BUSINESS STRATEGIES LIMITED LEADERS 2006 WORKSHOP DESIGNING AND IMPLEMENTING PROJECTS LOGICAL FRAMEWORK MONITORING AND EVALUATION

BUSINESS STRATEGIES LIMITED

• LEADERS 2006 WORKSHOP

• DESIGNING AND IMPLEMENTING PROJECTS

• LOGICAL FRAMEWORK

• MONITORING AND EVALUATION

THE PROJECT CYCLE

• DEFINITION OF A PROJECT• A non-routine, non-repetitive one-off undertaking,

normally with discrete time, financial and technical performance goals.

• A set of activities which can be separately planned, analyzed, financed and managed to achieve a specific objective, or set of objectives, within a given time, resource budget, and existing environmental constraints.

• A project has a specific beginning point and end point (in time) and must be terminated when it is clear that the objectives are not achievable or no longer desirable.

THE PROJECT CYCLE

• Projects incorporate a wide range of activities:• Project to yield services rather than physical

output, e.g. family planning, education, improved administrative efficiency.

• Designed to create output, i.e.:• (a) sold directly, e,g. agriculture produce,

clothes, bicycles; or• (b) given free or below cost, e.g. hospital

services, education.

THE PROJECT CYCLE

• Planned for a specific geographic area, e.g. an irrigation project, a drain, a bridge, etc

• Developed as a combination of related sub-projects in a number of localities e.g. rural development projects,

• Designed for a specific beneficiary group, e.g. low income housing projects.

• .

Eg. OF PROJECTS

• Damage Mitigation for Waste Water and Sewage Systems in Montego Bay (Module 2)

• Building a Disaster Management Resilient Tobago Community (Module 3)

• Improving National Disaster Capacity in Guyana (Module 5)

• Improving Crisis and Emergency Risk Communications in Suriname (Module 6)

• Prepare the Outlines of a Draft Strategic Plan for Emergency Evacuation in Ochio Rios (Module 7)

THE PROJECT CYCLE

• Figure 1STAGES OF THE PROJECT CYCLE. (Next Slide)

• CHART 1 illustrates the various stages of the project cycle beginning with the pre-identification and ending with an impact evaluation.

SOCIO-ECONOMIC

DATA

NATIONAL AND SECTORAL PLANSAND STRATEGIES

NATURAL RESOURCEDATA

PRE-IDENTIFICATION--IDEA GENERATION--RESEARCH, SURVEYS--DATA RETRIEVAL--OPPORTUNITY STUDIES

PROJECT IDENTIFICATION--PREPARATION OFPROJECT PROFILE--APPRAISAL INPRINCIPLE

PROJECT PREPARATION--FEASIBILITY STUDY--PREPARATION OF PROJECT REPORT

IMPACT EVALUATION PROJECT IMPLEMENTATION

PROGRESS MONITORINGPROGAMMING AND

BUDGETING

PROJECT APPRAISAL

ANDFINAL APPROVAL

CHART I: THE STAGES OF THE PROJECT CYCLE(ADAPTED FROM BRUCE, C.M.F., (1980)

1 2 3

4

5

7

8

6

Phase I: PRE-IDENTIFICATION

• Pre-Identification: Where do projects originate?

• The pre-identification phase refers essentially to the less specific research studies and surveys that should form part of any system of planning.

• It involves synthesizing, from national and sectoral strategies and policies, project ideas which seem worthy of more in-depth investigation.

PHASE I: PRE-IDENTIFICATION

• Pre-identification is thus an on-going process involving reviewing, inventorying, integrating and analysis of strategies, policies natural resource data and socio-economic information.

Project Identification

• Assuming that there is a reasonable database and development strategies and policies have been formulated in sufficient detail to be operationally useful - how do we go about identifying projects?

• Two complementary approaches are suggested:

Project Identification

• (i) Find out what people want and see how these ideas can be fitted into the schema of available resources, strategies and policies, taking account of physical, human, institutional and financial constraints; and

• (ii) Examine existing situations in respect of demand and supply of goods and services and look at past trends and likely future trends.

Project Identification: Screening Project Ideas

• Reasons for Rejection of a Project:

1) Inappropriate technology in relation to the project’s objectives or to local capabilities

2) Excessive risk

3) Inadequate demand for the proposed output or lack of comparative advantage

4) Inadequate raw materials or skills

5) Overambitious design in relation to available financial resources

Project Screening

6)Excessive economic, social, or environmental costs relative to the expected benefits

7)Lack of commitment of the intended beneficiaries or lack of political support from key authorities

Project Identification: Pre-feasibility

• Before time and resources are spent there is need to develop some feel for whether a project is likely to be feasible.

• A pre-feasibility analysis is necessary to serve as a screening process

• This pre-feasibility analysis should result in a Project Profile

The Project Profile defines: (Pay Special Attention)

the objectives of the project, identifies project output, inputs and constraints and makes a rough assessment of project costs and benefits.

The profile facilitates approval in principle by the relevant authority and serves as a basis for detailed feasibility and project preparation.

Pre-feasibility study

• Should be carried out in just enough detail to determine the broad justification of the: Project idea

• The possible design alternatives to be considered further

• Reasons for the choices made or proposed

Pre-feasibility study

• To permit a decision on the merits of the project idea, the study should briefly examine:

• 1) The size and nature of the demand for the product or service, and the intended or expected beneficiary groups or target areas

Pre-feasibility Study

• 2) The alternative technical solutions or package available, with corresponding estimates of outputs, including identification of technologies already located in local use and their potential for improvement

• 3) The availability of the principal physical and human resources and skills that will be required

Pre-feasibility Study

• 4) The magnitude of the costs both for the initial investment and for continued operation

• 5) The magnitude of the financial and economic rates of return (where applicable)

• 6) Any institutional constraints or policy issues likely to have an important impact on the proposed project

The Project Identification Test

• A project may be deemed to be ready for detailed preparation when:

• 1) Major options and alternatives have been identified and some initial choices have been made.

• 2) The principal institutional and policy issues affecting project outcome have been identified and appear amenable to solution.

The Identification Test

• 3) The project options selected are likely to be justified, given rough estimates of the expected costs and benefits

• 4) It appears that the project will have adequate support both from the political authorities and from the intended beneficiaries

The Identification Test

• 5) The prospects are reasonable that adequate funding will be available from domestic and if needed, external sources

• 6) A specific preparation program has been established.

Phase 2: Project Preparation

• Purpose and Scope:

• The purpose of the feasibility study is to: 1) provide decision-makers with the basis for deciding whether to proceed with the project, and,

• 2) for choosing the most desirable option or alternative among the few remaining.

Phase 2: Project Preparation

• Purpose and Scope:

• The purpose of the feasibility study is to: 1) provide decision-makers with the basis for deciding whether to proceed with the project, and,

• 2) for choosing the most desirable option or alternative among the few remaining.

Purpose and Scope: Questions

• 1) Does the project conform with the ortganization’s/country’s development objectives and priorities?

• 2) Is the project technically sound, and is it the best of the available technical alternatives?

Purpose and Scope: Questions

• 4) Is the project administratively workable?

• 5) Is there adequate demand for the project’s output?

• 6) Is the project economically justified and financially viable?

Purpose and scope: Questions

• 7) Is the project compatible with the customs and traditions of the beneficiaries?

• 8) Is the project environmentally sound?

Project Preparation

• Of primary importance in project preparation is a clear definition of project objectives.

• These objectives must be specific (as opposed to broad statements of intention) if their achievements are to be measured at the end of the project and if project preparation is to proceed in a logical fashion.

Project Preparation: Objectives

• Objectives should be SMART:

• Specific

• Measurable

• Achievable

• Reasonable

• Time bound

Objectives

• Defining Objectives:

• 1) An objective is the aim or goal of a project, and describes the desired state which the project is expected to achieve/contribute to.

• 2) it provides the reason for undertaking the project

Objectives

• A project will have at least two levels of objectives: – 1) A development or higher level– 2) An immediate objective or objectives

3) There may also be a transitional level, or

intermediate level which is necessary to attain, in order to progress from the intermediate to the development objective

Objectives

• 1) The development objective will usually be at the sectoral or sub-sectoral level.

• 2) The immediate objective provides the purpose of the project and in particular the goal that the management of the project will try to achieve.

Objectives

• Development Objective:

• Ensure that:It provides adequate justification for the

projectIts progress can be verified either

quantitatively or qualitativelyIt is single-purpose, or has multiple purposes

which are compatible.

Objectives

• Immediate Objectives/Project Objectives

• An immediate objective should specify the changes or improvements that could be expected in the target group, region, or organization if the project is completed successfully and on time.

• Immediate objectives are of most importance to the project designer

Objectives

• In defining an immediate objective, ensure:– It states the desired change and where this

will take place– It specifies the magnitude of the change to be

achieved– It indicates the time scale for the change– Its progress can be verified quantitatively– If it conflicts with another immediate objective,

priorities are indicated

Objectives

• The way in which the immediate objectives contributes to the development objective must be obvious.

• It may be helpful to introduce an intermediate objective in order to clarify the logical progress and connection.

Project Preparation

• Once these objectives are defined, the constraints to achieving them must be identified.

• Some of these constraints are removable by the project itself while others are exogenous and can only be tackled on a global or national basis and not through individual projects.

Project Preparation: Data Requirements

• If a project shows merit, additional data would be required during project preparation:

• a) Detailed market studies• b) Geological or environmental studies• c) Investigation of local sources of raw

material• d) Details of government regulations and

policies

Data Requirements

• f) Economic, social, or cultural characteristics of the people in the project area

• g) Availability of technical and managerial skills

• h) Existing or potential sources of local capacity for project preparation and implementation.

Project Preparation

• Project feasibility involves five important aspects:

• Technical• Institutional • Financial, • Economic• Social. • The project preparation process consists of

analyzing these five components and designing a feasible project. See Figure II

DATA SOURCES--MARKET INFORMATION--NATURAL RESOURCES--HUMAN RESOURCES--SOCIO-ECONOMICSTATISTICS

TECHNICAL DESIGN--PRODUCT MIX--TECHNOLOGY--LOCATION--SIZE & SCALE--INPUTS & OUTPUTS

PROJECT SPECIFICATIONTECHNICAL DATA

PROJECTIONS OFCOST AND BENEFITSCASH FLOW

FINANCIAL, ECONOMIC AND SOCIAL COST-BENEFIT ANALYSISDCF, NVP, IRRRISK, SENSITIVITY

NATIONAL PARAMETERSFOR COST-BENEFITANALYSIS

IMPLEMENTATIONPLANNING--PLANNING--SCHEDULING--CONTROL--SUPERVISION

INSTITUTIONALARRANGEMENTS--PROJECT ORGANIZATION--MANAGEMENT--RELATIONSHIPS

FINANCING PLAN--FINANCE NEEDS--DEBT--EQUITY--SERVICES

FINAL APPRAISAL

CHART II: FLOW CHART OF THE PROJECT PREPARATION PROCESSADAPTED FROM BRUCE, CMF, (1980)

Project Design: Project Logic and the Log Frame

• Project objectives are more readily achieved with a clear, precise and consistent project design

• If the purpose and scope of the project are clear at the outset, this makes implementation, monitoring, and evaluation more straightforward.

Project Logic and the Logframe

• Weaknesses in project formulation:• 1) A project with no clear objective, or an objective that is

far too ambitious given the available resources.• 2). A project designed with two or more objectives which

actually conflict, or where priority is not assigned.• 3). A confusion between the different project elements,

between objectives and outputs, outputs and activities and even inputs.

• 4) Inadequate technical specification of objectives, outputs or inputs.

Project Logic

• The Logframe provides a structure for specifying the components of a project and the logical linkages between a set of means and a set of ends in its larger framework

PROPJECT LOGIC

• For a well formulated project the:– 1) Objectives will be immediately relevant to

the need– 2) They will be realistic and achievable

Project Logic

• 3) The activities and outputs of the project will be only those that contribute directly to the achievement of the objectives.

• 4) The project will have clearly defined limits. Its organizational structure, institutional setting and geographical boundaries will be clearly specified.

PROJECT LOGIC

• 5).The project summary must be of value as a communication device, so that there is less risk of busy administrators finding their understanding of the project obscured

• .

Project Logic

• 6) For managers on the ground the summary clearly defines their primary task, serving as a model to compare actual implementation

• 7) The project summary becomes an integral part of the whole project preparation, appraisal, monitoring, and evaluation process.

Project Logic

• Preparation of the logframe also forces the project designer to identify systematically the risks inherent in the whole project.

• The structure of the project summary leads easily to the identification and definition of performance measures for each stage of the hierarchy.

• These should be time bound and either quantifiable or at least capable of being assessed.

Project Logic

• The planner has to start thinking in terms of the logical hierarchy from the moment when the project begins to take shape.

• Logical consistency is a characteristic of all good projects.

Project Logic

• The essential elements of a project are:

ObjectivesOutputsActivitiesInputs

Objectives have been discussed above.

Project Logic

• Project outputs

• Project outputs are the result of activities completed by the project with the use of inputs.

• The outputs of a project need to be stated in such a way that:

• 1) their realization can be identified in terms of quantity, quality, time, and place.

Project Outputs

• 2) As for objectives, a target is specified for the magnitude of output to be produced and a timeline for this

• 3) It is clear if a certain output is a prerequisite for other outputs

PROJECT OUTPUTS

• 4) All inputs necessary for achieving the immediate objectives are listed and all outputs clearly relate to the immediate objectives.

• 5) They are feasible within the resources available

Project Outputs

• SUMMARY

• By definition outputs are separate from objectives

• Their confusion is a common design error

• Outputs are also commonly confused with activities

Work Breakdown Structure

• A WBS is deliverable-oriented grouping of project components that organizes and defines the total scope of the project. (Slide 50)

• Work not in the WBS is outside the scope of the project

• The WBS is often used to develop or confirm a common understanding of project scope.


4 broad steps

1.Planning

2.Executing

3.Controlling

4.Closing


• A WBS from a previous project can be used for as a template for a new project.

• An important aspect of the WBS is Decomposition:

• Decomposition involves subdividing the major project deliverables or sub deliverables into smaller, more manageable components until the deliverables are defined in sufficient detail to support development of project activities:

•


• Decomposition involves the following major steps:

• 1) Identify the major deliverables of the project, including project management

• The major deliverables should always be defined in terms of how the project will actually be organized

Work Breakdown structure

• 2) Decide if adequate cost and duration estimates can be developed at the level of detail for each deliverable

• 3) Identify constituent components of the deliverable.

• These should be described in terms of tangible, verifiable results to facilitate performance measurement.


• 4) Verify the correctness of the decomposition.i) Are the lower level items both necessary and

sufficient for completion of the decomposed item?

ii) Is each item clearly and completely defined?iii) Can each item be appropriately scheduled?

Budgeted? iv) Assigned to a specific organizational unit who

will accept responsibility for satisfactory completion of the item?

The Project Environment

• The IF…..Then logic of the project hierarchy also depends on external events or conditions.

• Basic Premise: The achievements and conditions specified for each level in the means-ends chain ought to be not only necessary, but also sufficient to cause the higher level to be attained.


• Risks

• The linkages underlying the logic of a project are subject to a variety of risks:

• 1) inaccuracy of information

• 2) the uncertainty of the project environment

• 3) and/or the un-predictable reactions of the target group


• Risks

• In the absence of definitive data, the project designer will have to make assumptions.

• Each time an assumption is made, a risk that the assumption will not hold is introduced, thus compromising the performance of the project.


• Risks

• In the formulation of a project there will be 4 main types of risks:

• 1) Inherent Risks

• 2) Universal Risks

• 3) Internal Risks

• 4) External Risks


• Risks

• Universal Risks

• Risk of war, rare extreme climatic events or other natural disasters.

• They must be taken account of in project design and may mean the rejection of the project or at least its delay until the situation improves.


• Internal Risks• Risks relating to the inputs and activities under

the control of management, e.g.• 1) Delays in the supply of equipment• 2) Delays in the assignment of project staff• 3) Delays in the supply of materials• 4) Delay in the completion of an activity, eg.

Completion of survey work due to unavailability of key staff.


• External Risks• Factors upon which the success of the

project depends, but which are largely outside the control of project management. This is the important group of risks that may need to be shown in the Logframe.

• Some factors become risks when agencies external to the project management are responsible for them.


• External Risks

• Introduction of external risk identification in the earliest stages of project identification and formulation will rapidly screen out unfeasible project concepts.


• Risks

• The project environment column in the logframe is of value for two reasons:

• To prompt iterative improvement of the project design

• To ensure that any remaining risks are carefully monitored


• Risks

• Having identified a risk during preparation of the logframe:

• 1) Reject the project, if the risk is sufficient to call into question the viability of the project and cannot be realistically removed or reduced through re-design


• 2) Lower or eliminate the risk through re-design or by adopting a completely different approach

• 3) For risks that are acceptable at the time of project preparation, state them in the logframe and subsequent project documents and monitor them through the project’s life.


• Risks

• In summary, risks occur when:

• Key elements, actions or decisions, upon which project success depends, are subject to delay or do not materialize.

• Risks should be identified during the project formulation process.


• Risks: Their articulation:

• 1) leads to rejection of non-viable projects or redesign of the project to eliminate the risks

• 2) Makes risks explicit and ensures they are monitored during implementation, and that complementary action by other agencies is forthcoming

• 3)Facilitates the assessment of risk, helping judgment of the project’s chances of success during final appraisal

Progress Monitoring

• Good progress monitoring highlights any: divergences between budgeted and actual

expenditure, and shortfalls in the physical aspects of

implementation; determines whether budgets or targets were

realistic in the first place; and tries to find out the causes of slow progress with

a view to effecting corrective action.

Impact Evaluation

• The monitoring of financial and physical progress during implementation and operation of a project is not enough - progress may be good and on target, but the project may not be achieving the impact intended.

• It is thus important to evaluate the impact of the project in terms of:

Impact Evaluation

1. whether the target beneficiaries are being reached;

2. whether the identified constraints have been or are being removed;

3. whether the output targets are being met;

4. if the objectives or targets are not being met, what lessons can be learnt to improve design of new projects

Documents

BUSINESS STRATEGIES LIMITED LEADERS 2006 WORKSHOP DESIGNING AND IMPLEMENTING PROJECTS LOGICAL FRAMEWORK MONITORING AND EVALUATION