PROJECT

MANAGEMENT

UNIT - III

By
Vinod Vishwakarma
Assistant Professor
Department of Civil Engineering
1
Unit I – Basic Concept

THE PROJECT
• A project is a unique endeavor to produce a set of
deliverables within clearly specified time, cost and
quality constraints.

• Projects are different from standard business

operational activities as they:

– Are unique in nature.

– Have a defined timescale.
– Have an approved budget.
– Have limited resources.
– Involve an element of risk.
– Achieve beneficial change.

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

THE PROJECT: Definition

Project can be defined as a temporary

endeavor undertaken to accomplish a unique
objective at goal.
- Project Management Institute (PMI)

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

THE PROJECT
A project is accomplished by performing a set of activities.

Ex:- Construction of a House

Activities involved:-

– Digging of foundation pits,

– Construction of Foundation,
– Construction of walls,
– Construction of roof,
– Fixing of doors and windows,
– Fixing of sanitary, fittings, wiring, fuel and power etc.

Other Examples: Writing a Book, building a dam etc.

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Project Management

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Why Projects Fail???

• Failure to align project with organizational

objectives
• Poor scope
• Unrealistic expectations
• Lack of executive sponsorship
• Lack of project management
• Inability to move beyond individual and
personality conflicts
• Politics

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Why Projects Succeed!!!

• Project Sponsorship at executive level

• Good project charter (deed)
• Strong project management
• The right mix of team players
• Good decision-making structure
• Good communication
• Team members are working towards common
goals

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Is Project Management required???

• Today’s complex environments require

ongoing implementations
• Project management is a method and
mindset and a disciplined approach to
managing chaos
• Project management provides a framework
for working amidst persistent change

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Definition of Project Management

Project Management is the skills, tools and

management processes required to undertake
a project successfully. It incorporates:

– A set of skills.
– A suite of tools.
– A series of processes.

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Components of Project Management

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Project Management

• Project management is about organization.

• Project management is about decision making

• Project management is about changing

people’s behavior

• Project management is about creating an

environment conducive to getting critical
projects done!

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Planning the Project

• The Project Life Cycle

• Organizing the Project Team
• Project Plans

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Planning the project:

PROJECT DEVELOPMENT CYCLE
The Project Life Cycle refers to a logical sequence of activities to
accomplish the project’s goals or objectives.

Closure
Execution
&
Planning
Controlling

Initiation

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

1) Initiation

In this first stage, the scope of the project is defined along with the approach
to be taken to deliver the desired outputs. The project manager is appointed
and in turn, he selects the team members based on their skills and
experience. The most common tools or methodologies used in the initiation
stage are:

• Project Charter,
• Business Plan,
• Project Framework (or Overview),
• Business Case Justification, and
• Milestones Reviews.

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

1. Initiation

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

2) Planning

The second phase should include a detailed identification and assignment of

each task until the end of the project. It should also include a risk analysis
and a definition of a criteria for the successful completion of each
deliverable.

The governance process is defined, stake holders identified and reporting

frequency and channels agreed. The most common tools or methodologies
used in the planning stage are Business Plan and Milestones Reviews.

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

2. Planning

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

3) Execution and controlling

The most important issue in this phase is to ensure project activities are
properly executed and controlled. During the execution phase, the planned
solution is implemented to solve the problem specified in the project's
requirements.

In product and system development, a design resulting in a specific set of

product requirements is created. This convergence is measured by
prototypes, testing, and reviews. As the execution phase progresses, groups
across the organization become more deeply involved in planning for the
final testing, production, and support. The most common tools or
methodologies used in the execution phase are an update of Risk Analysis
and Score Cards, in addition to Business Plan and Milestones Reviews.

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

3. Execution and Controlling

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

4) Closure

In this last stage, the project manager must ensure that the project is
brought to its proper completion. The closure phase is characterized by a
written formal project review report containing the following components: a
formal acceptance of the final product by the client, Weighted Critical
Measurements (matching the initial requirements specified by the client with
the final delivered product), rewarding the team, a list of lessons learned,
releasing project resources, and a formal project closure notification to
higher management.

No special tool or methodology is needed during the closure phase.

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

PROJECT DEVELOPMENT CYCLE

4. Closure

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Planning the project:

Project Plans

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Planning the project:

Project Plans
• Estimating Time Accurately
• Scheduling Simple Projects
• Gantt Charts – Scheduling Projects with Dependent
Stages
• Critical Path Analysis and PERT – Scheduling Complex
Projects
• The Planning Cycle – A Planning Process for Middle-
Sized Projects

PROJECT MANAGEMENT By: VINOD

Unit I – Basic Concept

Planning the project:

Organizing the Project Team

• Project Leader
• The Team
• Work Methods and Procedures
• Work Plan

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal

• Meaning and definition

• Various aspects of project appraisal

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Appraisal

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Appraisal or Pressure???

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal

Meaning and definition

• Assessment of a project in terms of its economic, social and financial
viability

• A lending financial institution makes an independent and objective

assessment of various aspects of an investment proposition

• It is defined as taking a second look critically and carefully at a project

by a person who is in no way involved or connected with its
preparation. He is able to take independent, dispassionate and
objective view of the project in totality, along with its various
components

It is a detailed study of several aspects of a given project before recommending it.

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal
Steps for project appraisal/Aspects of project appraisal

• Economic Aspects

• Technical Aspects

• Organizational Aspects

• Managerial Aspects

• Financial Aspects

• Market/Commercial Aspects

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Unit III – Project Appraisal

Project Appraisal
Economic Aspects

It measures the effect of the project on the whole economy.

• Analyses if the benefits will justify the project cost/investment done

• A successful project gives following benefits:

– Increased output
– Enhanced services
– Increased employment
– Larger government revenue
– Higher earnings
– Higher standard of living
– Increased national income
– Improved income distribution
PROJECT MANAGEMENT By: VINOD
Unit III – Project Appraisal

Project Appraisal
Technical Aspects

It measures the effect of the project on the basis of techniques used as:

• Site and Location: RM supply, proximity to markets, transportation

facility, power supply, manpower, water, government policies, labour
laws, climate, taxes

• Size of plant/scale of operations: Technological capacity is

standardised for achieving economies of scale, low demand or less
resource availability result in economies of scale

• Technical feasibility: Technology selected, availability of

infrastructure, plant layout, project implementation schedules etc

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Technical Aspect
Various aspects are measured under this head as:

• Selection of appropriate Technology (This must satisfy the following questions)

• Does the Technology make use of the locally available Raw Material?
• Can the technology implement and maintained by the locally available man power?
• Is the technology in tune with the local social and cultural conditions?
• Does the technology protects ecological balance etc?

Example:
As cement can be manufactured wither by wet process or by the dry process.

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Technical Aspect
Contd:

• Scale of Operations (signified by the size of the plant)

• Raw Material (may be replaced by alternative Raw Material, hence alternative process
may be required)
• Technical Know-How (expert consultant must have knowledge and experience and
such project earlier successfully)
• Collaboration Agreements (the agreement should be specified as to the part played
by know-how supplier)
• Product Mix (Variation in product according to the customers)
• Selection and Procurement of Plant and Machinery
• Plant layout (For steady flow of production and minimizing overall cost)
• Location of Project (regional Factor, Site Factor)
• Project Scheduling (Scheduling of activities)

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal
Organizational Aspects

• Organization structure, recruitment and training aspects are studied

• Appraisal done to see if project is adequately staffed, initial

recruitment is done

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal
Managerial Aspects

• Financial institutions check if promoters are competent and have

business sense

• They can appoint nominee directors on board

• The Companies Act and Industries Act empower government to

exercise control over management

• They can also take over the management in case it is needed

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal
Financial Aspects

• Cost analysis: Finding out the cost of production

• Pricing: Deciding price of the product after considering demand,

profit and competition

• Financing: Raising funds and efficient use of the same

• Income and Expenditure: Concerned with predicting profit and costs

involved

PROJECT MANAGEMENT By: VINOD

Unit III – Project Appraisal

Project Appraisal
Market / Commercial Aspects

• Analysis of market opportunities

• Specification of marketing objectives

• Planning and organizing of marketing process

• Controlling of implementation of marketing plan

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Unit I – Basic Concept

THANKS

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PROJECT MANAGEMENT By: VINOD