Chapter 1: An overview of project management

Project
• A group of milestones or phases, activities or tasks that support an effort to
accomplish something.
• A project is a series of activities aimed at bringing about clearly specified
objectives within a defined time-period and with a defined budget (EU, 2004)

Features of a project
• Are unique in nature. It creates something new. It starts with an idea
• Have a defined timescale ( a clearly specified start and end date)
• Have an approved budget ( a level of financial expenditure)
• Have limited resources ( amount of labour, equipment and materails)
• Involve an element of risk ( a level of uncertainty)
• Achieve beneficial change ( the purpose if a project is typically to improve
an organization through the implementation of business change)
Management
• Management is the act of getting people together to accomplish the desired goals
and objectives using available resource efficiently
• Management is the process of planning, organizing, controlling and measuring
Project Management
• Project management is application of knowledge, skills, tools, and management
processes required to undertake a project successfully
Project management components
• A set of skills: specialist knowledge, skills and experience are required to reduce
the level of risk within a project
• A suite of tools: Various type of tools are used by project managers to improve
their chances of success. (document templates, planning software, audit
checklists…)
• A series of processes: Various processes and techniques are required to monitor
and control time, cost, quality and scope on project
• Planning is deciding in advance - what to do, when to do & how to do. It bridges
the gap from where we are & where we want to be -> It helps to visualize the
future problems and keeps management ready with possible solutions.
• Planning involves taking decisions on vision, mission, values, objectives,
strategies and policies of an organization.
• It is done for immediate, short term, medium term and long term periods, it is a
guideline for execution/implementation.
• Planning is necessary to ensure proper utilization of human & non-human
resources,
• it is all pervasive, an intellectual activity and it also helps in avoiding confusion,
uncertainties, risks, wastage etc.
Organizing
• Organizing means that managers coordinate the human and material resources of
the organization.-> To ensure that objectives set by planning can be achieved, the
organizing function takes the tasks identified during planning and assigns them to
individuals and groups within the organization.
• Organizing involves the following:
• Identification of activities
• Classification of grouping of activities,
• Assignment of duties, Delegation of authority and creation of responsibility,
• Coordinating authority and responsibility relationships,
• Designing organization structures,
• Defining relationships between departments and job positions
LEADING
• Leading describes how managers direct and influence subordinates, getting others
to perform essential tasks.
• Effective leading requires the manager to motivate subordinates, communicate
effectively, and effectively use power.
Controlling
• The purpose of controlling is to ensure that everything occurs in conformity
with the standards. An efficient system of control helps to predict deviations before
they actually occur.
• Therefore controlling has following steps:
• Establishment of standard performance,
• Measurement of actual performance,
• Comparison of actual performance with the standards and finding out deviation if
any,
• Corrective action.
The ability of the project manager
• Ability to select and develop an operational team from a standing start
• Leadership and management ability
• Ability to anticipate problems, solve problems and make decisions
• Ability to integrate the project stakeholders
• Operational flexibility
• Ability to plan, expedite and get things done
• Ability to negotiate and persuade
• Understand the environment within which the project is being managed
• Ability to review monitor and apply control
• Ability to administer the contract, the scope of work and scope changes
• Ability to manage within an environment of constant change
• Ability to keep the client happy.
Role of Project Management
1. Integration Management
2. Time and Cost Management
3. Scope Management
4. Quality management
5. Human Resource Management
6. Communication Management
7. Risk management
8. Procurement management
Project initiation
• During this phase a business problem or opportunity is identified and a business
case providing various solution options is defined.
• a feasibility study is conducted to investigate whether each option addresses the
business problem and a final recommended solution is then put forward.
• Terms of reference are completed outlining the objectives, scope and structure of
the new project, and a project manager is appointed
• The project manager begins recruiting a project team and establishes a project
office environment.
Project design
• Project plan outlining the activities, tasks, dependencies and timeframes;
• Resource plan listing the labour, equipment and materials required;
• Financial plan identifying the labour, equipment and materials costs;
• Quality plan providing quality targets, assurance and control measures
• Risk plan highlighting potential risks and actions to be taken to mitigate those
risks;
• Acceptance plan listing the criteria to be met to gain customer acceptance;
• Communications plan describing the information needed to inform stakeholders;
• Procurement plan identifying products to be sourced from external suppliers
Project implementation
• This phase involves implementing the plans created during the project design
phase
• While each plan is being executed, a series of management processes are
undertaken to monitor and control the deliverables being output by the project:
• identifying change, risks and issues, reviewing deliverable quality and measuring
each deliverable produced against the acceptance criteria.
• Once all of the deliverables have been produced and the customer has accepted
the final solution, the project is ready for closure.
Project closure
• releasing the final deliverables to the customer
• handing over project documentation to the business
• terminating supplier contracts
• releasing project resources and communicating the closure of the project to all
stakeholders.
• undertake a post-implementation review to quantify the level of project success
and identify any lessons learnt for future projects.
Feasibility criteria
• Relevance
• Effectiveness
• Efficiency
• Impact
• Sustainability
Relevance
• The validity of the overall goal and project purpose to the needs of communities
• Immediate results (outputs) are necessary and sufficient to attain the Purpose
Effectiveness
• The extent to which the project’s objectives will be achieved, and meet the
identified needs of beneficiaries
• Planned activities can be/will be realized and there are/were no major
obstacles/risks to affect expected results. (economic, physical, environmental,
social, technological risk factors)
• The project is realistic from a technical, social/cultural and political perspective
Efficiency
• A project is efficient when the project costs are necessary and sufficient in
quantity and quality to achieve planned objectives
• The degree to which Inputs will be converted into Outputs
• Absence of waste for a given output
Impact
• The Purpose and Overall Objectives once achieved will have positive effects on
the target group/communities
• Positive changes outweigh the negative changes produced, directly or indirectly,
as a result of the Implementation of the project
• The durability of the benefits and development effects produced by the project
after its completion
Sustainability
• The project will continue to meet the needs of beneficiaries long after its
completion
A FEASIBILITY STUDY
1. Project Identification
• Project identification is the initial phase of the project development cycle.
• It begins with the conceiving of ideas or intentions to set up a project.
• These ideas are then transformed into a project.
• The characteristics below must be clearly defined:
• Objectives
• Expected outputs
• Intended beneficiaries
• Planned lifespan
• Extended outcome of the project
• Principle stakeholders
• Financial plan and source of financing
Project ideas conceived by:
• Individuals
• Groups of individuals (community)
• Local leaders
• NGOs
• Policy makers
• Planners
• International development agencies
• Government pronouncements
Project ideas may be due to:
• prevailing problems in a given area.
• availability of resources in a given location.
2. Project Pre-Feasibility Study Process
• This pre-feasibility study is a short, focused and a low cost assessment of a
projects’viability. This process will provide a good basis for further pursuing the
project.
• The intention is to define the project, and to collate information necessary for the
institution to develop the project concept based on engineering design concept, the
technical and financial challenges of implementation, and expected project
outcomes and impacts.
• At the completion of this task the institution will have a well defined description
of the proposed project:
• its general scope,
• preliminary cost estimates,
• income generating opportunities,
• initial financial viability,
• opportunities,
• project risks,
• and what further actions are required to complete the project preparation and by
who
3. Project Feasibility Study
• The feasibility study is a critical component of project preparation, and a
technical working document for project appraisal. Any project regardless of its
scale and nature can have long-term implications with a great deal at stake once
it’s implemented.
-> A feasibility study therefore needs to be authentic, accurate and thorough.
The feasibility study will:
• consider how the project will be structured;
• contain a financial model with key investment ratios, and the capability
of running scenario and sensitivity analyses;
• identify constraints which may cause the project to be halted;
• ensure that the project is developed around a proper business plan;
• and has been subject to a due diligence that shows it is legally, physically and
socially compliant

4. A Feasibility Study Report

• It is a formally documented output of feasibility study that summarizes results of
the analysis and evaluations conducted to review the proposed solution and
investigate project alternatives for the purpose of identifying if the project is really
feasible, costeffective and profitable. It describes and supports the most feasible
solution applicable to the project.
Feasibility study document will provides:
• a full description of the business problem;
• a list of the requirements for a solution to fix the problem;
• a list of all available options for delivering a solution;
• an assessment of the feasibility of each option;
• a list of the risks and issues associated with each option;
• the preferred solution option for implementation.
What are the reason for project failure?
Major reasons for Project Failure:
• Incomplete, ambiguous, inconsistent requirements and specifications
• Poor or no planning
• No clear assignment of authority and responsibility
• Inadequate «End user » involvement during development
• Lack of adequate experience, tools and techniques
• Dependencies on external sources: Vendors, Subcontractors, Counting
on Inventions
• High staff turnover or indequate training
Chapter 2: Project Design management
2.1 Project initiation

Develop a business case

• A business case is created to define the problem or opportunity in detail and
identify a preferred solution for implementation. The business case includes:
• a detailed description of the problem or opportunity;
• a list of the alternative solutions available;
• an analysis of the business benefits, costs, risks and issues;
• a description of the preferred solution;
• a summarized plan for implementation
Undertake a feasibility study
• The purpose of a feasibility study is to assess the likelihood of each alternative
solution option achieving the benefits outlined in the business case
• The feasibility study will also investigate whether the forecast costs are
reasonable, the solution is achievable, the risks are acceptable and the identified
issues are avoidable
Appoint the project team
• The project team and a project manager are now ready to be appointed
• The project manager :
• creates a detailed job description for each role in the project team,
• and recruits people into each role based on their relevant skills and experience.
Set up a project office
• The project office is the physical environment within which the team is based
• equipment, such as office furniture, computer equipment,stationery and materials;
• communications infrastructure, such as telephones, computer network, e-mail,
• Internet access, file storage, database storage and backup facilities;
• documentation, such as a project methodology, standards, processes, forms and
registers;
• tools, such as accounting, project planning and risk modelling software
2.2. LOGICAL FRAMEWORK (Logframe)

Description Logframe
- Vertical logic defines the Project Structure and includes the Overall
Objective/Goal, Purpose, Outputs and Activities of the project (Column 1)
- Horizontal logic defines :
+ how project objectives specified in the project description will be measured (i.e.,
indicators)
+ and the means by which the measurement will be verified (columns 2
and 3 of the Logframe). This provides the framework for project
monitoring and evaluation.
+ Any assumptions (are the events, conditions or decisions) which are
necessary for the project success (Column 4)
FIRST COLUMN: THE INTERVENTION LOGIC
• The first column summarizes the logic of the proposed project
• Start at the top of the column and work downwards:
• If this project Overall Objective is desirable, then what project Purpose will
contribute to it?
• If the project Purpose will contribute to the Overall Objective attainment, then
what project Outputs will be necessary to achieve the project Purpose?
• If the project Outputs are to be accomplished, then what Activities, Tasks and
Inputs will be required?
• From the bottom up, it can be expressed in terms of
• IF adequate inputs/resources are provided, THEN activities can be undertaken;
• IF activities are undertaken, THEN results can be produced;
• IF results are produced, THEN the purpose will be achieved; and
• IF the purpose is achieved, THEN this should contribute toward the overall
objective
Objectively Verifiable Indicators (OVIs)
• Objectively Verifiable Indicators (OVIs) describe the project’s objectives in
operationally measurable terms, specify the performance standard to be reached in
order to achieve the goal, the purpose and the outputs.
Therefore OVIs should be specified in terms of Quantity, Quality, Time, Target
group, and Place.
Objectively Verifiable Indicators (OVIs)
• Indicators:
Define how to verify the attainment of objectives:
• Quality - The kind (or nature) of the change, (how well)
• Quantity - The scope/extent of the change, (how much, how many)
• Timing - When the change should have taken place. (by when)
• Target group -(for whom)
• Place - Location (where)
Targets
• Outcome indicators have two components: a baseline and a target.
• The baseline is the situation before the project activity begins. It is the starting
point for results monitoring
• Target is what the situation is expected to be at the end of the project.
• Between the baseline and the target, there may be several milestones that
correspond to expected performance at periodic intervals.
• Whereas the indicator defines how performance will be measured along a scale or
dimension, the target identifies the specific, planned level of result to be achieved
within an explicit time frame
Objectively Verifiable Indicators and Targets
• Performance indicators are measures that describe how well a project is achieving
its objective. Indicators indicate specifically what to measure to determine whether
the objective has been achieved.
• At the Purpose Level, the indicators and targets should reflect what the project
should accomplish when it is successfully completed/terminated. It is also useful to
indicate the Baseline situation at the Purpose level in the Logframe, so that the
magnitude of planned project progress is highlighted.
• Output level indicators should only measure specifics within the control of the
project that have been accomplished. At the Output level, the targets for each
indicator may be subdivided into intermediate – i.e., annual, quarterly or monthly
targets for the life of the project. Whenever possible, quantitative targets should be
indicated on a cumulative basis.
Means of Verification
• The means of verification (MOV) column of the Logframe identifies the source
of, how, and how frequently the data for each of the indicators and targets is to be
obtained.
• At the Goal Level, since this is beyond the project operational level, the data is
usually found in well-established secondary sources
• At the Purpose Level, most of the data is usually gathered by specialized but
infrequent evaluation surveys conducted by the project. The remainder of the data
required will probably be collected and reported regularly as part of the project’s
periodic (usually quarterly, semi- annual or annual) progress monitoring.
• The Output Levels, most of the data is usually collected and reported regularly as
part of the project’s periodic (usually monthly) progress monitoring. Some data
may also be obtained from specialized, but infrequent evaluation surveys
conducted by the project
Assumptions
• Assumptions are the events, conditions or decisions which are necessary for the
project success, but which are largely or completely beyond the control of project
management (external factors).
• Identifying assumptions:
They are the answer to the question: “What external factors may impact on project
implementation and the long-term sustainability of benefits, but are outside project
management’s control?”

Assumptions
• Once assumptions have been formulated, ensure that
• They are formulated as desirable, positive conditions
• They are linked to the correct project level
• Assumptions which are not important are not included
• Assumptions which are very likely to occur are not included
• If there are assumptions which are both important and unlikely to occur (killing
factors) the project should either be redesigned to avoid them - or abandoned
• The remaining assumptions are precisely and verifiably defined
Role of Logframe
• It summarize and ensure consistency among purposes, outputs, activities and
inputs and to identify important risks or assumptions that will likely affect the
attainment of project objectives.
• It tracks the causal relationship between the project input,output, effects, and
impact
• It is used to plan, implement and evaluate projects. It is useful in linking the
project’s objectives with the actual accomplishment of project implementation
through the use of performance indicators.
Role of Logframe
• Monitoring Implementation & Performance Evaluation.
• The Logframe helps to clarify data requirements in terms of indicators and targets
as well as sources of data and means for collecting them for progress monitoring
and periodic evaluation.
• The Logframe is also used to examine the original project assumptions about
external factors, and validate, or if necessary restructure the means-end linkages.
• The original design of an on-going project can be readily reexamined:
- The determine whether or not inputs were delivered in a timely manner, and
whether or not the outputs are being produced as planned;
- Identify which outputs were supposed to contribute to the project effect, and
validate whether they in fact are doing so.
Writing clear statements
• the Overall Objective/Goal describes the anticipated long term objective towards
which the project will contribute (project justification). It is to be expressed as ‘To
contribute to…..`;
• the Specific Objective/Purpose describes the intended effects of the project
(project purpose), the immediate objective for the direct beneficiaries as a precisely
stated future condition. It is to be expressed in terms of benefits to the target group
being ‘Increased/improved/ etc……….’,
• Results/outputs are expressed as the targets which the project management must
achieve and sustain within the life of the project. Their combined impact should be
sufficient to achieve the immediate objective. They are to be expressed in terms of
a tangible result ‘delivered/produced/conducted etc’, and
• Activities are expressed as processes, in the present tense starting with an active
verb, such as ‘Prepare, design, construct, research …..’. Avoid detailing
activities;indicate the basic structure and strategy of the project
Once the Goal has been formulated, ensure that:
1. It is consistent with the development policy of the partner country
2. It is consistent with the donor's policy guidelines for development aid
3. It represents a sufficient justification for the project
4. It is not too ambitious. (i.e. achieving the purpose will significantly contribute to
the fulfilment of the goal)
5. The target groups are explicitly defined
6. It is expressed as a desired end, not as a means (a process)
7. It is expressed in verifiable terms
8. It does not contain two or more objectives which are causally linked
(meansends)
Once the purpose has been defined, ensure that:
1. It consists of one single objective
2. The target groups of the project are specified
3. It can be expected to contribute significantly to the fulfilment of the goal
4. It is realistic, i.e. it is likely to occur once the project outputs have been
produced
5. It is outside the immediate control of the project itself
6. It is formulated as a desired state, not a process
7. It is precisely and verifiably defined
Once the outputs have been identified, ensure that
1. All essential outputs necessary for achieving the purpose are included
2. Only the outputs which can be guaranteed by the project are included
3. Each output can be seen as a necessary means to achieve the purpose
4. All outputs are feasible within the resources available
5. The outputs are precisely and verifiably defined
Once activities are describes, ensure that
• All essential activities necessary to produce the anticipated outputs are included.
• All activities contribute directly to the output level above
• Only those activities to be performed by the project are included
• Activities are stated in terms of actions being undertaken rather than completed
outputs
• The time available for each activity is realistic
• The activities are appropriate to the situation in the partner country, in terms of
institutions, ecology, technology, culture, etc.
Once inputs are described, ensure that
• The inputs can be related directly to the specified activities
• The inputs are necessary and sufficient conditions to undertake the planned
activities
• The level of detail is adequate but limited to comprehensibility
• The inputs are precisely and verifiably defined (quantity, quality,cost)
• The resources are appropriate for the situation in the partner country, in terms of
organization, gender, culture, technology,environment, etc
Purpose/Specific objective
• Purpose/Specific objective that are closer in time, are more concrete
and clear and as far as possible, their statements should be SMART
(Specific – Measurable - Attainable (or Agreed by all those interested
or affected) - Relevant (or Realistic) and Time bounded
OVIs AND MEANS OF VERIFICATION
• They are formulated in response to the question:
• “How would we know whether or not what has been planned is actually
happening or happened? How do we verify success?”
• A good OVIs is SMART:
• Specific to the objective it is supposed to measure and substantial, i.e. it reflects
an essential aspect of an objective in precise terms
• Measurable either quantitatively or qualitatively, in a factual way. Each indicator
should reflect fact rather than subjective impression. It should have the same
meaning for project supporters and to informed sceptics.
• Available at an acceptable cost, based on obtainable data. Indicators should draw
upon data that is readily available or that can be collected with reasonable extra
effort as part of the administration of the project
• Relevant to the information needs of managers and plausible, i. e. the changes
recorded can be directly attributed to the project
• Time-bound :– so we know when we can expect the objective/target to be
achieved

Once indicators have been specified, ensure that

• They are specific in terms of quantity, quality, time, location and target group
• The means of verification is available (statistics, observation, records)
• If not, check that the information can be generated at reasonable cost
• It is relevant as a measurement of the achievement of objectives
• The means of verification is reliable and up-to-date
• The collection, preparation and storage of information is an activity within the
project and the necessary inputs for it are specified in the PM
The means of verification (MOV)
• The means of verification should specify:
• What information to be made available, (e.g from administrative records, special
studies, sample surveys, observation, etc.)
• Where, in what form the information/documented source should be collected (e.g.
progress reports, project accounts, official statistical documents, engineering
completion certificates etc.)
• Who should collect/provide the information (e.g. field extension workers,
contracted survey teams, the district health office, the project management team)
• When/how regularly it should be provided. (e.g. monthly, quarterly, annually,
etc.)
Assumptions
• Identifying assumptions?
They are the answer to the question: “What external factors may impact on project
but are outside project management’s control?

This relationship between

Assumptions and Objective hierarchy
• once the Activities have been carried out, and if the Assumptions at this level
hold true, results will be achieved;
• once these Results and the Assumptions at this level are fulfilled, the Project
Purpose will be achieved; and
• once the Purpose has been achieved and the Assumptions at this level are
fulfilled,
• contribution to the achievement of the Overall Objectives will have been made by
the project.
Assumptions
• … are formulated as desirable, positive conditions
• … are linked to the correct project level
• … are not important are not included
• … are very likely to occur are not included
• If there are assumptions which are both important and unlikely to occur
(killing factors) the project should either be redesigned to avoid them -
or abandoned
• The remaining assumptions are precisely and verifiably defined
Once assumptions have been formulated, ensure that
• They are formulated as desirable, positive conditions
• They are linked to the correct project level
• Assumptions which are not important are not included
• Assumptions which are very likely to occur are not included
• If there are assumptions which are both important and unlikely to occur
(killing factors) the project should either be redesigned to avoid them - or
abandoned
• The remaining assumptions are precisely and verifiably defined

Chapter 3. Implementation management

3.1. Project planning
Define the planning basis:
• Scope
• The scope defines the boundaries within which all project activities and tasks are
to be completed
• Phases
• A phase is a set of activities to be undertaken to deliver a substantial portion of an
overall project.
• Milestones
• A milestone is a major event in a project, and often represents the completion of a
set of project activities.
• Activities
• An activity is a set of tasks that are required to be undertaken to complete a
portion of a project.
• Task
• A task is an item of work to be complete within a project
PROJECT PLAN
• A project plan lists the activities, tasks and resources required to complete a
project and realize the business benefits outlined in the business case.
• A typical project plan includes:
• a description of the major phases undertaken to complete the project;
• a schedule of the activities, tasks, durations, dependencies, resources and time-
frames;
• list of the assumptions and constraints identified during the planning process.
Dependencies
• Dependencies are logical relationships between phases, activities or tasks which
influence the way that a project will be undertaken.
• Dependencies may be internal to the project (between project activities) or
external to the project (between a project activity and a business activity).
• Types of dependency:
• Activities in series. They are carried out one after the other ( finish-to-start)
• Activities in parallel, they can be performed together (start-to-start)
• Finish-to-finish;
• Start to Finish
CREAT PROJECT PLAN
1. Create a project schedule
2. Create a resource plan
3. Create a financial plan
4. Create a quality plan
5. Create a risk plan
6. Create a procurement plan
7. Contract the suppliers
8. Create an acceptance plan

1. Create a project schedule

• Create a detailed project schedule, listing each of the phases, activities and tasks
required to complete the project.
2. CREATE A RESOURCE PLAN
• A resource plan describes the physical resource required to complete a project.
• This includes a list of the types of resource required, such as labour, equipment
and materials, as well as a schedule identifying when each resource will be
utilized.
• A resource is created after the project plan has been defined
To create a resource plan, the following steps are undertaken:
• List the general types of resources to be utilized on the project.
• Identify the number and purpose of each type of resource required.
• Identify when each resource will be utilized, by completing a resource schedule.
• Assign the resources to project activities, by completing a resource usage table.
3. CREATE A FINANCIAL PLAN
• A financial plan identifies the financial resources required to undertake a project.
This includes:
• a list of the costs/expenses likely to be incurred on the project such as labour,
equipment, materials and administration costs;
• A schedule identifying when each respective cost is likely to be incurred;
• A calculation of the total cost of each activity outlined in the project plan.
A financial plan includes:
• A list of the costs/expenses likely to be incurred on the project such as labour,
equipment, materials and administration costs;
• A schedule identifying when each respective cost is likely to be incurred;
• A calculation of the total cost of each activity outlined in the project plan.
4. CREATE A QUALITY PLAN
• Quality is usually considered from two different perspectives:
• the quality of each deliverable produced for the customer,
• and the quality of the management processes undertaken to produce each
deliverable.
• A quality plan is created during the project planning phase after the project plan,
resource plan and financial plan have been identified
To create a quality plan, the following steps are undertaken
• Define the term ‘quality’ in regards to this project.
• Identify the quality targets to be met.
• Describe the quality assurance and control techniques to be undertaken.
• Define the processes required to achieve the quality targets specified
4. CREATE A RISK PLAN
• A risk plan lists all of the foreseeable project risks and provides a set of actions
required to prevent each risk from occurring and reduce its impact should it
eventuate.
• list of the foreseeable project risks;
• rating of the likelihood of each risk occurring;
• description of the impact on the project should a risk actually occur;
• rating of the overall importance of each risk;
• set of preventative actions to be taken to reduce the likelihood of the risk
occurring;
• set of contingent actions to be taken to reduce the impact should the risk
eventuate;
• process for managing risk throughout the project.
CREATE A PROCUREMENT PLAN
• A procurement plan identifies the products to be procured from
external suppliers and the timeframes and methods of procurement.
• This includes:
• An overview of the external supply market. This will provide key stakeholders
with confidence that the products do actually exist in the market and that suitable
suppliers can readily provide them within the time and budget constraints.
• A full list of the products to be acquired and a detailed description of each
product.
• The justification for procuring the products externally rather than internally.
• A plan outlining the timeframes for acquiring the products.
• A tender process describing how the preferred suppliers will be chosen.
• A procurement process describing how the products will be acquired from the
preferred supplier. It also describes how the supplier relationship will be managed
to ensure continued delivery
6. CONTRACT THE SUPPLIERS
• Formal tender management process
• This is a method by which potential suppliers are identified, evaluated and
selected for the provision of products (goods or services) to the project
• This process involves creating a suite of tender documents which outline the
project procurement requirements and information required from suppliers upon
which to make a preferred supplier decision.
7. CREATE AN ACCEPTANCE PLAN
• ‘Acceptance’ is defined as gaining agreement from the customer that the
deliverables produced by the project meet the criteria defined by the customer.
These criteria relate to the quality and cost of deliverables as well as the
timeframes within which they are produced.
• The acceptance plan is an important document in a project. It is usually
constructed towards the end of the project planning phase after the project plan,
resource plan, financial plan, quality plan and risk plan have been documented.
An acceptance plan includes:
• a list of the milestones to be achieved and deliverables to be produced;
• a set of criteria and standards for the acceptance of deliverables by the customer;
• a plan outlining how the deliverables will be reviewed to determine whether or
not they meet the criteria and adhere to the standards set by the customer;
• a process for gaining customer acceptance once the deliverables have
been produced.
Tool
• A work breakdown structure
• Gantt

1. Work breakdown structure (WBS)

• Work breakdown structure is as an outline or map of the specific project. It is an
essential tool for planning and executing the project
• The purpose of the work breakdown structure (WBS) is to subdivide the scope of
work into manageable work packages that can be estimated, planned and assigned
to a responsible person or department for completion.
• The breakdown should group similar work together to improve productive
efficiency, built method and executive strategy

Work Breakdown Structure Guidelines

• The top level represents the final deliverable or project
• Sub-deliverables contain work packages that are assigned to a organization’s
department or unit
• All elements of the work breakdown structure don’t need to be defined to
the same level
• The work package defines the work, duration, and costs for the tasks required to
produce the sub-deliverable
• Work packages should be independent of other work packages in the work
breakdown structure
• Work packages are unique and should not be duplicated across the work
breakdown structure
Work Package
• the work packages are shown with short description and later with a number.
• On your projects you may consider also including the following: Specifications;
Duration; Quality requirements; Procurement; Estimate (manhours); Resources;
Budgets; Equipment requirements
Gantt chart
• The Gantt chart was invented in the early 1900’s by Henry L. Gantt, an American
engineer and social scientist.
• Henry Gantt (1861 - 1919), designed the barchart as a visual aid for planning and
controlling his shipbuilding projects. In recognition, planning barcharts are often
called after his name - Gantt charts
• The horizontal axis is (linear) time; each task is given its own horizontal band
where the calendar duration of the task is indicated by a box, line, or other object
with a variable horizontal dimension.
• Tasks are often grouped into categories, and each category can be treated as a
summary task whose duration spans all the tasks within that category.
Gantt Charts
• the top line is a calendar time-scale in days and the activities are listed on the left
hand column
• The scheduling of each activity is represented by a horizontal line from the
activity's start to finish date.
• The length of the activity line is therefore, proportional to its estimated duration
• Gantt further used this barchart to track progress by drawing a second line
alongside the planned schedule to indicate work done. The relative position of the
progress line to the planned line indicates percentage complete and remaining
duration, while the relative position between the progress line and Timenow
indicates actual progress against planned progress.
The advantages of the Gantt chart
• Time is explicit (and linear)
• All tasks visible in relationship to others
• Deadlines are shown
• Project status at intermediate times is shown
• Can show progress by “filling in” task boxes
[Link] and evaluation
Monitoring and Evaluation
• The overall purpose of monitoring and evaluation is the measurement and
assessment of performance in order to more effectively manage the outcomes and
outputs known as development results. Performance is defined as progress towards
and achievement of results.
Specific Purposes
1. to identify indicators and generate corresponding information necessary in
assessing the progress of project implementation;
2. To measure resource flows and project accomplishments and to detect delays, if
any or to determine on a regular basis the progress of project implementation;
3. To find out whether or not the real objectives of the project are attained as
planned and to identify the possible causes of the non-attainment of proper
objectives;
4. To identify both effective and defective strategies in the project implementation
for appropriate future courses of action and for planning similar projects in the
future
5. to enable management to assess the relevance, efficiency, and effectiveness of
project implementation, together with its impact on project participants and the
environment;
6. to monitor and evaluate the socioeconomic effects and impact of the project; and
7. to provide guidance and lesson for the planning of future projects.
Types of Project Monitoring and Evaluation
1. Project Monitoring
1.1. Implementation or Progress Monitoring (Input-output Monitoring)
• deals with the continuous or periodic surveillance of project operation and
implementation processes to measure progress of a given project
• a periodic activity that essentially looks into the effectiveness and efficiency in
the conversion of project inputs to outputs. Specifically, it looks into inputs
(delivery and quantities), time schedules, and outputs (quantity, quality, and use).
The relevant questions asked in progress monitoring are:
• Were the inputs delivered on time and in the proper quantities?
• Were the activities undertaken per plan or schedule?
• Are the outputs of the desired quantity and quality?
• What problems were encountered in the implementation of the activities?
1.2. Benefit Monitoring
Benefit Monitoring
• the periodic assessment of the benefits that have come about because of the
project
• look at how the project meets its higher-level objectives
• will be concerned mainly with the effects and impacts of a project as a result of
the proper and sustained use of project outputs.
• simply monitoring conducted by managers or entities which deliver development
services to help them ensure that benefits are derived from development
investments
The relevant questions asked in benefit monitoring are:
• What are the benefits generated by the project?
• Who has been affected?
• How large have been the impacts?
Two Types of Benefit Monitoring Systems
A. Formal Monitoring Systems
• with which benefit monitoring may be integrated with are often called
Management Information Systems (MIS)
• MIS is a system using formalized procedures to provide management at all levels
and all functions with appropriate information, based on data from internal and
external sources to enable them to make timely and effective decisions for
planning, directing, and controlling the activities for which they are responsible.
• Formal systems produce regular reports, operating or accounting statements and
statistical analyses.
• generally used by organizations or portions of organizations that have formal
organizational structures and decision-making procedures which are organized
along functional lines
• particularly useful in helping management make decisions with respect to the
internal operations of the organization (e.g., PCA).
B. Informal Monitoring
• consists of personal contact, occasional field visits to project sites, verbal
feedback from visiting field informal meetings, telephone conversations, and
exchanges of correspondence
• Informal monitoring activities are more useful for solving local or specific
problems than are formal monitoring methods. While there are limits to the
usefulness of informal monitoring systems, the value of informal monitoring
should not be underestimated simply because of the informality and lack of
documentation that is associated with it.
How can we tell when Project Control is needed?
Performance
- Unexpected technical problems arise
- Insufficient resources are unavailable when needed
- Quality or reliability problems occur
- Owner/Client requires changes in technical specifications
- Inter-functional complications and conflicts arise
- Market changes that increase/decrease the project’s value
Cost
- Technical difficulties that require more resources
- Scope of work increases
- Bid amount (accepted for the contract award) is too low
- Reporting of the monitoring results are poor/late
- Project budgeting for contractor cash flows not done right
- Changes in market prices of the inputs
Time
- Technical difficulties require more time to solve
- Scope of work increases
- Unexpected utilities needing relocation
- Task sequencing not done right
- Required material, labor/equipment unavailable when needed
- Key preceding tasks were not completed on time.
3.3. Cash-Flow
Cash-Flow
• The cash-flow statement is a document which models the flow of money in and
out of the project. The income (cash inflow) and expenditure (cash outflow) are
grouped together and totalled.
• A cash flow statement is not only concerned with the amount of the cash flows
but also the timing of the flows. Many cash flows are constructed with multiple
time periods. For example, it may list monthly cash inflows and outflows over a
year’s time.
• Working capital is an important part of a cash flow analysis. It is defined as the
amount of money needed to facilitate business operations and transactions, and is
calculated as current assets (cash or near cash assets).
• Computing the amount of working capital gives you a quick analysis of the
liquidity of the business over the future accounting period. If working capital
appears to be sufficient, developing a cash flow budget may not be critical. But if
working capital appears to be insufficient, a cash flow budget may highlight
liquidity problems that may occur during the coming year.
• Cash flow from operations represents the amount of cash a company generates
(or consumes) from carrying out its operating activities over a period of time.
Operating activities include generating revenue, paying expenses, and funding
working capital.
• Cash Flow from Investing Activities displays how much money has been used in
(or generated from) making investments during a specific time period.
Investing activities include purchases of long-term assets (such as property, plant,
and equipment), acquisitions of other businesses, and investments in marketable
securities (stocks and bonds).
• Cash Flow from Financing Activities is the net amount of funding a company
generates in a given time period used to finance its business. Finance activities
include the issuance and repayment of equity, payment of dividends, issuance and
repayment of debt, and capital lease obligations.
Project costs
Project Costs
• A project estimate can be subdivided into a number of different costs, consider
the following:
• Labour costs;
• Material and equipment costs;
• Transport costs;
• Other costs :Project office costs;
• Those costs can be specifically identified with an activity or project.
• Those costs are the total expense that can be charged to an activity
Project Accounts
1. The financial models are:
• Payback period: is the time taken to gain a financial return equal to the original
investment. The time period is usually expressed in years and months. Consider
this example where a company wishes to buy a new machine for a four year
project.
• Return on investment (lOR)
• Net present value (NPV)
• Internal rate of return (IRR)
Payback period
• Payback period is the time taken to gain a financial return equal to the original
investment. The time period is usually expressed in years and months. Consider
this example where a company wishes to buy a new machine for a four year
project.
• The disadvantages of the payback period calculation are:-
- It does not consider the time value of money.
- It is not a suitable technique to evaluate long term projects where the effects of
differential inflation and interest rates could significantly change the results.
- The figures are based on project cash-flow only. All other financial and
nonfinancial data are ignored.
- The payback period calculation does not look at the total project. What happens
to the cash-flow after the payback period is not considered.
Return on Investment (ROI)
• Another popular investment appraisal technique that does look at the whole
project is return on investment (ROI).
• This method first calculates the average annual profit, which is simply the project
outlay deducted from the total gains, divided by the number of years the
investment will run. The profit is then converted into a percentage of the total
outlay using the following equations
• The return on investment method has the advantage of also being a simple
technique like the payback period, but further, it considers the cash-flow over the
whole project. The total outcome of the investment is expressed as a profit and
percentage return on investment, both parameters readily understood by
management.
• The main criticism of return on investment is that it averages out the profit over
successive years. An investment with high initial profits would be ranked equally
with a project with high profits later if the average profit was the same. Clearly the
project with high initial profits should take preference.
Net Present Value (NPV)
• If you were offered $120 one year from now and the inflation and interest rate
was 20%, working backwards its value in today's terms would be $100. This is
called the present value, and when the cash-flow over a number of years is
combined in this manner the total figure is called the net present value (NPV).
• Where the cash-flow timing is expressed in years from the start date of the
project, the inflation effect is assumed to act at the end of the first year or
beginning of the second year, therefore all cash-flows in the first year are at present
value.
• The NPV is a measure of the value or worth added to the company by carrying
out the project. If the NPV is positive the project merits further consideration.
When ranking projects, preference should be given to the project with the highest
NPV.
Internal Rate of Return (IRR)
• The IRR is the value of the discount factor when the NPV is zero. The IRR is
calculated by either a trial and error method or plotting NPV against IRR. It is
assumed that the costs are committed at the end of the year and these are the only
costs during the year.
• The IRR analysis is a measure of the return on investment, therefore, select the
project with the highest IRR. This allows the manager to compare IRR with the
current interest rates.
• One of the limitations with IRR is that it uses the same interest rate throughout
the project, therefore as the project's duration extends this limitation will become
more significant.
Project Evaluation
1. Ex-ante Evaluation
• evaluation of the proposed project is conducted before the start of the project
• also called pre-programming evaluation or project appraisal
2. On-going Evaluation
• It is the analysis, during the implementation phase of an activity, of its continuing
relevance, efficiency, and effectiveness and present and likely future outputs,
effects, and impact
• It makes a continuous analysis and assessment of the outputs, effects, impact and
(to some extent) the relevance of a project
• Monitoring and on-going evaluation activities focus on whether time schedules,
costs and targets of physical facilities and infrastructure have been according to
plan and budgetary documents.
Why Conduct On-Going Evaluation?
1. to assess the overall performance in project implementation;
2. to establish whether project/program objectives are being achieved or are likely
to be achieved and whether there are unanticipated and unwanted side effects;
3. to assist decision-makers by providing information about any needed adjustment
of objectives, policies, implementation strategies, or other elements of the project,
as well as providing information for future planning; and
4. to assess whether the assumptions in the project design are valid or whether
adjustments are required to ensure that the overall project objectives will be
achieved.
Monitoring and on-going evaluation activities should include the following:
a. physical facilities and infrastructure – whether time schedules, costs and
targets have been according to plan and budgetary documents;
b. institutional aspects (e.g., staff recruitment, training and turnover,
intraorganizational cooperation, inter-organizational coordination, and relations
with other public and private institutions, in particular with beneficiary groups)
c. delivery systems (e.g., volume of services and costs in conformity with plans,
geographical coverage, outreach to the target groups, percentage of small farmers
reached in relation to the total number of farmers in a coconut extension project;
and
d. results achieved – i.e., outputs and effects or immediate and intermediate level
objectives attained, e.g., coconut yield and production, benefits and costs, both
direct and indirect, employment and income generation, if any, by sex and age.
3. Terminal Evaluation
• is undertaken from 6 to 12 months after project completion, either as a substitute
for ex-post evaluation of projects with short gestation periods (e.g. credit or
forestry extension) or before initiating a follow-up phase of the project.
4. Ex-post Evaluation
• is undertaken at full project development, i.e., some years after project
completion when full project benefit
• and impact are expected to have been realized.
For terminal and ex-post evaluations, the project should be evaluated with
regard to:
1. its performance, i.e., the extent to which it is proceeding according to
project design and plan. This is referred to as performance evaluation.
2. its impact in terms of economic, social, and environmental objectives,
particularly with reference to the target groups. This is referred to as impact
evaluation (sometimes called outcome evaluation).
3. its institutional devel