Projects Planning Analysis, Selection, Financing, Implementation, and Review by mfa16872

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									PROJECT CYCLE


   LECTURE 2
            Gittinger (1996 )
•   Identification
•   Preparation and analysis
•   Appraisal
•   Implementation
•   Evaluation
Project Management Institute (PMI)
•   Initiating
•   Planning
•   Executing
•   Controlling
•   Closing
                  Patel (2000)
•   Concept
•   Planning
•   Execution
•   Termination
             Keeling (2000)
•   Conceptualisation
•   Planning
•   Implementation (execution)
•   Termination
                World Bank
•   Identification
•   Preparation
•   Appraisal
•   Negotiations, Board presentations
•   Implementation and supervision
•   Evaluation
                 Proposed
•   Identification
•   Preparation and Analysis
•   Appraisal
•   Selection, Approval and Financing
•   Implementation
•   Monitoring and Control
•   Evaluation
                               Identification




                                                                   Preparation and Analysis


      Evaluation




                                                                          Appraisal

Monitoring and Control




                                                Selection, Approval and
              Implementation                           Financing
              Identification
• Initial step of the project cycle,
• synonymous with the concept stage in the
  case of Keeling (2000) and Patel (2000)
  and initiation of the PMI.
• This is the birthplace of the project.
• Needs preceded projects
• The first step in identifying a project is to
  identify a need
              Identification
• Rao (2004) states that needs could be:
  – social,
  – political,
  – economic,
  – commercial,
  – technological
  – environmental.
             Identification
• Sources:
  – Auditors
  – Entrepreneurs
  – Politicians,
  – opinion leaders,
  – consultants and
  – government employees
              Identification
• Activities Necessitating Projects
  – review of existing projects,
  – from national development plans,
  – situational reports on sectors,
  – country reports.
  – Media reports
  – Shortage of products,
  – feedback from customers and
  – market surveys unearths needs.
             Identification
• compare the existing facilities with the
  proposed needs and wants.
• Does needs and wants accommodate
  proposal?
• Discuss with stakeholders
• Informally, one may speak to confidants;
  potential supporters and those who would
  offer advice.
             Identification
• Keeling (2000) ‘….experience underlines
  the prudence of selectivity in choosing
  confidants, for many good ideas have
  been killed in infancy by hasty rejection
  or the covert opposition of someone with
  antipathy to change or situation that
  might threaten a private agenda.’
              Identification
• The terminal point of this stage is a
  problem and a list of alternatives.
• In preparation for the next stage; these
  alternatives may be reduced to a few;
  three or four.
     Preparation and Analysis
• This stage is also called project
  formulation or planning.
• The first thing to do is to conduct
  feasibility.
• Purpose
  – provide enough information for deciding on
    detailed planning
     Preparation and Analysis
• Feasibility considers viability of projects.
• Choice between:
  – modes of transport,
  – type of plant,
  – technology,
  – markets,
  – plant location,
  – raw material type and availability
     Preparation and Analysis
• Feasibility views the project in longer
  terms than Business Plans.
• Business plans are often prepared for a
  five-year period.
       Preparation and Analysis
•   Patel (2000) For Profit:
•   market feasibility,
•   technical feasibility,
•   financial feasibility.
•   Governments and NGOs
•   economic feasibility
•   social feasibility
      Preparation and Analysis
• Gittinger (1996)
• ‘aspects of project preparation and
  analysis.’
• technical aspect,
• institutional-organisational-managerial
  aspects,
• social aspects,
• commercial aspect,
• financial aspect
• economic aspect.
                 Appraisal
• A critical review and a re-examination of
  the plan prepared.
• This builds on the project plan.
• Questions are raised on the assumptions
  upon which the estimates are based.
• Ratios are examined
  – Benefit Cost ratio (BCR),
  – Benefit Investment Ratio (BIR)
  – NPV and IRR
                  Appraisal
• cashflow should pay be able to pay for:
  – the loan to be granted
  – accrued interest
  – some surplus for the initiator.
• Banks would determine whether the
  project is within their risk profile.
• Other donors; Does project fall within the
  scope of the agency, budgets within the
  limits to be funded.
                Appraisal
• stage where donors would want to see
  that the project meets the requirements for
  support.
                Financing
• critical element in the project cycle
• Issues are :
  – How each of the steps is financed,
  – the sources of funding,
  – the cost of each source,
  – methodology of arrangement of finance
  – size of financing
              Implementation
•   Also called execution
•   important part of the cycle.
•   action stage
•   ‘not until one implements a project, it
    remains an intention’.
•
            Implementation
• Steps:
• initiating the execution process of work
• coordinating activities and people for the
  assignment to be done.
• three phases:
• investment phase,
• development phase and
• the running phase.
      Monitoring and Control
• Monitoring concerns making observations
  of what is occurring.
• Data is generated from monitoring
• Information is collected in a planned,
  organised and routine way.
• Monitoring takes place during
  implementation
• Done by the implementing agency.
      Monitoring and Control
• Control
  – planning,
  – information
  – control.
• Planning and the plan are the basis of
  control. Information is the guide, what
  offers the opportunity to compare.
      Monitoring and Control
• Action is the essence of control.
• The objective of control is correct the
  mistakes of the past
• correct and direct future activities to
  ensure that expectations are achieved
                 Evaluation
• Evaluation is a means of determining
  success or failure.
• Evaluation addresses two important things:
  – what has been achieved
  – how well it has been achieved
• Done during:
  – implementation,
  – at the end or
  – when the project is in trouble.
              Evaluation
• Evaluation done at the end is called
  terminal or ex-poste evaluation.
• Independent persons or groups of persons
  often accomplish it.
• Independence lies in the person other than
  parties in the project.

								
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