PROJECT ANALYSIS AND MANAGEMENT
Lecture 3
Project Identification
Course leader : Asst.Prof Tadele T
Contents
• Conceptual Clarification
• Sources of project ideas
• Steps in Project Identification and Selection
Situation analysis
Stakeholders analysis
SWOT analysis
Problem analysis
Objective analysis
Alternative Tree Analysis or Project Selection
Group Exercise
A) Project Identification-meaning
- It involves the conceiving of ideas or
intentions to set up a project.
- These ideas are then transformed into a
project.
Project ideas are normally initiated
by a perceived need [PROBLEM or
OPPORTUNITY] in an organization
and converted in to a formal project
proposal.
Project Identification-meaning
The major focus in this step is finding
project ideas or identifying needs or
demands for projects.
The activities carried out are generally
fact-finding survey, or review of
census or available secondary
data.
What are the sources for project
ideas?
SOURCES OF PROJECT IDEAS:
The community, researchers, experts, local
leaders, Policy makers, entrepreneurs, donors,
NGOs, Planners, etc.
Government policy priorities, unusual events,
external threats, unsatisfied demands, under
utilized natural resources, etc.
The business or government development
planning document
Needs of clients
Individual working in organizations, well
informed technical specialists
Sources of project ideas:
Local leaders
Government departments,
Other country's experiences
Various Chambers of Commerce and
Industry
National Small Industries Corporation,
and several other institutions including
the business press,
They regularly publish valuable data and
analytical reports about the trends of
demand, supply, costs in various segments of
industry and business.
Sources of project ideas _Cont’d
By their very nature, opportunity studies are
indicative rather than detailed and hence are
generally based on macro-parameters and rough
estimates.
Such studies may also be carried out in one of the
following three directions:
A given geographical area (Area studies).
A specific sub-sector of economy or industry, like food-
processing, agriculture, or power generation (Sub-sectorial
studies).
Exploitation of renewable and non-renewable natural,
agricultural, or industrial produce like minerals, sugarcane,
fish, plants, and even geothermal energy sources, etc.
(Resource-based studies).
Sources of project ideas _Cont’d
Opportunity study:
Objectives:
Refinement of business idea
Preliminary evaluation of alternative approaches
Preliminary assessment of strengths and weaknesses of
concept
Characteristics:
Sketchy, based more on rough aggregate
Estimates than on detailed analysis
Who identifies projects?
Various organizations, whether
local or foreign, state owned or
private, government ministries,
development banks, interest
groups, CBOs, NGOs and of
course individuals can identify
projects.
APPROACHES TO PROJECT IDENTIFICATION
There are two major approaches
to project identification :
(a) Top-down approach
(b) Bottom-up approach
Top-Down Approach
Projects are identified based on demands from beyond
the community.
This may include directives from:
International conventions (such as Kyoto
Protocol/climate change)
International institutions that have
determined particular priorities and thus
projects
National policy makers identifying
projects that pertain to party manifestos
and/or national plans.
Advantages of Top-Down Approach
It may be a rapid response to disasters
like floods, war outbreak because there is
limited time and chance to consult the
beneficiaries.
It can be effective in providing important
services like education, health, water,
roads etc.
It can contribute to wider national or
international objectives and goals
LIMITATIONS OF TOP-DOWN APPROACH
Does not help in modifying strongly
established ideas and beliefs of people.
Assumes external individuals know better
than the beneficiaries of the service.
Communities have little say in planning
process rendering approach devoid of human
resource development.
Community develops dependency
syndrome on outside assistance and does
not exploit their own potential.
BOTTOM-UP APPROACH
In this approach
community/ beneficiaries
are encouraged to identify
and plan the projects
themselves with or without
outsiders.
Advantages of Bottom-Up Approach
Interveners accomplish more with limited resources
since people tend to safeguard what they have
provided for themselves.
Develops people’s capacity to identify problems and
needs and to seek possible solutions to them.
Provides opportunities of educating people.
Helps people to work as a team and develop a “WE”
attitude - makes project progressive and sustainable.
Resources are effectively managed; dependence
reduces, there is increased equity, initiative,
accountability.
Limitations of Bottom-Up Approach
Not always effective for projects that require
urgency to implement
Time-consuming and requires tolerance.
People sometimes dislike approach because they
do not want to take responsibility for action.
The agency using this approach is never in control
and cannot guarantee the results it would want.
The priorities of communities may not fit with
national or international priorities that seek to
have a broader impact.
Project Identification in Both approaches:
Involves needs assessment
- collecting, processing and analyzing data on
problems/needs of communities
Review of secondary data
- Look at books, survey reports/ research papers,
publications, media reports, internet etc.
Collecting and analyzing primary information
• Interviews
• Community mapping
• Focus Group Discussions
• Other methods
Activities (Steps) in Project
identification and initial screening:
Situation analysis
Stakeholders analysis
SWOT analysis
Problem analysis
Objective analysis
Alternative Tree Analysis or project
selection
a) Situation analysis
This is about describing the problem or situation to
be addressed by the project.
This can be ‘problem based’ or ‘opportunity based’.
What are the prevalent problem situations or ‘opportunity
based’, e.g. is there an opportunity to serve people with
disability? Or is there an opportunity to establish a Cement
Factory (suitable soil)
The information source is basically a status quo report
from the strategic planning process.
It could also be a status quo report from a
feasibility study, a pre-appraisal report.
B. Stakeholder Analysis
Stakeholder is any individual, group or
organization, community, with an interest in the
outcome of a programme/project.
Key Question
Whose problems or opportunities are we
analyzing? Who will benefit or loose-out,
and how, from a potential project
intervention?
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Stakeholder Analysis _ Cont’d
Purpose: To identify:
Needs and interest of stakeholders
Organizations and groups that should be
encouraged to participate in different stages of
the project
Potential risks that could put at risk
programme
Opportunities in implementing a programme
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Stakeholder Analysis-Cont’d
Execise 1
Let us list up the stakeholders for primary education
(more than 50)
Exercise 2
Let us categorize them
beneficiaries/negatively affected groups/decision makers/funding
agencies/community leaders/potential opponents/supporting group
Exercise 3
Let us set the target group
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