.
 Project performance (in terms of both
quantum and quality of work done)needs to be
monitored and controlled.
 There could be a number of attributes that
reflect project performance, time and cost.

390
EMI
Conflicting objectives:
 Meeting a certain contracted date
 Minimizing the total project cost
Direct activity cost
Indirect activity cost
Penalties for project delays
 Ensuring that certain activities are not crashed for
quality reasons
 Confining the expenses to a fixed budget

391
EMI
 With expenditure of additional resources it is
generally possible to accomplish the activity in a
shorter duration
 The minimum possible duration of the activity is
its crash duration, when its cost is the highest.
 For technological reasons it is not possible to
shorten duration below the crash limit even by
spending more money or resources.

392
EMI • project schedules influence both the direct costs of
activities and indirect costs associated with the
project.
• Activity direct costs:
– Costs associated with the performance of the
specific activity, such as:
• cost of planning and design
• raw materials procurement
• Labor costs
• Manufacturing or processing costs
• Travel, communication and transportation
• Consultation fees, etc

393
EMI
Project indirect costs

 Overhead costs such as:

 managerial services
Indirect supplies
Equipment rentals
Allocation of fixed expenses
Site office maintenance
 Indirect costs increase with the duration of the
project

394
EMI  Project cost comprises direct costs and
indirect project costs.
 As we shorten project duration, direct costs
increase whereas indirect costs decrease.
 Therefore, there is optimal project duration
where the total project cost becomes the
minimum.

39
5
EMI Project direct cost- time relationship

 Normal cost: The costs associated with a

normal time estimate for an activity.
 Crash cost: they are caused by extra wages,
overtime premiums and extra facility costs.
 Crash time: the minimum possible time that an
activity is planned to take. Applying extra
resources usually brings this about.

39
6
EMI
 Cost slope: this is the average cost of shortening an
activity by one time unit.

CrashCost NormalCost
CostSlope 
NormalTime  CrashTime
 Least cost scheduling or crashing: The process by
which we can find the least cost method of reducing
the overall duration of a project.

39
7
EMI
Heuristic solution procedure:
 Start with the normal project duration
 Obtain the critical paths
 Choose that activity on the critical path which is
cheapest to crash
 Crash that activity till either another path becomes
critical or the activity is fully crashed

398
EMI
 Determine the most economical set of activities to
be crashed or relaxed to reduce the durations all
critical paths
 No further crashing is possible when at least one
critical path can not be reduced
 When two or more activities on any path are
simultaneously crashed, some previously crashed
activity on the path may be relaxed.

399
 Example: Given the information below, find the maximum length of
EMI
the schedule and the minimum cost schedule when the indirect cost
is Birr70 per day.

Preceding
Time Cost
Activity
Activity
Normal Crash Normal Crash Slope *

A - 4 2 150 350 100

B - 8 6 100 200 50
C A 2 1 50 90 40
D B 10 5 100 400 60
E B 5 1 100 200 25
F C, E 3 1 80 100 10
Total Direct Cost 580

* Average cost of shortening an activity by one time unit

40
0
EMI
2

4 13
C (2)
A (4) 4
F(3)
0 5
13 15
18 18
0 0 E (5)

B (8) 3 D (10)

8 8

The critical paths are B and D

Normal project duration is 18 days

40
1
EMI Step 1: The first is to determine the normal costs
and normal durations of the project.
• The critical paths are B and D
• Normal project duration is 18 days
• Direct Cost = Birr580
• Indirect cost = 70X18= 1260
• Total project cost = Birr1840

40
2
EMI Step 2: Reduce the least cost slope critical activity B by
two days
• The critical paths B and D (Not changed)
• Project duration 16 days
• Direct cost = normal cost + crush cost =
580+100 = 680
• Indirect Cost = 70X16 = 1120
• Total project cost = 1120 + 680 = 1800

40
3
EMI Step 3: Since we have fully used the crash time for B,
now crash critical activity D by two days
• Two Critical paths: the first is B and D; and the
second is B, E and F.
• Project duration 14 days
• Direct cost = Cost of step 2 + crash cost =
680+(60*2=120) = 800
• Indirect Cost = 70X14 = 980
• Total project cost = 980 + 800 = 1780

40
4
 Step 4: Three crashing days remain from activity D.
EMI
We select one either E or F with the least cost slope
to crash it together with activity D. Therefore, we
can crash two days of activity D and only two days
of Activity F.
• Two Critical paths: the first is B and D; and
the second is B, E and F.
• Project duration is 12 days
• Direct cost = Cost of step 3 + crash cost
(crash cost of D + Crash cost of F) = 800 +
(60+10)*2 days = 940
• Indirect Cost = 70X12 = 840
• Total project cost = 940 + 840 = 1780
405
EMI Step 5: We can further crash by one more day activity D
and E but not activity F
• Two Critical paths. The first is B and D; and
the second is B, E and F.
• Project duration is 11 days
• Direct cost = Cost of step 4 + crash cost (crash
cost of D + Crash cost of E) = 940 + (60+25)*1
days = Birr1025
• Indirect Cost = 70X11 = 770
• Total project cost = 1025+ 770 = 1795.

40
6
EMI  Conclusion: The student should note that the total
project cost starts to increase at step 5 when
compared to step 4. Then the optimal solution for
this project is the values of step 6 as follows.
 Project duration = 12 days; Total project cost = 1780

40
7
EMI The activities and time estimate ( in weeks) for various
activities are illustrated below:
Activity Preceding Time Estimates
Activity Optimistic Most likely Pessimisti
c
A - 1 2 3
B - 8 10 12
C A 2 4 6
D B 1 2 3
E C,B 6 8 10
F
 Draw D diagram? 4
the network 3 8
 Determine the critical path
 Calculate EST, LST, EFT and LFT of the activities on the critical
path?
 Detriment the average estimated duration of the project?
 What is the probability of finishing the project with in 20 weeks?
40
8
  Given the following list of activities , precedence relationships,
EMI
normal and crash time and cost of a project, when the indirect
cost is birr 120 per day,
Activity Preceding Time Cost
activity Normal Crash Normal Crash

A _ 6 4 500 620
B _ 4 2 300 390
C A 7 6 650 680
D A 3 2 400 450
 E
Calculate theB,C 5
cost slope? 3 850 1000

 Draw the network diagram?

 Determine the project completion time?
 Determine the critical path?
 Construct a least cost schedule for the network (Crash it)?
40
9
EMI
Successful Project Implementation
 Project implementation success has been defined in
many ways to include a large variety of criteria.
 However, in its simplest terms, project success can be
thought of as incorporating four basic facets.

410
EMI  A project is generally considered to be successfully
implemented if it:
Comes in on-schedule (time criterion).
Comes in on-budget (monetary criterion).
Achieves basically all the goals originally set for
it (effectiveness criterion).
Is accepted and used by the clients for whom the
project is intended (client satisfaction criterion).

411
EMI

41
2
EMI
Success in Project Implementation

1. Political commitment
2. Simplicity of Design
3. Careful Preparation
4. Good Management

413
EMI
Reasons for Project Failure

1. Poor project and program management

discipline
2. Lack of executive-level support
3. No linkage to the business strategy
4. Wrong team members
5. No measures for evaluating the success of
the project
6. No risk management
7. Inability to manage change

414
EMI

415
EMI
Problems in Project Implementation

1. Financial Problems
2. Management Problems
3. Technical Problems
4. Political Problems

416
EMI
Exercise
1. List all the activities of the identified project
2. Assign time for each activity of the project
3. Draw the network diagram (precedence diagram)
and identify the critical and non-critical paths
4. Identify the critical success factors of project in
your organization or any organization you are
familiar with.

417
EMI

Session 9
Monitoring and Evaluation, Close out and Sustainability

418
EMI
Monitoring and Evaluation
What is Monitoring?
 Monitoring is the systematic and continuous assessment of
the progress of a piece of work over time.
 It is a continuous process of gathering, analysing and
interpreting of information of the daily use of inputs and their
conversion into outputs.
 It is the systematic and routine collection of information from
projects and programmes for four main purposes:
1. To learn from experiences to improve practices and activities in the
future;
2. To have internal and external accountability of the resources used
and the results obtained;
3. To take informed decisions on the future of the initiative;
4. To promote empowerment of beneficiaries of the initiative.

419
EMI
Monitoring and Evaluation --- cont’d
 Monitoring is a periodically recurring task already beginning in
the planning stage of a project or programme.
 Monitoring allows results, processes and experiences to be
documented and used as a basis to steer decision-making and
learning processes.
 Monitoring is checking progress against plans.
 The data acquired through monitoring is used for evaluation.
What is Evaluation?
 It is a systematic and periodic gathering, analyzing and
interpreting of information on the overall project performance and
objective achievement in light of relevance, efficiency,
effectiveness, impact and sustainability.
 Evaluations appraise data and information that inform strategic
decisions, thus improving the project or programme in the future.
 An assessment of the extent to which a project is achieving or has
achieved its stated outcome goals .

420
 performance
EMI
M&E
efficiency
outputs
effectiveness appropriateness
outcomes
Quantitative indicators
Qualitative indicators

impact target Logframes

DO NO HARM
assessment
coverage
INPUTS
connectedness
accountability
timelines
A WASP NEST………?
s
*
 Monitoring and Evaluation --- cont’d
EMI
What is M&E?
 M&E is an embedded concept and constitutive part of
every project or programme design (“must be”).
 M&E is not an imposed control instrument by the donor
or an optional accessory (“nice to have”) of any project
or programme.
 M&E is ideally understood as dialogue on development
and its progress between all stakeholders.
 M&E can help one to:
1. Identify problems and their causes;
2. Recommend possible solutions to problems;
3. Raise questions about project assumptions;
4. Reflect on where the project is going, and on how
best to accomplish its aims and objects.
422
EMI
Monitoring and Evaluation --- cont’d
 The power of measuring results:
 If you do not measure results, you cannot tell
success from failure.
 If you cannot see success, you cannot reward it.
 If you cannot reward success, you are probably
rewarding failure.
 If you cannot see success, you cannot learn from it.
 If you cannot recognize failure, you cannot correct it.
 If you can demonstrate results, you can win public
support and donor interests.

423
 Monitoring and Evaluation --- cont’d
EMI  Why undertaking M&E?
1. To check whether our project meets its objectives.
2. To generate data about the project’s progress.
3. To build greater transparency and accountability.
4. To improve day-to-day decision-making.
5. Inform us about the strengths and weakness of the project.
6. To detect unexpected and unintended results and effects of the
project.
7. To provide early warning of problems.
8. Explain the reasons why project activities succeed or fail.
9. To build understanding and capacity.
10. To stimulate learning.
11. To demonstrate & strengthen accountability

424
EMI
Monitoring and Evaluation --- cont’d
 There are different ways to perform an evaluation:
1. Self-evaluation
2. Participatory evaluation
3. Rapid participatory evaluation
4. External evaluation
5. Interactive evaluation

425
 Traditional vs result based monitoring and evaluation (RBME)
EMI
Elements of traditional M & E Elements of result based M & E
Description of the problem or Baseline data to describe the problem or
situation before the intervention; situation before the intervention;

Indicators are for activities and Indicators are for outcomes and impact;
immediate outputs;
Data collection focuses on Data collection focuses on outputs and
inputs, activities and immediate how/whether they contribute towards
outputs; achievement of outcomes
Systematic reporting on provision More focus on change among
of input and attainment of stakeholders by indicating the
output ; performance trend over time
Directly linked to a discrete Systematic reporting with more
intervention (or series of qualitative and quantitative information
interventions); on the progress of outcomes

426
EMI
Reaching Results

Later in the life of the project

Early in the life of the project

Strategic
Objective(SO)

Outcomes

Outputs

Inputs
Activity Level

427
EMI
Types of indicators
Indicators exist in many different forms:
 Direct indicators correspond precisely to results at
Direct
any performance level.
Indirect /  Indirect or "proxy" indicators demonstrate the
proxy
change or results if direct measures are not feasible.

 Indicators are usually quantitative measures,

Qualitativ
e
expressed as percentage or share, as a rate, etc.
Quantitativ  Indicators may also be qualitative observations.
e

Global /
standardised  Standardised global indicators are
comparable in all settings.
Locally
developed  Other indicators tend to be context specific
and must be developed locally.
EMI

Impact

Outcom
e

Output

Input
EMI

Impact Related to Goal

Outcome Related to Objectives

(or Purposes)

Related to Outputs
Output

Input Related to
Activities/Resources
EMI

Related to Goal Malnutrition rates

Impact amongst young
children reduced

% of young children
Outcome Related to Objectives getting appropriate
(or Purposes) complementary food

X number of mothers
Related to Outputs
Output know about good
complementary food and
how to prepare that

Nutritional education to
Input Related to mothers on
Activities/Resources complementary food

*
 Monitoring and Evaluation --- cont’d
EMI
Types of evaluation
 Evaluation can be characterized as being either
formative or summative.
1. Formative evaluation
 It takes place in the lead up to the project, as well as
during the project in order to improve the project
design as it is being implemented (continual
improvement).
 Formative evaluation often lends itself to qualitative
methods of inquiry.
 Is conducted at mid-term (also called periodic
evaluation) or semi-annually ( also called process
432 evaluation)
EMI Monitoring and Evaluation --- cont’d
2. Summative evaluation
 It takes place during and following the project
implementation, and is associated with more
objective, quantitative methods.
 Is conducted only when the project has been
completed.
 Summative evaluation is also called terminal,
final, outcome, or impact evaluations.
 Summative evaluation falls into two categories:
end evaluation and ex-post evaluation.

433
 Monitoring and Evaluation --- cont’d
EMI

Difference between Monitoring and Evaluation

Item Monitoring Evaluation
Frequency Periodic, regular Episodic /not regular

Main action Keeping track/oversight Assessment

Basic Purpose Improve achievement, Improve effectiveness,
Adjust work plan impact, future programming
Focus Inputs, outputs, process, Outcome, relevance,
work plan sustainability, impact

Information Routine or sentinel systems, Same, plus surveys and

Sources field observation, progress studies
Undertaken by Internal staff, community, Internal staff, stakeholders,
funder/donors funders/donors, external
evaluators, community
434
 Complementary Features Monitoring and Evaluation
EMI

Monitoring Evaluation
1. Implementation oriented 1. Policy oriented
2. Tracks results/output 2. Explain results/output, outcome,
3. Assess intermediate results and impact
4. Focus on timeliness 3. Assess attributes
5. Emphasis on multi-level results 4. Focus in rigor
6. Informs Budgeting 5. Emphasis on final results
7. Strengthens accountability for 6. Informs broad resources
managing results allocation
8. Essential for programme 7. Strengthens accountability for
implementation & improvements results themselves
9. Can use disaggregated data 8. Essential for strategy
development
9. May need aggregated data

435
 Project Monitoring: What, When and How to Monitor?
EMI
 Monitoring, supervision and control are tools for
project managers to use in judging and influencing
the progress of project from inception to
operation/implementation.
 Control is verifying whether everything occurs
(quality, cost, and time) in conformity with the
plans adopted, the instructions issued and the
principles established.
 Control includes reporting on any deviations from
the plan, the reasons for the deviations and the
corrective actions that need to be taken.

436
 Project Monitoring: What, When and How to Monitor?
EMI
 Supervision on the other hand, involves keeping a
finger on pulse of the program/project, diagnosing
problems as they arise and advising on their
solution.
 It is watching and assessing the environment for
factors and situations which may have an adverse
effect on the project, anticipation of problems.

437
 Project Monitoring: What to Monitor?
EMI

There are two types of monitoring and a distinction has to be

made between these - process monitoring and impact
monitoring.
 Process Monitoring: considers the use of resources, the
progress of activities, and the way these are carried out. It is a
means for reviewing and planning work on a regular basis.
 Impact Monitoring: Helps to monitor changes brought as a
result of the project/program intervention while the project is
still on progress. This might be economic aspect, social,
organizational, technological, attitude, etc. or other
intended and unintended results over a longer period.

438
 Project Monitoring: What & How to Monitor?
EMI

The following are among the major items that have to

be closely monitored in any development
programme/project in process monitoring:
1. Project Physical Progress (inputs, activities, and
outputs)
2. Finance Progress (expenditure)
3. Project Quality Monitoring /service & products/
4. Assumption and Risk Monitoring
5. Beneficiary Contact Monitoring (BCM)
6. Management related issues

439
EMI Steps in Developing Monitoring Tools (How to monitor)
1. Review expected inputs, activities and outputs
2. Determine information needs for monitoring
3. Decide on key elements to be monitored
4. Identify key factors
5. Identify key indicators to be used to measure key factors
6. Decide on the key indicators which should be used in
developing the monitoring tool
7. Use key indicators to formulate key questions
8. Check the relevance and validity of the questions
9. Pre-test the monitoring tools and improve according to
feedback obtained
10. Distribute the monitoring tools for application and improve
further on the basis of field application results
440
EMI Steps in Developing Monitoring Tools (How to monitor)
 The most widely used means of communication
tools employed in project monitoring and control
are:
a. reports,
b. meetings, and
c. site visits (observations).

441
 Project Evaluation: When, What, and How to Evaluate?
EMI

 Evaluation can be seen in two ways i.e. on periods

of evaluation and persons conducting the
evaluation.
 In terms of the periods of evaluation, four types of
evaluation are commonly distinguished. These are;
1. Ex-ante Evaluation (Start up Evaluation),
2. Mid-term Evaluation or On-going Evaluation/
Formative Evaluation/
3. Terminal Evaluation (Summative Evaluation);
and
4. Ex-post Evaluation (Impact Assessment).
442
 Project Evaluation: When, What, and How to Evaluate?
EMI
 Based on persons involved in the evaluation process we
have:
1. Internal and
2. External evaluation
3. Interactive/joint evaluation
 Internal Evaluation: It is performed by persons who
have a direct role in the programme/project. On-going or
formative evaluation can be done by the management
team or persons assigned from the implementing
agency.
 External Evaluation: Here the evaluation is carried out
by persons from outside the programme/project.
Terminal is often conducted by external evaluators. In
most cases it is conducted by the funding/ sponsoring/
agencies with formally designated persons outside the
443 project at fixed points in time.
 Evaluation Criteria /What to Evaluate?/
EMI
 Most of the basic evaluations criteria and concepts
are universally accepted and used by all
organisations as well as by the donors’ community.
 The criteria for evaluation address five major sets
of issues. These are:
1. Relevance
2. Efficiency
3. Effectiveness
4. Impact
5. Sustainability

444
 Evaluation Methods (How to Evaluate)?
EMI
 The commonly used evaluation methods are;
1. Physical Measurement: like height, weight,
length, etc.
2. Verbal questions
3. Survey (questionnaires)
4. Analysis of existing information: such as
regular records; reports; diaries
5. Field visits or observation
6. Meetings and discussions

445
 Steps in Developing Evaluation Tools
EMI
1. Review project objectives
2. Convert project objectives into evaluation objectives
3. Identify and list down key factors
4. Select indicators for key factors
5. Determine the key factor that should be used for developing
the evaluation tools
6. Decide the method(s) used for evaluation
7. Determine the tools to be used
8. Utilize the key indicators in formulating key questions
9. Check the relevance of the key questions to the information
needs
10. Pre-test evaluation tools, orient evaluators on the tools and
put the tools to use
446
EMI Activity: Form a small group and discuss the
following points:
1. Evaluate the monitoring and evaluation practices of your
organization.
2. What methods, tools and approaches you have been
using in your organization? Which tools, methods, and
approaches do you think is appropriate for your
organization? Why?

447
EMI

Setting up Monitoring and

Evaluation System

44
8
 M & E instruments design has five components:
EMI

1. Clear statements of measurable objectives

e.g. Providing more equitable access to health
services.
2. A structured set of Indicators
Types of Indicators:
a. Input Indicators- are quantified and time-
bound statements of resources to be provided.
E.g. Vehicle operating costs for the crop
extension service.

449
EMI Designing Monitoring and Evaluation
Instruments
b. Process indicators -measure what happens
during implementation.
e.g. latest date for delivery of fertilizer to farm
stores.
c. Output indicators- show the immediate
physical and financial outputs of the project:
physical quantities, organizational strengthening,
and initial flows of services. E.g. cost per
kilometer of road construction.

450
EMI Designing Monitoring and Evaluation
Instruments

d. Impact refers to medium or long-term developmental

change. e.g. (education) continuation rates from
primary to secondary education by sex, proportion
of girls completing secondary education.
e. Exogenous indicators are those that cover factors
outside the control of the project but which might affect
its outcome. e.g. currency exchange rates.

451
EMI Designing Monitoring and Evaluation
Instruments
3. Provision for Collecting Data and Managing Project
Records -so that the data required for indicators
are compatible with existing statistics, and are
available at reasonable cost.
 Indicators of inputs and processes will come from
project management records originating from field
sites.
 To measure output and impact may require the
collection of data from sample surveys or special
studies.

452
EMI Designing Monitoring and Evaluation
Instruments
4. Institutional arrangements for gathering, analyzing, and
reporting project data, and for investing in capacity
building, to sustain the M&E service.
5. Proposals for the ways in which M&E findings will be
fed back into decision making.

453
EMI

Monitoring and Evaluation Report

45
4
EMI Monitoring and Evaluation Report … cont’d
The M & E Report could be presented in two forms:
1. Narrative Report
The following information should be addressed in a
narrative report:
• Introduction. Significant developments in the
reporting period.
• Objectives and planned activities for the period.
• Were the objectives and the activities of the
project achieved?
• Did you meet any bottlenecks and/or problems?
(If not, why? What was done to deal with them?)
• Were you able to carry out the activities
according to schedule? (If not, why? What was
done to adapt the activities? )

455
EMI
Monitoring and Evaluation Report … cont’d

 Has the target group been reached?

 Copies or samples of every material produced
during the project implementation, like posters,
leaflets, study reports, newspaper articles,
publications, training lessons and programs, etc.
 Objectives and planned activities for the next
period.
 Specific recommendations for any action necessary
to ensure that the project achieves its objectives.

456
EMI
Monitoring and Evaluation Report … cont’d

2. Financial Reports
Financial reports should address the following
information:
 An account of the progress made towards the
achievement of the project objective.
 An overview of expenditures during the reporting
period.
 An explanation of any deviation from the budget
and links to actual progress.
 An overview of the budget required for financial
activities and expected output over the next 12
months.

457
EMI
Project Closure Phase
 The last major phase of a project's life cycle is
project closeout.
 Project closeout is performed once all defined
project objectives have been met and the customer
has accepted the project’s product.
 In this phase, you will formally close your project
and then report its overall level of success to your
donor.

458
EMI
Project Closing
 A successful project can be closed either by
extinction or by addition or by integration;
whereas an unsuccessful project can be terminated
by starvation.
 A project can be said to be closed successfully only
when it has a proper final report in place.
 A final report contains all the knowledge gained
from the processes of the project.
 Project final report along with the project records is
the best source to gain experience from previous
projects and improve the way future projects are
handled.
459
EMI The main functions of the project closeout process
are:
 to formalize project completion and disseminate
information to project participants;
 to assess the project and derive any lessons learned
and best practices to be applied to future projects;
and
 to verify that all work has been accomplished as
agreed and that the client or customer accepts the
final product.

46
0
  The project manager must ensure that the project is
EMI brought to its proper completion.
 The closure phase is characterized by a written formal
project review report containing the following
components:
 completion and closeout of any contractual
agreements with suppliers or providers
 formalizing customer acceptance
 closeout of any financial matters
 preparation of the project’s final report
 conducting a project review
 documenting lessons learned
 completing, collecting and archiving project
records
 Celebrating project success. 461
EMI
 There are two processes that occur during project
closeout.
 These are contract closure and administrative closure.
 Contract closure involves checking the work for
completeness and accuracy and documenting formal
project acceptance.
 contract closure involves verification that all work has
been completed correctly and satisfactorily, updating
of contract records to reflect final results, and
archiving information for future use.

462
EMI

Among other activities contract closure includes:

 Confirming the project has addressed the terms and
conditions of the contracts
 Confirming completion of exit criteria for contract
closure
 Formally closing out all contracts associated with
the completed project

46
3
EMI  Administrative closure involves gathering and
disseminating project closure information to relevant
parties, archiving files, and documenting lessons
learned.
 Among other activities administrative closure includes:
 confirming the project has met all sponsor,
customer, and stakeholder requirements
 verifying that all deliverables have been
delivered and accepted
 validating exit criteria have been met
 

464
EMI
 A final project report contains a section on
performance of the project wherein the delivered
output is compared with the planned output,
 A section on the performance or the administration
of the project, a section on the organizational
structure adopted and its implications on the
performance of the project and finally a section on
the confidential information to be reported to the
top management and the recommendations of the
project manager on ways of improving the
processes.

46
5
EMI Ensuring sustainability

 Revisit the project outcomes, and consider the

changes the project will stimulate or enable
 Consider the take-up and embedding needed to
achieve the envisaged changes
EMI  Formulate an exit strategy, which outlines:
1. Access – Who will host the deliverables after the project
ends? Will they be available on the project web site? Have
other arrangements for hosting been made?
2. Preservation – Where will the deliverables be preserved?
3. Maintenance – What supporting documentation will be
needed to maintain deliverables, e.g. user manuals,
technical manuals? Will any ongoing maintenance be
needed and what will it cost?
4. Intellectual property – What IP rights need to be cleared
to make sure deliverables can be accessible to the teaching,
learning, and community after the project ends?
EMI  Consider deliverables or outputs that will be
sustainable in the long term e.g., tools,
guidelines, protocols, …that could be used
by other projects or that are useful for the
research community.
 Develop sustainability scenarios for these outputs
 Think about who might carry them forward,
how, and the issues that will need to be
addressed to make these outputs self-
sustaining.
EMI Activities: Form a small group and discuss the
following points:

 Assess the reporting practice of your

organization and indicate the major
components of the report.

469
EMI Questions and/or comments

470
EMI

471
EMI
Best wishes!

472
EMI

Thank you!
Wishing you continued
success on your project
management journey!
473
EMI
My Address:
Temesgen Dagne
(ECSU, Institute of Public Management and
Development Studies )
Tel: 0911 103995
E-mail: teme2112@gmail.com