Project Analysis and Management

Samuel S.(PhD Candidate)

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 Chapter 1
Introduction to Project Analysis
and management

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 Topics to be discussed
Defining a Project
Parameters of projects
Main Features of a project
Classification of projects
Key Stakeholders of a project
Project management

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1.1. Defining a project
• A project can be defined as a temporary
endeavour/effort/attempt undertaken to create a
unique product or service.

• Turner defined a project as“……..an endeavour in

which human (or machine), material and financial
resources are organised in a novel way, to undertake
a unique scope of work, of given specification, within
constraints of cost and time, so as to deliver beneficial
change by quantitative and qualitative objectives”
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• A project is an endeavor(attempt) to accomplish a
specific objective through a unique set of interrelated
tasks and the effective utilization of resources.

• It has a well-defined objective stated in terms of scope,

schedule, and costs.

• Projects are “born” when a need is identified by the

customer – the people or organization willing to
provide funds to have the need satisfied.
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• It is the people (project manager and project
team), not the procedures and techniques, that are
critical to accomplishing the project objective.

• Procedures and techniques are merely tools to

help the people do their jobs.

• Therefore, a project is accomplished by

performing a set of activities.
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For example, construction of a house is a project.
• The construction of a house consists of many
activities like:
 digging of foundation pits,
 construction of foundation,
 construction of walls,
 construction of roof,
 fixing of doors and windows,
 fixing of sanitary fitting, wiring etc.
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• Another aspect of project is the non-routine nature
of activities. That is, each project is unique in the
sense that the activities of a project are unique and
non-routine.

• Thus, we can define a project as an organized

programme of pre-determined group of activities that
are non-routine in nature and that must be completed
using the available resources within the given time
limit.
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 Parameters of Projects
• During a project’s life, management focuses on
three basic parameters: quality, cost, and time.

• A successfully managed project is one that is

completed at the specified level of quality; on or
before the deadline; and within the budget. In
addition, client satisfaction indicates success and
possibility for replication or sustainability.

• Each of the parameters is specified in detail

during the planning phase of the project. These
specifications then form the basis for controlling
the project during the implementation phase.
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 parameters

scope

quality

Time cost

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 Interrelations among parameters

Project Parameters

Quality Cost Time

Performance Budget Schedule

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 Project Vs. Programs

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 Project Vs Program -Differences
BASIS FOR PROJECT PROGRAM
COMPARISON
Meaning A project refers to the temporary A program implies a set of
activity, which is undertaken to create projects which are linked to one
a distinct product or service, that has another, in a sequential manner to
certain objectives attain the combined benefits
Focus on Content Context
Time horizon Short term Long term
Concerned with Specific deliverables, i.e. product or Benefits received
service
Functional units Single Multiple

Tasks Technical in nature Strategic in nature

Produces Output Outcome
Success Success can be measured in terms of Success is measured by the extent
product quality, timeliness, cost to which program meets out the
effectiveness, compliance and degree needs and benefits, for which it
of customer satisfaction. was conducted.
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 Projects vs. programs
Similarities

• Projects and programs have similar characteristics

in a way that both are:
 Having objectives;
 Requiring financial, human, material, etc inputs (or
resources);
 Generating outputs, (goods/services), of value;
 Serving as instruments for the execution of development
plans in order to boost the national economy.

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 Projects and Plans

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 Hierarchical Relationships
Development plans

Programs

Projects

Tasks

Work packages

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 Development plans:
Most forward looking (futuristic)
Broad and require systematic thinking, preparation
and appraisal
Attempts to bring welfare in the society

 Programs:
Derived from development plans
Exceptionally large with long term objectives
Explores specific area with broader scope
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Projects:
– Derived from a program
– Unique investigative tool
– A development activity with specific objectives
– Funded by a program
– An implementation element (entity)

Tasks:
– Work elements under a project
– Specific approaches for doing things
– Set of activities comprising a project
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Work packages:

– Sub elements of a given task (or undertaking)

– Something accomplished stage by stage
– Collection of work packages defines a given task

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 1.2. Main Features of A Project
(1) Objectives : A project has a set of objectives or a mission.
Once the objectives are achieved the project is treated as
completed.

(2) Life cycle : A project has a life cycle (it has beginning & an
end).
 The life cycle consists of the following stages i.e. conception
stage, definition stage, planning & organising stage,
implementation stage and evaluation stage.

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(3) Uniqueness : Every project is unique and no two projects are
similar. For instance, setting up a cement plant and construction of a
highway are two different projects having unique features.

(4) Team Work : Project is a team work and it normally consists of

diverse areas. There will be personnel specialized in their respective
areas and co-ordination among the diverse areas calls for team
work.

(5) Complexity : A project is a complex set of activities relating to

diverse areas.

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(6) Risk and uncertainty : Risk and uncertainty go hand in hand with
project. A risk-free, it only means that the element is not apparently
visible on the surface and it will be hidden underneath.

(7) Customer specific nature : A project is always customer specific. It is

the customer who decides upon the product to be produced or services
to be offered and hence it is the responsibility of any organization to go
for projects/services that are suited to customer needs.

9. Use of resources: A project consumes resources. The resources required

for completing a project are men, material, money and time.

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 1.3.Classification of Projects
Projects are classified based on several
criteria, including:
Ownership,
Source of finance
Forces behind
Nature of the projects.

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 Based on ownership:
• Private sector- mostly projects undertaken by
business enterprises.

• Public sector- projects undertaken by national

and local government bodies.

• NGOs- development projects are most often

undertaken by non-government and non-for profit
organizations.
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 Based on the Sources of Finance
• Government treasury- projects may be entirely financed
by government budget as per its priority. For instance,
construction of regional airport.

• Government treasury and external sources- most

projects are financed by the joint partnership of the
government and donor groups. For example, a road project
may be financed 50% by the government and 50% by a
foreign donor.

• External sources of Finance- projects may be financed

totally by parties other than the government but established
for the well being of the citizens and the ownership may be
for the government or the public.
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 Based on the Forces Behind:
• Demand driven/need driven- based on identified
unsatisfied demand project can be created or on
unsatisfied basic needs like food, water and shelter.

• Donor driven- the force behind the financing

organization. Donors will have their own say and
influence the types of projects to be established.

• Political Driven- Projects may be established in

response to some political situation such as for example
because of national elections, projects by religious
organizations.

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 Based on their nature
• Civil engineering, construction, petrochemical,
mining, quarrying, projects far away from the
contractor’s home office, and involve special risk as
well as problems of organizational communication.

• Manufacturing projects- conducted in a factory or

other home based environment and enable exercising
on the spot management.

• Research projects- established for pure research

consuming large sum of money and lasting over years
resulting in dramatic profitable discovery or proving
waste of money.

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 Management projects- that require the employment of an
external project manager or managing contractor for issues
such as relocating head quarters, developing and
introducing a new computer system, preparing for a trade
exhibition, producing a feasibility or other study report,
restructuring the organization etc.

Economic projects- These are projects that aim at

generating income.
E.g. Cash crop farming, business concerns like shop keeping, an
industry, a commercial farm.

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Social Projects

• These are projects that aim at providing social services and do

not earn a direct income.
E.g. projects on education, health, water and sanitation, road construction
and maintenance.

Local or National Projects

• Local projects are those projects which are initiated or funded
by a given country or local authority – District, city
municipality.
• National projects on the other hand are projects common to a
Country/Nation as a whole.
• e.g. Polio vaccination, national road construction network.
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International Projects

• These are projects that involve or are implemented

by two or more countries. They may be referred
the as:

– Bilateral - Involving 2 countries e.g. Ethio-Japan

Road construction

– Multi-lateral- involving more than 2 countries

e.g. COMESA (Common Market for East and
Southern Africa) Projects
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Small Scale (Micro) Projects
• Also referred to as Micro-enterprises, these are projects
which are small in size, uses limited resources, employs
few people, has small capacity. E.g. a poultry unit, retail
shop, a road side seller.
Large scale (Macro) Project
• Also referred to as Macro Projects, they are projects
which are large in size and scope, require heavy initial
investment, employ many people of diverse skills, have
high capacity of production. E.g hydro electric power plant
(HEP); sugar processing factory
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 Cont’d
 Based on the type of relationship a project has with
other objectives, project can also be classified as:
 Independent projects – those that can be implemented
without precluding(stopping) the implementation of
other projects
 Mutually exclusive projects – those which when
implemented preclude the implementation of other
projects (e.g., single unit vs. apartment building) and
 Complementary projects – those that require
implementation of other projects to attain certain
development objectives (e, g. component projects of an
integrated area development package).

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 Cont’d
In addition, depending upon how new
resources committed to them relate to
existing economic activities, projects can be
classified as:
A.New projects
B.Expansion projects
C.Updating projects

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1.4. Key Stakeholders of a Project

 stakeholders’ are any individuals, groups of people, institutions

or firms that may have a significant interest in the success or
failure of a project (either as implementers, facilitators,
beneficiaries or opponents).

 Thus, stakeholders can be internal or external to the

business/project.

 A common problem that arises with having numerous

stakeholders in an project is that their various self-interests may
not all be aligned. In fact, they may be in conflict with each other.
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• The concept of a stakeholder does have moral and ethical
implications for business/project governance.

• If a business only has a duty to its shareholders, then the business

may have no moral obligations to any other person, organization
or society.

• On the other hand, if a business has a duty to its stakeholders, then

a business must take into account the interests of its stakeholders
as well and not focus completely on maximizing the interests of its
owners.

• Stakeholders are influenced by the outcomes and objectives.

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• Stakeholders may have a positive or negative influence on a
project.

• Positive stakeholders are those who would normally benefit

from a successful outcome from the project, while negative
stakeholders are those who see negative outcomes from the
project’s success.

• For example, business leaders from a community that will benefit

from an industrial expansion project may be positive stakeholders
because they see economic benefit to the community from the
project’s success.

• Conversely, environmental groups could be negative stakeholders

if they view the project as doing harm to the environment.
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Key Stakeholders

• Key stakeholders include the following:

a) Project Manager: The person, who is responsible for

managing the project.

b) Customers, End Users: The person or organization that will

use the project’s product.

• In some cases, customers and user are synonymous, while in

others, customer refers to the entity acquiring the project’s

product and users are those who will directly utilizes the

project’s product.
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c) Sponsors: The person or group that provides
financial resources, in cash, or kind, for the project.

d) Performing Organization: The enterprise whose

employees are most directly involved in doing the
work of project.

e) Project Team Members: The group that is

performing the work of the project. It includes the
members who are directly involved in the project
activities.
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f) Influencers: People or groups that are not directly related to the
acquisition or use of the project’s product, but due to an
individual’s position in the customer organization or performing
organization, can influence, positively or negatively, the course of
the project.

g) Suppliers: The external companies or people who supply

materials and equipment.

h) Supporters: The parties who provide goods and services to

enable the facility to be built. E.g. The suppliers of
telephone, electricity etc.

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 Project management
What is project management?

• Project management is application of knowledge,

skill, tools, and techniques to project activities to
achieve project requirements.

• Project management is accomplished through the

application and integration of the project
management processes of initiating, planning,
executing, monitoring and controlling, and closing.
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 Project management
• It is a dynamic process conducted within a
defined set of constraints that organizes and
utilizes appropriate resources in a controlled
and structured manner in order to achieve
some clearly defined objectives.

• Key areas to consider when looking at project

management are management of time, people,
and other resources.
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 The Project Management Process
1. Clearly define the project objective
2. Divide and subdivide the project scope into major “pieces,”
or work packages.
3. Define the specific activities that need to be performed for
each work package in order to accomplish the project
objective.
4. Make a time estimate for how long it will take to complete
each activity.
5. Make a cost estimate for each activity.
6. Calculate a project schedule and budget to determine
whether the project can be completed within the require time,
with the allotted funds, and with the available resource.

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 Roles of the Project Managers

• A project manager integrates and coordinates all

the contributions, and guides them to successfully
complete the project.
• In other words, the project manager provides the
leadership to the project team to accomplish the
project objective. Specifically, the role of the project
manager includes:
i) Planning:
ii) Organizing:
iii) Controlling:

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 Skills of the Project Manager
• The project manager is a key ingredient in the success of a
project.
In addition to providing leadership in ` the project, the
manager should possess a set of skills that will both inspire
the project ream to succeed and win the confidence of they
customer.

Effective project managers have strong leadership ability, the

ability to develop people, excellent communication skills, good
interpersonal skills, the ability to handle stress, problem –
solving skills, and time management skills.

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 Thank you!
End of chapter one

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