Project and Investment Analysis

PLC
A project life cycle is the sequence of phases that a project goes through from its initiation to its closure.
The number and sequence of the cycle are determined by the management and various other factors
like needs of the organization involved in the project, the nature of the project, and its area of
application. The phases have a definite start, end, and control point and are constrained by time. The
project lifecycle can be defined and modified as per the needs and aspects of the organization. Even
though every project has a definite start and end, the particular objectives, deliverables, and activities
vary widely. The lifecycle provides the basic foundation of the actions that has to be performed in the
project, irrespective of the specific work involved.
Project life cycles can range from predictive or plan-driven approaches to adaptive or change-driven
approaches. In a predictive life cycle, the specifics are defined at the start of the project, and any
alterations to scope are carefully addressed. In an adaptive life cycle, the product is developed over
multiple iterations, and detailed scope is defined for iteration only as the iteration begins.
Characteristics of the Project Life Cycle
Although projects are unique and highly unpredictable, their standard framework consists of same
generic lifecycle structure, consisting of following phases:
1. The Initiation Phase: Starting of the project
2. The Planning Phase: Organizing and Preparing
3. The Execution Phase: Carrying out the project
4. The Termination Phase: Closing the project
1. The Initiation Phase: The initiation phase aims to define and authorize the project. The project
manager takes the given information and creates a Project Charter. The Project Charter
authorizes the project and documents the primary requirements for the project. It includes
information such as:
o Project’s purpose, vision, and mission
o Measurable objectives and success criteria
o Elaborated project description, conditions, and risks
o Name and authority of the project sponsor
o Concerned stakeholders
2. The Planning Phase: The purpose of this phase is to lay down a detailed strategy of how the
project has to be performed and how to make it a success.
Project Planning consists of two parts:
o Strategic Planning
o Implementation Planning
In strategic planning, the overall approach to the project is developed. In implementation planning, the
ways to apply those decisions are sought.
3. The Execution Phase: In this phase, the decisions and activities defined during the planning
phase are implemented. During this phase, the project manager has to supervise the project and
prevent any errors from taking place. This process is also termed as monitoring and controlling.
After satisfaction from the customer, sponsor, and stakeholder’s end, he takes the process to
the next step.
4. The Termination Phase: This is the last phase of any project, and it marks the official closure of
the project.
This general lifecycle structure is used when dealing with upper management or other people less
familiar with the project. Some people might confuse it with the project management process groups,
but the latter contains activities specific to the project. The project lifecycle, on the other hand, is
independent of the life cycle of the particular outcome of the project. However, it is beneficial to take
the current life-cycle phase of the product into account. It can provide a common frame of reference for
comparing different projects
The generic life cycle structure commonly exhibits the following characteristics:
 At the start, cost and staffing levels are low and reach a peak when the work is in progress. It
again starts to drop rapidly as the project begins to halt.
 The typical cost and staffing curve does not apply to all projects. Considerable expenses are
required to secure essential resources early in its life cycle.
 Risk and uncertainty are at their peak at the beginning of the project. These factors drop over
the lifecycle of the project as decisions are reached, and deliverables are accepted.
 The ability to affect the final product of the project without impacting the cost drastically is
highest at the start of the project and decreases as the project advances towards completion. It
is clear from the figure 2 that the cost of making new changes and rectifying errors increases as
the project approaches completion.These features are present almost in all kinds of project
lifecycles but in different ways or to different degrees. Adaptive life cycles are developed
particularly with the intent of keeping stakeholder influences higher and the costs of changes
lower all through the life cycle than in predictive life cycles.

Let’s take a look at how knowledge on project lifecycle benefits an organization:
 It helps professional services teams to be more proficient and profitable.
 It helps the organization.
 It makes the flow of communication easier.
 It emphasizes on reporting and examining previous projects.

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Characteristics of the Project Life Cycle

1. The Initiation Phase: Starting of the project

2. The Planning Phase: Organizing and Preparing

3. The Execution Phase: Carrying out the project

4. The Termination Phase: Closing the project

o Project’s purpose, vision, and mission

o Measurable objectives and success criteria

o Elaborated project description, conditions, and risks

o Name and authority of the project sponsor

 It helps professional services teams to be more proficient and profitable.

 It helps the organization.

 It makes the flow of communication easier.

 It emphasizes on reporting and examining previous projects.

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