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Prepared by Avit Theophil, MKU-Nairobi Campus

2013

PAM 505: PROJECT PLANNING AND MANAGEMENT
TOPIC ONE: PROJECT CONCEPT
Definition: A sequence of unique and connected activities having one goal/purpose and must be
completed in a specific time within budget and specification.
Project characteristics:
a.
b.
c.
d.
e.
f.

Single and definable goal : SMART
Specific time
Sequence and connected activities
Customer/sponsor
Completed with a budget
Involve uncertainty and risk

Project parameter/ constraints:
a.
b.
c.
d.

Scope (boundaries of the project)
Time (deadline)
Quality (products and process)
Resources (people, equipments, physical facilities and materials)

Project features:
a. Nature of the project solution (learning and discovering)
b. Pace (steps) of project development (planning phase and management to ensure rapid or
gradual results)
c. Intention of the project (that is efforts on the solution, satisfactory, interest and directions)
d. Existence of changing goals caused by:
 Market changes
 Senior management priorities
 Lack of clear strategy
 Project with outside links (cooperation from different organizations, commitments and
interests)
 Changing in project environment
 Planned or emergent projects 9result of opportunities and events)
In summary: definition of the term project; characteristics; constrains; project features and finally
causes for changing of goals.

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Prepared by Avit Theophil, MKU-Nairobi Campus

2013

TOPIC TWO: PROJECT MANAGEMENT
Definition: is the discipline of planning, organizing, securing and managing resources to bring about the
successful completion in achieving a specific goal).
Project management Vs General management

Project management
1.Cross functional team work

General management
1. Routine well defined

2.Requires special skills
in conflict resolution

organization
2. Require management by

3.Requires flexibility

exception

and creativity

3. Dependent on good planning

4.Requires detailed planning

4. Sequence of activities in

5.Projects has a schedule of

manufacturing management is set

its own

when the production line is

6.Project manager has

designed

little legitimate authority

5. General manager has authority over all
operations

Project management vs Discipline management
Project Management

Discipline Management

1. What must be done

1) How it will be done

2. When it must be done

2) Who will do it

3. How much it will cost

3) How well it will be done

4. Coordinating overall

4) Coordinating specific needs

needs/resources

5) Single discipline focus

5. Multi discipline focus

7) Technical quality

6. Project quality

8) Technical view point

8. Administrative view point

9) Specialist approach

9. Generalist approach

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Prepared by Avit Theophil, MKU-Nairobi Campus

2013

Historical development of project management:
Said to begin with man since ancient times remember construction of pyramid in Egypt, Chinese great
wall the reasons for associate with construction is that require special organisation, facilities, labour,
materials resources input at various stages of development. During 1WW witnessed use of scientific
management approach and function within military operations, and ideal of Gantt chart was used for
scheduling and monitoring of activities.
However, there have been development in project management in terms of tools and application in
fields.
For instance in 1960s the USA Department of Defense through the NASA programme were the first to
use project management.
In 1970s more development concept of planning and tracking projects came into use.
1980s use of information technology, emergence of project management profession, monitoring and
evaluation techniques and full cycle project management.
Today we have project management institute on know ledged on subject including application,
management principles and practices for successfully project management. These areas includes Project
cost management, project risk management, project time management etc.
Specific roles of project management:
Its all about methods, techniques and accepted principles used for planning, estimating, and controlling
work activities for desire results and specifications.
a. Process context: problems, needs, opportunities and solutions its usually follow the phase forms
including: Definition phase (identify, define problem and solution) > planning phase (activities,
resources, costs budget risks) > execution phase (maintain control and communication) > close
out phase (lesson learnt, studies, evaluation and audit)
b. Interpersonal and behavior context: leading, coordinating people and team for skills and
knowledge sharing, get effective working team.
c. The organizational context: ability to carry projects, management
Measurement of project success:
Exists in four (4) levels each with its perspectives and set of matrices
Level 1: Meeting project targets
Level 2: Project efficiency (how well project managed),resources, cost, conflicts, efficiency etc
Level 3: Customer user utility extent the project fulfils its mission in solving the problem (services
satisfied etc.)
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Prepared by Avit Theophil, MKU-Nairobi Campus

2013

Level 4: Organizational improvements how organisation learned from the project and improved chance
for the future projects
Best practices in project management:

Project management best practices tie in with the project success. Project management best
practices depend on the level of project management competence and project management
maturity within an organization. To have successful projects we must have a focused and
deliberate go at the best practices (Best practices and project management: It includes management
capabilities, performance and organisation.)

a) Ensuring agreement with goals: Setting overall objectives and targets, clarifying the
b)
c)
d)
e)

problem and setting boundaries
Obtaining resources: identifying the resources and negotiations
Monitoring and learning: seeing expected and unexpected results
Creating appropriate structures: clarifying roles and functions and creating teams
Effective communication: linking the diverse and individuals contributing to the project, support
and commitment.

BEST PRACTICE

DESCRIPTION

a) Ensuring agreement with goals

Setting overall objectives and targets, clarifying the
problem and setting boundaries to it

b) Obtaining resources

Identifying the resources, negotiating

c) Monitoring and learning

Seeing the whole picture, taking a helicopter
view, managing time and other resources,
anticipating reactions from stakeholders, spotting
links and unexpected events

d) Exercising influence using individual

Moving things forward by taking action and risks
to keep the project going, especially through
difficulties
Clarifying roles and functions

initiative
e) Creating appropriate structures

Creating teams, procedures and links to the
f) Ensuring effective communication

4|P ag e

wider organization
Linking the diverse groups or individuals
contributing to the project to obtain their support
and commitment
Prepared by Avit Theophil, MKU-Nairobi Campus

2013

Definition of project management; PM Vs GM; PM Vs DM; historical development of project
management; specific roles of PM; Measurement of PM (levels) and Best practices (areas)
TOPIC THREE: PROJECT CYCLE
It passes in four (4) phases :
1. CONCEPTION AND DEFINITION PHASE
i.
Project identification and formulation tasks: through needs assessment, project
preliminarily design (scope, site, technical, administration, resources
requirements)
ii.
Feasibility analysis and appraisal: to determine successful implementation
(technical, economic, commercial, financial, environment and management
feasibility
iii.
Project definition, proposal and approval: that’s is project design and approval
(Docs: business case, feasibility and appraisal report and project proposal)
2. PROJECT PLANNING PHASE
Its includes plan, results and budget
i.
Project selection and approval (selection based on criteria given…feasibility,
priority, project contribution to organisation goals and senior management)
ii.
Project activities and resources planning (activities, resources and risks)
iii.
Project procurement and activation (coordination and allocation of resources)
{Docs: Project plan with estimation of resources, quality and scope}

3. PROJECT IMPLEMENTATION PHASE
Includes the following tasks Launching >implementation and control >completion
{Docs: final charter report, M &E reports and project manuals; explaining bringing all resources
together, execution, monitoring, evaluation, control}
4. PROJECT EVALUATION AND REFINEMENT
Its includes critical examination and analysis of the project and provide a necessary feedback,
solution to unexpected results, lesson learnt, improve policies, procedures, plans and
management in the future.
{Doc: evaluation reports and policy review reports to assess the achievements refine policies}
Four phases of project cycle

5|P ag e
Prepared by Avit Theophil, MKU-Nairobi Campus

2013

TOPIC FOUR: PROJECT CONCEPTION AND DEFINITION
NEEEDS ANALYSIS > PROJECT FORMULATION > FEASIBILITY ANALYSIS &APPRAISAL > PROJECT
APPROVAL& ACTIVATION >

First level: Project concept paper (Needs Analysis)
The first tasks includes needs identification, needs recognition, and needs articulation and
establishment of requirements this leads to project concept paper.
The contents of project concept and definition have two important sections:
That is INTROUCTION and PROJECT STATEMENT
INTRODUCTION: the concept, elements of the concepts, business analysis, project management,
concept review, and problems during the concept phase
PROJECT STATEMENT: Project statement, elements of project statements, who does what, plan for
planning, time frame for completion, alternative approach to the preparation of project statement,
purpose level of details, and recommendations
Second level: Project brief Document (project formulation):

The project brief is a document describing the nature of the works incorporating a statement of
objectives, expected results and statement of requirements as agreed in the project formulation.

6|P ag e
Prepared by Avit Theophil, MKU-Nairobi Campus

2013

The project brief summarizes all the relevant facts about the project as conceptualized and
formulated.
The content of a brief should include:
• Project title

- identifying the relevant title for the project

• Project overall objective

- stating the overall objective statement (POS) describing the
project’s desired results

• The time scale

- providing the proposed start date and the required end dates

• Project deliverables

- identifying the primary deliverables that will be achieved
from the project through its life cycle. SMART

• Project benefits

- listing the benefits already identified in the needs analysis. This
is the lead to project appraisal



Project strategies, project skills required, and project costs

Project brief into the request for proposal:
Since feasibility study and project appraisals normally commissioned by consultant, selection is done
through solicitation using Request for Proposal (REP)/ Invitation to bid
Therefore, request for proposal normally includes (REP):
(a) Statement of work: problem description, scope of work and requirements, how work will be
measured, expectation of completion date etc
(b) Proposal requirements: proposal contents and formats, submission and deadline.
(c) Contractual provision: describes type of contract to be awarded simple or non disclosure
(d) Technical information or data: any additional data, name of contract person for requesting
additional data necessary to develop solution
Third Level: Project Feasibility analysis study and Appraisal Report (Feasibility study and Appraisal)

The needs to be addressed, the project goal, the objectives of the project and the approach to
the project have all been identified, the brief is complete. It is now time to establish and confirm
them and identify alternative options for solutions for addressing the needs.
FAA Objectives:





Exploring all possible options for implementing project
Achieving clear understanding of issues involved in the project (costs, objectives, returns
technical viability, financial viability etc)
Produce enough information for ranking
Obtain clear way forward for the future stages

7|P ag e
Prepared by Avit Theophil, MKU-Nairobi Campus

2013

STEPS FOR CONDUCTING FEASIBLITY STUDY:
1. Appointment of the project manager and project team (economists, environmentalists experts,
legal, resources specialists etc)
2. Study the scope (quality, costs, time for completion)
3. Appointment external advisors (consultants)
4. Draw up a plan for study include milestone and responsibility (meetings >data collection
>analysis > reporting )
5. Set timetable and budget for the study
6. Organize the team
7. Conduct the study
8. Maintain control
9. Complete the study
SCOPE FOR FEASIBILITY STUDY ANALYSIS








Technical (scope, alternatives, design criteria, technological, activation and implementation
estimate inputs and outputs)
Economic (society contribution, project fit within the sector, responsiveness of the project, cost
benefit of the project)
Commercial (competitiveness, demand, distribution channel etc)
Environmental (compatibility, impacts to the environment and support)
Financial justification (profitability, sources of funds, alternative funding, project cash flow,
project accounting system etc)
Administrative/ managerial studies (capacity of implementing agency, internal, external,
linkages, management and personnel)
Social/political factors

PROJECT APPRAISAL: The feasibility study is tied together and reconciled with an appraisal of its

findings. The project appraisal provides an assessment of the projects likelihood for success.
It must address two important questions:
(a) Will the project meet its own objectives as well as the larger needs of the
organisation or community or country?
(b) How does the project compared with other projects it may be competing with for
funding?
It can be done using financial and non financial methods:
1. Financial Methods: financial analysis, business case, project financials or cost/benefit
analysis often includes four basic metrics; Net Present Value (NPV), Internal Rate of Return
IRR, payback period and cash hole.
a) Net Present Value (NPV): how much money will this project make or save, it is a calculation
8|P ag e
Prepared by Avit Theophil, MKU-Nairobi Campus

2013

of the present value of all future cash flows expected from a project.
b) Internal rate of returns (IRR): how rapidly money will be repaid. It is a calculation of the
percentage rate at which the project will return wealth; - in effective yield of a saving account.
c) Payback period (PP): This is when will the original investment (the amount spent on the
project) be received through benefits. It is expressed in months or years.
d) Cash hole (Maximum exposure,): What is the most we will have invested at a given time?
2. Non-Financial Methods: Whenever the process of getting financial data is difficult,
expensive or time consuming, using a weighted factor scoring model may be a reasonable option
for selecting the best alternative solution.
In performing financial analysis, the process consists of 4 steps:
Step 1: Identify sources of cash flows:
Step 2: Estimate magnitude of cash flows
Step 3: Calculate the total and the cumulative cash flows
Step 4: Calculate the net cash flow using and agreed upon Discount Rate
FEASIBILITY STUDY AND PROJECT APPRAISSAL REPORT
It should consist of the following:
1. Introduction section.
i.
Summary of major findings of the studies be brief, precise references and detailed
information),
ii.
Description of the project (relationship with the organisation and other projects)
iii.
Goals and Objectives in comprehensive and clear list
2. Individuals studies section
i.
Data collected for each individual study
ii.
Analysis of data collected
iii.
Findings from analysis of the data
3. Conclusion and recommendations: major points of findings explain how well project meets the
goals and objectives make recommendations for the next step.
Taking into consideration we have five steps (phases) in project development that is needs analysis
>project formulation >project feasibility study and appraisal, project proposal > finally project
approval and activation .we have looked phase on basis of phase, tasks and sections. In each step
we have report as follows:

9|P ag e
Prepared by Avit Theophil, MKU-Nairobi Campus

PHASES TASKS
1
Needs analysis
2
Project formulation

2013

3

Project feasibility and Appraisal
study

REPORT
Project concept paper
Project Brief Paper and
REP
Feasibility and
Appraisal report

4
5

Project
Project Approval and Activation

Project Proposal
Project Charter

development of REP
Feasibility: Steps, objectives
and scope
Appraisal methods: step for
financial analysis

Fourth level: PROJECT PROPOSAL (DEFINITION)
Things to understand: Contents, purposes, formats and sections.
This comes after project feasibility and appraisal

The content of the project proposal include:
(a) The purpose and objectives: The reason for undertaking the project with expected results, the
work needed to achieve
(b) The statement of works(activities): The statement of outlines the work to be done
(c) The project organization: Defines the organization system and personnel (project team roles)
(d) Project management .system: Defines the tasks and techniques for planning and controlling the
project
(e) Project Budget: The initial project cost estimates and a statement of the maximum amount which
can be spent to justify the expected benefits
(f) Project execution plan: Project works breakdown structure and the works schedule.
(g) Project justification and benefits: The report on the appraisal of the investment criteria and
fulfillments of resources. The benefits associated with the project
(h) Risk and assumptions: Identify and record the results of risk analysis and the potential risks
reduction strategies
=purpose, objectives, activities, organisation team, management system, budget, action
plan, justification and benefits
Purpose of a project proposal:

• Specify the objectives of the proposed project
• Describe the approach to the assignment based on agreed understanding on the problem and the
Objectives
• Provide the basis of a legally binding contract when the project goes ahead
• Highlight the benefits that would accrue to the buyers by the end of the proposed project and
10 | P a g e
Prepared by Avit Theophil, MKU-Nairobi Campus

2013

even beyond
• Create confidence in and comfort with the proposing entity and his team
• Move the project audience from where their current situation to the desired situation through
the project results and accrued benefits
Formats and sections of proposal document:
The sections in a proposal include The Introduction (Summary), The Problem Section, The
Solution Section or The Proposal Section. The Method Section, the Capabilities Section, the
Budget Section and the Closing Section.
1. INTRODUCTION SECTIONS
Includes terms of references, brief background of the proposal that is ; aim, how the
proposal structured, methods used prepare the proposal, description of organisation goals,
logical lead to the problem statement an brief summary of the proposal.
2. THE PROBLEM STATEMENT BACKGROUND SECTION
Explains the baseline situations with basic facts, needs, implication of addressing the
current problem, approaches likely to be used to improve situation, some biggest
dissatisfactions with the current situation, internal and external factors for the rise of
current problem effects of these problems and what has been done to solve the problem
and what results.
3. SOLUTION STATEMENT SECTION
Mostly is referred as proposal section that covers subsection; Goals, Objectives and
Outcome or Benefits.
Goals=Statement on what to be accomplished
Objectives=how to move to desired results, shows precisely what you intend to change
Outcomes=Expected benefit (accrue) and benefits beyond this project
4. METHOD SECTION
Action plan for achieving the project, explain how project activities will satisfy the
objectives, include sequences, flow and relationships (Approach, methodology, and
programme activities subsections)
 Approach =gives problem solving process by defining the action to be taken in
achieving the objectives
 Methodology= how project will be conducted and describing major activities to
reach objectives
 Programme activities=shows interrelationship among project activities as prepares
programme activities assigns key inputs to the individual activities.
5. QUALIFICATION SECTION
Discusses the abilities of the team and capabilities, competences, skills, knowledge and
experiences in a given sector.
11 | P a g e
Prepared by Avit Theophil, MKU-Nairobi Campus

2013

6. BUDGET SECTION
Includes human resources inputs and their remunerations costs, non human inputs,
overheads and contingences
7. PAYMENTS DISMBURSEMENTS
Shows how and when the payments are to be done
8. CLOSING SECTIONS
Sometimes called conclusions section or recommendation, tell sponsor what you want
from them to do and brief about proposing agency
Fifth Level: PROJECT APPROVAL AND ACTIVATION:
At this stage project proposal is subjected to an assessment by the sponsor or senior management
for approval. Expert explores certain areas of the project includes:
 If proposal satisfy the objectives
 Will it operate as expected
 Will it brought successfully into existence (technical feasibility, references and methods)
 Project team have required skills
 Availability of required physical resources
 If benefits exceeds cost
 Project proposal in sequence
 Is it economically sound
 Acceptable to the organisation
 Is the project risks acceptable
 Can project be delivered on time
Based on the above questions, sponsor make a decision on either to give formal approval or
authoritarization to the project.
EXISTENCE OF PROJECT CHARTER by recognizing and approval of the project, and
confirm senior management support for the project need and committing resources to the
project activities. The project charter briefly gives the statement of work, expected end-items
or results and required resources. If work is being performed under a contract then the charter
will serve as the terms of Reference document for the contract or the contract document itself.
The purpose of the charter is to confirm the agreement about the project scope and resources to be
committed to the project between the project sponsors and senior management. Moreover,
description of the project with objectives, anticipated project outcome, primary stakeholders,
project customers, preliminarily project plan, formal project signatures (manager, sponsor and
senior management).

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Prepared by Avit Theophil, MKU-Nairobi Campus

2013

TOPIC FIVE: PITFALLS OF PROJECTS AND LINKING PROJECTS TO BUSINESS STRATEGY
WHY PITFALLS IN THE FOUNDATION OF THE PROJECT
Can be seen into 2 categories:
1. Insufficient support
2. Poor project definition
INSUFICIENT SUPPORT;







Senior management support the project attitudes,
Project definition not aligned to the business plans
Principles and policies of the project not defined
Lack of clear senior management (roles and responsibilities)
Lack of effective management (agreement of stakeholder requirements)
Lack of clear proven skills and approach to the project management and risk management

POOR PROJECT DEFINITION;




Imprecise project goals: as result of lack of clear links between the project and the organisation
key strategic priorities and agreed measures of success
Undefined limits of scope: clear defined milestone, plan and clear responsibility chart.
Unbalanced level of ambition: feasibility study needs to focus on all areas technical, financial,
economic, commercial, managerial, and environmental, and not only technical aspects.

HOW TO LINK PROJECTS TO BUSSINESS STRATEGIES
Means making business more from where it is now to where it ought to be .projects are linked with
business strategy of an organisation in terms of how they are managed. Managing projects
strategically requires:





13 | P a g e

Check and confirm project is appropriate vehicle towards achieving business strategy
Develop various options for implementing project
Understanding key opportunities and threats that projects faces in its environment and
develop internal strength and weakness
Interrelating projects with other to achieve corporate strategy (it helps issues are identified
and addressed in strategic corporate plan in order to avoid spreading around too thinly
around too fronts.

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Project Planning and Management Summary 505 by Avit Theophil

  • 1. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 PAM 505: PROJECT PLANNING AND MANAGEMENT TOPIC ONE: PROJECT CONCEPT Definition: A sequence of unique and connected activities having one goal/purpose and must be completed in a specific time within budget and specification. Project characteristics: a. b. c. d. e. f. Single and definable goal : SMART Specific time Sequence and connected activities Customer/sponsor Completed with a budget Involve uncertainty and risk Project parameter/ constraints: a. b. c. d. Scope (boundaries of the project) Time (deadline) Quality (products and process) Resources (people, equipments, physical facilities and materials) Project features: a. Nature of the project solution (learning and discovering) b. Pace (steps) of project development (planning phase and management to ensure rapid or gradual results) c. Intention of the project (that is efforts on the solution, satisfactory, interest and directions) d. Existence of changing goals caused by:  Market changes  Senior management priorities  Lack of clear strategy  Project with outside links (cooperation from different organizations, commitments and interests)  Changing in project environment  Planned or emergent projects 9result of opportunities and events) In summary: definition of the term project; characteristics; constrains; project features and finally causes for changing of goals. 1|P ag e
  • 2. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 TOPIC TWO: PROJECT MANAGEMENT Definition: is the discipline of planning, organizing, securing and managing resources to bring about the successful completion in achieving a specific goal). Project management Vs General management Project management 1.Cross functional team work General management 1. Routine well defined 2.Requires special skills in conflict resolution organization 2. Require management by 3.Requires flexibility exception and creativity 3. Dependent on good planning 4.Requires detailed planning 4. Sequence of activities in 5.Projects has a schedule of manufacturing management is set its own when the production line is 6.Project manager has designed little legitimate authority 5. General manager has authority over all operations Project management vs Discipline management Project Management Discipline Management 1. What must be done 1) How it will be done 2. When it must be done 2) Who will do it 3. How much it will cost 3) How well it will be done 4. Coordinating overall 4) Coordinating specific needs needs/resources 5) Single discipline focus 5. Multi discipline focus 7) Technical quality 6. Project quality 8) Technical view point 8. Administrative view point 9) Specialist approach 9. Generalist approach 2|P ag e
  • 3. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 Historical development of project management: Said to begin with man since ancient times remember construction of pyramid in Egypt, Chinese great wall the reasons for associate with construction is that require special organisation, facilities, labour, materials resources input at various stages of development. During 1WW witnessed use of scientific management approach and function within military operations, and ideal of Gantt chart was used for scheduling and monitoring of activities. However, there have been development in project management in terms of tools and application in fields. For instance in 1960s the USA Department of Defense through the NASA programme were the first to use project management. In 1970s more development concept of planning and tracking projects came into use. 1980s use of information technology, emergence of project management profession, monitoring and evaluation techniques and full cycle project management. Today we have project management institute on know ledged on subject including application, management principles and practices for successfully project management. These areas includes Project cost management, project risk management, project time management etc. Specific roles of project management: Its all about methods, techniques and accepted principles used for planning, estimating, and controlling work activities for desire results and specifications. a. Process context: problems, needs, opportunities and solutions its usually follow the phase forms including: Definition phase (identify, define problem and solution) > planning phase (activities, resources, costs budget risks) > execution phase (maintain control and communication) > close out phase (lesson learnt, studies, evaluation and audit) b. Interpersonal and behavior context: leading, coordinating people and team for skills and knowledge sharing, get effective working team. c. The organizational context: ability to carry projects, management Measurement of project success: Exists in four (4) levels each with its perspectives and set of matrices Level 1: Meeting project targets Level 2: Project efficiency (how well project managed),resources, cost, conflicts, efficiency etc Level 3: Customer user utility extent the project fulfils its mission in solving the problem (services satisfied etc.) 3|P ag e
  • 4. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 Level 4: Organizational improvements how organisation learned from the project and improved chance for the future projects Best practices in project management: Project management best practices tie in with the project success. Project management best practices depend on the level of project management competence and project management maturity within an organization. To have successful projects we must have a focused and deliberate go at the best practices (Best practices and project management: It includes management capabilities, performance and organisation.) a) Ensuring agreement with goals: Setting overall objectives and targets, clarifying the b) c) d) e) problem and setting boundaries Obtaining resources: identifying the resources and negotiations Monitoring and learning: seeing expected and unexpected results Creating appropriate structures: clarifying roles and functions and creating teams Effective communication: linking the diverse and individuals contributing to the project, support and commitment. BEST PRACTICE DESCRIPTION a) Ensuring agreement with goals Setting overall objectives and targets, clarifying the problem and setting boundaries to it b) Obtaining resources Identifying the resources, negotiating c) Monitoring and learning Seeing the whole picture, taking a helicopter view, managing time and other resources, anticipating reactions from stakeholders, spotting links and unexpected events d) Exercising influence using individual Moving things forward by taking action and risks to keep the project going, especially through difficulties Clarifying roles and functions initiative e) Creating appropriate structures Creating teams, procedures and links to the f) Ensuring effective communication 4|P ag e wider organization Linking the diverse groups or individuals contributing to the project to obtain their support and commitment
  • 5. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 Definition of project management; PM Vs GM; PM Vs DM; historical development of project management; specific roles of PM; Measurement of PM (levels) and Best practices (areas) TOPIC THREE: PROJECT CYCLE It passes in four (4) phases : 1. CONCEPTION AND DEFINITION PHASE i. Project identification and formulation tasks: through needs assessment, project preliminarily design (scope, site, technical, administration, resources requirements) ii. Feasibility analysis and appraisal: to determine successful implementation (technical, economic, commercial, financial, environment and management feasibility iii. Project definition, proposal and approval: that’s is project design and approval (Docs: business case, feasibility and appraisal report and project proposal) 2. PROJECT PLANNING PHASE Its includes plan, results and budget i. Project selection and approval (selection based on criteria given…feasibility, priority, project contribution to organisation goals and senior management) ii. Project activities and resources planning (activities, resources and risks) iii. Project procurement and activation (coordination and allocation of resources) {Docs: Project plan with estimation of resources, quality and scope} 3. PROJECT IMPLEMENTATION PHASE Includes the following tasks Launching >implementation and control >completion {Docs: final charter report, M &E reports and project manuals; explaining bringing all resources together, execution, monitoring, evaluation, control} 4. PROJECT EVALUATION AND REFINEMENT Its includes critical examination and analysis of the project and provide a necessary feedback, solution to unexpected results, lesson learnt, improve policies, procedures, plans and management in the future. {Doc: evaluation reports and policy review reports to assess the achievements refine policies} Four phases of project cycle 5|P ag e
  • 6. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 TOPIC FOUR: PROJECT CONCEPTION AND DEFINITION NEEEDS ANALYSIS > PROJECT FORMULATION > FEASIBILITY ANALYSIS &APPRAISAL > PROJECT APPROVAL& ACTIVATION > First level: Project concept paper (Needs Analysis) The first tasks includes needs identification, needs recognition, and needs articulation and establishment of requirements this leads to project concept paper. The contents of project concept and definition have two important sections: That is INTROUCTION and PROJECT STATEMENT INTRODUCTION: the concept, elements of the concepts, business analysis, project management, concept review, and problems during the concept phase PROJECT STATEMENT: Project statement, elements of project statements, who does what, plan for planning, time frame for completion, alternative approach to the preparation of project statement, purpose level of details, and recommendations Second level: Project brief Document (project formulation): The project brief is a document describing the nature of the works incorporating a statement of objectives, expected results and statement of requirements as agreed in the project formulation. 6|P ag e
  • 7. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 The project brief summarizes all the relevant facts about the project as conceptualized and formulated. The content of a brief should include: • Project title - identifying the relevant title for the project • Project overall objective - stating the overall objective statement (POS) describing the project’s desired results • The time scale - providing the proposed start date and the required end dates • Project deliverables - identifying the primary deliverables that will be achieved from the project through its life cycle. SMART • Project benefits - listing the benefits already identified in the needs analysis. This is the lead to project appraisal  Project strategies, project skills required, and project costs Project brief into the request for proposal: Since feasibility study and project appraisals normally commissioned by consultant, selection is done through solicitation using Request for Proposal (REP)/ Invitation to bid Therefore, request for proposal normally includes (REP): (a) Statement of work: problem description, scope of work and requirements, how work will be measured, expectation of completion date etc (b) Proposal requirements: proposal contents and formats, submission and deadline. (c) Contractual provision: describes type of contract to be awarded simple or non disclosure (d) Technical information or data: any additional data, name of contract person for requesting additional data necessary to develop solution Third Level: Project Feasibility analysis study and Appraisal Report (Feasibility study and Appraisal) The needs to be addressed, the project goal, the objectives of the project and the approach to the project have all been identified, the brief is complete. It is now time to establish and confirm them and identify alternative options for solutions for addressing the needs. FAA Objectives:     Exploring all possible options for implementing project Achieving clear understanding of issues involved in the project (costs, objectives, returns technical viability, financial viability etc) Produce enough information for ranking Obtain clear way forward for the future stages 7|P ag e
  • 8. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 STEPS FOR CONDUCTING FEASIBLITY STUDY: 1. Appointment of the project manager and project team (economists, environmentalists experts, legal, resources specialists etc) 2. Study the scope (quality, costs, time for completion) 3. Appointment external advisors (consultants) 4. Draw up a plan for study include milestone and responsibility (meetings >data collection >analysis > reporting ) 5. Set timetable and budget for the study 6. Organize the team 7. Conduct the study 8. Maintain control 9. Complete the study SCOPE FOR FEASIBILITY STUDY ANALYSIS        Technical (scope, alternatives, design criteria, technological, activation and implementation estimate inputs and outputs) Economic (society contribution, project fit within the sector, responsiveness of the project, cost benefit of the project) Commercial (competitiveness, demand, distribution channel etc) Environmental (compatibility, impacts to the environment and support) Financial justification (profitability, sources of funds, alternative funding, project cash flow, project accounting system etc) Administrative/ managerial studies (capacity of implementing agency, internal, external, linkages, management and personnel) Social/political factors PROJECT APPRAISAL: The feasibility study is tied together and reconciled with an appraisal of its findings. The project appraisal provides an assessment of the projects likelihood for success. It must address two important questions: (a) Will the project meet its own objectives as well as the larger needs of the organisation or community or country? (b) How does the project compared with other projects it may be competing with for funding? It can be done using financial and non financial methods: 1. Financial Methods: financial analysis, business case, project financials or cost/benefit analysis often includes four basic metrics; Net Present Value (NPV), Internal Rate of Return IRR, payback period and cash hole. a) Net Present Value (NPV): how much money will this project make or save, it is a calculation 8|P ag e
  • 9. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 of the present value of all future cash flows expected from a project. b) Internal rate of returns (IRR): how rapidly money will be repaid. It is a calculation of the percentage rate at which the project will return wealth; - in effective yield of a saving account. c) Payback period (PP): This is when will the original investment (the amount spent on the project) be received through benefits. It is expressed in months or years. d) Cash hole (Maximum exposure,): What is the most we will have invested at a given time? 2. Non-Financial Methods: Whenever the process of getting financial data is difficult, expensive or time consuming, using a weighted factor scoring model may be a reasonable option for selecting the best alternative solution. In performing financial analysis, the process consists of 4 steps: Step 1: Identify sources of cash flows: Step 2: Estimate magnitude of cash flows Step 3: Calculate the total and the cumulative cash flows Step 4: Calculate the net cash flow using and agreed upon Discount Rate FEASIBILITY STUDY AND PROJECT APPRAISSAL REPORT It should consist of the following: 1. Introduction section. i. Summary of major findings of the studies be brief, precise references and detailed information), ii. Description of the project (relationship with the organisation and other projects) iii. Goals and Objectives in comprehensive and clear list 2. Individuals studies section i. Data collected for each individual study ii. Analysis of data collected iii. Findings from analysis of the data 3. Conclusion and recommendations: major points of findings explain how well project meets the goals and objectives make recommendations for the next step. Taking into consideration we have five steps (phases) in project development that is needs analysis >project formulation >project feasibility study and appraisal, project proposal > finally project approval and activation .we have looked phase on basis of phase, tasks and sections. In each step we have report as follows: 9|P ag e
  • 10. Prepared by Avit Theophil, MKU-Nairobi Campus PHASES TASKS 1 Needs analysis 2 Project formulation 2013 3 Project feasibility and Appraisal study REPORT Project concept paper Project Brief Paper and REP Feasibility and Appraisal report 4 5 Project Project Approval and Activation Project Proposal Project Charter development of REP Feasibility: Steps, objectives and scope Appraisal methods: step for financial analysis Fourth level: PROJECT PROPOSAL (DEFINITION) Things to understand: Contents, purposes, formats and sections. This comes after project feasibility and appraisal The content of the project proposal include: (a) The purpose and objectives: The reason for undertaking the project with expected results, the work needed to achieve (b) The statement of works(activities): The statement of outlines the work to be done (c) The project organization: Defines the organization system and personnel (project team roles) (d) Project management .system: Defines the tasks and techniques for planning and controlling the project (e) Project Budget: The initial project cost estimates and a statement of the maximum amount which can be spent to justify the expected benefits (f) Project execution plan: Project works breakdown structure and the works schedule. (g) Project justification and benefits: The report on the appraisal of the investment criteria and fulfillments of resources. The benefits associated with the project (h) Risk and assumptions: Identify and record the results of risk analysis and the potential risks reduction strategies =purpose, objectives, activities, organisation team, management system, budget, action plan, justification and benefits Purpose of a project proposal: • Specify the objectives of the proposed project • Describe the approach to the assignment based on agreed understanding on the problem and the Objectives • Provide the basis of a legally binding contract when the project goes ahead • Highlight the benefits that would accrue to the buyers by the end of the proposed project and 10 | P a g e
  • 11. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 even beyond • Create confidence in and comfort with the proposing entity and his team • Move the project audience from where their current situation to the desired situation through the project results and accrued benefits Formats and sections of proposal document: The sections in a proposal include The Introduction (Summary), The Problem Section, The Solution Section or The Proposal Section. The Method Section, the Capabilities Section, the Budget Section and the Closing Section. 1. INTRODUCTION SECTIONS Includes terms of references, brief background of the proposal that is ; aim, how the proposal structured, methods used prepare the proposal, description of organisation goals, logical lead to the problem statement an brief summary of the proposal. 2. THE PROBLEM STATEMENT BACKGROUND SECTION Explains the baseline situations with basic facts, needs, implication of addressing the current problem, approaches likely to be used to improve situation, some biggest dissatisfactions with the current situation, internal and external factors for the rise of current problem effects of these problems and what has been done to solve the problem and what results. 3. SOLUTION STATEMENT SECTION Mostly is referred as proposal section that covers subsection; Goals, Objectives and Outcome or Benefits. Goals=Statement on what to be accomplished Objectives=how to move to desired results, shows precisely what you intend to change Outcomes=Expected benefit (accrue) and benefits beyond this project 4. METHOD SECTION Action plan for achieving the project, explain how project activities will satisfy the objectives, include sequences, flow and relationships (Approach, methodology, and programme activities subsections)  Approach =gives problem solving process by defining the action to be taken in achieving the objectives  Methodology= how project will be conducted and describing major activities to reach objectives  Programme activities=shows interrelationship among project activities as prepares programme activities assigns key inputs to the individual activities. 5. QUALIFICATION SECTION Discusses the abilities of the team and capabilities, competences, skills, knowledge and experiences in a given sector. 11 | P a g e
  • 12. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 6. BUDGET SECTION Includes human resources inputs and their remunerations costs, non human inputs, overheads and contingences 7. PAYMENTS DISMBURSEMENTS Shows how and when the payments are to be done 8. CLOSING SECTIONS Sometimes called conclusions section or recommendation, tell sponsor what you want from them to do and brief about proposing agency Fifth Level: PROJECT APPROVAL AND ACTIVATION: At this stage project proposal is subjected to an assessment by the sponsor or senior management for approval. Expert explores certain areas of the project includes:  If proposal satisfy the objectives  Will it operate as expected  Will it brought successfully into existence (technical feasibility, references and methods)  Project team have required skills  Availability of required physical resources  If benefits exceeds cost  Project proposal in sequence  Is it economically sound  Acceptable to the organisation  Is the project risks acceptable  Can project be delivered on time Based on the above questions, sponsor make a decision on either to give formal approval or authoritarization to the project. EXISTENCE OF PROJECT CHARTER by recognizing and approval of the project, and confirm senior management support for the project need and committing resources to the project activities. The project charter briefly gives the statement of work, expected end-items or results and required resources. If work is being performed under a contract then the charter will serve as the terms of Reference document for the contract or the contract document itself. The purpose of the charter is to confirm the agreement about the project scope and resources to be committed to the project between the project sponsors and senior management. Moreover, description of the project with objectives, anticipated project outcome, primary stakeholders, project customers, preliminarily project plan, formal project signatures (manager, sponsor and senior management). 12 | P a g e
  • 13. Prepared by Avit Theophil, MKU-Nairobi Campus 2013 TOPIC FIVE: PITFALLS OF PROJECTS AND LINKING PROJECTS TO BUSINESS STRATEGY WHY PITFALLS IN THE FOUNDATION OF THE PROJECT Can be seen into 2 categories: 1. Insufficient support 2. Poor project definition INSUFICIENT SUPPORT;       Senior management support the project attitudes, Project definition not aligned to the business plans Principles and policies of the project not defined Lack of clear senior management (roles and responsibilities) Lack of effective management (agreement of stakeholder requirements) Lack of clear proven skills and approach to the project management and risk management POOR PROJECT DEFINITION;    Imprecise project goals: as result of lack of clear links between the project and the organisation key strategic priorities and agreed measures of success Undefined limits of scope: clear defined milestone, plan and clear responsibility chart. Unbalanced level of ambition: feasibility study needs to focus on all areas technical, financial, economic, commercial, managerial, and environmental, and not only technical aspects. HOW TO LINK PROJECTS TO BUSSINESS STRATEGIES Means making business more from where it is now to where it ought to be .projects are linked with business strategy of an organisation in terms of how they are managed. Managing projects strategically requires:     13 | P a g e Check and confirm project is appropriate vehicle towards achieving business strategy Develop various options for implementing project Understanding key opportunities and threats that projects faces in its environment and develop internal strength and weakness Interrelating projects with other to achieve corporate strategy (it helps issues are identified and addressed in strategic corporate plan in order to avoid spreading around too thinly around too fronts.