Introduction to Project Preparation- Dr. Gamini Abayasekara
- Introduction
· The execution of projects is one of the most powerful means of speeding up development in desired ways.
· They are accepted as the cutting edge of modern development, being a dominant tool that can enhance the ability of the administrators and managers to plan, direct, and execute the ways in which an organisation uses its resources .
· Many in the public service have to undertake project work at some point, and hence it is important that they study project management, regardless of the academic qualifications and experience.
· Projects differ from those of routine day-to-day activities of the administrators, and so need different structures, planning, controlling, coordination and closing approaches.
· Therefore the main reason the public is interested in projects and want them to be managed successfully is to get the optimum out of scarce resources.
- Why Learn Project Management?
· It is through project management that development takes place and so should be given priority.
· Generally projects have failed to achieve their objectives, because unlike in day-to-day administration where risk minimization is the rule, projects need skills, attitudes and practices that can cope with risk and uncertainty.
· Project managers should have the ability to challenge assumptions and check their validity, and base project selection partly on numerical indication of the value of costs and returns- this is unlike routine administrators.
· The public sector also has to come up with new methods and approaches of financing projects that are cost recoverable (as in the private sector).
· There is the need to adapt to the changing ways, the new skills necessary, and the changing demands of new management of the public service.
· The new trend in project management is not to allow the sector to do it all alone, but to seek the best combination that will deliver the service satisfying the customer with maximum efficiency and effectiveness.
· Public servants must identify potential projects that address government policy and priorities, plus those which have long term rather than short term effects.
· Unfortunately there are 4 reasons favouring short term to long term results of development.
· Rapid changes in technology and knowledge have to also be adopted for successful project management, along with the consideration of gender issues and environmental issues.
· Partnerships as well as co-petitions will form (where you compete as well as cooperate with other firms etc to the best advantage of your organisation).
· Though the present public service is of varying knowledge, skills and attitudes, their unique strengths can be used to achieve success in projects.
- What is a Project?
· There are many classical definitions of the term project.
· Essential features of a project are:
· A project is not a routine continuing activity
· A project has:
§ well defined outputs or deliverables- e.g the construction of a dam
§ these deliverables are defined by specifications
§ well defined objectives to be achieved through the outputs –e.g. increase in paddy production
§ some larger purpose to be realized or an expected outcome – e.g. reduction of poverty, achieving food security through self-sufficiency
· A project has to start and be completed within a specific time frame. It has a start and an end
· A project consumes resources
· A few things a public servant must be aware of with regard to projects are
o When using a resource, and because resources are scarce, priorities have to be set for their use by considering the entire public sector.
o There is a waiting period for benefits of a project which invariably will incur costs on the project. This maybe felt as a loss to both or either the project in concern and other agencies involved.
o Projects must work under a single financial and management frame work.
o Projects have to be planned and appraised before implementation. A “definition workshop” is helpful for this.
o Projects have limited budgets, therefore overruns are costly.
o Projects have to be completed within the specified time period.
o Benefits of the projects, in the case of the public sector, must go to the public (including the underprivileged).
o Therefore criteria for project appraisal have to be different to those used in the private sector.
o Part of project planning is to provide alternative ways of achieving the same objective.
· Despite their value, use of projects for development (project approach) has its critics. Reasons being:
o High rate of project failure due to:
§ Optimistic and overestimated benefits
§ Limitations in forecasting models used (that of physical science and engineering – these models assume that there is a direct cause and effect relationship. However, social systems operate differently.)
§ Inconsistencies and uncertainties
§ Non-involvement of beneficiaries
§ Inappropriate intervention (e.g. political intervention)
§ Lack of data
§ Inadequate understanding of social and cultural conditions
· Alternative approaches to the project approach that have been suggested are:
o Adaptive management
o Process approach
o Learning process approach
o Problem solving approach
· However these approaches have not gained as much influence as the project approach.
- The project cycle
- The sequence in which a project is initiated and carried out is called the project cycle.
- The project cycle can be compared to a human lifecycle.
- Resources used at different stages of a cycle vary with each stage.
- There are many versions of the project cycle.
- The Rondinelli project cycle have 12 steps:
1. Project identification and definition:
§ In Sri Lanka, there are 3 main sources of projects identification , each having their own reasons for selecting a particular project:
o Politicians: votes
o Public: improvement of welfare
o Professionals: experience in the field
§ The challenge of the manager of a public sector project is to see that all three groups are happy, or in other words, find the place where all 3 parties agree.
§ This is done at the definition workshop.
2. Project formulation, preparation & feasibility analysis
§ Several things are defined and analysed at this stage:
o Objectives
o components of the projects
o project size
o potential location
o preconditions for successful implementation
o potential cost benefits
§ At this stage, a preliminary discussion with the relevant political personalities/potential beneficiaries/involved professionals is useful.
3. Project design
§ The project design should provide:
· detailed description of the selected design
· list of strategies of operation
· justifications of technology chosen
· technical specifications of machinery to be used
· technical procedures to be used
· organization charts and facility requirements
§ the project design must define:
· project targets
· activities to take place
· timing of each activity
· expected outputs
· sequence of implementation
· control systems
§ the project design must contain annual budgets and a project budget for the life span of the project
§ at this stage, designers must cross check whether the duration, financial resources and the tasks of the project are integrated.
4. Project appraisal
§ This is done by an independent body
§ Normally, feasibility studies are cross checked with the design.
§ Alternatives are not looked into.
§ If required by the appraisal team, new information may need to be collected and supplied.
5. Project selection, negotiation & approval
§ Selection is based on government policies on allocation of resources.
§ Government policy may depend on:
§ Urgency
§ Cost
§ Benefits
§ In the public sector, there are 2 types of projects:
§ Projects designed to help families – assessed on financial returns (e.g. Samurdhi project)
§ Projects designed for welfare of society – assessed on shadow prices (e.g. construction of a road)
§ After this stage, it is difficult and extremely time consuming to change components or objectives of a project.
§ Approval is usually given by the relevant funding authority
6. Project activation & organisation
o At this stage, several activities take place:
o project office site is selected
o resources needed to run the office are obtained
o incentives are created to attract senior personnel to remote areas
o different project teams are created to perform different functions
o transport, housing and support personnel are organised
7. Project implementation & operation
o This is the most crucial phase of the cycle. It the point at which “the rubber hits the road” (i.e. where the theory is tested, when the action begins)
o It is the development/construction phase before a project become fully operational.
o Successful implementation depends on:
o Preparation of an implementation schedule
o Good supervision, monitoring and control
o Capable staff
o Timely release of funds
o Many problems, anticipated and unanticipated, will surface at this point
o Therefore the skill of decision making is crucial.
o The main problems face is delay and thus increases in budget. Delays may be due to:
§ Poor performance of manager
§ Poor performance of contractors
§ Delays in bidding and procurement
§ Technical problems
§ Poor design
o However, half these problems can be solved by proper scheduling.
o Use of Gantt charts, network analysis and computer software can be extremely useful for this purpose.
8. Projects supervision, monitoring & control
o Strictly speaking this is carried out throughout the cycle.
o It can be applied from different levels of command (higher/middle/lower)
o It keeps track of progress
o It removes obstacles faced during implementation
o It copes with risks and uncertainties
9. Project completion or termination
o Once the objective/s has/have been reached the project has to be handed over to the national or regional administration.
o This is an aspect often neglected (here and abroad)
o There has to be a clear understanding about salary scales right from the initiation of the project.
10. Output diffusion & transition to normal administration
o Barriers to handing over of completed projects are:
o Lobbying
o Vested interests
o Lack of capacity building in the national or regional administration that is to take the project over.
o Inability to consolidate salaries of project staff with that of normal staff.
11. Project evaluation
o Whoever does the evaluation must:
o Consider the objectives and see if the plan has been properly conceived
o See whether the assumptions were credible and predictions were reasonable
o Consider the response of the management to changing circumstances.
o In case of impact evaluation, it is necessary to assess:
o Whether the target beneficiaries were being reached.
o Whether identified constraints were removed – if not why?
o Whether output targets were reached, if not why?
o What lessons can be fed back into implementation and design of new projects.
12. Follow up analysis & action
o Ideally the lessons learnt should be diffused among policy makers and project managers and they should be made use of in selecting, implementing and designing of new projects.
o However, this aspect has been highly neglected with repetition of the same mistakes over and over again.
5. Project Feasibility
Project feasibility generally looks at several aspects:
o Site and location – reasons for siting a project in a given location must be justified.
o Technical and technological studies – the study should justify technology chosen and machinery used. Technical factors normally investigated are:
o Magnitude of the project.
o The process, material equipment and reliability of the system.
o Suitability of plans, layout and design.
o The availability of various factors of production.
o Availability and sufficiency of necessary infrastructure.
o Proposed methods to implement, operate and maintain the project.
o Contracting procedures and arrangements to procure goods, works and services
§ Financial studies –
o Financial feasibility is concerned with profits
o Most public sector projects do not fall into this category
o Financial feasibility of public sector projects can be looked at from different points of view, i.e. that of:
o project beneficiaries
o the project as a whole
o financial intermediaries
o the government
§ Economic studies (Market studies)
o This is virtually the lifeblood of every project feasibility report.
o However, it is very complex in the public sector and often impossible.
o In the private sector, this is determined on the basis of supply and demand and the price mechanism.
o This is not possible as many goods/services do not enter the market (e.g. police service)
o In the public sector one has to use social cost-benefit analysis.
§ Cultural / social marketing studies
o This can be done from 2 view points:
o The government – social cost-benefit analysis
o The people/region
o There are 3 factors that need to be taken into account when performing these studies:
o Social-cultural demography
o Social organization
o Cultural acceptability
§ Institutional – organizational management studies
§ Environmental / gender and other mandated studies
6. Concerns for project success
§ Public sector managers need to keep the following points in mind when initiating, appraising, evaluating and assessing projects within their jurisdiction:
o Be clear on objectives and the stakeholders.
o Observe whether analysis is done at the appropriate level, preferably along with other projects conducted in the same sector/region/etc
o Explore outcomes of the project (cost recovery/citizen satisfaction/etc)
o Explore critical factors of project success (timing/ competitive advantage/cost base/etc)
o Evaluate key sources of uncertainty (change of government/etc)
o Consider intangibles and positive and negative externalities.
o Examine conditions on which value obtained is dependant
o See that project short term goal do not hinder long term benefits.
o Make decisions through past experiences
o Be familiar with the pros and cons of various techniques and tools of project management.
o Where possible have a top-down approach in assessment.
7. Beyond planning for project management
- Most public projects are open systems
- However much planning goes into the planning of a public project, guarantying success is difficult.
- This is because future outcomes have to be forecast in partial ignorance of the present information.
- Effectiveness of project management depends on how well the manager has understood its objectives.
- The most important quality of a project manager is the ability to make good judgements.
- The project manager can control the conversion of input to output, however, he has no control over the change from output to outcome.
- A good manager needs to be able to interpret data correctly. He needs to have a wider view of the environment.
- A good public project manager is one who can relate well to different personalities as he has to work between many interested parties.
- A good manager must be able to manage risks and uncertainties.
- He should also be able to add value or create new values to old and failing projects
- One area widely neglected in the area of public projects is the compensation to victims of development. This area need to be revised.
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