Project management

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Jump to: navigation, search Project management is the discipline of planning, organizing, securing, and managing resources to achieve specific goals. A project is a temporary endeavor with a defined beginning and end (usually time-constrained, and often constrained by funding or deliverables),[1] undertaken to meet unique goals and objectives,[2] typically to bring about beneficial change or added value. The temporary nature of projects stands in contrast with business as usual (or operations),[3] which are repetitive permanent, or semi-permanent functional activities to produce products or services. In practice, the management of these two systems is often quite different, and as such requires the development of distinct technical skills and management strategies. The primary challenge of project management is to achieve all of the project goals[4] and objectives while honoring the preconceived constraints.[5] Typical constraints are scope, time, and budget.[1] The secondaryand more ambitiouschallenge is to optimize the allocation and integrate the inputs necessary to meet pre-defined objectives.

Contents
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1 History 2 Approaches o 2.1 The traditional approach o 2.2 Critical chain project management o 2.3 Extreme project management o 2.4 Event chain methodology o 2.5 PRINCE2 o 2.6 Process-based management o 2.7 Agile project management 3 Processes o 3.1 Initiating o 3.2 Planning and design o 3.3 Executing o 3.4 Monitoring and controlling o 3.5 Closing o 3.6 Project controlling and project control systems 4 Topics o 4.1 Project managers o 4.2 Project management triangle o 4.3 Work breakdown structure o 4.4 Project management framework o 4.5 International standards o 4.6 Project portfolio management 5 See also

6 References 7 External links

[edit] History

Roman soldiers building a fortress, Trajan's Column 113 AD Project management has been practiced since early civilization. Until 1900 civil engineering projects were generally managed by creative architects, engineers, and master builders themselves, among those for example Vitruvius (1st century BC), Christopher Wren (1632 1723), Thomas Telford (17571834) and Isambard Kingdom Brunel (18061859).[6] It was in the 1950s that organizations started to systematically apply project management tools and techniques to complex engineering projects.[7]

Henry Gantt (18611919), the father of planning and control techniques. As a discipline, Project Management developed from several fields of application including civil construction, engineering, and heavy defense activity.[8] Two forefathers of project management are Henry Gantt, called the father of planning and control techniques,[9] who is famous for his use of the Gantt chart as a project management tool; and Henri Fayol for his creation of the 5 management functions which form the foundation of the body of knowledge associated with project and program management.[10] Both Gantt and Fayol were students of Frederick Winslow Taylor's theories of scientific management. His work is the forerunner to modern project management tools including work breakdown structure (WBS) and resource allocation.

The 1950s marked the beginning of the modern Project Management era where core engineering fields come together working as one. Project management became recognized as a distinct discipline arising from the management discipline with engineering model.[11] In the United States, prior to the 1950s, projects were managed on an ad hoc basis using mostly Gantt Charts, and informal techniques and tools. At that time, two mathematical projectscheduling models were developed. The "Critical Path Method" (CPM) was developed as a joint venture between DuPont Corporation and Remington Rand Corporation for managing plant maintenance projects. And the "Program Evaluation and Review Technique" or PERT, was developed by Booz Allen Hamilton as part of the United States Navy's (in conjunction with the Lockheed Corporation) Polaris missile submarine program;[12] These mathematical techniques quickly spread into many private enterprises.

PERT network chart for a seven-month project with five milestones At the same time, as project-scheduling models were being developed, technology for project cost estimating, cost management, and engineering economics was evolving, with pioneering work by Hans Lang and others. In 1956, the American Association of Cost Engineers (now AACE International; the Association for the Advancement of Cost Engineering) was formed by early practitioners of project management and the associated specialties of planning and scheduling, cost estimating, and cost/schedule control (project control). AACE continued its pioneering work and in 2006 released the first integrated process for portfolio, program and project management (Total Cost Management Framework). The International Project Management Association (IPMA) was founded in Europe in 1967,[13] as a federation of several national project management associations. IPMA maintains its federal structure today and now includes member associations on every continent except Antarctica. IPMA offers a Four Level Certification program based on the IPMA Competence Baseline (ICB).[14] The ICB covers technical competences, contextual competences, and behavioral competences. In 1969, the Project Management Institute (PMI) was formed in the USA.[15] PMI publishes A Guide to the Project Management Body of Knowledge (PMBOK Guide), which describes project management practices that are common to "most projects, most of the time." PMI also offers multiple certifications.

[edit] Approaches
There are a number of approaches to managing project activities including agile, interactive, incremental, and phased approaches.

Regardless of the methodology employed, careful consideration must be given to the overall project objectives, timeline, and cost, as well as the roles and responsibilities of all participants and stakeholders.

[edit] The traditional approach

A traditional phased approach identifies a sequence of steps to be completed. In the "traditional approach", five developmental components of a project can be distinguished (four stages plus control):

Typical development phases of an engineering project

initiation; planning and design; execution and construction; monitoring and controlling systems; completion.

Not all the projects will visit every stage as projects can be terminated before they reach completion. Some projects do not follow a structured planning and/or monitoring stages. Some projects will go through steps 2, 3 and 4 multiple times. Many industries use variations on these project stages. For example, when working on a brick and mortar design and construction, projects will typically progress through stages like PrePlanning, Conceptual Design, Schematic Design, Design Development, Construction Drawings (or Contract Documents), and Construction Administration. In software development, this approach is often known as the waterfall model,[16] i.e., one series of tasks after another in linear sequence. In software development many organizations have adapted the Rational Unified Process (RUP) to fit this methodology, although RUP does not require or explicitly recommend this practice. Waterfall development works well for small, well defined projects, but often fails in larger projects of undefined and ambiguous nature. The Cone of Uncertainty explains some of this as the planning made on the initial phase of the project suffers from a high degree of uncertainty. This becomes especially true as software development is often the realization of a new or novel product. In projects where requirements have not been finalized and can change, requirements management is used to develop an accurate and complete definition of the behavior of software that can serve as the basis for software development.[17] While the terms may differ from industry to industry, the actual stages typically follow common steps to problem solving"defining the problem, weighing options, choosing a path, implementation and evaluation."

[edit] Critical chain project management

Critical chain project management (CCPM) is a method of planning and managing projects that puts more emphasis on the resources (physical and human) needed in order to execute project tasks. The most complex part involves engineering professionals of different fields (Civil, Electrical, Mechanical etc.) working together. It is an application of the Theory of Constraints (TOC) to projects. The goal is to increase the rate of throughput (or completion rates) of projects in an organization. Applying the first three of the five focusing steps of TOC, the system constraint for all projects is identified as are the resources. To exploit the constraint, tasks on the critical chain are given priority over all other activities. Finally, projects are planned and managed to ensure that the resources are ready when the critical chain tasks must start, subordinating all other resources to the critical chain. Regardless of project type, the project plan should undergo Resource leveling, and the longest sequence of resource-constrained tasks should be identified as the critical chain. In multi-project environments, resource leveling should be performed across projects. However, it is often enough to identify (or simply select) a single "drum" resourcea resource that acts as a constraint across projectsand stagger projects based on the availability of that single resource.

Planning and feedback loops in Extreme programming (XP) with the time frames of the multiple loops.

[edit] Extreme project management

In critical studies of project management it has been noted that several PERT based models are not well suited for the multi-project company environment of today.[citation needed] Most of them are aimed at very large-scale, one-time, non-routine projects, and currently all kinds of management are expressed in terms of projects. Using complex models for "projects" (or rather "tasks") spanning a few weeks has been proven to cause unnecessary costs and low maneuverability in several cases[citation needed]. Instead, project management experts try to identify different "lightweight" models, such as Agile Project Management methods including Extreme Programming for software development and Scrum techniques. The generalization of Extreme Programming to other kinds of projects is extreme project management, which may be used in combination with the process modeling and management principles of human interaction management.

[edit] Event chain methodology

Event chain methodology is another method that complements critical path method and critical chain project management methodologies. Event chain methodology is an uncertainty modeling and schedule network analysis technique that is focused on identifying and managing events and event chains that affect project schedules. Event chain methodology helps to mitigate the negative impact of psychological heuristics and biases, as well as to allow for easy modeling of uncertainties in the project schedules. Event chain methodology is based on the following principles.

Probabilistic moment of risk: An activity (task) in most real-life processes is not a continuous uniform process. Tasks are affected by external events, which can occur at some point in the middle of the task. Event chains: Events can cause other events, which will create event chains. These event chains can significantly affect the course of the project. Quantitative analysis is used to determine a cumulative effect of these event chains on the project schedule. Critical events or event chains: The single events or the event chains that have the most potential to affect the projects are the critical events or critical chains of events. They can be determined by the analysis. Project tracking with events: Even if a project is partially completed and data about the project duration, cost, and events occurred is available, it is still possible to refine information about future potential events and helps to forecast future project performance. Event chain visualization: Events and event chains can be visualized using event chain diagrams on a Gantt chart.

[edit] PRINCE2

The PRINCE2 process model PRINCE2 is a structured approach to project management, released in 1996 as a generic project management method.[18] It combined the original PROMPT methodology (which evolved into the PRINCE methodology) with IBM's MITP (managing the implementation of the total project) methodology. PRINCE2 provides a method for managing projects within a clearly defined framework. PRINCE2 describes procedures to coordinate people and activities in a project, how to design and supervise the project, and what to do if the project has to be adjusted if it does not develop as planned. In the method, each process is specified with its key inputs and outputs and with specific goals and activities to be carried out. This allows for automatic control of any deviations from

the plan. Divided into manageable stages, the method enables an efficient control of resources. On the basis of close monitoring, the project can be carried out in a controlled and organized way. PRINCE2 provides a common language for all participants in the project. The various management roles and responsibilities involved in a project are fully described and are adaptable to suit the complexity of the project and skills of the organization.

[edit] Process-based management

Also furthering the concept of project control is the incorporation of process-based management. This area has been driven by the use of Maturity models such as the CMMI (capability maturity model integration; see this example of a predecessor) and ISO/IEC15504 (SPICE software process improvement and capability estimation).

[edit] Agile project management

Agile project management approaches based on the principles of human interaction management are founded on a process view of human collaboration. This contrasts sharply with the traditional approach. In the agile software development or flexible product development approach, the project is seen as a series of relatively small tasks conceived and executed as the situation demands in an adaptive manner, rather than as a completely preplanned process.

[edit] Processes

The project development stages[19] Traditionally, project management includes a number of elements: four to five process groups, and a control system. Regardless of the methodology or terminology used, the same basic project management processes will be used. Major process groups generally include:[20]

initiation planning or development production or execution monitoring and controlling

closing

In project environments with a significant exploratory element (e.g., research and development), these stages may be supplemented with decision points (go/no go decisions) at which the project's continuation is debated and decided. An example is the stage-gate model.

[edit] Initiating

Initiating process group processes[19] The initiating processes determine the nature and scope of the project.[21] If this stage is not performed well, it is unlikely that the project will be successful in meeting the business needs. The key project controls needed here are an understanding of the business environment and making sure that all necessary controls are incorporated into the project. Any deficiencies should be reported and a recommendation should be made to fix them. The initiating stage should include a plan that encompasses the following areas:

analyzing the business needs/requirements in measurable goals reviewing of the current operations financial analysis of the costs and benefits including a budget stakeholder analysis, including users, and support personnel for the project project charter including costs, tasks, deliverables, and schedule

[edit] Planning and design

After the initiation stage, the project is planned to an appropriate level of detail (see example of a flow-chart).[19] The main purpose is to plan time, cost and resources adequately to estimate the work needed and to effectively manage risk during project execution. As with the Initiation process group, a failure to adequately plan greatly reduces the project's chances of successfully accomplishing its goals. Project planning generally consists of[22]

determining how to plan (e.g. by level of detail or rolling wave); developing the scope statement; selecting the planning team; identifying deliverables and creating the work breakdown structure; identifying the activities needed to complete those deliverables and networking the activities in their logical sequence; estimating the resource requirements for the activities; estimating time and cost for activities; developing the schedule; developing the budget;

risk planning; gaining formal approval to begin work.

Additional processes, such as planning for communications and for scope management, identifying roles and responsibilities, determining what to purchase for the project and holding a kick-off meeting are also generally advisable. For new product development projects, conceptual design of the operation of the final product may be performed concurrent with the project planning activities, and may help to inform the planning team when identifying deliverables and planning activities.

[edit] Executing

Executing process group processes[19] Executing consists of the processes used to complete the work defined in the project plan to accomplish the project's requirements. Execution process involves coordinating people and resources, as well as integrating and performing the activities of the project in accordance with the project management plan. The deliverables are produced as outputs from the processes performed as defined in the project management plan and other frameworks that might be applicable to the type of project at hand.

[edit] Monitoring and controlling

Monitoring and controlling process group processes[19] Monitoring and controlling consists of those processes performed to observe project execution so that potential problems can be identified in a timely manner and corrective

action can be taken, when necessary, to control the execution of the project. The key benefit is that project performance is observed and measured regularly to identify variances from the project management plan. Monitoring and controlling includes:[23]

Measuring the ongoing project activities ('where we are'); Monitoring the project variables (cost, effort, scope, etc.) against the project management plan and the project performance baseline (where we should be); Identify corrective actions to address issues and risks properly (How can we get on track again); Influencing the factors that could circumvent integrated change control so only approved changes are implemented

In multi-phase projects, the monitoring and control process also provides feedback between project phases, in order to implement corrective or preventive actions to bring the project into compliance with the project management plan. Project maintenance is an ongoing process, and it includes:[20]

Continuing support of end-users Correction of errors Updates of the software over time

Monitoring and controlling cycle In this stage, auditors should pay attention to how effectively and quickly user problems are resolved. Over the course of any construction project, the work scope may change. Change is a normal and expected part of the construction process. Changes can be the result of necessary design modifications, differing site conditions, material availability, contractor-requested changes, value engineering and impacts from third parties, to name a few. Beyond executing the change in the field, the change normally needs to be documented to show what was actually constructed. This is referred to as change management. Hence, the owner usually requires a final record to show all changes or, more specifically, any change that modifies the tangible portions of the finished work. The record is made on the contract documents usually, but not necessarily limited to, the design drawings. The end product of this effort is what the industry terms as-built drawings, or more simply, as built. The requirement for providing them is a norm in construction contracts.

When changes are introduced to the project, the viability of the project has to be re-assessed. It is important not to lose sight of the initial goals and targets of the projects. When the changes accumulate, the forecasted result may not justify the original proposed investment in the project.

[edit] Closing

Closing process group processes.[19] Closing includes the formal acceptance of the project and the ending thereof. Administrative activities include the archiving of the files and documenting lessons learned. This phase consists of:[20]

Project close: Finalize all activities across all of the process groups to formally close the project or a project phase Contract closure: Complete and settle each contract (including the resolution of any open items) and close each contract applicable to the project or project phase.

[edit] Project controlling and project control systems

Project controlling should be established as an independent function in project management. It implements verification and controlling function during the processing of a project in order to reinforce the defined performance and formal goals.[24] The tasks of project controlling are also:

the creation of infrastructure for the supply of the right information and its update the establishment of a way to communicate disparities of project parameters the development of project information technology based on an intranet or the determination of a project key performance index system (KPI) divergence analyses and generation of proposals for potential project regulations[25] the establishment of methods to accomplish an appropriate the project structure, project workflow organization, project control and governance creation of transparency among the project parameters[26]

Fulfillment and implementation of these tasks can be achieved by applying specific methods and instruments of project controlling. The following methods of project controlling can be applied:

investment analysis costbenefit analyses value benefit Analysis expert surveys simulation calculations

risk-profile analyses surcharge calculations milestone trend analysis cost trend analysis target/actual-comparison[27]

Project control is that element of a project that keeps it on-track, on-time and within budget.[23] Project control begins early in the project with planning and ends late in the project with post-implementation review, having a thorough involvement of each step in the process. Each project should be assessed for the appropriate level of control needed: too much control is too time consuming, too little control is very risky. If project control is not implemented correctly, the cost to the business should be clarified in terms of errors, fixes, and additional audit fees. Control systems are needed for cost, risk, quality, communication, time, change, procurement, and human resources. In addition, auditors should consider how important the projects are to the financial statements, how reliant the stakeholders are on controls, and how many controls exist. Auditors should review the development process and procedures for how they are implemented. The process of development and the quality of the final product may also be assessed if needed or requested. A business may want the auditing firm to be involved throughout the process to catch problems earlier on so that they can be fixed more easily. An auditor can serve as a controls consultant as part of the development team or as an independent auditor as part of an audit. Businesses sometimes use formal systems development processes. These help assure that systems are developed successfully. A formal process is more effective in creating strong controls, and auditors should review this process to confirm that it is well designed and is followed in practice. A good formal systems development plan outlines:

A strategy to align development with the organizations broader objectives Standards for new systems Project management policies for timing and budgeting Procedures describing the process Evaluation of quality of change

[edit] Topics
[edit] Project managers
A project manager is a professional in the field of project management. Project managers can have the responsibility of the planning, execution, and closing of any project, typically relating to construction industry, engineering, architecture, computing, and telecommunications. Many other fields in the production engineering and design engineering and heavy industrial have project managers. A project manager is the person accountable for accomplishing the stated project objectives. Key project management responsibilities include creating clear and attainable project objectives, building the project requirements, and managing the triple constraint for projects, which is cost, time, and scope.

A project manager is often a client representative and has to determine and implement the exact needs of the client, based on knowledge of the firm they are representing. The ability to adapt to the various internal procedures of the contracting party, and to form close links with the nominated representatives, is essential in ensuring that the key issues of cost, time, quality and above all, client satisfaction, can be realized.

[edit] Project management triangle

The project management triangle Like any human undertaking, projects need to be performed and delivered under certain constraints. Traditionally, these constraints have been listed as "scope," "time," and "cost".[1] These are also referred to as the "project management triangle", where each side represents a constraint. One side of the triangle cannot be changed without affecting the others. A further refinement of the constraints separates product "quality" or "performance" from scope, and turns quality into a fourth constraint. The time constraint refers to the amount of time available to complete a project. The cost constraint refers to the budgeted amount available for the project. The scope constraint refers to what must be done to produce the project's end result. These three constraints are often competing constraints: increased scope typically means increased time and increased cost, a tight time constraint could mean increased costs and reduced scope, and a tight budget could mean increased time and reduced scope. The discipline of project management is about providing the tools and techniques that enable the project team (not just the project manager) to organize their work to meet these constraints.

[edit] Work breakdown structure

The work breakdown structure (WBS) is a tree structure that shows a subdivision of effort required to achieve an objectivefor example a program, project, and contract. The WBS may be hardware-, product-, service-, or process-oriented (see an example in a NASA reporting structure (2001).[28] A WBS can be developed by starting with the end objective and successively subdividing it into manageable components in terms of size, duration, and responsibility (e.g., systems, subsystems, components, tasks, subtasks, and work packages), which include all steps necessary to achieve the objective.[17]

The work breakdown structure provides a common framework for the natural development of the overall planning and control of a contract and is the basis for dividing work into definable increments from which the statement of work can be developed and technical, schedule, cost, and labor hour reporting can be established.[28]

[edit] Project management framework

The Program (Investment) life cycle integrates the project management and system development life cycles with the activities directly associated with system deployment and operation. By design, system operation management and related activities occur after the project is complete and are not documented within this guide[19] (see an example of an IT project management framework). For example, see figure, in the US United States Department of Veterans Affairs (VA) the program management life cycle is depicted and describe in the overall VA IT PROJECT MANAGEMENT FRAMEwork to address the integration of OMB Exhibit 300 project (investment) management activities and the overall project budgeting process. The VA IT Project Management Framework diagram illustrates Milestone 4 which occurs following the deployment of a system and the closing of the project. The project closing phase activities at the VA continues through system deployment and into system operation for the purpose of illustrating and describing the system activities the VA considers part of the project. The figure illustrates the actions and associated artifacts of the VA IT Project

PROJECT IDENTIFICATION
Sources of Project Identification
2.1 Project identification is the first phase of the project cycle. The project is a notion, speculative imagining of a proposal deemed fit for a prospective undertaking. It may be defined as a proposal for investment to achieve certain objectives. J. Price Gittinger, in his book, "Economic Analysis of Agricultural Projects" maintains that "all we can say in general about a project is that it is an activity on which we will spend money in expectation of returns and which logically seems to lend itself to planning, financing and implementation as a unit. It is a specific activity with a specific starting point and a specific ending point intended to accomplish a specific objective. It is something you draw a boundary around and say: 'This is the Project'. It is something which is measurable both in its major costs and returns. Normally it will have some geographical location or at least a rather clearly understood area of geographic concentration. It will have a relatively well-defined time sequence of investment and production activities. It will have a specific group of activities which we can identify and estimate values of. It will be a partially or wholly independent administrative structure and set of accounts".

2.2 Projects in various sectors are proposed and prepared by concerned ministries/departments. In advanced countries, there are special organizations which are employed continuously in the field surveys and necessary investigations required for formulation of feasible projects. These outside agencies, engaged for the purpose, prepare complete project documents including cost estimates and financial and economic analyses of such projects enabling the Government in appropriate evaluation of their potential and fixation of their priorities in a particular sector. In less developed/developing countries, unfortunately, there are no such organizations. In the prevailing procedure and practice, the following sources are used for project identification. Go To Top Plan Priorities / Plan Documents 2.3 Identification is done by the project's relevance to the National and Annual Development Plans. It is said that fixation of priorities is the first step to wisdom. The development plans are prepared after thorough scrutiny and judicious selection of the most important and remunerative projects by the Planning Commission/ Planning and Development Division of the Government of Pakistan charged with the responsibility of giving the final shape to these plans. The order of priority assigned to each project depends on the viability and desirability of the project's impact on national economic growth, social development, generation of greater resources/revenues and overall Government policy. All such potentially promising projects are identified and included in the national development plan, subject to expected resource availability. These selected projects as find place in the plan priorities are picked from the whole lot of projects pertaining to various sectors which pour in from different provincial governments as well as the federal government. Such projects have their relevance within the perspective plan's spanning long periods of 20 years, which aim at the steady evolution of the economy towards a state of self-sufficiency free from foreign aid and characteristic of a prosperous progressive nation. On these aspirations of a self-reliant free nation, the projects are identified in plan documents.

2.4 The exercise of "taking and leaving" the project is repeated for formulating the Five Year Plan which contains projects taken out of the long-term perspective plan documents. Final identification is made for the Annual Development Plan which is the operational plan and lists only top priority projects proposed to be implemented in advance of others in a particular year. The plan is constituted out of the ongoing projects of various sectors, which are in different stages of completion, and other new priority projects. A project will thus be reckoned as successful if it is well-planned, can be conveniently implemented and is bound to achieve the objectives envisaged. Such

projects are prepared for investment, recognition of economic effectiveness and identification in the frame work of five-year and annual development plan document. Go To Top

Sectoral Analysis and Current Situation 2.5 As discussed above, national development plans are framed and finalised at all stages, after strict scrutiny, deep study and critical evaluation of large number of projects received from the sponsoring agencies. Within the financial limitations, and budget allocations for each sector's development, the best pick of the projects is identified and earmarked for inclusion in the long and short-term plans.

2.6 The plan priorities are generally governed by the guidelines that venture to show the most promising investment and/or most pressing problems of a particular sector in a current situation, like protection against super-floods or restoration of heavy rain/flood damages or security measures against serious law and order situation etc.

2.7 To elaborate the above point, it may be stated that for investment in Water, Power and Agriculture Sectors, an action programme was prepared by IBRD under Indus Special Study and for salinity and water-logging by RAVELLE GROUP. Again a revised action programme for investment in the water sector was formulated by WAPDA with the assistance of the World Bank, and is currently being updated. Similarly, a ranking study for the power sector was also formulated by WAPDA with the assistance of CIDA, indicating the construction of power stations, both HYDEL and THERMAL, for attaining optimum power generation within the available investment resources.

2.8 Once the priorities are fixed and the selected set of projects is documented, a project in any sector shall be eligible for consideration only if it is identified by its entry in the approved plan. For its entry into the plan, however, the sectoral project has to stand the test of scrutiny under the normal guidelines. For example, the on-going projects will deserve first priority for funds, and the new projects of major sectors of the national economy will rank second. Projects aided by foreign sources are an exception and are generally included. 2.9 In keeping with the Rules of Business, all projects approved for implementation are included in the Annual Development Plan subject to resource availability. The projects prepared in each sector and presented by a provincial government for financing are adjudged individually and collectively. The selection/acceptance depends,

among other factors, on the general constraints over the country's capacity and position of her exchequer, which may permit only such projects as give quick returns, alleviate poverty, eradicate social evils, promote export, curtail import and provide a springboard for faster development of science and technology. 2.10 Before reckoning the identity of a project in any sector, the role assigned to the project in the concerned sector and its impact on the overall economy or its interference/ overlapping with contemporary projects must be examined. Along with sectoral analysis, it will be tested for its favourable fitness in the current situation. For instance, a new medical college in the education sector of Balochistan Province may gain priority on socio-political grounds to respond to people's aspirations and meet squarely the call of the current situation. Similarly, the projects of salinity control and reclamation will rank prior to other competing projects in the agricultural sector, and will be justified under the severity of the current situation of sick soils. In the energy sector, again, the erection of transmission lines to energize the long-awaiting villages may compete with the setting up of a new hydel or thermal station to overcome acute energy shortages and ensure adequate power for industries to avoid colossal losses. An expert and expedient compromise has to be made in all such cases of sectoral competition in the Planning Commission and finally in the National Economic Council, (NEC), the highest decision-making body chaired by the Prime Minister. The rationale of sectoral analysis and consideration of the current situation are, therefore, important elements of project identification. Go To Top

Special Policy Directives 2.11 Projects are also identified as a result of special policy directives of the Government. Projects initiated under such directives should be taken up on priority, even by postponing/ superseding other projects, if availability of funds is the constraint. It is always to be borne in mind that the over-riding limiting factor to the desired level of development in each sector, or to meet the need of the hour under the situation or to follow freely the special government policy, is the resource position. Go To Top

New Ideas/Areas of Investment 2.12 Planning is a continuous process which generates new ideas for and areas of profitable investment, as a result of the sense of dedication and past experience. It calls for selfless efforts in the

national interest on the part of all sponsoring agencies in various sectors to go beyond the routine and explore new avenues of development and consequent growth of economy, to exploit/ augment natural resources so as to eliminate dependence on external aid and usher in an era of self-respect and prosperity for the people. 2.13 More often than not, exploration and research are rewarded with rich returns. A case in point is OIL & GAS DEVELOPMENT, a national asset, harnessed by man's labour and skill for the benefit of the state. Investment in such enterprises of exploiting rare natural resources is immensely justified and the projects aimed at their exploration, extraction, transmission and refinement are readily identified as new areas of development/investment. These projects have self-evident potential and are self-identified. With adequate incentives from the Government, the bulk of the risk capital for oil/gas and hard minerals exploration should come from the private sector. 2.14 In the sphere of new ideas and areas of investment, projects are identified by objectives not pursued properly owing to paucity of funds or lack of clear vision. Recently a campaign at government level has been started for the development of the arid zones of Sindh Province. The desert dwellers of the arid zones of Thar and Kohistan (like 'Thal' of Punjab) are endowed with the most unfriendly climate and totally hostile topography. They face frequent famines and are always hungry or half-fed, leading a life of unending misery. Their main problem is water and without water there is no life. The projects pertaining to this part are identified in their new areas of investment, namely, exploration, treatment, conveyance and distribution of water, particularly for domestic use and livestock, alongside of the provision of basic health services and catering to the need for education, starting with the elementary level. These projects are prepared and executed by Sind Arid Zone Development Authority (SAZDA), a new organization created to work under the chairmanship of the Chief Minister, Sind. These projects and other similar ones aimed at ameliorating the sub-human living conditions of a part of the population are identified as based on new areas of investment. Go To Top

Potential Projects 2.15 As a matter of fact, all projects that bear the strain of scrutiny by the Planning Commission, and finally succeed to find a place in the approved development plans are beyond doubt potentially promising projects. In a narrower sense, however, projects could be distinguished and identified for their potential of development in a

particular sector of national economy. Fundamentally the projects are identified by the purpose they intend to accomplish in terms of time and money. Among other features, the single most attractive aspect of a project is more profitable benefit-cost ratio. However, there are projects which aim at the specific object of harnessing/enhancing the natural resources of the country to increase its capacity for longerterm gains. These are potentially productive projects. They pave the way by their large benefits to undertake ambitious development programmes for attainment of healthier and higher standards of living and for achievement of tangible targets in advancement of modern technologies. 2.16 Projects promising reduction in unemployment, amelioration of educational standards, superior health services, and security of life and property, are identified as potential projects answering the aims of any state administration for the welfare and well-being of her people. Go To Top