Project Analysis

and
Management
Oda Bultum University
Course Instructor:- Debela Bonsa
(Ass. prof)
 Course Content
 An Overview of Project  Pricing and Estimating
Management  Trade-off Analysis in a
 Project Management Growth: Project Environment
Concepts and Definitions  Risk Management
 Organizational Structures  Strategic Planning for
 Time Management Excellence in Project
 Special Topics in project Management
management  Modern Developments in
 Project Scheduling Techniques Project Management
 Project Planning  Quality Management
 1.1 PROJECT MANAGEMENT DEFINED
 A project is defined as a sequence of unique, complex,
and connected activities having one goal or purpose and
that must be completed by a specific time, within budget,
and according to specification.
 A project is a proposal consisting of collection of
activities performed to achieve a specific purpose so as
to get benefits that exceed costs.
 A project is a temporary endeavor, having a defined
beginning and end/
 Project is undertaken to meet unique goals and
objectives, usually to bring about beneficial change or
added value (PMI).
 1.2 Features of a project
 Unique: accomplishment of specific purpose
 Specific Deliverable
 Specific Due Date
 Multidisciplinary
 Complex
 Conflict
 Part of Programs
 Needs capital and commitment of other resources
 Collection of activities that generates benefits in the long
run
 Has limited estimated life
 Associated with risk and uncertainty
 Project Parameters
 There are five parameters that constrain the operation of every project:
 Scope
 Quality
 Cost
 Time
 Resources
 These constraints are interdependent set implying that a change in one can
cause a change in another to restore the equilibrium of the project.
Scope
 It is a statement that defines the boundaries of the project.
 It tells not only what will be done but also what will not be done.
 In the information systems industry, scope is often referred to as a
functional specification.
 In the engineering profession, it is generally called a statement of work.
 It is not secret that scope can change. We do not know how or when, but it
will change.
 Detecting that change and deciding how to accommodate it in the project
plan are major challenges for the project manager.
 Continued…
Quality
 Two types of quality are part of every project.
 The first is product quality. This refers to the quality of the deliverable from
the project.
 The second type of quality is process quality, which is the quality of the
project management process itself. The focus on how well the project
management process works and how can it be improved.
 Not only does quality contribute to customer satisfaction, it helps
organizations use their resources more effectively and efficiently by
reducing waste and rework.
Cost
 The money spend for doing the project is another variable that defines the
project.
 It is best thought of as the budget that has been established for the project.
 This is particularly important for projects that create deliverables that are
sold either commercially or to an external customer.
 Cost is a major consideration throughout the project management cycle.
 Continued…
Time
 The customer specifies a timeframe or deadline date within which project
must be completed.
 To a certain extent, cost and time are inversely related to one another. The
time a project takes to be completed can be reduced, but cost increases as a
result.
 Time is an interesting resource. It can't be inventoried. It is consumed
whether we use it or not. The objective for the project manager is to use
the future time allotted to the project in the most effective and productive
ways possible.
Resources
 Resources are assets, such as people, equipment, physical facilities, or
inventory that have limited availabilities, can be scheduled, or can be leased
from an outside party.
 Some are fixed; others are variable only in the long term.
 In any case, they are central to the scheduling of project activities and the
orderly completion of the project.
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1.4 Phases in Project management
 Defining
 We need to determine what the customer wants/in
case of development projects, we need to know what
the community/public wants
 We do this by identifying:
 Requirements
 Identifying Stakeholders
 Identifying Problems
 Identifying Deliverables
 Setting Success criteria
 Determining project Scope
 Risks
 Probability of occurrence
 Impact of the risk
 Planning
 We know what we want
 Now, we figure out how to do the work required
 We do this by:
 setting overall goal, project purpose
 Identifying activities: work breakdown structure (WBS)
 Identifying dependencies between activities
 Estimating activity duration
 Estimating activity resource requirements
 Scheduling activities (start date, duration)
 Execution
 We have a detailed work plan
 Now, we get the work underway
 We do this by:
 Choosing participants
 Making participants available for the project
 Assigning work to participants
 Organizing participants into team(s)
 Providing resources to the team(s)
 Establish constraints and freedoms for the team(s)
 Motivate the team and getting project activities executed
 Monitoring & Evaluation
 Monitoring involves reviewing the progress of the project
 It involves taking concurrent correction to keep the project on
truck and we must ensure we are making adequate progress
 We do this by:
 Interviewing and observing progress reports
 Providing mechanisms for requesting changes
 Continually updating plans (e.g. schedules)
 Evaluation involves post-implementation review to correct if
there are significant deviations or to take lessons for future
projects.
 Closing
 Refers to completion of all activities
 The result should be that
 All overall goals are satisfied
 All conditions of satisfaction are met
 All deliverables are ready for use
 We do this by:
 Obtaining client acceptance
 Deploying deliverables
 Performing post implementation analysis
 How did we do?
 Why do projects fail?
 We need to ask these important
questions:
 What kind of failure was it?
 e.g. incomplete, unreliable, off-schedule/budget
 Who was responsible?
 What happened?
 What did not happen?
 Which process(es) broke down?
 What deliverables (s)/feature(s) failed?
 Reasons for project failure
 These reasons seem to blame the staff:
 Poor plan
 Uncommitted or demotivated staff
 Weak, antagonistic, unreliable staff
 Gold-plated features or documentation
 These reasons seem to blame the customer or upper
management:
 Unrealistic schedules
 Unrealistic expectations
 Incorrect requirements
Continued…
 These reasons seem to blame the project manager:
 Poor planning
 Insufficient risk management
 Insufficient quality assurance
 Inadequate support
 Reluctance to follow up the project implemetation
 Who is really responsible for these problems?
 The project manager
1.5 Skill Requirements for Effective Project
Management
 Conflict Resolution
 Creativity and Flexibility
 Ability to Adjust to Change
 Good Planning
 Negotiation
 win-win versus win-lose
1.6 A project manager’s role
 A major role of a project manager (PM) is to ensure that
the project succeeds
 To a lesser degree, this is also a role for other stakeholders
 Therefore, the PM is responsible (if not to blame) when
these problems occur
 A project manager must remain unbiased
 Customers or upper management may ask for unrealistic
features and/or schedules
 It is not a project manager’s role to make such schedules work,
by pushing teams harder
Project management careers
 A PM is someone with years of experience
 This is usually someone who…
 has experienced successful projects
 has experienced failed projects
 has excellent organizational skills
 has excellent communication skills
 is a strong leader
1.7 Benefits of Project Management
1. Clear Objective
2. Risk Assessment
3. Milestones
4. Resource Allocation
5. Task Dependencies
6. Communication
7. Avoid Scope Creep
8. Client Appreciation
9. Your team will know what’s going on and what is expected of
them. With clear objectives, scheduled milestones and a detailed
task list , there should be no confusion about who is to do what.
 Chapter Two

Project Cycle Management

 Project Cycle Management (PCM)
 Is a management tool that treats projects as a cycle
 Is a tool for managing the entire cycle of a
development project
 The cycle comprises of planning, implementation and
evaluation
 a project format used in PCM is the Project Design
Matrix (PDM).
 The PDM shows the objectives, activities, inputs and other
components of a project together with their logical
relationship.
 PCM
 The project life cycle is the actions or processes
organized into phases that enable a project to produce its
deliverables.
 It refers to a logical sequence of activities to accomplish the
project’s goals or objectives.
 These stages of a project life cycle may differ according to
the expression of different authors or institutions. But the
basic ones are :
 the pre-investment phase,
 the investment phase and
 the operational phases.
 Each of these phases is divisible into stages.
 Cont’d…
 On medium to large projects, the life cycle generally follows the following
seven patterns:
1. Identification: stage where one project-idea out of several
alternatives is chosen and defined.
2. Preparation: defined idea is carefully developed to the appraisal
stage.
3. Appraisal: every aspect of the project idea is subjected to systematic
and comprehensive evaluation, and a project plan is prepared.
4. Presentation: detailed plan is submitted for approval and financing
to the appropriate entities.
5. Implementation: with necessary approvals and financing in place,
the project plan is implemented.
6. Monitoring: at every stage the progress of the project is assessed
against the plan.
7. Evaluation: upon completion, the project is reassessed in terms of
its efficiency and performance.
 1. Project identification
❖ Project identification is the initial stage of the project.
❖ It contributes towards achieving specified development objectives
identified.
❖ A project idea may originate from multiple sources.
Many of the important projects in developing countries emerge from :
✓ political commitment of national leader, as response to crisis,
✓ emergencies and external threats or to foreign governments’
policies and
✓ assistance agency priorities.
✓ Others are new experiments emerging from previous project
failures or expansion
✓Generally, project ideas are born at two levels, the macro-level
and micro-level:
 2. Project Preparation
❖is the process of analyzing and developing a
project idea into a final project ready for
implementation
❖Pre-feasibility study if indicates that the project is,
prima facie, promising and further work is justified, the
project enters the next stage for more detailed and
sophisticated analysis supported by accurate
information.
❖ In the study, all aspect, technical and non-technical,
should receive the attention they deserve without
postponing any consideration to the later stage.
 Cont’d…
❖Project preparation necessitates a team work approach with
professionals investigating different aspects of the project,
working closely.
❖They should exchange views and check their conclusions under
the coordination of an expert working as team leader.
❖Time spent on project preparation is not lost time. There is a
trade-off between project preparation and implementation.
❖The better a project is prepared, the easier and faster its
implementation and lowers the probability of cost over runs.
 3. Projects Appraisal and Investment Decision
❖ Appraisal is the comprehensive and systematical assessment of
all aspects as of the proposed project
❖ The appraisers are usually the central economic authorities
responsible for drafting the overall development strategy and
entrusted with major decisions on matters relating to this
strategy.
❖ The project is reviewed to confirm that it accords with the broad
development objectives and fits into the development process of
the country.
❖ The project is viewed from different perspectives; technical,
commercial, financial, economic, managerial and organizational.
❖ It is also to ensure that the project represents a high priority use
of country’s resources and in combination with other policies,
contributes towards achieving national development objectives.
 4. Project Implementation, Supervision and Follow-up:
 It is the stage where the conclusions reached and
decisions made are put into action.
 Detailed designs and specifications should be drawn,
contract to be signed, workers to be hired and put to
work, materials to be moved to site, etc.
 It is not only well-prepared and evaluated but seriously
executed projects that deliver the predicted benefits.
 The execution of the project should be supervised
closely and progress should be reported regularly to
ensure that the implementation is progressing without
deviating from the predicted path.
 5. Project Evaluation
 Project should be measured against its original
objectives. It involves ex-post evaluation process (after the
fact evaluation).
 At this stage, performance of the project is observed and
evaluated and important decisions are made based on
the feedback obtained.
 It may include expanding the project, discontinuing it,
merging with others or the like.
 Project Life Cycle Models
 There are many project cycle models which differ in their perspective,
emphasis and level of detail.
 Three of these models are listed below and explained further as
follows:
 The Baum Cycle
 The New Project Cycle (World Bank 1994)
 United Nation Industrial Development Organization
(UNIDO) Project Life Cycle
A. The Baum Cycle (Adopted by the World
Bank in 1970)
 The World Bank suggested some stages in the project activities.
 These project cycles are divided into the following stages:
1. Project identification
2. Project preparation
3. Project appraisal
4. Project implementation
5. Project evaluation
 C. UNIDO Project Cycle
1. Pre-investment phase (Project Identification)
a) Opportunity studies (Project identification)
b) Preliminary selection stage (Pre-feasibility study)
c) Project formulation /Preparation Stage (Feasibility study)
d) Evaluation and decision stage (Appraisal/Evaluation report)
2. Investment phase (Implementation)
a) Negotiation and contracting stage
b) Project design stage
c) Construction stage
d) Pre-production marketing stage
e) Training stage
3. Start up stage Operational phase (operation and ex-post evaluation)
f) Long-term views (expansion, innovation)
g) Short-term views (replacement and rehabilitation)
B. New Project Cycle (World Bank 1994)
 This cycle emphasizes on the issue of participation of different
groups in the project. It is particularly relevant where beneficiary
participation is critical to the success of projects. It has four distinct
phases:
 Listening- this is the stage of understanding the needs of the stakeholders of
the completed project.
 Piloting- is a stage of trying the success or failure of the project in small
scale operation before scarce resources are spent and wasted.
 Demonstrating-this is the stage of showing the stakeholders the
successfulness of pilot in an effort to convince them accept the whole project
idea.
 Mainstreaming- this is the stage of duplicating the pilot as large scale
operation and getting into the main project activity.
PCM method
Planning

PDM

Evaluation Implementation
 Project design matrix
Narrative summary Objectively Means of Important
verifiable verification assumption
indicators

Overall objective

Project purpose

outputs

activities Inputs preconditions

Characteristics of PCM
 Participatory approach: PCM involves participatory approach
that gives chance and respect on the opinions of participants
/stakeholders/.
 Logicality: PDM shows “cause-effect” and “means-end”
relationships.
 Consistency: the use of PDM enables consistent management
through the project cycle.
Advantages
 Accurate and effective project management: clearly provides
the objectives and outputs at the project planning stage leads
to effective project management
 The project plan accommodates recipient's/ beneficiaries
needs
 Assured transparency of assistance for donor based projects
 More effective communication
Issues in PCM
 Modification of PDM: the PDM set-up at the planning stage may
be modified considering the status of the project.
 Importance of workshop participants: the PDM will be formed
with the consent of workshop participants
 Application of supplementary methods
 Problem-solving: PCM is a planning technique for analyzing and
solving existing problems
PCM workshop and participatory
approach
 Concept of participation: it refers to to way in which
implementing agencies and beneficiaries who are the subject
of development projects, share the concepts with the donor,
offer resources and work force together, and play active roles
in decision making and implementation from the beginning
of the planning.
Advantages of participatory approach
 It is possible to hear opinions of beneficaries
 Beneficiaries develop a sense of ownership over the project
 Involvement of many stakeholders improves the transparency
of the project
 It is possible to carry out the project efficiently by making a
full use of labor and resources
 PCM method background
 PDM has its origin from the logical framework developed by the
USAID developed in the late 1960s
 Since 1970-the planning method is termed as logical framework
 Applied in USAID and UNDP
 In 1983, GTZ developed OOPP(ZOPP, adopting logical
framework and analysis stage incorporating the idea of
participatory planning in the logical framework
 NORAD and FINNDA and othr donors in Europe employing it
 In Japan, FASID, recognizing ZOPP, improves it and extends
participation at all stages (implementation and monitoring)-PCM
 The logical framework approach

 The logical framework approach was developed in the

late 1960s to assist the US Agency of International
Development (USAID) as a tool for:
 Detailed planning with clearly defined objectives that can be
monitored
 Clear management responsibility
 Pre-determined evaluation process
 The logical framework/Project
Design matrix

 Also known as the log frame which provides the documented

product of the analytical process
 It consists of a matrix with four columns and four rows (or more),
which summarize the key elements of a project plan

 The project's hierarchy of objectives

 Project description or intervention logic
 The key external factors critical to the project’s success
 Assumptions
 How the project’s achievements will be monitored and evaluated
 Indicators and sources of verification
Information contained in the
logframe matrix
 Logframe - how do we use it?

 The logframe is a format for presenting the results of the LFA as a

process and is developed on the basis of the LFA tools applied
earlier during the analysis phase
 Clear statement of what should be accomplished (outputs)
 Clear statement of important results that can be expected in the short to
medium-term and in the long run

 When the logframe has been completed it is used to design further

scheduling
Sources of verification

 Do appropriate external sources already exist (e.g.

reports, statistics)?
 Are these sources specific enough?
 Are the sources reliable and accessible?
 Is the cost of obtaining the information reasonable?
 Should other sources be created?
 SMART
 A good indicator should be SMART
• Specific to the objective it is supposed to measure

• Measurable (either quantitatively or qualitatively)

• Available at an acceptable cost

• Relevant to the information needs of managers

• Time-bound so we know when we can expect the

objective/target to be achieved
 Killer assumptions

 The external factors that are essential for the project to

achieve its objectives, but will most probably not be
realised become so called killer assumptions

 If the project cannot be redesigned to achieve its

objectives without having to rely on the realisation of the
respective external factor it should be abandoned
 Objectives - an example
Logical framework/project design matrix
Post harvest losses

Project description Indicators Sources of verification Assumptions

Overall objective: • Sustainable utilization of fish • Annual stock size

Improve the utilization stocks. measurements.
• Strengthen possibilities of • Census among fishermen,
of fisheries and aquatic
increased product value. exporters, sales outlets and
resources for the • Increased annual average customers.
benefit of the current income of fisher's household by 7% • Quality control measurements.
and future generations. . • Governmental export reports.
• Consistent and certified quality. • Sample household surveys.

Purpose/Immediate • 10% increase in annual export • Governmental export reports. • Political stability.
Objective: volume within the next 5 years. • Sample surveys among • Adequate institutional
• 10% annual increase in export fishermen, exporters, sales funding, Interest and
1. To minimize post
value within the next 5 years. outlets and customers. determination.
harvest losses and • 8% annual increase of fish • Sample household surveys. • Sufficient stakeholder
improve quality and supply/production in domestic interest.
safety of fish products market within the next 5 years.
to acceptable
standards.
 Results - an example
Logical framework matrix
Post harvest losses

Project Sources of
Indicators Assumptions
description verification
Results/Outputs/ • 8% increase in ISO 9000 certificated • ISO registration • sufficient financial
Deliverables: fish processing facilities within the next reports. and human capacity to
1.1 Improved fish 5 years. • Govt. statistics. support development.
handling. • 750 trained and certified fishers before • Govt. tax • Level of increased
the year 2009. authorities. income is sufficient to
• 7% increase in average income of make a significant
small and medium sized fishery difference in fishery
businesses in the next 3 years. businesses.
• 7% increase in the volume of fish in
the next 3 years.

1.2 Strengthen • 120 managers have undertaken a • Training reports. • Availability of

management short training course in financial • Official quality qualified staff.
practices to management before 2009. valuation reports. • Sustainability of
improve quality • 8% of multi-day boats apply an upper • Analysis of maintenance.
and profits. limit of days spent at sea to relevant
maximize/optimize quality instead of governmental
volume by 2010. statistics.
 Activities an example
Logical framework matrix
Post harvest losses

Sources of
Project description Indicators Assumptions
verification

Activities: Indicators Include cost for • Inadequate willingness

1.1 Improved fish handling • Short training course has been activity here. to seek changes and
designed and course material is improvement
1.1.1 Select 15-20 boat crews
ready for printing. • Lack of follow-up
that are willing to co-operate • 10 locations have been selected to • Insufficient importance
on improvements in onboard hold STC and 5 local coordinators on quality
fish handling have been hired to undertake controlled/orientated
1.1.2. Design a short training practical preparations. decision making
course in fish handling for • 10 instructors have been hired to
teach the STC.
fishers.
• Etc.
1.1.3 Train fishers on how to Input
handle fish onboard. • Training coordinator
1.1.4 Install temperature • Technical adviser
monitoring device onboard. • Travel and training costs
1.1.5 Initiate installment of • Cost of new temperature
monitoring equipment
cold chain procedure.
• Funding of a report on assessment
1.1.6 etc. on current "modus operandi" in
fisheries
 Chapter 3

Project Planning and scheduling