module 1 session 1.3 visual 1 module 1 understanding the project and project management session...

Module 1 Session 1.3 Visual 1

Module 1

Understanding the Project and Project Management

Session 1.3 The Project Preparation/Analysis Process and the Hierarchy of Objectives


Instructional Objectives

1. Describe the process of preparation and analysis

2. Explain the purpose of a feasibility study

3. Name the six “feasibilities” and describe each

4. Describe how a feasibility study is used

5. Describe what is meant by a hierarchy of objectives

6. Create a simple hierarchy of objectives


A Generic Project Life CycleIdentification

orConception

Feasibilityor

Definition

Developmentor Design orPreparation

Approval orAppraisal orFinancing

Implementation(Construction,Manufacture,Development)

OperationsEx Post

Evaluation

MajorPhases

orStages

Milestonesor

DecisionGates

Activities orProducts

orDeliverables

Objectiveof

Phase

ConceptApproved

FeasibilityApproved

DesignApproved

ProjectApproved

Start-upof

Operations

PrefeasibilityStudy

FeasibilityStudy

DesignDocuments

ProjectAnalysisReport

CompletedProject

Benefits andan AuditReport

DefineNeeds

DefineRequirements

DevelopSpecifications

Financing ImplementProject

LearnFrom

Mistakes


Flowchart of the Project Preparation/Analysis Process

Economic Costsand Benefits

(Shadow Prices)

Economic Cost-Benefit

Analysis

Financial Costsand Benefits

(Market Prices)

FinancialCost/Benefit

(ROI)

FinalAppraisal

(Feasibility)

1. Technical

2. Financial

3. Economic

4. Institutional

5. Environmental

6. Social

TechnicalDesign

Implementationand Operational

ManagementCapacity

System forDelivery or

Distribution toBeneficiaries or

Customers

Need orDemand

Start:Ideas

or Concept


Six Types of Feasibility

Technical—Can it be done? Financial—Is the rate of return acceptable? Economic—Is the benefit/cost ratio for the country

acceptable? Institutional—Can the organization

maintain it? Environmental—How will it affect the

environment? Social—How will it impact society?


Preparation and Analysis Are Iterative

Preparation Preparation Preparation

Analysis Analysis Analysis

Identification Feasibility Design

Ideas

Recycle Recycle Recycle

Approval

Time

1 10 100 1,000 10,000

Order of Magnitude of Costs

Drop Drop


Another Life Cycle

Wild enthusiasm

Disillusionment

Chaos

Search for the guilty

Punishment of the innocent

Promotion of nonparticipants

Definition of objectives


Hierarchy of Objectives

Clarify need

Clarify requirements

Communicate project objectives

Get input and feedback

Helps expost evaluators measure “right” objectives

Makes relationship of objectives clear


Level of Objective

Level of Management


Policy

Strategic

Operational

TopPolicy

Objectives

Middle

Working Project Objectives Input Objectives

Strategic Objectives


Hierarchy of ObjectivesElectric Power Project

Policy Objective

Strategic Objective

Project Objective

Input Objective

Increase Industrial Production

Produce 50 MW Power

New Power Plant

$10 Million Contract, Land, Labor


Why-How Framework

Why Ends Objectives Go Up

How Means Strategy Go Down

You can start at any level and go up and down!


An Example

What is the objective? Praise the glory of God Build a cathedral Build a wall Make square stones Hit stones with a hammer

Why?

How?


The Hierarchy and the Why/How Framework

Levels of Detail

Policy Objectives


Project Objectives

Why

How

Less Detail

More Detail



The Cathedral Project

Policy Objective


Project Objectives(Operational)

To praise the glory of God

To build a cathedral

To build a wall

To make square stones

To hit rocks with a hammer

Why?

How?

Why?

How?


Hierarchy of ObjectivesThe Series of Causal Linkages

Hierarchy TerminologyLevel of Purpose Examples

PolicyResults

(Impact)Policy

Objective

IncreaseFarmer Income

($200/year)

Strategic

Operational

Effects

Outputs

Activities

Strategic Objective

Increase Rice Production (50%)

Project Objective

Input Objectives

Inputs


Objective TreeAnalysis of Alternative Strategies to Accomplish Objectives Is Key as You Work Down Each Level

Increase

Rice

Production

New Practice

New Land

Switch Crops

Import Rice

Reduce Consumption

Objective

Alternative Strategies



Hierarchy TerminologyLevel of Purpose Examples

PolicyResults

(Impact)Policy

Objective

IncreaseFarmer Income

($200/year)

Strategic

Operational

Effects

Outputs

Activities

Strategic Objective

Increase Rice Production (50%)

Project Objective

Input ObjectivesInputs

The Series of Causal Linkages

Introduce New Farming Practices: New Seeds and TechnologyPeople, Money, Seeds, Knowledge


Level of Objectives Means-Ends Chain

Policy Objectives


Project Objectives(Operational)

Input Objectives

Objectives

Loans and extension work with farmers

Strategy

Bank loan of $10 million

Objectives

Use new seeds and fertilizer

StrategyLoans and extension work with farmers

Objectives

Increase rice production 50%

Strategy


Objectives

Double farmer income to $200

Strategy


Why

How

Why

How

Why

How

Why

How

Vertical Logic


Project Development Objective (PDO)

Outcome Indicators Use of Results Information

Urban water supplies provide safe water

80 % of systems meet international standards 100 % of time

Provide technical assistance to systems failing tests

Intermediate results, one per component

Results indicators for each component

Use for outcome monitoring

Component 1

Component 2

-

-

-

-

Results Framework World Bank Terminology


Measurable Indicators of Results

Horizontal Logic(To measure progress and verify assumptions)

Assumptions

What outside influencesmay affect the project (if-then relationship)

How to measure


Hierarchy of Project Objectives(For definition and measurement/evaluation)

Measurable Indicatorsof Results

Policy Objectives


Project and Operational Objectives

Input Objectives

Level of Objectives Means-Ends Chain Assumptions

Objective (end-outputs)

Strategy (means-inputs)

Objective

Strategy

Objective

Strategy

Objective

Strategy

Why

How

Level of effort/ expenditure


Hierarchy of Project Objectives

Level of Objectives Means-Ends Chain

Measurable Indicators of

Results Assumptions

Policy Objectives


Project Objectives

Input Objectives

Objective (end-outputs)

Double farmer income to $200

Strategy (means-inputs)


Objective


Strategy


Objective


Strategy


Objective


Strategy

Bank loan of $10 million

• per capita income

•total tons grown

•tons/hectare

•number of tons distributed

•number of loans

•value of loans

•level of effort/expenditure

Price of rice does not fall

with increased production

Proper use of fertilizer will

increase yields

Loans will lead to better practices


The Hierarchy of Objectives

Logical framework with vertical andhorizontal logic

Vertical logic = Why? How? Horizontal logic = Measures and Assumptions Planning can begin at any vertical level

Policy Strategic Operational


The Hierarchy of Objectives

Levels match management levels and interests Primarily tool for analysts, but also helps project

management and evaluators advice feedback communication consensus building commitment/motivation evaluation planning


Summary Preimplementation phases of life cycle emphasized Key deliverable = Project Analysis Report Iterative process of preparation and analysis Hierarchy of objectives (and results) useful tool

planners expost evaluators project management


Coming up:

Making a simple hierarchy of objectives (and results)

How to read a Project Analysis Report (Session 1.4)


Discussion Questions

How can the hierarchy be used for collaborative planning with beneficiaries and others?

Why is a clear definition of objectives essential before implementation?

Contrast the use of the preparation/analysis process during the identification phase with its use during the feasibility phase.