ON ENTOF ENTATION

AL GUIDE FOR IMPLEMENTORS PORTED PROJECTS

published by Asian Development Bank Revised Edition. 1988

TABLE OF CONTENTS

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FOREWORD
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. I. IN'TRODUC'TION·'·

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II. PURPOSES AND SCOPE·Of·PR<iJE<!:t"~\::·, ';":;'. IMPLEMENTATION MANAGEMENT·,'.·.·.::::;;;;::::: A.: Purposes of Project . -'. . 21.· 1'< I ;, ,: " .. Implementation Management·.:::.:.::.·,'.·.·:: ..::.:.;;.,..................................... B. Scope 'of Project fmplementatioN!5::~ 2 \::,. :"'~ c r_' Management..................................... III. PLANNING FOR IMPLEMENTATION : ~_.....................................

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The' Project 'and the· Project Environment .'........................... 8. Problems Arising During Project Execu~Jili.-.......................................... t> FlnalizinqtheProjectWork Plan.:::;:::::,::;......... 0, Organizing for Project Implementation E:' Planning for Financial., ... ; ~_J~ ;':' Management and Accounting............................................................ ~.~'Preparation 'of. Project·Controli'Plan:):.-::.:.:.· ..'}.i. ;, . ..:·.; G. Preparation' of-a .Project " .. .. ..'., .:. Procedures Manual...........................................................................
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IV. THE PROJECT MANAGER .".".................................................................
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A. Functions and Responsibilities of a Project Manager.............................................................................. B. Qualities of a Good Project Manager....................................................
V. MANAGING PROJECT IMPLEMENTATION

16 16
18

A. Preparing for Project Implementation................................................... 18 ".. 20 B. Making the Loan Effective C. Engaging and Supervising the Work of Consultants................................................................................... 20 D. Procuring Goods and Contracting . 23 for Civil Works ; E. Supervising Construction of Works or Installation of Equipment L..;..".................................................... 27 F. Executing Project Covenants................................................................ 28 G. Controlling Costs ;...................... 28 H. Withdrawing Loan Funds." """ .."" " ..,,.............. 29 I. Controlling Project Changes.................................................................. 29

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J. Coordinating with Other Implementation

and Support Agencies....................................................................... K. Project Monitoring and ControL............................................................ L. Procedures for Monitoring and ":-i Control of Projects M. Preparing Project Progress. Reports.i., :::::::.'. :: : ~~ . -;:;-,, .. PROJECT INTERACTION BETWEEN. 'FHfrHANK.AND THE. EXECUTING AGENCY. ::::.::: ..:.. ..~.:~.~~~~:,:~~~.:.~:;. i::: ,'..: : .. :;:'_~ , .. '.',

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A. Need for Close.and Frequent Consultations ,.: ;.<.:, ••.••••.• : •.•,••. ,•• <, 36 (:;·,·:. :·,: . •.. ·····" •. , ;:-:';':'_.~'j36 B. Visits of Bank Missions " ;::..c.: : t C. Orientation for Executing Agency s :::;taff.'.'.+b~: .. '·.~;'.)'.,!,..,.,:1..• '.i:.. j,i .. 1i',::: .... 37 . PRO,JECT COMMISSIONING.·.·..· '.i.:',
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A. Transferring Responsibility for Project Operations ,.,

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PROJECT REVIEW AND E\I, ,LUATION
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A. Project Benefit Monitoring ,<;1Oq .. ~.vqh~,at.~t>n<.; :·:).,.}.<,~.:/.}.~e.,-".~':.:;';'~'':'~''~ ..,; 4q B. Project Completion Report. "~;.,,,:., .. l'"f·n!: :':"1"0,." (', :,.;c; 41 {..:i. -;;;
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APPENDICES.............................................................................................
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This requires that project implementation be carried out in accordance with the plans. the lack of properly trained and experienced managers often emerges as an obstacle. Little International (ADL). however. Traditions. by staff who possess the technlcal and management know-how relevant to the demands of the job. I (v) . The experience of the Asian Development Bank indicates that problems in project implementation are oftentimes due to poor management. resulting in delays or losses to the project. the need for assistance in the area of project management has become an essential element of any program of development assistance.FOREWORD One of the major challenges that confronts international developmental institutions is ensuring that the projects they support are implemented successfully and that the 'Objectives of the projects are being realized. -. It is hoped that project managers would find this handbook as a useful practical guide in implementing projects supported by the Asian Development Bank. because of this. an international management consulting firm. To help address these problems. the Asian Development Bank has prepared this handbook with the assistance of Arthur D. and other parameters set out during project preparation and appraisal. In most developing countries. customs and even bureaucratic practices often prevail over rational management decisions. Unfamiliarity with sound management concepts and techniques or the inability to apply them in complicated project situations is also a major cause of inefficiencies in the implementation process. habits. schedules.

" this handbook will also be useful to Bank staff involved in supervising the implementation of Bank-financed projects. however. This handbook also contains examples and a sample form to serve as models and to make easier the task of managing project implementation. Strictly speaking. 2. Moreover. critical to the successful implementation of the project. 4. therefore. covers the preapproval stage of the project cycle insofar as it refers to activities that are carried out during the implementation stage. It should be realized. this . (ij) directing the activities required in executing the project. This handbook." of a project. as well as procedures for subsequent project organization and staffing. . This handbook is intended to be used by executing agencies 1 of projects financed by the Asian Development Bank/ as a guide to the management of project implementation. Henceforth.are to a great extent. project implementation management would also include ensuring compliance with the relevant regulations and requirements of the assisting agency. the material in the handbook should be modified. project implementation starts with the signing of the loan agreement. that many of the actions and decisions taken before the signing of the loan agreement. Project implementation management encompasses all activities that an executing agency undertakes in transforming a project from plans to physical reality. Discussed in this handbook are detailed procedures for project planning. I "Executing agencv" refers to the agency directly responsible for implementing the project. (iii) monitoring the progress of the project and controlling or solving problems that do occur. In case of conflict. Some of the materials included may not be relevant to some types of projects. as well as the subsequent initial operation of the completed project.MANAGEMENT OF PROJECT IMPLEMENTATION •• I. commissioning. The functions of project implementation management are: (i) planning the execution of the project. 3. appraisal and negotiations for example . and (iv) gathering lessons from experience that will assist better planning and management of future projects. ? Hereinaiter refelT~d to as "the Bank. interfacing of activities.during project preparation. When funding support is received from an external source such as the Bank." :l The term "executing agency's desiqnated project manager" refers to the individual responsible for implementation individual will be referred to as "Project Manaqer. INTRODUCTION 1. review and evaluation. as appropriate. and. implementation and control. However. the specific provisions of the loan agreement will prevail. what is contained in this handbook will always be subject to the provisions of the loan documents or financing agreements that relate to a specific loan. while designed primarily to assist an executing agency's designated project manager.

and in conformity with sound technical per. from both the executing agency's and Bank's points of view. PURPOSES AND SCOPE OF PROJECT IMPLEMENTATION MANAGEMENT Purposes of Project Implementation Management Project implementation management has two major objectives.· Financial management includes actions taken to mobilize. Procurement and contract administration encompass actions required for the procurement of goods and services.-. organizing a project team.JLO·ng agency must be concerned that a project will meet its goals and objectives. during which time . 2. .gement. The purposes of project implementation :. forecasting and controlling expenditures. the ~:::c'. when the project starts zra 'ng the benefits intended. The _ stage is the operating stage.~ or a project is used only for the purposes for which the funding was granted. On the other hand.~2Lailedlist of tasks involved in managing the implementation of a project is presented in dix 1.-:-I·n as the loan effectiveness period. The activities comprised by project implementation as discussed in this handbook.. Financial Management. therefore.II. \ . Under the functional heading of project management are the actions taken to implement a project. Scope of Project Implementation Management In a general sense.main investment of project resources (human. and will be completed on time. Project Management. scheduling. establishing procedures for receiving and disbursing funds. dertaken in three stages after approval of the financing for a project. On one hand. 3. . within budget. including planning. the following specific functional areas emerge: l. the period after project completion. the Bank must be concerned that the funding pro. project implementation management encompasses all the acand actions undertaken by both the executing agency and the Bank.> ce standards. and project monitoring and reporting. runs from the date of the signing of the loan agree• 0 the date when conditions for loan effectiveness have been met and the loan red effective. instituting and maintaining a project accounting system. directing and coordinating the work of the project participants and other outside parties. Procurement and Contract Administration.ementary and interdependent. are . including administration of the relevant contracts entered into between the executing agency and suppliers. recruiting and training staff. preparing detailed budgets. physical and financial) takes place. and that z: consideration is given economy and efficiency. The first stage. employ. The second stage is the period following effectiveness. In actual project arnentation management. and control the financial resources invested in a project. and auditing project expenditure accounts. This includes sourcing funds. and consultants._. supervising preparation of detailed project plans and designs. contractors.

cost estimates. economic. use of loan proceeds. includes a number of schedules that form part of the loan agreement. and conditions for loan effectiveness. there would be a need for a separate project agreement to be entered into between the Bank and the executing 3 1. During loan negotiations. and technical. Figure 1. Figure 1 also shows the principal participants and the outcome of the activities. 10. such as the terms and conditions of the loan. which in addition to incorporating. These agreements are embodied in a loan agreement. and documents during appraisal. Such schedules usually consist of the following: Schedule 1. To assist the executing agency in the implementation of a project. procurement.. It is important that the Project Manager review the feasibility studies to apprise himself about the parameters. "Scope of Activities in the Project Cycle for Bank-Financed Projects". presents the various stages of the entire project cycle and the activities that take place during each stage. 12. The specific activities are discussed in the following paragraphs. particular covenants dealing with the manner loan funds will be utilized. through technical assistance funding. and other project-related activities. by reference. Schedule 3.and setting down the various project parameters and requirements relating to organization. 11. Schedule 4. economic. . the Bank's loan regulations and guidelines. the Bank sometimes provides sample forms. and alternatives used in developing the project. Schedule 2 contains an amortization schedule for repayment of the loan as well as provisions for payment of premiums for early repayment. -c . Schedule 3 sets out the allocation of loan proceeds by various categories and the conditions for withdrawal thereof. Consultants are frequently used in project preparation. feasibility studies are conducted to examine the technical. During project preparation.5. staffing. sources of funds. 2. 9. In cases in which the borrower is not the executing agency. . scope and components. Schedule 1 contains a detailed description of the project components and the expected completion date. and financial aspects of the project. institutional. The direct end result of the appraisal exercise is an appraisal report describing the project . and financial justifications . involves a detailed review of the feasibility studies relating to a project. Schedule 6. how the project will be implemented. schedules. and their services are often procured by the Bank directly. It is through the appraisal process that the Bank makes judgments on whether a project is consistent with 'the Bank's own operational policies and programs and whether a project is suitable for Bank financing. 6. 3. Schedule 6 describes the various activities and requirements for the execution of the project and for the operation of the project facilities. Schedule 2. 8. assumptions. It is also at the appraisal stage that the Bank determines what measures would be necessary to ensure the successful implementation of a project and the realization of project goals. Schedule 5. objectives. Schedule 4 describes the procedures and requirements for the procurement of goods and services (except consultants) .sectoral background. the borrower and the Bank agree on various matters relating to the loan and the project. which is undertaken by Bank staff. 4. Feasibility study review would also help the Project Manager better understand how a project fits into the overall country development program and priorities. Schedule 5 describes the types of consultant services to be procured and the procedures and requirements for the recruitment of consultants. Appraisal. reports.

g this period. This does not b o 'ever._ . comply with the requirements and guidelines -.ful implementation of the project. the borrower must comply with certain requirements before the loan can eclared effective. 3 . ~..y._ operating unit..._ Bank.-. ~_~...:== users. _--. the project facilities are turned over . as it involves a ..project agreement would define the specific obligations of the executing agenating to the implementation of the project. and interact with outside agencies and possibly with . In some cases.~-._ ement specifies additional requirements for loan effectiveness considered critical for the _.. Thereafter.ranqe of activities that require substantial investments of money. Reference would also be made to certain . engagement and supervision of ts. of arly the schedules in the loan agreement. that the interest of the Project Manager should cease after such turn-over 2 Project Manager has a stake in the successful operation of the project and should _ide whatever assistance is required for the project to operate successfully. After the signing of the loan agreement.·ci·ons the loan agreement that would be equally binding on the executing agency.\. . which generally runs between 60 to 90 days after the date of the loan agreement...~-ement expertise.rized and ratified through all necessary corporate or governmental action and that the . time.~::. The scope of the Project Manager's activities at this stage ::::::::::[25 he organization and staffing of the project team.~tion supervision and contract administration. procurement of goods and contracting of civil or other technical works. This Strictly speaking.:: ernents constitute valid and binding obligations of the borrower. manpower..>. The requirements generally relate to the submission of evidence and _ opinions attesting that the loan agreement (and other agreements) have been duly -. which may be headed by an Operations Manager who may not -. It is also the time when the difficult problems es that come to the fore must be dealt with efficiently and expeditiously in order to project delays and failures.::::::c~~J·ly~e the Project Manager responsible for project implementation. and start-up and commissioning of e:ed facilities.-LU =-=. the Project Manager must adhere to the -' ns of the loan and project agreements. and other resources.-. project implementation management ends when a project has ompleted and is ready for operation. In undertaking these activities. The execution stage is the most critical period of the project cycle. the loan . consult with Bank staff.. the period for loan effectiveness comes...

JCIPAL EV ENTS Review of national and sectoral priorities. objectives. principal issues. Bank President Board of Di rectors Bank approval of loan. 6.I . Figure 1. completion of other project requirements. start up. Review of project preparation. financial. Commissioning of project. Scope of Activities in the Project Cycle for Bank-Financed Projects PRINCIPAL PARTICIPANTS 0 0 PROJECT PERIOD PROJECT CYCLE STAGES 1. 4. Completion of project.0 0 0 0 -8. construction. plans and programs. 0 0 Borrower (P) Bank Executing Agency (P) Bank Consultants Suppliers Civil Works Contractors Other project participants Bank (P) Executing Agency Declaration of loan effectiveness. Where this symbol is not used in a particular stage. procurement of goods and services. and training. Consideration and Loan Approval Negotiations agreement. Project Preparation Feasibil ity studies to establ ish project viabil itv . Consultant recruitment. Signing of loanaqreernent. 2. toward loan 0 0 Review of project and loan proposal by Management and Board of Directors. . • (P) (J1 Organization having primary responsibility for activities in the particular stage. 0 0 0 Bank (P) Borrower Consultants with Bank) Borrower Bank (often Minutes of loan negotiations. draft loan agreement. 0 0 . 0 0 Borrower (P) Consultants (often through Bank) Project Pre-approval Period 3. Loan Negotiations 5. rdent if ication of project. the participants at that stage share responsibility. detailed design. Review of project benefits. general scope and time frame. Feasibility studies examining the economic. PRINCIPAL RESULTS Borrower Bank (P)· Definition of project goals. Project administration by Bank staff.>-0 0 Project completion report. operational testing. Project performance audit report . Project Identification PR Ir. Appraisal report. technical and institutional aspects of the project. 0 0 . Evaluation -. appraisal and implementation. Appraisal Comprehensive project review by Bank Appraisal Mission. Project Execution Project Implementation Period Compliance with Bank loan effect iveness requ irements. Loan Effectiveness 7.

there may be multiple executing agencies. Feasibility study for the project. would obtain the services of consultants. assignments of responility for inputs. planning for project implementation starts during the early stages -: the project cycle . to incorporate these procedures and requirements . -ed on project goals and objectives. if necessary.during project preparation and appraisal. and interfacing and roordmetion of activities. Such documents Id include the following: 1. Detailed planning is a key activity in the successful implementation of a project. release of funds. in addition to the provisions of the loan =:eement. and. autonomous :: . staffing. As far as the Bank is concerned. In such cases.rpericnce has shown that errors in detailed planning can have extremely unfavorable ef-2 15 on costs. as well as the evant Bank publications. = . management control systems. lie bodies.er Bank documents . procurement of goods and services. Skillful coordination and interaction would be required to achieve effective integraof all project activities. Appraisal report for the project. The Project Manager must know the persons and agencies that will be involved in ::-e implementation of the project. and execution := other project activities. and the Project Manager will have .in the framework of the executing agency's own systems and procedures. Funding for some projects may come from various sources. PLANNING FOR IMPLEMENTATION The Project and the Project Environment As stated earlier. 3. detailed planning covers strategies and work plans. cost estimates. and other project elements. schedules and budgets.it would do well for the Project Manager to become familiar with __ h documents. if required. For some projects. there are requirements and procedures embodied in guidelines. evaluation methods.each financier. national planning agencies. handbooks and . -]€ncies may include government ministries.III. Minutes of loan negotiations. the Project Manager should know which part of the project is funded which source and the specific requirements or conditions applicable to the use of funds -. One important step the Project Manager must take. However. and even user groups. :::. The Project Manager involved in detailed planning may have to rk closely with the Bank and. agency participation may be required in the approval _: roject expenditures. as well as the nature and extent of their involvement. implementation schedules and technical performance.prepare more detailed and updated plans as soon as the project has been approved and es more specific information becomes available. 2.[ect organization and staffing. and become fully familiar with their contents.. Bank . h with its own Project Manager responsible for implementing a specific component of the oject. work authorization procedures. as in co-financed pro. is to gather all the documents related to the project. preferably before the start of ject implementation. Apart from prescribing specific measures for -::plementation. --ancial plans. planning during e preapproval stages is generally broad and tentative. changes may have to be made in work schedules.

9. 5. Ordinary Operations (or Special as applicable) Loan Regulations of the Asian Development Bank. 14. 11.Supply. Irrigation and Rural Development Projects). problems in coordinating with other project organizations responsible for implementing some project components.4. if any. Handbook on Bid Evaluation. strikes or other labor disputes. in procuring equipment and materials. Delivery and Installation of Goods. projects may be delayed for long periods at the outset by delays in selecting and appointing consultants. Problems Arising During Project Execution 21. price escalation. and shortages in equipment and materials. Practices and Procedures Relating to Procurement Under Asian Development Bank Loans. 16. Sample Bidding Documents . Handbook on Policies. In some cases. Financial problems are also often experienced during project implementation. 8. 10.these must be dealt with taking into account the circumstances relating to each particular situation. or inadequate allowance for physical contingencies. the Project Manager should identify potential problem areas. difficulties in site access because of rough terrain. 17. but many cannot. work stoppages due to adverse weather conditions.12. problems are encountered by the executing agency in complying with some of the conditions for loan effectiveness. 7. Loan agreement and project agreement. Guide on Prequalification of Civil Works Contractors. Some of the more common types of problems are described below. Likewise.Procurement of Civil Works. Loan ~sbursement Handbook. 23. Each sector and each country has its own unique problems and risks . Guidelines on the Use of Consultants by Asian Development Bank and Its Borrowers. Handbook for Users of Consultants. As a part of planning the implementation of a project. withdrawal of loan funds is delayed by the executing agency's failure to comply with the Bank's disbursement requirements and procedures. 6. Guidelines for Procurement Under Asian Development Bank Loans. A detailed list of problems appears in Appendix 2. 15. Certain external factors can also impede the speedy and successful implementation of a project. 7 . Many projects fail to get off to a good start because of delays in establishing a project implementation organization and in appointing a Project Manager. Eligibility Requirements Under Special Funds Loans. 13. Sample Bidding Documents .Procurement of Goods. particularly the acquisition of rights-of-way and the organization of a Project Management Office (PMO). Guidelines on Project Benefit Monitoring and Evaluation (for Agriculture. The more common of these problems are inadequate local counterpart funds and cost overruns resulting from underestimation. Such factors would include local inhabitants resisting the projects. Sometimes. Sample Bidding Documents . Some problems can be anticipated. and in awarding construction contracts. 22. 24. B.

Measurement and reporting systems must be .. In establishing a work plan. several contractors may participate. acquisition of land for structures. warehousing and site arrival sequence. and. If the steps necessary to complete an activity are not uled separately. and manageable units..::::::. Those events that can be influenced by timely follow-up. indicating how the tasks will be accom-ed and managed and identifying the resources necessary to carry out the various _ t activities. and lack of Finalizing the Project Work Plan Planning for implementation involves the preparation of a project work plan . The preparation and monitorsubsidiary schedules should be done by the functional unit responsible for a specific --=_ 0 activity. . The subsidiary schedules would contain all necessary details. it would be necessary to think through what each party oed must do. By segregating these schedules. project management e er focus on each activity and can determine how progress within each unit is affect~ overall project A suggested general framework for delineating functional areas com. Such a of detail is needed by the Project Manager so that slippages can be predicted and p remedial action taken. tasks should where possible be broken down into their component parts. _ogistics Schedule . The scheduled start time of each activity should be clearly indicated. To --=:r:--··e control..ions in the project site that make it difficult to induce personnel ~_. while the master ::. ule _ ss.le.. which may include several components or in --. including transportation.rp 0 keep project management informed about the progress achieved in relation to the .Personnel-related problems often encountered in project _ ~ges of skilled labor.schedules. would show only those events that would permit an assessment of overall pro..ibinq the various project tasks and activities.~. The integration of the subsidiary schedules into a master schedule must be by a central planning team. . implementation include reliable PMO staff either or remote project subpoor social or economic to relocate. lor the purpose of overall project management control.iule such that decisions can be made when changes are needed or when problems Planning for more complex projects.ort for delegation schedules facilitate better coordination among participants and provide of authority.:0 most projects is given below: J Subsidiary bject Suggested Contents Materials and equipment required. procedural adjustments. inability to recruit adequately trained or --2 central PMO or for assignment to geographically scattered lack of trained staff to operate and maintain project facilities..~:. . as appropriate.. These schedules are then combined and summarized in a master . measurable.er such measures should be identified.J. to insure uniformity and consistency. = : :=. . usually involves the preparation of several sub.e training facilities. delays may be discovered only when it is too late for any remedial o be taken or when remedial measures would be costly or no longer effective. as well as to schedule all events that may affect the meeting of the overall ule.component parts should be identifiable.

relatively unsophisticated schedule that all parties concerned can readily understand and use is better than one that is difficult to comprehend and that would neither be used nor updated. Sequence for commitment of funds and timing of project expenditures. As a practical matter. and ease in updating the schedule. Networks like CPM or PERT are ideally suited for complex projects for which numerous activities must be analyzed. Also included is discussion relating to the balancing of resources as a part of the planning effort. unless computerized. in the sequence in which they are expected to occur. The simplest way of scheduling is the tabular listing of activities or events. However. Table of Activities and Events. training and personnel placement activities. based directly on information shown in the graph. A simple. about the effect a delay in one activity might have on another. The choice among these methods should be based on considerations of suitability for the project to be scheduled. Bar Graph. are often time-consuming to update. the simultaneous timing of events and the overlap of events. When several activities are scheduled to occur simultaneously or to 2. networks have the disadvantage of requiring considerable expertise for both preparation and use. but updating may be cumbersome and might be neglected. familiarity of users with the scheduling methods to be used. for which only a few parties have responsibilities for taking action. Schedules may be prepared in t~e following forms: 1. Recruitment. However. simplified networks are useful in establishing the initial project schedule and the form in which the final schedule is to be cast. as networks show visually the points at which specific activities affect other activities. with an indication of the time they should occur. A number of methods for preparing schedules are available. Finalization of the implementation schedule 9 ./ Procurement Schedule Manpower Schedule Financial Schedule Construction Schedule Evaluation Plan Procurement and contracting events for obtaining project goods and services. presentation of the schedule in bar grapn form has the advantage of giving the user a picture of the sequence in which activities will begin and end. overlap in time. Simplified networks showing the relationship between project elements and specific activities are not difficult to prepare. and. 3 Networks. Sequential activities for the physical construction of project components. The latter aspect permits conclusions. 30. CPM or PERT methodology should be used only if scheduling is assigned to an individual familiar with the CPM and PERT methodology. Appendix 3 of this handbook contains a discussion of the development and use of network schedules for planning and control. The date of the loan agreement is the reference date from which all activity periods appearing in a schedule are normally based. A bar graph would indicate the starting and terminal points constituting an event. Preparation and reading of a bar graph usually is not difficult. Data collection activities and timing of review actions. This method is usually adequate for simple projects. scheduled and integrated. use of such a graph should be considered in scheduling projects of moderate complexity. a 31.

Tasks can be sequenced by precedence or can be shown in 'ork diagrams and then for project control purposes consolidated into overall network crams or bar charts. This is usually done during apof the project.~ating the executing agency for the project and identifying the type of organization suitable for carrying out the various project activities. Staff of the PMO can be drawn from existing personnel in the ~""""":~g agency or can be individuals engaged from outside sources for the duration of the ample functional descriptions for staff in the PMO are shown in Appendix 5 . Once this has been decided upon. using a standard called the work breakdown structure (WBS). determination of the kinds of experd skill levels required. This unit is normally tasked with the planning. then summed :0 the major tasks. It may therefore be advisable that the plan . it es for the auditing of funds to ascertain the appropriateness of project expendi~-. The preparation of the final implementation schedule is in most cases a task sre ching over a considerable period of time. although it is sometimes called by some name. . and finally totalled for the overall project. including the need for consultants services. execution.anning for financial management and accounting involves formulating a budget roiect and setting up a cost control and accounting system that will record and e various items of project expenditures. _ 0 Project Budgeting nrrV-D':C 0" an icipatinq and estimating the financial requirements of ."allycover only those activities and events that can be estimated reasonably and that can easily controlled. and g of a project. Breaking a project into its component parts makes estimating the resource requirets for each task easier. The work plans can be .-JoJo· nning for Financial Management and Accounting P. is shown in dix4. The cost of the various smaller tasks can be estimated. Planning for financial management and also involves adoption of measures designed to ensure the timely infusion of eir disbursements in accordance with established procedures and practices... Organizing for Project Implementation One of the main tasks involved in planning for project implementation is ::e:. Further guidance for breaking down project.to assess the financial position of the executing agency. but at the latest when the loan agreent is signed. Scheduling the remaining activities of a project can be completed when ution can be forecast with reasonable certainty.•••••••••• -L-.~~---- ----- begin after the Bank has approved the project. as in an overview of major project elements. there might be a need for a core group that would be e responsibility for implementing a particular project.'bed in detail at the lowest breakdown levels and then prescribed in more summary -"on.. This group is commonly ~::l:A~ as the Project Management Office (PMO). will have to be Within the executing agency. control.

The Project Manager must be able to accurately forecast final budget needs well before a project reaches the end of its scheduled completion.not enough money being appropriated. Adjustments may be necessary when additional or more updated information becomes available. it is advantageous to divide a full year's budget into monthly or quarterly amounts . and must be closely controlled to avoid such costs becoming too high in relation to the direct costs of the project.~ ell C( di 11 1 . Adoption of the budget is not the end of the budgeting cycle. 42. and salaries for PMO staff can be determined. the actual release of funds may be delayed or not made at all if the money simply is not available in the national treasury. during project implementation. and even up to the execution phase. The problem that may be encountered is a funding constraint . Such costs must be provided for in the project budget. in order to avoid any financial complications arising from a cost underrun or cost overrun. 38. identifying sources of funds.a project. It is therefore important that the Project Manager provide to the budgeting authority the necessary estimates of funds to be included in the government's annual budget. contingencies and other financial charges would have to bevadded. the borrower does not normally include in one annual budget all the funds required for the entire project. from which scheduled inputs such as payments to contractors and suppliers. To these direct project cost estimates. These costs are summed up through the various higher levels of the project tasks. An up-to-date budget is vital for developing an estimate of the cost to complete each element of the project. For purposes of financial control. are likewise incurred. either to optimize the use of funds or to ensure continuity in funding. Project budgets are built up from cost estimates generated from detailed work plans. A cost underrun could entail carrying the cost of committed money that eventually is not used. when allocation and reallocation of funds is carried out to meet current project expenditures. 39. . when the estimates are reviewed and further refined. and that these may be invalidated by significant developments in the course of implementation. as displayed in the work breakdown structure. In providing funds for project implementation. while a cost overrun might result in project delays if problems in obtaining supplemental funds are encountered. The end product should reflect a fairly realistic estimate of costs. At the same time. 40. budgets should be reviewed to determine whether they are still realistic. it is necessary to budget for contingencies that may increase the cost of the project. In addition to the direct expenditures for the project. and adopting measures to ensure that such funds are made available on time. overhead. the budgeting process continues through the appraisal stage. Appropriations are made on a yearly basis. Expenditure forecasting is based on the implementation schedule.this enables the Project Manager to plan and balance cash flows. after contracting has been completed or when changes have been made in the scope or components of the project during implementation. land acquisition. such as administrative expenses and fixed overhead. / 4fj f sa p 41. indirect expenses. based on an expenditure forecast for the year. so that ample funds could be provided on time. until the overall direct cost for the project is obtained. Even if there is an appropriation. Although the budgeting process is initiated during the preparation of the project when costs of the various elements of the project are estimated. thus avoiding work stoppages. It should be borne in mind that budgets are derived from project cost estimates made at the start of a planning period. Cost estimates for work to be performed by consultants and other contractors may have to be confirmed or adjusted following negotiations.t .

ents compared therewith over time. Additionally. and for requesting withdrawal of loan proceeds from the Bank. Each a tivity in the network schedule is assigned a duration and a budget amount. The primary object of cost accounting is to provide the borrower. as contained in the Bank publication. A completed work plan. discussed in Section III-C. for maintaining books of account and for classifying.2. y deviations. Disbursement schedules for each major project component must be prepared on a quarterly basis and actual disburse. recording.•.rrectness of expenditure payments. loan covenants normally require the executing _ ency to maintain appropriate project accounts and to submit annually to the Bank audited ancial statements. ad reporting transactions. compare such expenditures with forecasted amounts. and provide a clear picture of e cost position of the project at any given point of time. is comfunds for the project and the agency. an organizational structure with assignment of responsi. As far as the Bank is the Bank's guidelines on loan Disbursement Handbook. To be useful. therefore. arrived at through the processes of work planning. deals with thp.own in Appendix 6. I . The Project Manager must know the sources of -' burscrnent practices and procedures of each financing . _ to-date. cost estimating and manpower and construction equipment usage scheduling. Executing agencies often have been unable to comply with this requirement because of delays in the closing of the books of account. and a network schedule of properly sequenced project tasks and activities.ncerned. This means that there should be a system for authorizing and proving expenditures. rlE'velop . 3. resource allocation. The basic elements of a project cost accounting and auditing system are . the executing _ ncy and the Project Manager with financial imformation that can be used in monitoring d controlling the cost of a project. ""%"5. ities. the Project Manager will be responsible for setting up the cost accounting _ stem and for submitting to the Bank annual audited financial statements. The loan _ eement stipulates the requirements in this regard and the Project Manager must make a soecial effort to comply with these requirements.ete" forecasting and cost control activities. If there is no qualified accountant on the ~ oject implementation team. A good project cost accounting system must be able to account for all project penditures. for making payments to contractors and suppliers. r disbursements relates primarily to the development of procedures for verifying the . facilitate payments. the Project Manager should not hesitate to engage a suitable oerson for the job. and informative.ent of a project master schedule. Planning . indicate funding balances. identify the reasons for . the Project Manager should be familiar with . bursements. the information must be accurate. Funds Disbursement Procedures A smooth flow of funds is essential to expeditious project implementation.Loan Preparation of Project Control Plans The fully developed work plan. Generally. Cost Accounting 3. Keeping such planned versus actual disbursement schedules and comparing them with physical progress are key features in "cost to com. -ri-.

concrete. and testing of equipment and systems before the user takes over. 2. controlling detects in design. controlling strikes and potential outside interference. An important responsibility of the Project Manager is cost control. etc. monitoring quality of equipment and construction works. Cost and Schedule Controls 49. Once the project budget is developed. planning for cost control should include establishing procedures for work authorization. Corrective action should be taken to bring any time overruns back on target. Planning for technical control also includes the development of test procedures. providing for adequate in-progress reviews or monitoring systems. and taking corrective action when actual expenditures are unjustifiably out of line with projections. controlling project changes. comparing bid results against owner's estimates. ) Budget. examining schedule estimates for realism. monitoring quantities of work completed for payment to contractors. Cost control is the optimizing of the expenditure of funds relative to work accomplishment. 1. Procedures to accomplish this should include the institution of quality control measures such as review by qualified staff of technical specifications and consultant's technical reports. while meeting technical performance specifications. monitoring costs to complete. 50. Technical Performance Control 52.) during construction for compliance with technical specifications. 51. performing risk analysis and risk management. controlling shipping and delivery delays. who in the project organization is assigned the responsibility for managing the budget. or getting the most work accomplished from a given budget. control is exercised by knowing how much money has been allocated for the various project components. and what arrangements and procedures have been set up for obtaining funds from specified sources and for monitoring project expenditures. inspection of construction and equipment installation. The Project Manager must plan to control the third critical project element . Planning for project schedule control should include controliinq potential sources of delay by establishing clearly defined approval action and decision rnakinq channels that involve the minimum possible number of decision makers. Accordingly. the Project Manager should periodically assess project status and progress trends and review the estimated project completion date.the technical quality of the completed project. provision for inspection of equipment before shipment and after arrival on site. check lists and reporting formats for tests and inspections.posed of activities and tasks whose costs and schedules have been in egra ed. 13 ----- --- . Cost control means promoting efficiency and avoiding waste and unnecessary or unauthorized 'expenditures. testing of materials (soils. asphalt. e completed work plan also describes how technical requirements for a project will be me Procedures must be planned for controlling these project parameters in order to complete the project on time and within budget. comparing project expenditures and performance against the project budget. ensuring cost effective designs and construction/installation activities. The Project Manager should obtain the services of qualified personnel to install a quality control system. and controlling changes in scope and resource allocations. Further. controlling administrative and personnel expenditures.

Such procedures may involve a study of the implications of the proposed change on cost. the Project Manager must ascertain immediately the reasons for the variances so that early corrective actions can be taken. during procurement of goods and services. and then analyzed and used as the basis for decision making. and changes be gathered in a timely fashion. or project technical performance requirements. The individuals responsible for establishing the progress reporting system must review the project appraisal report and the loan documents o determine the kinds of information required. Project Reporting Requirements and Procedures 53. A project completion report (PCR) is required from the executing agency after physical completion of the project. or may affect only one or two of these critical project elements. 58. The Project Manager must be aware of this requirement and must include in his data generation system the information that will be required in the preparation of the PCR. the periodicity of submission. The Bank needs project reports that are current and that show deviations from original estimates and identify potential problem areas. technical requirements. 54. Control of Changes 57. 56. needs. during installation/construction. trends. or requirements for goods and services. implementation progress. If actual developments vary from what were originally expected. or by suppliers or construction contractors. project costs. 55. upon completion of the project and during its operation. Another important function of project management is the maintenance of adequate project records. The kind of information needed in progress reports will vary from project to project and from sector to sector. and even during the project commissioning phase. Project Data Management 13 59. The system of progress reporting must be designed to provide the types of information that will satisfy the user's needs. Changes in projects may occur during the detailed design stage. Rapidly moving events. Such procedures should also include approval procedures that identify the approving authoritv and the manner by which approval could be obtained. and. and the need for project control make it imperative that data concerning project plans. Project reporting is a key element in enabling the Project Manager to compare actual developments during project implementation with projections made during detailed planning. Changes mayor may not affect implementation schedules. 4. and the form in which the information will be submitted. The Project Manager should formulate procedures for introducing and controlling changes to the project. and whether benefit flows correspond to original expectations.3. reports that provide information from which it would be possible to assess how the benefits flowing from the project compare with its costs. The Bank also needs reports dealing with compliance with covenants contained in the loan documents. Changes may be initiated by the Project Manager. 5. and may cover variations from original plans and estimates resulting from changes in scope. 14 . benefits and technical performance before the change is authorized. by project consultants.

For the inexperienced Project Manager. The Project Manager should determine the types of documentation and data necessary to plan and control the project and to fulfill project reporting requirements. 64. and (v) inspection of goods delivered on site or at a port of destination before final acceptance. Procedures for managing consultants' actions include: (i) review of technical performance at various points during the period of the consultant's services. This may be carried out as explained in the following paragraphs. (iv) inspection of the packaging of goods before shipment. (ii) review of prescribed periodic progress reports required from the consultant. Suppliers and Construction/ Installation Contractors 61. Procedures for managing construction/installation contractors' actions include: (0 frequent physical inspection of the contractor's works to gauge adherence to technical specifications and generally accepted international construction standards. The project procedures manual should be updated as required and should contain a listing of serially numbered revisions with appropriate references to the page. Preparation of a Project Procedures Manual 65. figure or table number revised. 63. ) 6. paragraph. (iii) inspection of goods while they are being manufactured to ensure adherence to technical specifications. suppliers and construction/installation contractors perform in accordance with their contractual commitments. (iii)" requiring contractor's attendance at periodic project meetings with the Project Manager. it is essential that a project procedures manual be developed at the beginning of project implementation. (iii) evaluation of the consultant's interaction with the Project Manager and the PMO staff at periodic meetings. the Project Manager must plan how to supervise the actions of these participants in the project. This manual should cover the most important activities relating to project implementation. and (v) final review before acceptance of the work performed. and should describe how such activities will be carried out. (v) close. 62. Management of Consultants. this may pose some difficulties. (ii) review of prescribed periodic progress reports.properly perform their assignments. G. letters and documents should be included in the manual. monitoring of the contractor's compliance with the provisions of the contract. and (vi) final inspection of the contractor's completed works before acceptance. To enable the individuals of the PMO staff when first assigned to the project to . Suggested outline for a project procedures manual is shown in Appendix 8. Appendix 7 provides a listing of the kinds of project records that may be considered in establishing some sort of a project data bank that can serve as the basis for a management information system. particularly those involving the actions of a large number of staff. The Project Manager is responsible for ensuring that project consultants. (iv) close monitoring of the consultant's adherence to the terms of the contract. Accordingly. Procedures for managing suppliers' actions include. (ii) review of periodic progress reports for the manufacture and delivery of the goods. (iv) ensuring the contractor's adherence to change order procedures.60. Sample forms. 15 . (i) monitoring the supplier's adherence to contract requirements regarding submission of shop drawings and materials certifications.

control of costs. Controlling project changes and functioning as the contact point for change requests. Project Management Control and Reporting. an individual specially hired by the executing agency from outside the government. Establishing procedures for interacting and cooperating with other agencies and parties involved in or affected by the project. 2. Project Staffing and Training. sense of fairness. A good Project Manager should possess as many of the following personal qualities as possible: strong human relations and leadership skills. and it is also important that the Project Manager be assigned to the project full time. consultants. technical performance control systems and reporting procedures.an individual permanently employed within the executing agency. notifying all project participants of authorized changes. 3. or an outside consultant or consulting firm specializing in project management (and perhaps specializing in operating and maintaining facilities as well). THE PROJECT MANAGER 66. 5. maintenance of an effective accounting system. Conflict Management. schedule. the Project Manager will have full resqonsibility for the following: 1. within budget and in accordance with technical performance requirements. Managing the various project implementation activities. As the person responsible for implementing and completing a project on time. B. including local government. Functions and Responsibilities of a Project Manager 67. Resolving conflicts among the project participants. private groups and end-users. Change Management. 10. 8. an individual who is a permanent member of a project management group within the executing agency or in another department or agency of the borrower. Project Planning. Carrying out responsibilities for preparing the procedures and resources for turn-over of the project facilities when completed. and providing training whenever required. Integrating all project participants. Project Financial Management. Project Interfacing or Linkages. A. Implementing cost. Recruiting the personnel necessary to staff the project organization.' successful experience in managing similar pro5 6 . After the project has been completed. 7. Project Implementation. 11. Arranging the timely provision of funds. The appointment can be made from a number of sources . 9. Compliance with Terms of Loan Agreement. Completing the final detailed implementation plan. 4. Project Coordination. suppliers and constructionlinstallation contractors into a smooth working group. Insuring compliance with all requirements and covenants in the loan agreement. Qualities of a Good Project Manager 68. The appointment of the Project Manager is a critical factor in the success of project implementation. Project Turn-Over and Commissioning. ability to comromise and to arbitrate personal concerns. the Project Manager responsible for implementing the project may become the manager for operating the facilities.IV. 6.

an effective communicator. honest.jects. a project-oriented outlook. strong personal interest in managing projects. energetic. discerning. tools and techniques. ability to concentrate on the overall picture and to delegate responsibilities. dependable. sound knowledge of proicctmanaqement principles. physically and medically fit to perform the duties and to meet the challenges of the position. and take responsibility for decisions. and willingness to face risks. and. loyal. intelligent. last but not least. 17 . ability to exercise effective control of difficult and complex situations. make decisions. The Project Manager should be aggressive. unafraid of confrontation. mature.

vehicles and storage areas should be protected from fire and adverse weather gs. Recruiting and Training Personnel The Project Manager should endeavor to engage only qualified personnel and to to the extent possible. and flooding. establish information and accounting systems..ions such as wind... storage areas and vehicles from theft. such as immunizations and medical services. graphs.19 laboratory if needed.protection.. even with qualified staff there -. .. dust. Organizing the Project Management Office Whenever possible. rain. including first aid and "-~lDncy treatments.The project office should be provided with ~~u.. lighting . and should include a closed :erence room.ht still be a need for orientation or training courses to improve staff skills in certain . and coordinating with outside agencies. Preparing for Project Implementation At the start of the project implementation phase. the Project Management Office (PMO) should be located at the e of the project. Special personal protective gear (clothing and equipment) should be ._-cally secure the office facilities.c:<. MANAGING PROJECT IMPLEMENTATION 9.ate and reliable utilities such as air conditioning or heating. sideration may be given to locating the project office at the nearest town that has ommodations. -"--'--... a publications room. 1. files.:0 ism and access by unauthorized persons.v. ies.•••. monitoring construction works. unwarranted external pressures for the employment of persons o do not possess the requisite qualifications. and wall space arts.uJe . However. If this cannot be done because the project site is in a remote area. a closed negotiating room.. obtaining disbursement of loan funds.. transportation and communication facilities.. The PMO should have facilities adequate to serve the needs of its staff. . to PMO staff when necessary. schedules and bulletin boards ..' complying with loan covenants. organize the project management staff and allocate duties and responsi__. schedules and technical performance. ities for the project are available. supervising the work of consultants... making the loan effective. If there are multiple ~oject sites. 2. utilities. electricity.sewerage. The PMO d be spacious enough to provide space for drafting tables.. space ffice files. equipment. Arrangements should be made to . a satellite office may be put up in each area. water. a communications room. Vehicle parking areas and open storage areas should be provided if needed. -. controllproject changes. Arrangements should also be made for . procuring goods and ices. controlling s. a storage area for office supplies and office and field equipment. t . a space for a . and initiate actions to commence the rarious project activities. This section discusses the activities the Project Manager undertakes in implementing _ project and describes the Project Manager's actions in preparing for project implementan. the Project Manager must set up ~ project office. It is important that the PMO and its _ H have ready access to the project site and that the requisite services and communications . a closed office for the Project Manager.

The person in charge of administration should be assigned the responsibility of establishing administrative procedures for a project. Defining and Assigning PMO Staff Responsibilities 76. The need for training should be carefully assessed and if necessary. Technical competence should be a major consideration in the selection of personnel and they should be assigned to positions wherein they can make full use of their talents and capabilities.the administrator should use a project code of accounts number develop 79. Additionally. The extent to which staff are authorized to make decisions in the field should also be clearly defined in the project procedures manual. workshops or other training programs conducted by organizations with expertise relevant to the training needs of the individual staff member.records of invoices or expenditures. and implement and maintain a follow-up system. purchase orders. it should be done before the recipients become heavily engrossed in their work. A detailed recommended listing of project records and administrative files to be maintained in the PMO for the duration of the project is shown in Appendix 7. To control the flow and filing of all project documentation. the administrative officer should determine the disposition of project files and records. 75. the administrative officer should assign suspense dates for PMO action. These functions. With the establishment of the PMO. In assigning file numbers to those documents and data referring to or having bearing on project costs. responsibilities and job descriptions should be included in the project procedures manual and should be updated or revised as circumstances warrant. and distributing the items to the appropriate staff within the PMO or to individuals outside the PMO.specialized fields. At the completion of the project. Such training can be enhanced by attendance at seminars. the administrator should and apply a specific system of document numbering. assigning control or reference numbers to the incoming items. 4. Of great importance is having staff assigned to the PMO on a full-time basis during the implementation of the project. or by directly hiring local or expatriate personnel. either as regular employees or as contractual or temporary employees for the specified period. ( 3. If necessary. The Project Manager should define the functions and responsibilities of the various PMO units as well as of key individual staff. Appendix 5 shows some examples of PMO staff functions. change order requests. job descriptions should be written for each member of the PMO staff. Establishing a Project Records System 77. Training can be accomplished through formal classroom instructions or through actual on-the-job training carried out by competent and qualified instructors. This individual should be responsible for receiving all incoming correspondence and data. schedules and scope . enter these dates clearly on the documentation. etc. . Staffing of the PMO may be done by reassigning personnel occupying permanent positions within the executing agency or in other agencies of the borrower for the duration of the project. 19 . 74. The administrative officer should see that completed action and all incoming documentation and copies of outgoing correspondence are properly filed. 78. manpower reports. the Project Manager must set up and activate the project records and administrative files and procedures.

For the to become effective. an individual consultant's continuous involvement over I1gperiods may be affected by sickness. but the range of an individual consultant's experience and knowledge is confined to --. and coordinating the work of . em.:::~nerallyengaged to prepare detailed engineering designs and draft bidding documents.particular expertise.in the period prescribed in the loan agreement. and :crry out other specific project activities. though . a consultant is . unless the deadline for loan effectiveness has been extended by the :xmk. laying out the terms of reference. the project administrator should establish an appropriate file mbering system. Although compliance with the conditions for loan effectiveness is primarily the -: ponsibility of the borrower. the Project Manager should zmind the authorities concerned that any such delay might adversely affect the timely . If there is any possibility of delay. The Project Manager must be ready to request commitment and release of funds both sources. supervise the construction of civil works. and accepting e results. Engaging and Supervising the Work of Consultants It is common practice to engage consultants when the executing agency does not e sufficient in-house expertise to undertake a particular activity. the _ uirements and procedures for the withdrawal of loan funds from the Bank or other :: nors. A loan normally includes . such as withdrawal uests or project reports. Also. Individual consultant services can be engaged more quickly and are less expensive than the services of consulting s. such as that discussed in Appendix 4. The Project Manager will have to decide whether to use the services of an inidual (self-employed) consultant or the services of a consulting firm. and if applicable from other donors. injury or other commitments. and the procedures for payment of expenditures for the project. Failure to do so could result in the Bank :ancelling the loan. The Project Manager has responsibility for properly defining the scope of services -eeded. Making the Loan Effective Approval of a loan does not mean that funds to meet project expenditures can be it drawn immediately. Obtaining Funds Required for the Initial Works The funds initially required for the project may be provided by the borrower or the 3ank. The Project ager should ensure that funds are available for immediate disbursement before underinq any work that will involve a financial commitment.. 5. peer review of individual consultant's work is often not easily arranged. supervising the consultant's work.mpletion of the project. the Project Manager should monitor the actions taken to ke the loan effective. A consulting firm. Moreover. For other correspondence. this can be done only after the loan has become effective.ds to cover such services. this must be done 7.eral independent individual consultants might prove difficult. With regard to project implementation. The Project Manager should review e regulations and procedures relating to the allocation of local funds by the borrower. the loan agreement provides that the borrower (not necessarily e executing agency) comply with the conditions for loan effectiveness. ertake or assist in the evaluation of bids.

the Bank's procedures and requirements will prevail. the Project Manager can obtain the names of individual consultants or consulting firms from. Failure to follow the proper procedures and requirements may cause delay in obtaining Bank's approval of the award of contract and could prompt the Bank to withhold financing.from this registry the Bank can provide a long-list of consulting firms or individual consultants with relevant experience. the borrower having agreed to these procedures in the loan agreement. provides continuity of services should an assigned staff become sick or disabled. Procedures for Selecting Consultants 85. 86. dated April 1979. 2. Telex No. and trade offices of ADB member-countries borrowing country. in the 4. 3. and assures availability of continuous services over an extensive period. Handbook for Users of Consultants. including services in the home office. Price negotiations then are begun with the first-ranked consultant. until an agreement is concluded. at: P. Lausanne 12 Chailly. noting the points in this process for which the Project Manager must get Bank approval before proceeding with the next step. facilitates peer review.these requirements are set out in the Bank's Guidelines on the Use of Consultants by the Asian Development Bank and Its Borrowers. International Federation of Consulting Engineers (FIOIC). in the borrower-country and in other AOB member countries. Figure 2 shows a flow diagram of the process followed in selecting individual consultants. and so on. Box 86. It may happen that the Bank's procedures and requirements are in conflict with those of the borrower or executing agency. Professional societies and associations. In compiling a list of consultant candidates. 21-335-003. 24698 FIOI CH. 87. if necessary. Telephone No. Switzerland. among others. primarily on the basis of qualifications. Reference may also be made to the Bank publication. 21 .generally more expensive' and requiring a longer time to engage. The Project Manager then ranks the individuals. It should be remembered that only consultants from eligible source countries can be considered for selection for projects funded by the Bank. The Project Manager must make adequate preparations for recruitment of consultants.O. consulates. and Embassies. 84. If such is the case. the following external sources: 1. with the assistance of higher authorities concerned. CH 1000. if they exist. The Bank's requirements in this regard are quite specific and must be adhered to closely -. offers a wider range of expertise. The Bank's registry of consultants . Individual consultants are usually selected based on qualifications. the Project Manager should try his best to find an acceptable solution. If the conflict cannot be resolved. following a fairly simple procedure. 1. The Project Manager prepares a list of suitable candidates from a reasonable number of ADB member-countries and inquires about their availability and interest in the assignment.

. -----. Flow Diagram for Selection of Individual Consultant Develop Terms of Reference (TOR) ..: d \.. (/) >- QJ >- a) (/) :he be Issue Invitations for Expressions of I nterest and Availabil itv Evaluate and Rank Consultants Negotiate with First-Ranked Consultant Notify Consultants Not Selected Execute Contract Furnish Signed Contract to Bank 21 22 .-~ Figure 2....H Prepare List of Consultants & thei r Qual ifications Prepare Draft Con tract - . o..

without price proposals. 91. with the first-ranked firm being invited for price negotiations. construction/installation contractors are shown in Figure 5. the borrower. Note the points in each of the processes at which Bank approval must be obtained before the next step can be undertaken. The selection of consulting firms follows a more complicated process. housing. Procuring Goods and Contracting for Civil Works. 89. Short-listed firms are invited to submittechnical proposals. These would normally consist of counterpart personnel and support staff. negotiations are conducted with the next highest ranked firm. Further explanation and guidance for selecting consultants may be found in Appendix 9. i. office facilities. D. the executing agency. Channels of communications between the consultant and the PMO.e. Procedures for supervising consultants may include visual inspections. 92. as well as discussions during reviews and briefings concerning the consultant's performance. etc. The sequential steps involved in procuring goods are shown in Figure 4. Responsibility for reviewing the consultant's report should be defined and identified so that the reports can be reviewed expeditiously and prompt feedback provided to the consultants. materials. to enable the consultant to settle down quickly and comfortably and start work at the earliest time possible.) and civil works (including installation of equipment) are major items of expenditure in a project. The Project Manager should provide full logistic and administrative support to the consultant upon arrival. Figure 3 shows a flow diagram of the process for selecting a consulting firm. The cost of goods (machinery. he must submit to the Bank as required projections of contract awards. This process includes a detailed examination of the experience and capabilities of the firms included in a long-list of firms claiming expertise in the field.. this examination should result in a short-list of five to seven firms wiht sufficient geographical spread and considered to be most qualified and best suited to receive invitations for proposals. Note the points in this process at which the Project Manager must secure Bank approval before proceeding with succeeding steps. and the act of procurement is in itself usually a long drawn out process. If no agreement is reached. and other project participants should be clearly established and the procedures for information flows laid out. and transportation. The consultant should also be briefed fully about the project and be provided any necessary information and data. Supervising Consultants 90. Delays in procurement have often caused project delays and therefore it is necessary that the Project Manager carefully plan procurement activities. equipment. and evaluation of performance as reflected in periodic progress reports. The technical proposals are evaluated and ranked on the basis of technical merits. Furthermore. Detailed guidance for procuring goods and construction/installation services through international competitive bidding (lCB) is provided in 23 24 .88. and so on. design reviews and physical inspections. the procedures for procuring the services of. supplies. 93. Any serious defect in a consultant's performance may later have a profoundly adverse effect on the implementation of the project. 2. It is important that consultants be adequately supervised.

p pi Figure 3. Flow Diagram for Selection of Consulting Firms Develop Evaluation Criteria Yes issue Invitations tor. . Proposals Information CoPY to Bank Receive Proposals Evaluate Proposals Select Consultant Cf) >- <lJ Negotiate Contract Cf) >- <lJ Execute Contract nformation Copi to Bank Notify Consultants \ Not Selected 4 1 if provided in loan agreement.

Figure 4. Flow Diagram for Procuring Goods Under International Competitive Bidding Pr epero List of Goods to be Procured • YES Issue Invitations to Bid and Receive Tenders Report Advertisement Procedures to Bank Evaluate Bids and Propose Award YES Award Contract Report Results to Bank Receive and Install Goods 25 26 .

Flow Diagram for Procuring Civil Works and Technically Complex Supply Contracts Under International Competitive Bidding (With Pre qualification Procedure) Prepare No. and Scope of Civil Works Contracts to be Awarded I Invite and Receive Prequalifications Proposals I I '1. Report Advertisement Procedures to Bank Evaluate Prequalification Proposals Formulate List of Prequalifieu Firms YES Issue Invitations to Bid Notify Firms Considered Not Qualified Evaluate Bids and Propose Award YES Award Contract Report Results to Bank 26 .19ure5.

Appendix 10. International shopping Local competitive bidding Direct purchase/negotiations/single tender Force account Limited tendering/repeat order Purchase of equipment for use of small private subborrowers Procurement under loans to development financing institutions are SP{ with agreen projec agers 99. and requests for partial progress payments. Contract provisions generally place strong emphasis on the contractor's responsibility to maintain a suitable management organization and to adopt appropriate and sound management practices. Supervising Construction of Works or Installation of Equipment that it I of sup. to foci action' cornpe measu and se satisfa tive e: costs) time 10l. This would include the requirements that the contractor's site manager will not be removed or changed without approval of the project owner and that the contractor will institute quality control measures. The inspection should verify the contractor's compliance with the technical specifications and adherence to international construction standards and practices. F. 94. as-built drawings. preferably with the use of a bar chart or a PERT -CPM network. Inspection may be carried out by the executing agency's own technical staff or by the consultant responsible for detailed engineering design and construction supervision. 2. Practices and Procedures Relating to Procurement Under Asian Development Bank Loans. The actual progress of the works should be closely monitored and compared against the construction schedule. su the 0 G. compl Projec projec The P contrc 102. The Project Manager is responsible for supervising the construction of works or installation of equipment and should ensure that there is frequent or continuous independent on-site inspection of work done by the contractor. spare parts lists. unit c refere type _ Projei 95. For example. the inspection team should check equipment delivered against approved shop drawings and civil works completed against approved technical plans and designs. warranties. 98. bring out. Materials tests should be conducted to determine compliance with prescribed technical standards. 100. 3. numbers 6 to 13. The inspection force should also undertake other activities. 5. E. 6. 96. Reference may also be made to the various Bank publications relating to procurement which are listed on page 7. 9 There may be special circumstances wherein other methods of procurement (nonICB) would be more economical and efficient. to COJ 27 28 -~ ---~~ -~ ---------"---~-- . The procedures for monitoring and controlling the contractor's work are discussed in Section L on page 31. such as review and approval of equipment operations and maintenance instructions. Some of these other methods are listed below: 1. Neither the Project Manager nor the PMO staff should interfere with or usurp these responsibilities. 97. A more detailed explanation of these methods and the conditions and procedures for using them may be found in Section III of the Guidelines for Procurement Under Asian Development Bank Loans and in Section X of the Handbook on Policies. paym delive escala the p contrz 103. 4. 7.

controlling staff assignments and overme services. or . 01. In fixed-price contracts. The Project Manager should know the implications of the different forms of contract payments on the cost control system. the contractor agrees to diver goods or to perform work at an established price and assumes the risk for any cost escalation. there are specific undertakings the borrower or executing agency must carry out in connection with the implementation of the project. tabulating and reporting project cost commitments and ensure that entries to this record are maintained up to date. The Project Manager should also establish a format for forecasting. Cost control measures include adopting authorization procedures for incurring expenditures for goods and services. Apart from the standard loan covenants that appear in the loan agreement. the Project Manager must review the actual units of work accomplished before payment is made ·0 contractors..e original covenant. vehicle usage. e. and telephone and other communications :osts). 03. and :0 focus attention on potential cost problems in time to take corrective or cost-minimizing actions. The principal objectives of cost control are to execute a project within budget. 99.. G. Executing Project Covenants 98.. the Project Manager should prepare a forecast of costs to project ompletion and should continuously disseminate cost information to all concerned.g. and controlling personnel expenditures. Unit price contracts involve a contractor's agreement to be paid on the basis of per nit of work performed (e.g. the Project Manager should immediately bring the matter to the attention of the Bank so that a satisfactory solution can be worked out. 8 .ontract fluctuate during the life of the contract. The Project Manager should also conduct periodic cost control meetings and assign cost control duties to a cost control engineer or to another suitably qualified PMO staff member. controlling disbursements to consultants. It is recognized that delays could occur in complying with the project covenants. at it may become extremely difficult or impossible to comply with the covenants because of supervening circumstances. 02. The terms of reference for unit price contracts will indicate the owner's estimate of the quantities of each e of work to be performed. travel. Each month. these are usually detailed in Schedule 6 of the loan agreement. Controlling Costs 00. based on satisfactory contract performance. controlling administraive expenditures (e.F. Contracts involving prices subject to escalation are more difficult to manage as :he price first agreed upon is subject to adjustment when the cost components of the . dollars per cubic meter of soil excavated). In such a situation. These project covenants are intended to facilitate the implementation of the project and help ensure that the objectives and benefits will be achieved. The Project Manager should therefore make every effort to carry these out in an efficient and timely manner.g. suppliers and contractors. These objectives are achieved by closely monitoring project expenditures and comparing expenditures against cost estimates contained in the project budget. To exercise proper cost control in unit price contracts. such as the adoption of alternative measures that would achieve the same purpose as . controlling project change orders.

Withdra"". 107. It is important that the Project Manager designate a staff member who will be primarily responsible for the withdrawal of funds for the project. Decisions on the sources and allocation of funds for the various project elements are generally made during the pre approval stage in the project cycle and are shown in the loan agreement. This system for withdrawing loan funds consists of four standard disbursement procedures. This handbook also contains. the Bank has devised a system under which requests for withdrawals from the loan account require the submission of appropriate support documentation. These procedures me discussed in detail in the Loan Disbursemenr Handbook. and closely monitoring project expenditures against budgets and against physical completion of the project components. Controlling Project Changes The Project Manager should formulate specific procedures for reviewing and ap- sl- J 1 tli P. 108. after the loan is approved but well in advance of the expected time of the first disbursement under the project. These are: 0) direct payment procedure. commercial bank's report of payment and request for reimbursement and application for amendment of letter of credit. standard forms for withdrawal applications and accompanying documents. In general. ensuring the preparation of accurate project estimates (cost or quantities) for budgeting and bid validation purposes. H. However. ti 109. which is provided to the executing agency together with a disbursement letter immediately after the loan agreement has been signed. (iii) commitment procedure. The Project Manager must also be aware that withdrawal of loan funds is subject to the loan closing date stipulated in the loan agreement.104. beyond which no disbursements under the loan can be made. the Bank must ensure that such expenditures are consistent with the purposes for which the loan has been granted. and (iv) imprest fund disbursement. as delay in the receipt of funds can impede the smooth progress of a project. (ii)reimbursement procedure. among others. 106. I. His functions would include following up the release of funds coming from the borrower's resources under approved budget allocations and preparing applications for withdrawal of loan funds from external sources. The staff member assigned will also be responsible for preparing and updating disbursement projections as well as producing periodic reports that would enable the Project Manager to conduct regular reviews of fund utilizations. Accordingly. ensuring that the terms of reference for detailed design services require the consulting engineer to select the most cost effective alternatives and design specifications for equipment and construction/ installation work. with due consideration for economy and efficiency. Timely action is essential. 29 . the procedures for the withdrawal of loan funds are usually determined and agreed to between the executing agency and the funding source.. the Project Manager's cost control efforts involve selecting the appropriate type of payment provisions in the contract. including the Bank. .Jng loan Funds 105. It is the desire of the Bank that withdrawal of loan funds to cover expenditures as they are actually incurred for a project be expedited. However.

as weil as aspects of monitoring and controlling the time. and technical performance and their consequential effects on expected project benefits carefully assessed. K. One way of doing this is to bring the agencies or institutions concerned into the project planning process. Specific administrative procedures for processing change orders under contracts etween the executing agency and a supplier or contractor must also be established. The control number should come from the project code of accounts system (see Appendix 4). active. The Project Manager may also be required to deal with other parties affected. on-going performance by the Project Manager to ensure that the project is completed on time and within the budget. Proposed changes must be studied carefully and the implicaions relating to costs. To obviate such problems. adversely or beneficially. filed separately. The discussion of project monitoring and control includes a brief review of project planning leading to the development of a project monitoring and control system. Some of the problems encountered during project implementation may be outside the direct control of the Project Manager. and even the general public. inspecting and controlling what is being accomplished during project implementation. Project monitoring is a positive. and assigned a document control number from an established numbering system. national budget and planning offices or finance ministries. costs and technical aspects of a project 30 . or at least keep them informed of developments that may require their participation. The Project Manager may be required to interact with persons or agencies outside the project organization who are involved in some part of project implementation. Every request should be logged in a change order status register. J. A standard change order request form should be developed. Project monitoring implies reviewing. The routing of the change order request must be recorded in the register and the final action taken should be reflected in the register and change order file. When the proposed change involves substantial modification of the project. the actions of such persons or agencies may be essential to the success of the project. user agencies or their personnel. local inhabitants affected by the project. schedules. along the lines of the example shown in Appendix J 1. the contracting agencies of the borrower. the change should be approved by the Bank. 110. A suspense date for completing action should also be established. project coordinating committees. Coordinating With Other Implementation and Support Agencies 111. Such persons or agencies or groups may include the Bank and other donors.proving changes in the project. 112. Project Monitoring and Control 113. Any contract modifications should be cross-referenced to these records and files. by the project. and that the completed project meets technical performance and specification requirements. other executing agencies and their project managers responsible for implementingspecific components of the project. This section briefly discusses the features of the project that must be monitored. it is important that the kinds of linkages required to establish rapport with the people involved be considered.

4. spare parts and equipment. Disbursement procedures. 60 per cent. and completion of administrative requirements such as completion certificates. warranty documentation and bonds. 7. to ensure that items procured conform with the requirements of the project and that the guidelines and procedures of the Bank and other donors are being followed.. supply of fuel and other materials necessary for operational testing and future operations. i 1 a a 9 ( r t L. Procurement effort. 90 per cent and final design completion stages). to ensure that the owner's technical specifications are complied with. to ensure that payments are made correctly and on time and that the guidelines and procedures of the Bank and other donors for withdrawal of loan funds are adhered to. to ensure that the consultants comply with the provisions of their contracts. project administration (data management. engineering and construction management. and as-built drawings. Project work plans. budgeting and cost analyses and cost accounting. The Project Manager should review the design drawings and engineering calculations at certain stages (e. 5. 8. and property administration I' Technical control. Some of these activities may require periodic visual inspection to confirm that progress is actually achieved. cost estimating. parts inventory control systems. Construction of civil works and installation of equipment. 6.114. compilation of operations and maintenance instructions. staffing and performance of personnel. contract administration. turn-over of completed facilities to the end-users. The Project Manager 31 . to ensure that 'construction and installation activities are carried out in accordance with accepted standards and are as per contract requirements. including installed property.g. at the 30 per cent. If detailed designs are done in a foreign consultant's home office. correspondence control and report generation). training of operations and maintenance personnel or other end-users. parts lists. to ensure that qualified and efficient staff are available in the following functional areas: (a) (b) (c) (d) (e) (f) (g) 3. The features of the project that must be continuously monitored and controlled include: 1. 2. Tae project organization. to assess their continued validity and to identify potential problem areas. scheduling and schedule analyses. Procedures for Monitoring and Control of Projects ( 115. insurance and claims releases. project performance analyses. the Project Manager may assign a representative to be in residence at that office or arrange for periodic visits by a representative. The Project Manager and project staff should continuously monitor the progress of [he various project activities. Supervision of consultants. operational testing of equipment and systems. special tools. Commissioning procedures including detailed planning for equipment and systems start-up.

cost monitoring. quality and progress.may send staff or may contract outside assistance to perform factory inspections of critical equipment being manufactured. The project control system's key function is to provide early warning to Project Management about any potential problems. and project on-site subordinate managers for geographically separated project components. suppliers and contractors as well as with outside implementation and support agencies. to provide permanent. . e. or. the Project Manager must make extensive use of projeci control and project accounting systems. 5. to be accomplished daily. important questions raised and answers given or actions to be taken that might affect contract time. Submission of consultant and contractor reports should be monitored closely and the reports thoroughly reviewed. in addition to visual inspection of the equipment. progress and performance measurement. Much of the cost information comes from the project cost accounting system. 8. 6. for scheduling and schedule monitoring and for future planning.g. work completed for the day. specific site inspections performed by the project staff: site conditions . visitors to the site. while undertaken manually for smaller projects. including purpose and results: significant telephone conversations. and should be dated and arranged in proper sequence . This should be done before the project commences and periodically thereafter as the works progress. labor. work plans for the next day. 2. equipment and material tracking. sorted and reported via a WBS coding structure. These systems are often computerized for iarge projects. mail. Deputy Project Manager. equipment and materials brought to and employed at site. telephone and radio) to establish linkages with consultants. Information can be collected. Project accounting systems include the use of the books of account earlier described. The following illustrates the kinds of information each system can supply: 3 32 . 3. All photographs should be identified with a brief title or description. soil conditions. visual records of project status. The Project Manager should establish clear channels of communications (messengers. This system does not provide precise cost information but it can supply vital current key information for managing a project. 117.photographs are invaluable as evidence in settling contract disputes or claims and can be important as a part of reports. as an alternative. to provide the following information: 1. as appropriate. etc. Photographs of the project site should be taken. may require' written reports. The Project Manager should play an active role in eliciting action on project matters from higher authorities and outside agencies and should maintain records of the results of such interactions with outside agencies. Key project staff.. The typical project control system provides for review of schedules. 9. problems or potential problems and actions taken or plans made to overcome these problems (including technical and safety problems and problems affecting personnel and facilities outside the project area). 116. cost or quality of performance. 11 S. though the project control system may also use the same coding system for monitoring cost. Project Manager. and cost forecasting. should maintain official diaries or journals. In controlling the project.weather. 7. 4.

actual value of resources expended to date). Of increasing concern to Project Managers and the Bank is the control of project works done by force account (i. e. 120 Appendix 12 describes how to measure . Measuring project progress at a particular date involves totalling the budgeted value of the portions of each project element or work task that have been physically completed. Using the integrated costs and schedules developed as a part of the initial detailed planning. and time sheets for salary payments to PMO staff or those involved in force account work. salaries paid to personnel working on the PMO staff. the accuracy of the original cost estimates. that are widely scattered geographically or located in remote areas. the techniques for monitoring and controlling involve the periodic (generally monthly) comparison of actual progress and expenditures against original estimates and budgets. and the quality and timeliness of project staff reports from remote project sites.1. carried out by agencies of the borrower. and that generally are labor-intensive. as gathered from the time sheet reports. Close physical monitoring of such projects involves much time and 33 . Problems that are encountered usually relate to the quantity of the scope of work to be done. and payments due on procurement orders for equipment and materials that have not yet been received. Information that may be furnished from the project cost accounting system to the project control system could include: (a) (b) (c) (d) (e) expenditures from the last reporting date to the current reporting date and total expenditures to date. such as a Department of Public Works). Information that may be provided from the project control system to the project cost accounting system could include: (a) (b) (c) purchase orders for equipment and materials ordered but not yet delivered.. Procedures for computing revised estimates of cost at completion are also discussed in Appendix 12. the tools and techniques for cost and schedule control are discussed in detail in Appendix 12 and follow directly from the planning techniques for project control discussed in Appendix 4. the total budgeted value of work physically completed as measured above is compared to the actual value of the work physically completed 0. requests for payments from consultants or contractors. The difference (called schedule variance) gives the amount of schedule overrun or underrun at that date (in dollars or other units of measure that can be converted graphically to time measure). the control of the quantities and costs of materials used in the work. status of actual expenditures against budget estimates. Standard tools and techniques are available to the Project Manager for monitoring and controlling project implementation. The difference (called cost variance) gives the amount of cost overrun or underrun to date.e. funds available for project payments. 121. ( 119. To measure cost status.costs and project progress against original and totals at completion.. and comparing that total value against the total budgeted value of the portions of the project tasks scheduled to be completed by that date. the adherence to time schedules. Project works commonly implemented under force account are those that involve small amounts. c S € € 1 I 2.

assigning better skilled workers and managers to the problem areas.some pro34 . Quality control (QC) measures on the other hand include visual inspection of detailed design drawings. Contracts with consultants.investigation might show that the contractor accelerated work during a particular period. QC measures also cover operational testing of equipment prior to turnover and other such activities. suppliers and contractors should clearly state that they will be responsible for the technical quality of their work. and establishing better coordination and information flows among project participants and between project participants and outside agencies or personnel. adjusting budgets and schedules. packaging of goods prior to shipment. To control project costs. frequent (perhaps monthly) site visits by qualified staff to verify progress and expenditures may be the best way to control costs.consequently entails higher costs. Monitoring the technical performance aspects of the project requires a carefully planned course of action. making advance preparation. using prescribed technical specifications and standards. Some problems can be corrected by increasing productivity. It may be impossible to correct all problems . the Project Manager should first analyze the variances in project costs and progress as computed and shown graphically in Appendix 12. that technical and performance specifications in the contract be clear and complete. relaxing schedule or technical requirements. Through this procedure. implementation problems can be discovered and responsibilities assigned for corrective action. and inspection of items on delivery and again upon installation at the project site. including follow-up actions for correction of any deficiencies. development of inspection checklists. nonetheless. Price escalations in delivered goods may also result in a cost overrun for the project. These QA/QC measures must be adopted throughout the life of the project to assure that the end product performs as planned and meets required technical specifications. Tracking of variances through the work breakdown structure (WBS) (see Appendix 4) will help pinpoint the specific work elements from which deviations in cost plans. schedules and technical performance have occurred. In addition to the usual early validation of design and cost estimates. or that the schedule sequence was temporarily altered. Technical performance variances might be discovered through visual inspection of equipment and construction and through testing. at a given point. 125. the Project Manager should then require the functional managers to determine the causes of these variances. that could be made up as the work gets back on schedule. equipment and materials during manufacture. 123. a project may be ahead of schedule but experiencing an overrun in costs . The Project Manager's planning for quality inspections. such as continuing increases in cost overruns or persistent slippages. It is important. The variances over previous periods should be analyzed together with the latest results to establish trends. progress and technical performance. the Project Manager should undertake supervision of the work. For example. Not all cost and schedule variances cause serious bottlenecks. completion of documentation of inspection results. 124. but those affecting the critical path must be addressed immediately. The contract should also stipulate that work and technical control measures will be subject to inspection by designated parties and that measures will be taken to correct any weaknesses in control systems or any defects in the quality of the works. 122. however. resulting in variations. 126. and review actions to assure compliance with the terms of the contract are generally known as quality assurance (QA) measures.

Bank requirements will be indicated at an early stage of project implementation. 128. reasons for delay in procurement and disbursement. the Project Manager should prescribe reporting schedules and procedures to meet the requirements of the Bank.blems might require adjustment in schedules. or unavailability of qualified project staff). problem analysis. 6. As a general guide. including circumstances that could affect costs or schedules (e. and actions required by outside agencies. 2. the expenditures incurred for the project. as well as the executing agency. 4. and disbursements made from the proceeds of the loan. financial position of the project. the format and depth of detail will also vary according to the level of management receiving the report. such as detailed engineering. 35 . principal work accomplished during the reporting period.. . 5. scope of work.. evaluation of bids. 3. information needed for progress reports will vary according to the nature of the project.g. The information that the Project Manager needs from within his organization for project control purposes must be detailed enough to enable him to identify and to address himself to problems that are being encountered. M. The extent of the detail required in the reports. 7. and awarding of contracts and construction works. actual or potential deviations from original plans or schedules and the reasons therefor. or acceptance of lesser technical performance. Reports required from consultants and other contractors should be spelled out in their contract agreements. 8. must be discussed with each end-user . the borrower and other outside agencies. difficulty in collecting information from the field. As stated previously. implementation plans for the next reporting period. During detailed implementation planning. fulfillment of the borrower's and executing agency's covenants as contained in the loan documents. This implies that reports for the Project Manager require greater depth than the much more condensed reports that would be submitted to superior officials and to the Bank. as well as the frequency of reporting. preparation of tender documents. the kinds of information needed at all levels should cover: 1. Preparing Project Progress Reports 127.

6.. and. 36 .. It is essential that close consultations between the executing agency and the Bank _ undertaken. technical reviews and disbursements. The Project Manager should be prepared to make project files and records available for review. project reporting. Moreover. Visits of Bank Missions _30. Such consultations enable all parties to work effectively in discharging their respective obligations under the loan or project agreements and in identifying and solving . the 3ank also stands ready to send out special missions to provide assistance to the executing agency on various matters relating to project implementation. It is also important that the h ?roject Manager..VI. 132. PROJECT INTERACTION BETWEEN THE BANK AND THE I. Minutes of discussions or memoranda of undertanding should be provided to those participating in the meetings and follow-up actions to implement anything agreed upon with the mission should be undertaken. The Bank periodically sends out missions to conduct consultations with the executg agency and to undertake an overall review of the progress of the project..~oblems indering the smooth implementation of the project. 2. 3. office facilities. The Project Manager must make adequate preparations to receive missions from e Bank. such as procurement. 1. 5. in obtaining the concurrence or approval of the Bank on certain project atters. see Appendix 13. arrange for visits o the project site. government officials and project staff and make appointments in connection therewith. The Project Manager should ensure the provision of administrative support for the mission. such as communications facilities. B. project inception mission review mission special project administration mission project completion report mission country projects review mission country loan disbursement mission disbursement mission For a more detailed description of these missions. submit complete documentation and provide all the information required to enable rie Bank to act intelligently and expeditiously. 7. secretarial upport. 131. The following is a list of the types of Bank missions that visit the borrower or the executing agency during the implementation of the project. 4. if required. and provide any information and assistance that may be required to enable the mission to perform its tasks.:XECUTING AGENCY Need for Close and Frequent Consultations _29. develop an agenda for discussions involving Bank staff.

project scope. either in the Bank's headquarters or in the borrowing countries. including the requirements of the Bank. . This is particularly important when PMO staff were not involved in the preparation and appraisal of the project. procurement strategies for goods and services. 8. 5. Orientation for Executing Agency's Staff 133. organization for project management. 7. it would be useful to conduct project orientations for PMO staff. A. procedures and arrangements for working with outside organizations.' and economic and social benefits to be derived from the project. As soon as the PMO has been organized. project time schedules. 13( pre ahr she Pre em the tes fen the Ma cOJ sUI tee the op 37 38 .Bank.. staff of executing agencies are invited to participate in semi . project goals and objectives. agencies and individuals involved in the project.C. 4. provisions of loan and project agreements. 13< pre to 6. project costs and funding sources. 9. components and location. Mal 13~ tors dis cea nm In addition to such orientation. The orientation may be conducted with the assistance of Bank staff and should cover at least the following: 1. 2. 3. nars/workshops on various aspects of project implementation that are conducted hy the .

The individuals or organizations involved in this transfer include the Project Manager. are also responsible for the successful completion of their individual tasks. suppliers and contractors. parts catalogues and lists. the PMO staff. However. There is generally a period following physical completion when the contractor retains responsibility for works while acceptance inspection and operational testing are being performed. There is a distinct point at which the responsibilities of the Project Manager and the project contractors cease and are transferred to the operators or end-user(s). Trained operators must be ready to operate the completed project facilities. 136. shop drawings. Administrative elements. Project commissioning is a critical project milestone and requires early planning and preparation of procedures such that operational tests and turn-over of the completed works to the user(s) can be accomplished. A. 38 . equipment and goods against theft. The transfer of responsibilities normally involves the following: 1. warranties. Overall responsibility for the completion of the project facilities rests with the Project Manager. spare parts lists. tools and other goods that are not a part of constructed facilities. installed equipment systems. destruction and vandalism. 2. and special tools lists. equipment and systems operatioris and maintenance instructions or manuals.VII. The administrative and physical control elements are transferred when the individual items of equipment and the constructed works are transferred to the operators. Transferring Responsibility for Project Operations 135. and special fuels and lubricants. Physical control element. to supervise start-up and operational testing. as well as fire protection and maintenance of equipment and facilities. will tome to the site to inspect the equipment before start-up. the consultants who supervised construction. Physical elements. Administrative elements include as-built drawings. Physical control elements include facilities to secure works. other project participants. constructed facilities. The technical representatives. perhaps with the arrangement that minor deficiencies be corrected by the contractorls) after turn-over. the installation/ construction contractors and the various manufacturers' technical representatives who supplied the equipment and systems specified in the contracts. inspected. and the operations staff. such as consultants. Physical elements include individual items of equipment (if not installed in constructed facilities). special tools. and to provide operations and maintenance instructions to the operations staff. spare equipment. PROJECT COMMISSIONING 134. under the terms of their contracts. Major works should be turned over when physically completed. 3. tested and accepted by the Project Manager. Completed physical facilities should be transferred as provided in the contract and project documents though some individual items may be transferred to the user(s) well ahead of or later than the scheduled date of turnover of the major works. spare parts.

The training program may be developed and carried out by experienced training consultants. The following procedures should be employed for transferring responsibility: 1. 137. 2. . equipment and components catalogues. 5. 4. In some cases. 7. 139. 6. operations and maintenance manual and instructions. the Project Manager will be involved in the development and administration of a training program for the operation of the project. and recruit qualified trainors or instructors. Accept and turn over equipment. The responsibility for recruiting personnel to operate the completed facilities rests with the operating agency. Turn over equipment spares. listing of spare parts. etc.. Conduct equipment and operational systems start-up and operational performance testing. In many circumstances. Inspect civil works and interfaces with installed equipment for compliance wi the contract. spare parts. 1 training schedule should be conducted in advance of project completion. indicate the reference materials and training supplies required. The Project Manager could assist in indicating the qualifications. operations after turn-over. Provide fuels and utilities for operational start-up and testing and subseque . systems and facilities to operators. B. and assignments of the staff needed to operate the facilities. to projec Appendix 14 contains guidelines for transition from project implementation operations. 140. materials and equipment installation for compliance with contract. 39 . completion certificates and warranty documentation. provide advice about the training facilities and equipment. This he would afford trainees the opportunity to observe the on-going construction of the facilities and the installation of the equipment and systems. including: (a) (b) (c) (d) (e) as-built drawings and approved engineering shop drawings. which may not necessarily be the executing agency. Turn over project documentation to operator. recommend suitable training locations. position titles. Inspect equipment. The training consultants will develop courses for formal classroom and on-the-job training. insurance and claims releases. and bonds.I . special tools and special fuels anc lubricants to operator. parts lists. the manufacturer's representatives may be asked to propose programs applicable to the items they have supplied. Providing Advice and Training to Operations Staff 138. 3.

Project benefits are monitored to ensure that beneficiaries receive and use project goods and services in accordance with original expectations. monitoring the chances of achieving such benefits during implementation. Very early in the project cycle the borrower generally appoints an agency to be responsible for PBME throughout the project period and for as long as needed after project completion. and initiating or recommending necessary action to ensure that benefits are received. Project Benefit Monitoring and Evaluation 141. PBME is concerned with identifying the benefits expected to be derived from a project. and to provide a guide for the preparation of new projects. the effect of the project on their economic and social well-being. and the risks and actions that must be taken by beneficiaries to obtain project goods and services. Provisional impact evaluation studies are undertaken to help identify follow-up activities needed after physical completion to ensure that benefits are achieved.g. PBME activities for the early delivery components (e. to help on-going development programs. PBME helps executing agencies and the Bank ensure that benefits are achieved by adopting appropriate measures at several phases of the project cycle. 143. During project preparation and appraisal. the agency responsible for PBME must establish a system for verifying the receipt and use of project goods and services by beneficiaries. At the start of project implementation. how the beneficiaries are organized. PROJECT REVIEW AND EVALUATION A. The PBME reports should be brief but sufficiently detailed to identify differences between actual and expected performance in important operational areas and to enable nalysis of problems and adoption of remedial measures. Even with full. Project benefit monitoring and evaluation (PBME) activities. 142. 144. basic information concerning the beneficiaries and the sectoral socio-economic conditions are obtained to enable projects to be prepared on the basis of realistic assumptions about beneficiary response to the project. o . These problems often arise because insufficient attention is given to ensuring the delivery of project goods and services and their use by beneficiaries. the borrower must update its knowledge concerning the sectoral socio-economic conditions influencing the project. The agency responsible must update its information about the beneficiaries at this time. for example. introduced in recent years. knowledge about the beneficiaries.VIII. Accordingly. are encouraged by the Bank. the interest of beneficiaries in the project. and evaluating the extent and impact of benefits received upon project completion and use. measuring their effects. The executing agency should schedule PBME activities to begin as soon as project goods or services start flowing to beneficiaries. to include comprehensive identification of beneficiaries and user preferences where applicable. the agency responsible for PBME must expect to deal with problems in achieving benefits that arise during implementation. This agency must prepare itself to carry out the PBME program. PBME activities involve the collection of information needed to confirm that project goods or services are received and used by the beneficiaries and that benefits are derived from their se.. a fertilizer distribution program) should be initiated first as these activities and the accruing benefits often begin long before overall project completion.

The Project Manager is expected to make significant contributions to the PBME efforts. The peR should be prepared under the direction of the Project Manager.145. prepared and implemented. the executing agency is required to prepare a project completion report (peR). He could assist by allowing easy access to project records and by providing data on goods and services delivered and their use by the beneficiaries.be to provide a factual and objective report of how the project was conceived. B. Suggested topics for a peR to be submitted by the executing agency are given in Appendix 15. the Project Manager should be involved in instituting these changes. and to gather lessons that could be learned for application to future projects. 41 4 . the Project Manager's concern should . Within three months of physical completion of a project. to evaluate the completeness and adequacy of the preparation and appraisal process in relation to implementation. Project Completion Report Ap 146. In the event that project developments reveal that changes may be required to achieve the benefits desired. The Bank in turn will prepare its own peR within six months after physical completion of the project. to review experiences in the implementation of the project. The purposes of the peR are to provide a concise project history from identification to physical completion.

................. 4.................. 3...................... 13...... 14........................ Tools and Techniques for Project Cost and Schedule Control................. --........... Project Records and Files............ List of Project Implementation Management Tasks Problems........ 5........... _................................. 6... -.......APPENDICES Appendix 1. System for Project Cost Accounting and Auditing..... Description of Bank Project Administration Missions 93 97 101 105 111 117 121 131 7.....................~ ------- ................................ 8....... 12........................ - Guidelines for Transition from Project Implementation to Project Operations...... 10........................... Procedures for Selection of Consultants Procedures for Procurement of Goods and Works Change Order Request Form........ 9................. Suggested Outline for a Project Procedures Manual................. Page 45 49 53 77 89 List of Common Project Implementation Project Scheduling and Resource Planning.................................Planning and Control by Work Breakdown Structure...............Suggested Topics for a Project Completion -............................... Report 137 141 15.............................. 2.................. Project Management Office Staff Functions........... 11................

APPENDIX 1 LIST OF PROJECT IMPLEMENTATION MANAGEMENT TASKS .

II I " I Appendix I LIST OF PROJECT IMPLEMENTATION MANAGEMENT TASKS Project Management Planning and scheduling project activities Organizing the Project Office Recruiting. assigning and supervising project staff Monitoring and controlling project activities Coordinating with the Bank and other donors Reviewing reports from project consultants. including a project budget Establishing and maintaining a project accounting system Establishing with the Bank suitable procedures for disbursing loan funds Certifying invoices for payment Establishing procedures for project audit Preparing financial reports Procurement and Contract Administration 1. time-phased financial plan. For Consultants: Preparing a short-list of consultants 47 . suppliers and contractors Preparing reports required by the Bank Financial Management Establishing a detailed.

For Goods and Civil Works: Preparing list of goods and contract packages Preparing tender documents and issuing tender invitations Evaluating bids and negotiating contracts Inspecting goods and supervising construction works j .Appendix 1 Continued Preparing and issuing invitation documents for consultants' proposals Evaluating consultants' proposals and negotiating contracts Supervising the work of consultants 2.

APPENDIX 2 LIST OF COMMON PROJECT IMPLEMENTATION PROBLEMS .

(f) Staff appointed for project implementation not being involved in the preparatio or appraisal of the project. Rigid government procurement regulations/rules. (d) Political interference in the appointment of project staff. (e) High cost of foreign consultants compared with local consultants. and acquisition of land or rights-of-way. 1. (d) Cumbersome. stringent. or restrictive government procedures and requiremen for recruiting foreign consultants. Problems in understanding or adhering to the Bank's requirements/guidelines. 2. (b) Delay in obtaining approval from the ratifying agency. (f) Settlement problems on the part of the consultant. Failure of supplier to comply with the provisions of contract. (h) Disagreements between the executing agency and the consultant. (c) Difficulty in recruiting qualified personnel due to poor payor absence of proper incentives. (b) Lack of qualified technical personnel. In Procuring Goods and Works (a) (b) (c) (d) (e) (f) (g) (h) Lack of suitable expertise for procurement in the executing agency. Lack of counterpart funds for local procurement or delay in release of such funds.Appendix·2 LIST OF COMMON PROJECT IMPLEMENTATION PROBLEMS In Making the Loan Effective (a) Delay in preparation of legal opinions necessary to make the loan effective. 4. Cost overruns. (b) Inadequate response from consultants due to unfavorable local work conditions. In Organizing and Staffing of Project Office (a) Delay in obtaining approval of an organizational structure. In Engaging and Supervising Consultants (a) Difficulty in establishing qualifications and terms of reference. Difficulties or delays in obtaining approvals from higher authorities. appointment of a Project Manager. . (c) Difficultyin assessing actual capabilities of consultants through curriculum vitae or proposals. (c) Delay in complying with special conditions for loan effectiveness such as organization of a project office. (e) Weak or inappropriate organizational structure. Complex and cumbersome procurement procedures. (g) Inability of the government to provide adequate logistical support to the consultants. 3.

In Project Commissioning and Operation (a) Lack of coordination between implementing personnel and operating staff. In Withdrawing Loan Funds (a) Cumbersome government procedures for submission of withdrawal applications. Delay in reimbursing contractor's expenditures. (c) Operating personnel not qualified or trained to operate and manage the completed project. Security problems at project site. Right-of-way problems. (b) Lack of provisions for spare parts and maintenance. Changes in work specifications/contract conditions. Poor quality of contractor's work. Poor working conditions at project site. Financial problems on the part of contractor. 0) 6. Labor problems. S2 . Technical problems. (b) Lack of familiarity with the Bank's disbursement practices and procedures. 7. In Construction Management (a) (b) (c) (d) (e) (f) (g) (h) (i) Delay in providing engineering designs.Appendix 2 Continued 5.

APPENDIX 3 PROJECT SCHEDULING AND RESOURCE PLANNING .

Figure 2. 2. The three rectangles considered together in this example represent an entire project. 1985 May 1 .4" "Task Z" 2. Each of the circles (milestones) represent accomplishment of a specific phase of the total undertaking and each of the rectangles represents a task. with the time scale across the bottom. Table of Activities and Events This is the simplest way of scheduling implementation activities and events.September 1.November 15. Bar Graph (Gantt Chart) This is a chart depicting work to be done and some of the interrelationships between and among all phases of the work.· Appendix 3 PROJECT SCHEDULING AND RESOURCE PLANNING The following discusses several scheduling techniques and their use together with procedures for effective employment of project resources. Bar Chart TASK X o 100 Feb 1 Mar 1 Apr 1 TASK Y TASKZ May 1 Jun 1 Jul 1 Aug 1 Sep 1 Oct 1 Nov i : Dee 1 55 . 1985 June 1. This chart. l. Activity No.June 15. 4. Table of Activities and Events Schedule Period February 15 . 1985 August 1 . A. Scheduling Techniques 1. Figure 1. 1985 Activity Description "Task X" "Task y" "Event No. Figure 2 illustrates a bar chart. shows how long it will take to accomplish a specific project. The method shown in Figure 1 is usually adequate for simple projects involving activities of just a few responsible managers. 3.

For illustration purposes. The bar chart is an effective scheduling tool with respect to simple projects involving a minimum of coordination among the various tasks making up the entire project.Appendix 3 Continued The bar chart shows the relationship between the milestones within the same task. The bar chart does no: tell whether Milestone 6 can be started before Milestone 2 has been completed. This will be done in three steps. but the relationship between and among milestones contained in different tasks is not indicated on the chart. or between Task Y and Task Z. and that Milestone 4 cannot begin until Milestone 3 has been completed. This step removes the rectangles signifying tasks and illustrates the interrelationships between milestones within a specific task by the use of arrows connecting Figure 3. 3. is unclear. Therefore. the relationship between Task X and Task Y. Figure 3 indicates the results of the first step in the transition from a bar chart to a network. the following discussion shows how the initial developers of network scheduling progressed from bar charts to networks. one can tell from a bar chart the relationship between two specific milestones within a task. nor whether Milestones 6 and 7 are at all dependent upon the milestones in Task X. This is the big limitation of this particular tool. however. Figure 2 shows that while Mi!estone 2 cannot be started until Milestone 1 has been completed. a. but it is quite ineffective as a planning and control tool or for use in trying to represent the enormous number of interrelationships among the phases of the development of a complex project. Results of the First Step in Transition from Bar Chart to Network 0 (2) "0-----+0 ·0 TASK X TASK Y 0 56 ·0 TASK Z . Networks Networking was developed as a means to develop a project schedule to show the interrelationships between and among all the milestones and tasks in an entire project.

and because Milestone 3 depends on Milestone 1. and Milestone 7 is the ending point of the entire project. or whether only Milestone 3 can be undertaken. Now that Figure 4 indicates by the arrows all the interrelationships between and among all the milestones. 57 -. Because all times are given. For example. In short. and which milestone can be completed without being coordinated with others. Milestone 1. it is not clear whether Milestone 4 can be completed before Milestone 7 can begin. the horizontal time scale is omitted in favor of individual time notations on the arrows themselves. still unsolved is the problem of interrelationships between milestones not contained in the same task. In addition. with some arbitrary times in weeks indicated over the arrows. Although this results in a somewhat neater chart. as Figure 4. is the beginning point of the entire project. The completed transaction is shown in Figure 5. Results of the Second Step in Transition from Bar Chart to Network c. as in Figure 4. the relationship between and among all milestones in the entire project (regardless of which task the milestone is a unit of) are clearly shown on this chart by use of the added arrows. a time scale is unnecessary. one can say that Milestone 4 also depends on Milestone 1.~ ~_----""'! "--- . nor can one tell whether Milestones 3 and 4 contained in Task Y must both be completed before Milestone 2 can begin. Milestone 4 cannot be started before Milestone 3 has been completed. TASK X TASK Y TASK Z L_ shown in Figure 5.Appendix 3 Continued the milestones. the third transition step omits the term "task" entirely. b. The second transition step between the bar chart and the network involves adding the relationships among the milestones contained in different tasks. The addition of arrows representing the necessary flow of the work shows what milestones must precede other milestones. of course. For instance.

An event (or milestone) is denoted by a circle. Activity A is represented as: O.waiting for curing of concrete or waiting for delivery of materials for example. Makes redundant the designation of the task because the project is viewed as an integrated whole and not as a number of tasks. which showed milestone or achievements within defined and linked tasks. Thus. b. It requires time to finish an activity . Before proceeding further into the details of networking. Allows the use of the network for highly complicated projects. An activity starts and ends with a circle. the bar chart. Substitutes for the previous time scale an individual time value for each leg of the network. Developing the Network 1. events and their relationships. the reader should understand some basic definitions and symbols. It represents the start or end of an activity. a. Definitions. Thus we show sequence logic graphically with networks. gave way to a diagram. Bar Chart Completely Transformed Into a Network Thus. B. to form a finished project. 58 .__ c.Appendix 3 Continued Figure 5. An activity is denoted by an arrow. The major advantages of the network over the bar chart are that the network: Indicates all the interrelationships among all milestones. A __ ~·O A network is a graphical representation of the logic or sequence of activities.

or. B depends on the completion of A Job H can start only after the completion of both F and G Job C must be completed before either of the activities D or E can be started Both of the Jobs J and K must be completed before Land M can be started. Prepare rice Cook rice Prepare meat 59 . Job R depends only on the completion of P. A dummy is an artificial activity.Appendix 3 Continued Sequence Logic Job B cannot start until A is completed. It indicates that an activity following the dummy cannot be started until the activity preceding the dummy are completed. Dummy activities are introduced to provide consistence in logic. Graphical Representation - H - C d. and eating both afterwards. It requires no time or cost. represented in the network by a dotted arrow.. For example: Sequence Logic Jobs Nand P must be completed before Q can start. X is a dummy to show dependence of Q on P Graphical Representation 0 0 N P -Q -6 x I I Eat Q -0 -0 R A common example of this graphic logic would be the preparation and cooking of rice. preparation and cooking of meat. .

the latest event time is determined by the earliest of the various possibilities. project duration equals the duration along either path. weeks or months. Critical Path Most projects with any degree of complexity will contain both critical and non-critical activities that must be performed in proper sequence. Depending on the type of project. If one critical path equals the duration along another path. One method for determining the critical activities consists of establishing the earliest time and latest times that each event can occur and then applying simple tests to see if an activity lies on the critical path. Given the duration time of each activity. 3. Some actvities may be performed simultaneously. Three questions that will help to plot activities and that should be asked for each activity are: What can be done at the same time this activity is being performed? What must be done before this activity can be started? What cannot be started until this activity is completed? 2. For purposes of discussions. "Early Start" is the earliest time at which an event can occur . By introducting the TIME element. 60 . When there is more than one chain of activities. If there is more than one chain of activities leading to an event. This is placed above the circle. others may not begin until certain related activities are completed. b. Project Time To this point the network represents only the logical interconnection of the vbrious activities. "Late Start" is the latest time at which an event can occur without extending the project duration time. Project duration equals the duration along the criuical path. event times can be calculated. one starts with the final event and works backward toward the start. The critical path will present the sequence of activities requiring the longest time for project completion.Appendix 3 Continued Generating the network is partly a trial-and-error process. activity times may be calculated in days. The total duration along one critical path equals or exceeds the duration along the others. The late start is denoted by a number with a line over it. To calculate a late start.when all the activities leading into the event have been completed. Plotting project activities according to network techniques results in the depiction of the project as a collection of parallel paths from project start to finish. The network will show several courses of paths of project completion. the early start is given by the largest chain or largest sum of durations. which is the single best estimate of how long it will take to complete the activity. much more can be done with the model. The basis of this is the duration of each activity. Each event has two times: a. the early start is denoted by an underlined number placed under the circle (event). as long as a single measure is used consistently.

(Note: It may be useful to look at the network again to make sure that the logic involved is understood. the events are arbitrarily numbered.· Appendix 3 Continued To illustrate. duration and sequence are shown below: Activity A B C D E Normal Duration 3 days 5 1 2 2 F G 4 3 1 H The project activities are shown with the duration denoted under the arrow as a matter of convention. The reader should prove that the ES of Event 7 is 12 days. several ESs will be arrived at. Whenever one comes to an event into which two or more arrows end." For example. examine a simple project . such as in Events 4 and 7.whose component activities. one determines how long the project implementation would take and what the critical activities are. For discussion purposes. ~~----:------~{ ___ H__ ~··0 Next. and add the duration of the activity to the ES.) Step 1: Determine the early start of each event. In such cases take the LARGEST VALUE as the ES of this "Merge Event. It was stated that the early start (ES) will be denoted by an underlined number under the circle. Assign an ES of 0 to Event 1. 61 . in Event 4. Take 8 as the ES of Event 4. Path A-B takes 3 + 5 = 8 days while Path AC will take 3 + 1 = 4 days.

two activities (E & F) emanate from it. take 13 and put it on top of the circle. If the LS = 0. In this example. the late start (LS) will be denoted by a number with a line over it and located over the circle. It is important to check that the initial event (Event 1. If not. Proceed to subtract the LS less the duration of the preceding activity to get the LS of the previous event. Also. 8 o o A ~ H ~~~ 13 3 12 Step 3: Note the total project duration. ° 62 . then one concludes that the total project duration is the ES or LS of the final event. In the example. Take 8 as the LS of Event 4. note the various LS's and simply TAKE THE LAST VALUE. Back-Path H-E results in 13-1-2 = 10 days while Back-Path H-F results in 13-1-4 = 8 days. Whenever one gets to an event from which two or more arrows emanate. in the example) must end up with ES = and LS = 0.~~ 13 Step 2: Determine the late start of each event. In the case of Event 4 again. something is wrong with the addition or subtraction or in the determination of greatest or least values. Take whatever ES one gets for the last event and assign that as the LS of the last event. a total project duration is 13 days.Appendix 3 Continued ~~--~:~----~~~( o ______ ~H----~. as previously stated.

Appendix 3 Continued

ppe

Step 4:

Identify the critical path.
(

Connect the events that have the same numbers on top as the one below them, or ES= LS. This is the critical path (CP); in the example; the CP is AB FH. (Note: C and E ar not in the CP since their ES = LS condition was arrived at with another path.) 4. Significance of the Critical Path The critical path is the chain of activities which determines the project duration time; there may be more than a single critical path. If the duration of an activity along the critical path is lengthened/shortened, total project time will increase/decrease. The EA Project Manager will want to devote extra effort and attention to the activities along the critical path - these are the priority activities. It must be noted that as a project proceeds, the critical path may actually shift to another path depending on the actual performance.
C.

[

(

1=

c

(

The Time-Phased Diagram In the network, one first establishes three things: the logic sequence, the total project time, and the critical path. To make further analyses, the time-phased diagram (TPD) is constructed from out of the network In the previous networks, the length of the arrows were not proportional to the duration in the network; in the TPD, they are. The time-phased diagram is essentially the same as the network except that it is drawn scaled with respect to time. The TPD of the example is drawn below: Figure 6. Time-Phased Diagram

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(ii

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,...--.--~
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A

B F

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13

O--_G_-.~----_J
2 3
.4

I

5

6

7 DAYS

8

9

10

11

12

PERIODS,

63 64

Appendix 3 Continued

In TPD construction, it is suggested that one first draw the criticalpath along a straight line

(note how ABFH is drawn). Next, one draws the other non-critical paths and activities. Dotted lines or slack are drawn to indicate where the non-critical activities must be finished. One then notes that the critical path has no slack, while non-critical activities do. Critical paths do not have margin for delays while non-critical activities do. One can afford to delay, intentionally or unintentionally, non-critical activities. Exercise: Networking and Critical Path Identification A project has seven well-defined activities. Their sequence logic are as follows:
(i) (ii] (iii]

(iv) (v) -

A, Band C are starting activities and may take place after the start event. D and F must wait for completion of A. E follows C. G follows B, D and E. F and G complete the project. Develop the network. Assume normal duration as follows: Activity A B C Duration 3 weeks 6
2

D E F
G

5 2
7

4

-- Compute the total project duration and identify the critical path. -- Construct the preliminary time-phased diagram.
3 SOLUTION:

12

~---4---+0
12

Critical Path is ADG Total Project Duration

= 12 weeks

64

Appendix 3
Continued

Figure 7.

Time-Phased Diagram (Solution to Exercise)

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6

7

8

9

10

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D.

Analysis of the Time-Phased Diagram
This section shows how the time-phased diagram is used for various aspects of project analysis and scheduling. The TPD is the basis for analysis because of one major feature - its ability to describe the whole project GRAPHICALLY. The following describes and illustrates, using the data in the example in Paragraph C, how the analysis is done. It is important that one understands what is going on as the TPD is shifted. The reader should concentrate on the concept, not on procedures. The following concepts and suggested procedures will be demonstrated. -Project Crashing Least -Cost Analysis Manpower/Equipment Leveling Manpower/Equipment Scheduling Project Finance Planning p

AC

1. Project Crashing Under the circumstances, where the total project duration is excessive and faces very rigid time constraints, or when the project has been delayed and efforts must be accelerated to meet the deadline, the EA Project Manager may have to conduct a crash program. Project activities can generally be performed in a number of ways, between two limits. Normal conditions refer to minimum cost at optimum time: crash conditions refer to minimum time at maximum feasible cost. If a project is under a crash program, it may be necessary to do any or all of the following: (i) increase the number of personnel; (ii) increase the availability of materials; and (iii) work overtime. All these alternatives entail a higher cost. One does not crash programs by eliminating activities. It should be remembered that in crashing a program, it would be useless to increase the work rate (or shorten the time spent) for activities that are not on the criticai path. and that crashing a program may cause a shifting of the critical path. .

65

66

One studies thoroughly each of the activities and notes the "crash-ability" of the activities and the cost implications. 66 .000 (4) Crash Duration 2 4 2 4 2 6 2 (5) Crash Cost$ 8.000 3.300 3.000 4.000 $47.000 8.080 (6) Possible Reduction N-C 1 2 (7) Cost Slope $280 650 400 100 500 C 0 E F G ° ° 1 1 2 * Normal (or Crash) Costs include those directly attributable to the activity only.Crash Time It would be useful to check the validity of the cost slope formula in the example in Paragraph C. and using Figure 7.000 9.000 5.Appendix 3 Continued In the following example.000 $44. The cost slope gives the rate of increase in cost for decrease in time. Example: PROJECT CRASHING (1) ACTIVITY A B (2) Normal Duration 3 6 2 5 2 7 4 (3) Normal Cost$ 8. it is desirable that the project be completed in nine weeks instead of the normal 12 weeks.280 10. The cost slope is determined from the following formula: Cost Slope = Crash Cost .000 7. This study should yield crash durations and crash costs.Normal Cost Normal Time . In the example. which is a continuation of the example in Paragraph C. a rational choice as to which job can be crashed can be made by shortening the time duration of activities in the critical path with the least cost slope.100 6.000 7. suppose that the 12-week duration is unacceptable.000 8. In this case. This formula assumes a linear and divisible increase in cost for every reduction in time period.400 4.

The cost slope of A is $280. Notice that as one tries to compress further. Alternative 2 is selected as having less additional cost. 67 .C.Crash Time Compute cost slope. in the most economical manner.3.B. Step 1.3. For example.Appendix 3 Continued Step 1.8.Crash Duration Step 1. one can best achieve the first week crashing by reducing Activity A by one week. Cost slope Examp!e. it would be more expensive.3.B. Step 1. cost = $400 Therefore. Step 1. the other activities may lose their slack (causing the critical path to shift).280 .Normal Cost Normal duration . Crash Cost . Alternative 2: Reduce 0 by 1 week. for Activity A: 8.Normal Time . cost = $500 b.2.3. Note: Crashing for the third week is similar to step 1. Compute possible reduction (Column 6) Possible Reduction .3. If it were done in any other way. Alternative L Reduce G by 1 week.000 280 Cost slope = 3 -2 1 = 280 Step 1.1. By looking at the time-phased diagram and the cost slopes. cost = $500 1. it can be achieved by: a. The problem here is how to reduce implementation time from 12 weeks to nine weeks.A. as required. The most economical alternative is to reduce G by one week. The second week crashing is more complicated because there are many ways of achieving it.

F A o B G ~ • 0------4. the overhead and indirect costs are decreased.4 Redraw the time-phased diagram reflecting the crashed durations.2. minimum total project costs are determined by: Total Project Cost Example: Step 2. Least-Cost Analysis In least-cost analysis. direct costs are increased. provisions of bonuses for early completion may also be in effect. as the total project duration is compressed. we are continuing to use the example in Paragraph C and Figure 7).~----c E _. one takes these factors into consideration to find out the optimal least cost duration. the objective is to determine the optimal duration for which total project costs are minimized. In short.J 2 3 4 5 6 7 8 s 2. Generally. some noncritical activities may turn out to be critical.Appendix 3 Continued 2. as one compresses the critical path further. = Direct Cost + Indirect Cost . (that is. Through least-cost analysis. Furthermore.Bonuses 8 . This was previously shown in Step 1.1 Compute cost slopes of crashable activities. Step 1. but as one compresses the total project duration. Likewise.

Note the duration for which the cost is minimum. Reduce Activity G by one week Cost slope = $500/ wk. Step 2. Looking at the TPD and the cost slopes. it would also represent the most expensive way of proceeding with the project.2 •I Identify the most economical way to achieve various completion targets. Usually. Reduce Activity 0 by one week Cost slope = $400/ wk. the most economical way to complete the projects at the indicated target completion are: Target Completion 12 weeks 11 weeks is by: Normal Schedule Reduce Activity A by one week Cost slope = $280/wk. however. Additional Cost Total Direct Cost $44.680 ------------------------------------------------------------------- 9 weeks $500 $45. This is the optimal point 69 . that is. Reduce Activity G by one week Cost slope = $100/wk.780 Week 8 is the maximum CRASH POINT. Reduce Activity G by another week Cost slope = $500/wk.180 8 weeks $600 $45.3 Compute the total project cost for each of the target completion dates.280 10 weeks $400 $44.000 $280 $44.Appendix 3 Continued Step 2. it is the maximum limit for crashing and the project cannot be shortened any further.

* Bonus Provision of $80.Bonuses.120 $49.680 $45.---- Target Completion Supervision Cost" Bonuses 00 Total Project Cost 12 weeks 11 weeks 10 weeks 9 weeks H weeks * Supervision/Indirect $44.610 $5.week for every week earlier than 12 weeks.280 $44.Appen .120 $5.100 $4.000 $44.530 $49.---.620 $49.080 80 160 240 320 $50.780 $6. 50.180 $45.590 $4. Therefore: Total Direct Cost .530.540 Cost is estimated to be $51O!week.000 TOTAL PROJECT COST One can readily see that the least cost is incurred if the project is executed weeks. ' within nine 70 . Continued Recall that Total Project Cost = Total Direct Cost + Indirect Cost .810 $49. The Total Project Cost is $ 49.

Figure 8. Levelingand Scheduling Another application of the network schedule is in the scheduling of manpower and equipment resources..( ·1'" 3X J .~~ ].. f. by using the technique below and Figure 8.. r---· ... The objective of this analysis is to ensure that the adequate number and type of manpower and equipment are known in advance and made available when they are needed.. Let us consider our previous illustration (1) Activity A B (2) (6) Manpower Normal Duration X Equipment ------------~~---Y Z 1 1 3 weeks 6 2 5 3 2 C D 4 5 2 "7 I E F G 3 4 4 Y is analysts: Z is specialized equipment..! Manpower/Equipment . 11 12 ..--~--~ z -. Jet us first determine when the manpower and equipment will be needed. 4 X is technicians: Where Taking the original time-phased diagram of 12 weeks (we could also take the 10-week time-phased diagram)... } 'l Count 9 1. Manpower and Equipment -.-'.Appendix 3 Continued E.-.' r--------~---_J 4 ---~--------.o)----.. 1..~-------~.~-.-.'-' . Example of Resource Management (Figure 7) with its manpower requirements.

a.) than others. Manpower X will be examined first. We can proceed to do resource leveling.D <lJ •. X.e. depending upon the conditions under which the project will be implemented. Y and Z. This analysis will also identify some alternatives. try to make the manpower equipment requirements as constant or as "smooth" as possible. i. and that Manpower Y is more crucial than Equipment Resource Z. assume that Manpower Resource X is more crucial than Manpower Resource y.. more expensive. in this case. We can look at the available manpower and equipment which we currently have and identify resource constraints (and when they will occur). For purposes of illustration.1 Construct a Manpower Loading Chart for Manpower Resource X 8 6 0 x .. several types of information or analyses are possible.Appendix 3 Continued From here on. Manpower and Equipment Leveling Among the types of manpower and equipment needed. 4 E Z :l 2 - ot 0 --~I--_~ _ 2 3 4 5 6 ~ __~I__ --L 7 8 9 ~ 10 ~ __-J 11 12 DURATION 72 . depending on what the project planner considers crucial resources. etc. then Y and finally Z. Step 3. some will be more important (more scarce. and b. Looking at each of these applications in turn: a.

one tries to achieve a constant requirement or a smoothly rising or falling requirement in manpower and equipment Wide variation between the maximum ana the minimum requirements and sharply rising and falling requirements hardly ever happen in the field.•. 0 •. ~·"'. That' 2 3 4 5 6 8 9 10 11 12 ~------------------------~-----.. .J 4 . one ends up with a much "smoother' manpower loading pattern. Q. 4Y \ F A D G . 6 x . .. \ 2X B "'"_ +- .J 5 8 x Y 5 2 5 8 5 4 5 4 2 4 4 4 4 4 4 4 2 By simply shifting activities C and E to the right. By not analyzing manpower and equipment.Appendix Continu Note that there is wide variation in the number of Xs required. This variation is usuall not desired and a constant level of X should be maintained for the duration of the projec. 5 2 Z ~------5 3/4Y ~1--3:-~~~-.J I 4X II I I \ \ . idle equipment and manpower.0 :l Z E 2 0 0 2 3 4 5 6 7 8 9 10 11 1- Although coming up with a perfectly constant requirement doe= revision is certainly much easier to manage. Note that this can be done by shifting the non-critical activities (activities with slack) X-requirements towards the direction of the durations with minimum demand.t seem possible. 73 . the Generally. . one usually ends up with wasted.

0 >- :::J Z ~ . However. '--A 5X.. 8 . 4- 2I I 0 0 .4Y 1( i 3X • -------5 ~O 5 4 1 5 4 1 ~ 5 J 2 4 1 I X Y Z 5 2 5 4 1 4 4 4 4 4 4 4 4 " 1 74 . note that.•.a:q Appendix 3 Continued In this specific illustration after analysis of X.Z / 0 2X B \.. Finally we end up with: 2 3 4 5 6 7 8 F 4Y ·9 10 11 12 r-- \ \ \ 5 .. note the effect of shifting activity B two weeks to the right. The loading of equipment Z may be considered acceptable. The manpower loading chart for Y shows: 8r- 6f- . 9 10 I I 1 2 4 5 6 7 11 12 If we shift Activity F to the right by two weeks. G 4X z c 3X. we proceed to the next priority resource Y.0 E •. 3 I I I . this will result in a perfect leveling of Y at four men.

000 3.66 say $2667.143 1. all the alternatives can actually be costed and a decision made. Again.equipment constraints . d enD 8._----------- 3 6 2 5 2 7 4 8. In making a decision.1_ Compute Cost Per Period. . Determine if finishing the project in 12 weeks is critical. If one uses a least-cost criteria.000 4.000 7.500 1.000 1.000 8.000/3 $2666. Project Finance Planning Project finance planning can also be done based on network scheduling.00 75 . Normally. Others.000 9. Costlp eno d (W ee k) = Normal CostlD uration . F.400 2. Rent or borrow another Equipment Z.250 Step 4.Suppose that only one unit of Equipment Z is available.. For example: Activity A: Cost/p . taking the original 12-weeks time-phased diagram (or any of the modified time-phased diagrams): ------. problems of this nature may be solved by shifting noncritical activities so that activities requiring the same equipment are not scheduled simultaneously. Analysis considering manpower and .667 1.000 2._---------------------_._--------.----------------------------------------------------------(2) (3) (4) (1) Unit Cost (Cost/Period) Duration Normal Cost Activity A B C D E F G . one may consider the following alternatives: Crash Activity B. Note how the technique shows what the alternatives are.000 5.500 1.Appendix 3 Continued 2.

.... bonuses.g l'.000 = 6.2 •..043 The cumulative cost is the running total of the projected expenditures. 76 ---------------- -- -- . "' N .543 = 34.. Cost = 1.143 + 1. Compute periodic costs and cumulative costs.. M :J \l) §~.. For example: For Week 7. '" U . Under actual conditions.• . The planner should make the appropriate modifications. "' .500 + 2. special costs. '" M '" N 0 en . etc .630 + 2....500 = 5. The periodic cost is computed by adding the unit costs of all the activities taking place in a specific week. '" CD M = '" 16 .• '" ... Note the other indirect costs. .Appendix 3 Continued Step 4.667 + 1. Cum.• .2.~O :8 0 :e .. N N '" . .500 + 1..173 The cumulative costs represent the project cash flow. CD •. payment may be made monthly and the cost of supplies and equipment may not actually be paid at the end of the activity. Step 4. Per. some alternative modifications in the schedule can be effected.. '" '" '" •...3. Add up all the costs and note the cash outflow. ~ ~ '" ~ g . it would be instructive to match the cash release schedule and the projected expenditures: Cash shortfalls may be eliminated by shifting the activities so that the cost of the activity is postponed or deferred to a time when the project finance can cover these costs. Cost = 31.. Per... For example: For Week 1.. Cost = 2.. ~ :.... M M N en M N en ~ N N '~ " '" . . 0 0 '" . U 0 CD CD •... . Assume for purpose of illustration that payments will be made on a weekly basis...• 0 :e .400 + 1. .. and the time they occur. one can determine by a cash flow approach whether financing will be a constraint. d B 1500 E 2000 4 1143 • G 1250 --~ • 11 0 0 1400 _JI ______ 5 M ~ " JI 8 9 M 6 M 10 M 12 0 •. Ifthe project involves a fixed cash release schedule developed independently of the project schedule.. If so.667 For Week 4... In project finance planning.

· I APPENDIX 4 PI.ANNING AND CONTROL BY WORK BREAKDOWN STRUCTURE .

The period of work represented by c work package is usually of short-duration. = 2. This breakdown is continued until a work package level is reach at which distinct tasks are small enough for detailed planning. consultants and contractors will be employed. three months or less. such as "training the instructors" in an education project. project organization formulation. This consists of the identification and display.· It is essential that the WBS be established early in the project life. and cost estimates: those resources. formulati :: detailed work plans and establishing estimates of resources required. Tr: WBS is a detailed breakdown of the overall project level into its component parts. therefore are portions of the overall completed project. and establishing schedules for the conduct of the work plans and use of _ resources. consultants. Examples of such milestones are planned project start dates. engineerir:: periods.. 2items required to build the facilities. Ea work element is a complete entity.. See Figure 1 for an illustration of a sam WBS. parts of the constructed facilities portions of the overall effort. e. usually in bar chart forrr. final project network schedule development and resour-ce 7 . but if longer.Appendix PLANNING AND CONTROL BY WORK BREAKDOWN STRUCTURE 1. and assigning functional responsibilities. Concurrent with the development of the WBS is the development of the project mas milestone schedule.. etc.. and commissioning dates. may be brokedown further into plans at the work package level. g. materials. 3. or the contracts required to complete construction of r z facilities. These schedule milestone dates (and constraints) must be distributed :c and known by all project participants engaged in development detailed work. These milestone constraints will opera = to establish start and completion dates of various project subtasks. The WBS defines the project in a structured format via the facilities and . procurement and construction periods. The next phase is formulating the project organization. The work elements. The effort er:compassed by a work package is planned in detail. The WBS works as an effective tool in organizing the work in-logical groupings. resource procurement and usage.e objective. Following detailed planning. This mas schedule provides the schedule framework and boundary constraints with which final sched ing. A standard method for planning a project is the work breakdown structure (WBS). The borrower's s who originally prepare the outline and the concept of the project defines the WBS to a sta_: from which it can be prepared. separate and distinct from all other elements and und the management responsibility of a single person. call work elements. the first phase is the complete definition of a proj and its associated WBS. must be remembered that there are no "approved solutions" for developing a WBS for '" project. therefore. of the broad project tasks that must be accomplished in order to meet the project complctior da.. These schedule co straints will. consisting of z: PMO. contractors. equipment. and work task pia ning must comply. Thus. The WBS structure should reflect on paper as accurately as possible the physi project to be completed. Sample WBSs for several types of other projects are shown in Figure 2 through 4. affect planning on how the various subtasks will be performed an how resources of men.

. 0000 CONTRACT 8501 t:1:~ o. Installat ion . Sit •.A.~ ~ PROJECT X Levell IRRIG."\) o 00 Figure 1.TION Level 2 0100 A Site Clearance 1000 2000 3000 Irrigation . Improvement I H Consuiting Services 4000 I I Project Manager I Works 1100 I Level 3 1200 C Roads and Paths 1300 I E 2100 F Canal Lining 2300 G Pump Equipment B Drainage Ditches Road Surfacing 2310 Procurement . Sample Work Breakdown Structure - Irrigat~n Project n> 0"0 ~"O ~ :s s:: _ ro Q.

Sample Work Breakdown Structure - Agricultural Education Project AGRICUL SECTOR TURE PROJECT EDUCATION I Project Management I Educational Programs Development Building Construction I Equipment 'I Fellowships I Consulting . ~ o.~ .~ ~' I Figure 2.1 r-. =' ~ c ro -. . a n:g o ~. Services I I r VEDCA' Agriculture Sector Schools • Vocational Education Development Center for Agriculture I Procu rement I I nstallat ion eQ..

t\.) Sample Work Breakdown Structure - Irrigation Project n> 0'0 tt(\) ::3 ::3'0 0000 FIRST IRRIGATION SECTOR PROJECT SQ.(il fFigure 3. CJ:. o.. Works 014000 I 015000 I Preparatory Works Pilot Demonstration Tanks Consulting Services 013100 I 013200 Construction 013300 Canal Structures 013400 Service Roads 013500 I 013600 1 Diversion Works On-Farm Facil ities Drainage Facilities 013410 Sitework 013420 Roadway Construction 013430 I Surfacing .~ \\I •• :s ~ 010000 Core Project 02‫00סס‬ Sub Projects 03‫00סס‬ I Project Management 010100 I 011000 Procurement of EQuipment 012000 Project Facilities 013000 Civil.

Wf-··- " ample Work Breakdown Structure Urban Development Project Figure 4. 'C n~ o ~ C ~ ::l = C:c.. 0000 rI I l::l '. ::l _ >< ~ ~~ .JRSAN ' F -E""t~OPMH -RAM PRO~--.-J I .

This final project master schedule then becomes a tool for use in reporting project status. While it is undesirable that the management of a project should be encumbered with too many work packages. A sample project master schedule is illustrated in Figure 5. the project manager should IV)t be constrained from subdividing work in areas that are complex. Work packages ore discrete elements or units of work ilt Ihe level where work is performed. or otherwise critical to project SI1CCCSS. Additionally. Establish assignment of responsibilities for all identified effort to specific orqanizations and organizational elements. A key issue in constructing a WBS for a project is the depth to which the WBS should be extended. Check that WBS provides for local subdivision of all project work. while routine. with others added as needed.though if longer may be broken down further into activities. 2. 7. 5 6. Limit WBS development to subdivision of work to the work package level. resulting in final subdivisions that are too small in some cases and too large in others. Check proposed WBS against the reporting requirements of the organizations involved. A work package is assigned to a single individual or contractor as that individual's or contractor's responsibility for accomplishment. compatibility and continuity. or because of insistence on a uniform number of subdivisions for all tasks. if that is desired. The effort represented by a work package is clearlv distinguishable from effort in any other work package.three months or less -. 5. the project master schedule milestones and task durations are adjusted. Two principles are particularly important and bear repeating: (1) each part of the WBS should be subdivided to the number of levels useful for managing the project: and (2) no effort should be made to extend the WBS to the same number of levels for all project tasks. 4. performance and trends to higher authorities. Check proposed WBS and planned efforts for completeness. it should be possible to construct a schedule or a network for a WBS task. These activities within a work packaqe would then be of relatively short duration and could be sequenced for . Some criteria generally applicable to subdividing tasks provide that it should not be difficult to understand what the WBS task is. . 3. creating an unproductive administrative burden. 4. The effort encompassed by a work package is planned in detail. Subdivide total effort into discrete and logical sub-elements. project managers and planners should: 1. repetitive work should not be excessively subdivided. nor should lowest-level WBS tasks involve excessively small costs. The period of work presented by a work package is usually of short duration . A large percentage of the problems experienced with the WBS device have occurred because of the tendency often to break the WBS down into too many subdivisions. high-risk. Determine that WBS satisfies both functional and project requirements. In developing a WBS. Detailed project planning and assiqnmcnt of responsibilities for planning and rnanaqcment are perlorrned at the work package level.Appendix 4 Continued usage determinations.

Q.--_._'--. - Consulting Engineering I Complete Detailed Design I - Project Management n:g o ~ ::3 c:t. ::3 _ ~ = CJ1 00 ro .po 0 c: ~ . Sample Project Master Schedule IRRIGATION PROJECT X MASTER SCHEDULE Schedule (Months) TASKS 1 I 2 I I I I I I I I 3 4 5 6 7 8 9 10\ 11 I 12 A - Site Clearance I I Y B - Drainage Ditches y I I I Complete Drainage Ditches C - Roads and Patches l D Canals and Flow Structures E Road Surfacing I I Y Complete' Roads Complete Project ~..----_. F Canal Lining Complete Pump Procurement G Q - Pump Equipment I \J H.-----~ " Figure 5. .

The WBS dictionary also provides the basis for work descriptions appiicable to each responsible organization. The reader should note that the dictionary description for the WBS element "Piping. The functional manager may have to adjust the work plans and resources to accomplish any required overall work package schedule. or other measurable units. The purpose of the WBS dictionary is to have all project work adequately described so that there is no misunderstanding between the Project Manager and the responsible functional manager about what the work clement includes. to be included in the WBS dictionary.}. the work package functional manager proceeds to develop a work plan that displays how the job will be done. schedules and schedule sequences. procurement or construction). budgets and schedules will be estimated. A sample WBS dictionary item is shown in Figure 6. should have a written description. The functional manager will have to plan under budgetary constraints as well. man-hours.labor. what the material for the item consists of. the preparation of detailed work plans for some portions of a project may have to be delayed until later in the implementation phase. such as in Figure 6. what functions are included in the item (e. 86 . In some instances. This integrates budgets and schedules. in terms of monetary value (dollars. a consultant. Short durations for work packages facilitate objective measurement of work. equipment . 7. and. The functional manager must ensure that the final schedule for the work package falls within any critical milestones imposed by the project master milestone schedule and as included in the contract agreement. and balance the parameters of work effort. materials. where needed for clarity. Budgets are assigned to the work packages or activities within a work package as appropriate. etc. The functional manager determines the activities within the work package. schedules and budgets as best can be done. In these instances.Appendix 4 Continued scheduling purposes by a network diagram. Detailed planning at the work package level is done by the functional manager responsible for that packaqe.required to perform the work. a supplier. when more definite or accurate information will be known for planning purposes. A WBS dictionary is generated as an attachment to a WBS to define each element. Each WBS element down to the work package level. or a construction contractor. assigned and held at higher levels of the WBS until such time as the subordinate-level work packages may be assigned for planning in detail. yen.g." shown in Figure 6.. 6. Work packages are then scheduled in order of precedence for the project by an overall project network diagram. fully explains what the item is and where it fits into the project. Budgets and schedules are then developed and verified as falling within the originally alloted budgets and schedules. This dictionary provides a disciplined method for assuring that all work is included in the WBS and that each element is exclusive of all others. Working within a general schedule duration and budget given by the next-level manager to whom the functional manager reports or as contained in the contract bid price. what items are not included in this work element. and the costs of the various resources . design. The functional manager may be a member of the PMO staff.

Appendix Continu -

Figure 6.

Sample Work Breakdown Structure

Element Dictionary Description

Piping The piping components element refers to all system piping in this plot area regardless whether the piping is for a utility or process system. Both aboveground and underground piping are included. Aboveground piping may be broken down at the ne: WBS element level, by piping block or groupings of piping blocks (batch Ref. No. depending on the number of categories of blocks that are best for internal rnanaqerner.; control of the work. Types of piping materials.include carbon steel, stainless steel, allo tile, concrete, and other non-metallic piping, as well as piping supports. Abovegroun piping includes the following systems: cracking .and quench, gas compression antreating, propylene refrigeration, ethylene refrigeration, flare, stem distribution/water treating, fuel supply, instrument air, and cooling water. Underground piping includes the fire. sewer and cooling water systems. The work for ·aboveground piping encompasses detailed design from routing and planning studies through completion of the bill 0: material and vendor print checks. It also encompasses the vendor providing piping materials and all assembly work starting with prefabrication and ending with final chec of each of the system lines. The work for underground piping encompasses all assembly work starting with installation of the piping and ending with the final check of each of the system lines. 8. The Project Manager, in developing a WBS for planning and control, should conside establishing a coding structure to be assigned to each element of the WBS. Such a coding structure is shown in Figures 1, 3 and 4. The purpose of this structure is to provide a mean for easily referring to the work element for management or administrative control purposes. The key to the usefulness of the coding structure is to assign a unique number to each element, a number which will essentially not change for the duration of the project. The system for developing this coding structure is to assign a particular number as a basic number to each of the upper-level elements of the breakdown structure and to alter .tha number to the extent of changing certain digits or adding additional digits to the element's basic number when assigning numbers to the lower level subtasks of the element. For an example, Figure 3 illustrates a work element coding system down to the work package level for "Service Roads" and assigns code number 013400 to that work element. These numbers are used for management control purposes. Other numbers can be added to each of these WBS numbers either on the front end of these numbers for administrative' control purposes or on the rear of these numbers for resource usage control. 9. As an example only (there is no specific way to develop coding system of 14 positions that may ing sketch depicts ment application to planning and control of projects. Under tions are administrative and used to designate the contract

a

a coding structure), the followbe useful for project managethis system, the first nine posinumber, management control 87

Appendix 4 Continued

areas and special (for example, administrative control) requirements. The last five positions comprise the code of accounts which define work tasks, resource usage and schedule activities for management control. [1]-[2]-[3]-[ 4]-[5 ]-(6]-[7]-[8]-[9]-[10]-[11]-[12]-[13]-[ 14] Administrative To further explain these positions: 1. 2. Positions 1 through 4 may be used to designate the contract number. Complete cost reports (summary or detailed) can be produced for each contract. Positions 5 and 6 are used to identify control areas of the project, such as different portions of the project scattered geographically over a large area, or portions of the project that are distinctly different in character from each other. Positions 7, 8, and 9 are available for special uses (perhaps administrative uses), e.g., to collect costs of vendor backcharges, claims, change orders, etc. Positions 10, 11, 12, and 13 are code numbers that may be applied to all project components, work elements and sub-elements down to work packages, to identify the individual components and elements of the project. Position 14 is the indicator position designating the classification of resources (costs, man-hours, etc.) being reported. For example, Indicator I might be material, Indicator 2 labor, Indicator 3 subcontract, etc. Code of Accounts

3. 4.

5.

10. To illustrate the use of this 14-position coding system: the work package "Surfacing of Service.Roads" in Figure 3 bears the code of accounts number 013430. The portion of this number shown as 01 has been used to designate the control area (Positions 5 and 6), that is, it is a part of the "Core Project" and not "Subprojects." The numbers 3430 are used for Positions 10 through 13. If one wished to code labor costs for this work package, the number 013430-2 would be used on all man-hours time cards of personnel working on this task (the number "2" is used for Position 14). If one wished to open a change order file for this work package, an administrative control number of 8501-01-100-3430 might be used, where 8501 is the contract number (Positions 1 through 4) where the number series 01 is used for Positions 5 and 6, where the number series 100 is arbitrarily used for a change order file number for this work package (101, 102, etc., would be the successive change order file numbers) and where 3430 is the code of accounts number. If one wished to assign a purchase order number to an order for pilot demonstration tanks, the number used might be 8501-01-200-4000, where the number series 200 is arbitrarily used for purchase orders (201 would be the next purchase order number, etc.). For a labor time charge number to be used by the PMO staff engaged in the procurement of equipment, the code of accounts number under this system would be 011000-2. 88

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APPENDIX 5

PROJECT MANAGEMENT OFFICE STAFF FUNCTIONS

c Appendix 5 PROJECT MANAGEMENTOFFICE STAFF FUNCTIONS The following are sample staff position functional descriptions for a project managemen office (PMO) organization. The Project Construction Manager is responsible for the preparations for and conduct of project commissioning and turnover to the user(s) and coordinates this latter activity closely with the Project Engineering Manager.The Project Construction Manager is responsible for the management and quality of performance for the construction of works and installation of equipment into the works in the field. Deputy Project Manager . Project Manager . Some positions may be omitted or functions described below may be combined and assigned to a single individual.". may operate as the Project Control Manager. may be assigned the added functions of the Project TechnicalManager. approval action regarding shop . For example. the DPM may supervise all the PMO functions under the Projec . Project Engineering Manager . drawings and field engineering changes. Depending on background and expertise. and project administration. or may closely supervise all the functions 'under the manager. miscellaneous purchases of equipment and supplies for the PMO. The Project Technical Manager supervises quality control/quality assurance activities and supervises the performance of the Project Engineering Manager and the Project Construction Manager. Project Construction Manager . including the quality of management and the contract deliverables from consulting engineers and other technical engineering consultants.The DPM performs the functions of the Project Manager when the latter is absent.The Project Manager is totally responsible for the management and technical performance of the project. Technical Manager.The Project Engineering Manager is responsible for supervising the performance of all technical engineering work done for the project. I ( ( 91 c . The Project Technical Manager also reviews the quality of the technical specifications contained in all tender documents for goods and services. the DPM assists the Project Manager by controlling the activities of designated functional managers within the PMO. These functions include project cost/schedule analysis and control and performance measurement. Project Technical Manager . including procurement of goods and services for the project.The Project Technical Manager is directly responsible to the Project Manager for the quality of technical performance throughout the project. Project Control Manager . project cost accounting. construction/installation contract documents. Specific technical areas of concern are technical specifications. project procurement.The Project Control Manager is reponsible to the Project Manager for the business and project management control functions within the PMO. etc.

including procurement of consultant services. billings.). an account ledger. and prepares the annual project financial statement for auditing. etc. The PMO Office Manager operates under the management control of the Project Manager and administrative supervision of the Project Administration . Project Accountant . dispatch and maintenance of office vehicles. equipment and services (utilities. etc.The Project Administration Manager is responsible to the Project Control Manager for the administration of project records. change order/contract modification. performance of office secretaries and other services staff. contract administration files. commitments.The PMO Office Manager is responsible for the day-to-day operations for the office. and PMO office management. project report generation and dissemination. supplies and services for the PMO.The Project Procurement Manager is responsible to the Project Control Manager for all project procurement. including data management for project cost/scheduling reporting from contractors.The Project Cost Specialist is responsible.The Project Accountant is responsible to the Project Control Manager for the recording and reporting of project costs and for the performance of such project business matters as invoice payments. PMO Office Manager .The Project Scheduling Specialist is responsible to the Project Control Manager for formulating and updating project schedules and for analysis and control recommendations concerning project scheduling and progress. record keeping. including a cash disbursement book. and contractor services and goods (equipment and materials) and is responsible for the purchase of equipment. security. Project Scheduling Specialist . files and correspondence. administration control procedures.Appendix 5 Continued Project Procurement Manager . and a journal. to the Project Control Manager for project cost estimating and budget development and for analysis and control recommendations concerning project costs and performance. Project Cost Specialist .Manager. including keeping records of PMO staff time sheets. construction/installation. fulfilling needs for office purchases of supplies. custodial. Project Administration Manager. The Project Accountant maintains the project accounts. 92 . etc.

.APPENDIX 6 SYSTEM FOR PROJECT COST ACCOUNTING AND AUDITI .

Account ledger . In essence. 3. Bank and other agen _ funds (i. the total investment in the project). Entries made in the journal (and then posted: the accounts) are identified as to date. the Bank requires assurance that the project accounting system will provide complete. Journal .Appendix 6 SYSTEM FOR PROJECT COST ACCOUNTING AND AUDITING 1. 2. There should exist some notation in the cash book as to final account destination of each payment. amount. local etc. In addition. such as reclassifications and adjustments. The project accounts should be organized by the ultimate destinetion of payments (component and category) and. timely and accurate recording of project accounting data and that a doc -. The minimum requirement generally includes for each fiscal year a sched ~ (by project component and category) of the expenditures of local. Cash disbursement book . and to aid in evaluating project progress. mentation trail will exist from the reports generated for the Bank back to the original boo ~ of account and transaction documents. together with loan disbursernen. -.project expenditures that are financed under tha direct payment and commitment procedures. more frequently. this is a check register with additioncolumns to spread the accounting for the payment among the various official memo accounts in use. The Bank will stipulate at the outset the timing of the statements. summary basis. 2. IFAD.From the amounts in the cash book.Records details of withdraw applications submitted to the various agencies under the different types of disbursement procedures and by project component and category and the disbursements thereunder. The Bank includes in its loan agreements a covenant that requires borrowers to mai tain appropriate accounts and to annually submit audited financial reports to the Bank Perio -and properly prepared statements of project expenditures. on a month'. accounts and reports to be submitted. and identity of payee for cash and check disbursements.A journal is an accounting record for non-cash transactions. are meant to provide a level of assurance that the Bank's funds are bei _ used for their intended purposes. This would facilitate monitoring the status of disbursements by Proje Managers. 4.. Specifically. An additional report section that presents the . Withdrawal application memorandum register .e. entries to the account ledgers may be posted on an item-by-item basis. amounts. within accounts. be seqrcgatec by funds source (ADB. it will constitute a record of project expenditures that are n : recorded in the cash book . Effective reports may also provide a basis for post evaluation and be a source of data in designing future pr _ ects. The most basic system of accounting that will be a propriate for the administration of Bank-financed projects will include the following elemen 1. documentation.Records date.) so that report preparation is a relative_ simple process. or. and accounts affected. and usu include short narrative description of the transaction.

The financial report sections submitted to the Bank should be accompanied by a report of the auditor that indicates that these report sections have been examined in all material aspects and are considered to present fairly the expenditures on the project.Appendix 6 Continued total commitments to date (whether or not yet expended) is recommended. provided that the reporting needs are precisely defined at the onset. The actual report may take many forms. the financial report sections will then use the same or similar project component categories. Generally. The concepts and practices of audit vary significantly throughout the region. . In defining the report content. but it is necessary that the auditor expresses an opinion that indicates an independent look at the various report sections has been taken and that the underlying detail has been sufficiently tested to indicate that the report sections are materially correct. A summary project status report (with measurement in physical units) should be firstdesigned. 3. The accounting system can be set up later to facilitate report generation. it is imperative that the report categories for the final results and physical completion status materially agree. audit that are conducted by an independent government agency include an evaluation of internal accounting controls. The reports submitted to the Bank should be audited by the Auditor General's office (or a similar independent agency) of the borrower to ensure the greatest level of auditor independence. in the case of Bank-financed projects.

APPENDIX 7 PROJECT RECORDS AND FILES .

12. 11. 8. and purchase orders for equipment and materials. q L-. 99 . Cost expenditure and commitment records Budget expenditure records Performance measurement records Funds disbursement records Manpower expenditure records Project progress reports from consultants. 2. " I . The following is a recommended listing of project records to be maintained in the P C files for the duration of the project implementation period: A. 4. suppliers and other contractors. 1. 3. 6. 5. PMO staff meetings with consultants. Project Manager work authorization in the form of memoranda to the PMO key managers. Project planning documents 1. suppliers and construction/installation contractors Technical (quality) inspection records Consultant agreements Construction/installation contracts Procurement records for goods and services Change order and contract modifications records Minutes of project meetings . 10. 6. Project work breakdown structure Project master milestone schedule Organization and task responsibility matrjx Project network schedule Project budget Project financial management plans Code of accounts Project procedures manual Project authorization documents 1. 3. B. 4.internal PMO staff meetings. 3.Appendix PROJECT RECORDS AND FILES 1. 9. letters of notice to proceed to consultants and other contractors. Project control documents (and data and correspondence relating thereto). 7. Loan/project agreements Loan effectiveness date letter from the Bank Master work authorization from the executing agency in the form of a notice of funding and disbursement authorization for the project. 5. 8. C. 4. 2. and Project Manager meetings with higher authorities and with Bank staff.

Quarterly progress reports (if applicable) Semiannual status reports (if applicable) Annual reports (if applicable) Emergency spot reports Technical reports (if applicable) Project completion report 2. approved shop drawings.. B. spares and special fuels and lubricants. 5. 4. 3. other agencies and indivi. questions and responses. Records of operations and maintenance training. purchase in the PMO order and contract. Monthly progress reports of Project Manager Bank and other project donors. 8. Contract bonds and insurance certificates. Contract deliverables records. warranties. 3. payment of travel expenses and payment of other authorized expenses. The following is a listing of project administrative records to be maintained files for the duration of the project implementation period: A. includ- 7. Personnel records of PMO staff. (and data relating thereto) to higher authorities and to the 7. complaints. Records of inspections and tests. including final drawings. payment of utilities and office rental. Correspondence files between PMO and higher authorities. 6.Appendix 7 Continued D. if applicable. Correspondence between the PMO and the consultants/contractors relating to contractual matters. equipment. and dispatch E. 4. 2. drivers listings. files for each agreement. 2. Project Manager directives to the consultants/contractors. PMO records of expenditures such as purchase of office supplies and equipment. 5. 6. spare parts lists and records of delivery of special tools. equipment operations and maintenance instructions. C. Notices from contractors of potential claims and disputes. including assigned and maintenance records. D. e. duals and the Bank and other donors. Project reporting documents 1. Partial payment requests from the consultants/contractors. 100 ------- -- - . Contract administration ing: 1. Vehicles records for project vehicles. etc.g. materials certificates of compliance.

APPENDIX 8 SUGGESTED OUTLINE FOR A PROJECT PROCEDURES MANUAL .

2 1.4 2. list all responsible PMO position titles ar.2 2. list names of key PMO staff. General (with introduction 1. network schedule. by nama address. Program Management 3.4 -. change order control. numbers.1 Personnel staffing assignments the project.0 ~ r- R eporting requirements 103 . and task responsibility matrix. etc. describe functions.2 General Planning . location and any identifying num to distinguish these from other projects.1 3. with telephone.1.1 1.identification of all organizational participants.. Projection identification .5 Travel Changes in status promotions.project name.3 to manual) Objectives of the project. Personnel 2. Hours of work. budget. code of accounts. description of how personnel are assigned tc 2. Relocation procedures and requirements for project staff. 3.Appen SUGGESTED OUTLINE FOR A PROJECT PROCEDURES MANUAL 1. cable and re. Project organization . and responsible manager's name.performance corrective action. as applicable. master schedules.::.WBS. 3. Work authorizations Control .4 2. Description and scope of the project. meetings. 1. measurements.3 3.3 2. and the functional responsibilities of the organiza ioc include organizational charts here.

3 6. Correspondence Control 5. equipment and supplies.4 6.1 4.2 Correspondence Correspondence handling procedures tracking procedures.2 Procurement of services procedures.Appendix 8 Continued 4. Procurement of materials. 6. Procurement 4. 5. incoming/outgoing.2 6.5 Scope Procedure general Incoming material Outgoing material Project file ) 104 . Document Control 6.1 5.1 6.

APPENDIX 9 PROCEDURES FOR SELECTION OF CONSULTANTS .

Prepare invitation documents. or comments about. and d. invitation documents consultant contract to Bank for concurrence. 4. During Loan Negotiations 7. 6. 9. Procedures for the Selection During Project Appraisal Period 1. write the first ranked negotiations. Use standard contract provided by appraise 3. firm for face-to -Iace 11. 12. the above. of Consulting Firms Finalize scope of work and terms of reference for consultants. evaluation criteria. Request a copy of standard invitation le-:from the appraisal mission. 5. After Project is Approved 10. background info mation and terms of reference. 107 . Sixty days should be giIJP to the firms for submission of proposals. deadline. Receive Bank's concurrence Revise the documents with. Submit short-list of firms.Appe PROCEDURES FOR SELECTION OF CONSULTANTS The following information supplement those found in the Bank publication "Guide on the Uses of Consultants by the Asian Development Bank and Its Borrowers" re~procedures for the selection of consulting firms and individual consultants.ef: 8. Gather information on qualifications of firms. by incorporating by the Bank Bank's comments. Prepare a short-list of firms and evaluation criteria. A. Request Bank assistance if needed. including letter of invitation. A long-list of firms will be g: _ by the Bank appraisal mission if so requested by the borrower. Prepare draft consultant mission. contract. Issue invitation documents to the short-listed firms. 2. Evaluate proposals without delay after the submission After evaluation of proposals. Prepare a long-list of firms.

Appendix 9 Continued

13.

Upon completion of negotiations, send draft negotiated contract to the Bank together with the breakdown of billing rate, breakdown of social charges and overheads. Receive Bank's approval/comments. Revise the contract by incorporating Bank's ccmments. Sign contract with the consultants. Send signed contract to the Bank. Advise all other unsuccessful firms on the selection, giving the name of the selected firm and in case a two-envelope system was used, return unopened all envelopes containing the financial proposals.

14. 15.
116.

17. 18.

After the Loan has been Declared Effective 19. 20.
B.

Give notice to proceed with the work to the selected firm. Provide copy of notice to the Bank. Give notice to proceed with the work to the selected firm. Provide copy of.notice to the Bank.

Procedures for the Selection of Individual Consultants 1. 2. 3. 4. 5. 6. 7. 8. Prepare a long-list of consultants. Bank is prepared to provide a long-list of consultants if requested. Finalize the short-list and rank the candidates in order of preference on the basis of their qualifications and experience. Submit short-list to the Bank for concurrence together with the terms of reference. Upon receiving the Bank's concurrence, inquire about consultants' interest in and availability for the assignment, using Bank's standard letter. Negotiate financial terms with the highest-ranked and available candidate. Send draft negotiated contract to the Bank for approval, using Bank's standard contract. Upon receipt of Bank's approval, sign contract with the selected candidate. Send a required number of copies of the signed contract to the Bank.

108

Append"

Continuec

9. 10.

Give notice to proceed with the work to the consultant. Advise all other unsuccessful candidates of the selection.

109

.~~
~--:-------

)
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APPENDIX 10 PROCEDURES FOR PROCUREMENT OF GOODS AND WORKS

j

(ii) a summary and evaluaiion of the bids. as necessary. of the substantially responsive bids and 6. and pro forma performance guarantee. pro forma bid bond. if applicable. if required. such sizes as to attract international competition. the same time. instructions and conditions for tendering. 4. send a copy of the invitation to bid to local representatives of th Bank's member countries based on a list of addresses provided by the Bank. of goods and civil works un C are 2. bill of quantities. List the goods to be procured and group them into suitable contract packages . together with the consultants' recommendations. After bid opening. technical specifications. 3. Compare the bid prices. examine the bids to determine compliance with the tendering conditions and instructions and responsiveness to the technical specifications. Th Bank will also arrange to have a specific procurement notice published ir Development Business. 7. which generally consist of the following: invi bid. 5. Submit to the Bank (i) an account of the public opening of the bids. Prepare tion to (general dule of draft tender documents. At the time set for the opening of bids. The proposed award of contract should be made to the lowest evaluated bidder. conditions of contra and special). advertise the invitation bid in an English newspaper of general circulation in the borrowing country. (iii) the proposal for award.Appendix PROCEDURES FOR PROCUREMENT OF GOODS AND WORKS The following procedures apply to the procurement international competitive bidding procedure. as adjusted. 6. After obtaining Bank approval of the tender documents. Procurement of Goods 1. Representatives of bidders attending the bid opening should be requested to sign the record of bid opening. A. Provide at least 60 days for the submission of bids. 4. 2. select the lowest evaluated bid. 3. terms and conditions laid out in the bidding documents. 5. Adjustments should be made in the bid prices. the bids should be opened in public and the bid prices (including for alternative bids and discounts offered) should be read aloud and recorded in the minutes of public opening. and (v) a certificate of eligibility of the goods. (iv) draft contract if such draft differs substantially with the draft previously approved by the Bank. The substantially responsive bids will then be evaluated in accordance with the methods. 113 _ 4 . pro forma scheprices.

Prepare prequalification documents. location. advertise the invitation to prequalify in an English language newspaper of general circulation in the borrowing country. 4. Contracting of Civil Works In most civil works contracts. 6. . 5. The procedures are as follows: 1. which consist of the prequalification invitation. background information describing the project. The tender documents should be approved by the Bank before issue as in the case of procurement of goods. prequalifications of contractors is required before bids are invited. Allow at least 90 days for the submission of bids. Only the contractors who have been prequalified will be invited to submit bids. Submit three copies of the contract signed to the Bank. the bids should be opened in public and the bid prices (including for alternative bids and discounts offered) should be read aloud and recorded in the minutes of public opening. Evaluate the prequalification applications received based on the prequalification methodology and criteria agreed upon with the Bank. After obtaining the Bank's approval of the list of prequalified firms send invitations to bid to all the pre qualified contractors. The proposed prequalification methodology and criteria should not be included in the documents to be provided to applicants for prequalification. where applicable). and proposed prequalification methodology and criteria. and scope of contract and other relevant data.ppendix 10 ntinued 8. 3. send a copy of the invitation to bid to local representatives of the Bank's member countries based on a list of addresses provided by the Bank. (il) a summary and evaluation of the applications. prequalification questionnaire. submit to the Bank (i) a list of the applicants for prequalification. At the time set for the opening of bids. Allow at least 60 days for the submission of prequalification proposals. Representatives of bidders attending the bid opcninq should be requested to sign the record of bid opening. 2. and [iii) list of contractors proposed to be prequalified (together with the consultant's recommendations. negotiate and award the contract. After evaluation has been completed. After obtaining Bank approval of the draft prequalification documents. The Bank will also arrange to have a specific procurement notice published in Development Business. At the same time. After obtaining the Bank's approval.

Appendix 10 Continued 7. The substantially responsive bids will then be evaluated in accordance with the methods. After obtaining the Bank's approval. Submit three copies of the contract signed to the Bank. Compare the bid prices. as adjusted. 115 . 9. 10. together with the consultants' recommendations. as necessary. negotiate and award the contract. Adjustments should be made in the bid prices. (iv) draft contract if such draf differs substantially from the draft previously approved by the Bank. responsive bids and 8. of the substantially select the lowest evaluated bid. The proposed award of contract should be made to the lowest evaluated bidder. if required. Submit to the Bank: (i) an account of the public opening of the bids. terms and conditions laid out in the bidding documents. After bid opening. and (v) a certificate of eligibility of the goods. if applicable. examine the bids to determine compliance with the tendering conditions and instructions and responsiveness to the technical specifications. [ii) a summary and evaluation of the bids. (iii) the proposal for award.

APPENDIX 11 CHANGE ORDER REQUEST FORM .

. labor and material.go.-----I-----------------~ Signature Signature . Submit your proposal in space indicated on page 2. DESCRIPTION OF CHANGE: Pursuant to the clause of this contract entitled..caHon h. "Modification Proposals -. l=~~-:. ISSUING OFFICE 2.-. j I 119 ' . "Changes".. mod. .. (see the clause of this contract entitled. and attach detailed breakdown of prime and subcontract costs. all terms and conditions of said contract as heretofore modified remain unchanged and in full force and effect.. TO (CONTRACTOR) 5.a . AND ACCEPTANCE 3. A proposal is requested for making the hereinafter described change in accordance with specification and drawing revisions cited herein or listed in attachment hereto. PROJECT LOCATION AND DESCRIPTION ---------------------------------~---------------------------------------------6.f.Appendix CHANGE ORDER REQUEST FORM CONTRACT MODIFICATION PROPOSAL 1. Date Typed Name and Title Signature L-. and perform all work necessary to accomplish the following described work: 'II Except as hereby modified. the contractor shall furnish all plant. MODIFICATION NO_ 4..ng I i j (Executing Agency) CONTRACTOR ~----------------------1 ! I BY --.--------------------... CONTRACT NO.«by ""pted.Price Breakdown") DO NOT start work under this proposed change until you receive a copy signed by the Contracting Officer or a directive to proceed.nd I--~~D-d-te---·-----T-y-p-e-d-N-a-m-e-a-n-d--T-it-Ie--------~--D-a-t-e-------T-y-p-e-d-N-a--m' T~..----------------------------------------------------------- I 7.

APPENDIX 12 TOOLS AND TECHNIQUES FOR PROJECT COST AND SCHEDULE CONTROL .

Tasks displayed as a time-phased network diagram showing individual task costs with each activity as indicated in Figure 2. sequence of schedules and costs for each of the activities comprising the task (or for the task itself if the task does not lend itself to further subdivision into activities). If necessary or desired. materials and equipment resources required to perform the activities or task. costs and budgets. a responsible member of a project participating agency. a task plan may be represented as in Figure 1. Next. a supplier. a consultant. That individual may be the borrower's Project Manager. Once finalized. This procedure is followed for all project tasks. for example.. The total cost for Task C over the time interval X to Y is $4. Roads and Paths. Costs are computed from the costs of labor. etc. This discussion refer to a hypothetical project. which is then distributed back down to the tasks for control purposes. trends in progress and costs.000. This appendix discusses detailed procedures for establishing and employing a system 0 record and tract project progress (schedules). whose WBS is shown in Figure L Appendix 4.£. It should be noted at this point that only the time interval (schedule) for Task C has been determined and that interval has not yet been fixed in terms of calendar dates. and estimates at completion. In the case of the work element Task C.Appendix 1 TOOLS AND TECHNIQUES FOR PROJECT COST AND SCHEDULE CONTROL 1. establishing schedules. 2. Costs (budgets) are computed for each of the activities such that the task itself is a summation ot these activities. These assignments determine the overall project organization. It is extremely important that neither these budget estimates nor these schedules be changed except by authorized change orders (variation orders) and contract modifications. • _. Irrigation Project X. Costs of the various tasks are summarized to higher WBS levels to develop the overall project budget. estimates. least-cost analysis. The cost is thus integrated with the schedule for Task C. tasks are sequenced into an overall (CPMIPERT) network schedule. The project network and the overall schedule critical path is determined and the overall schedule analyzed to see that it meets project milestone constraints.- --9 • These i 123 124 . The individual responsible for his work element (task) plans the task in detail. This total time interval can be presented by a single bar time span with other project tasks on a project bar chart. 3. a member of the project management staff. by careful precedence determinations for these tasks. the network schedule in Figure 2 may be revised using such techniques as project crashing. The total time interval for Task C in Figure 1 is the time distance from X to Y. variances from origina. or a construction contractor. resulting in costs integrated with schedules for each task. 4. Each of the blocks is a work element and each of these work elements has an individual responsible for the completion of that element. the CPMiPERT network schedule becomes an integrated budget (costl/schedule project baseline aqamst which project status determinations and performance measurements are made for project monitoring. The cost of each of the network activities has been determined previously.

-:-.----------) lor subcontract/contract .000) \ Dll0. Right of Way IROW) Clearance x V.Appendix 12 Continued Figure 1.If a subcontractor price is used in place of L +M+E.000) / __J . .000) . ~ - \ HI8. I I ••. Project x Time-Phased Schedule Months .A!3.000) E 12 OOO! I _-------••...200 $800 $ $ L+M+E L+M+E lor S/C)' 10rS/C) 2.-. ACTIVITY Task Plan for Task C SCHEDULE AND COST 1. Sub-base Course and Base Construct ion .0001 \\ \\ \ \ '--0-------------\ ~_~ \ FI18. his contract or Figure 2. $1..(l ------•• 816.000 Y Y $ L+M+E lor SIC) • L +M+E lor SIC) = Labor + Equipment + Materials contractor is used to perform the task. ROW Subgrade Improvement I 3.) $2.-------4~>-------~:::>-.- [-------.OOO)· ' I G (8 ..• Tbese are to tat cos t s Ibudqe t estimates) tor each activity 24 .OOOl e'l.

000 + 8. AVWP at any point does not necessarily correlate with cash flow. For purposes of this example. the blackened portion of the bars in the above figure. i.000) + 1.000 + 8. As indicated on this bar chart..000 = 68.000 + 8.000 + 2.000 + 12.000 + 10. costs and technicz. as the sum of the budgeted values of all project activities as scheduled to be completed. project status determination and performance measurement techniques. This subsection discusses how project status is determined and how project pertermance is measured in terms of cost/schedule variations and trends from those estimated a :.e . equal to the total project costs. It does not include expenditu. The primary purposes for these actions are to be able to identify immediately any problems as they occur and to corre these problems in time to avoid adverse effects on project schedules. This totals' BVWS (tot) = 3. projec status and performance to date at the end of the 4th month will be determined.0()O 125 126 . This is the actual value of all items expended i doing the portions of the work as completed up through Month 4.000 + 6.expenditures and costs of materials. Compute the actual value of the work performed (AVWP) in dollars or other currency up through Month 4. performance.Appendix 1 Continu 5. The bar char: schedule for Irrigation Project X is shown in Figure 3. equipment and construe tion equipment-hours expended in performing completed work. though it is not necessary when the time phased netwo schedule diagram is used.000 lS.000 + 1/5 (10. Compute the total amount of the budgeted value of work scheduled (BVWS) ir: dollars (or other currency).000 + 4.000 + 2. These are the steps: 1.000 + 4112 (12. It has nothing to do with budgeted ua/ues or estimated ualues of blackened portions of the bars in Figure 3.000 + 2/6 (6. for items obtained early but not yet included in completed work. Information for AVWP comes from the project administration and cost control staff based on records of man hour. 4 reporting line. let us say that AVWP reported for the various tasks are: AVWP Task A B H I Amount = 4.000 3.000 2.000) + 8. to display the project schedule in bar chart form in order to appr.000 + 18.000) = 21. It does include items put into the completed work but which will be paid for later. This becomes: BViNS = 2.re . It may be helpful. reported periodically throughout the life of the project.000) + 1/9 (18.000 + 1. Compute the BVWS at the end of Month 4 in dollars or other currency as the total of all the budgeted values of the scheduled project activities to the left of the Mont. In other words.

0001 7 I 8 I I 9 I 10 I 11 I 12 o.000) G 2300 Pump Equipment H 3000 Consulting Engineering (12.. The blackenedportton of the bar. ro _.. Project x Bar Chart Schedule (J~ 0"0 ::l"'O :1:~ WBS Tasks Oeser rpt Ion ::l Schedule (Monthsl c Q..000) I 4000 estimates Project Management I • Total budget for the activities are shuwn.! ~ 1\00:) (3.~ N 0'\ Figure 3.000) D 2100 Canals and Flow Structures I (2. .000) F 2200 Canal Lining I (8.000) I E 1300 Road Surfacing I (18.000) C 1200 Roads and Paths I (10..0001 A 0100 Site Clearance B 1100 Ora inaqe Oi tches (1. indicate I work completed at the dates shown..000) I (8. = Code 1 I 2 I 3 I 4 5 I I 6 I (6.

such an early appraisal may be inaccura e_ Indeed there is no indication of inefficiencies. This is used for relatively short-duration (one to two months) lower-valued tasks that are not easily measured. performed (BVWP) (in dollars or other currency). BVWP = 1/6 x 6. Again. however. Determining percent physical completion is done by establishing in advance a set rule of measurement of war' for each of the tasks (e. the rule must not be changed for the project duration. (ii) 50 per cent . Once selected. 4. then the remaining 50 per cent is credited. then. no quantitative indication of schedule status despite ha areas shown as shaded portions of the schedule bars. cubic meters. for comparison with the BVWS and AV factors above in determining progress and cost status is the budgeted value of wo . for Task B above. The key factor to be computed. the task is credited for 50 per cent of the budgeted value of that task. some tasks turn out to different in costs from those budgeted. again.000 or 16 percent complete.000.e. underrun status. This rule is used for longer duration tasks (say two to six months).100 per cent . budgeted values of the respective tasks. it is easy to determine visually if a task is started and when it has been entirely finished. The task. however. For example. There is.a task must be completely finished before the task receives any credit for BVWP. receives no further credit for BVWP until the task is completely finished.g. one may be tempted to say that the project is in a cos. so. One can easily determine visually whether or not a task has been completely finished. No other measurement is needed. square meters or linear meters of work or percentage of like units installed) and visually inspecting to see how much has been done. that are quite low in estimated value when compared with the other tasks and which are not easily measured. No other measurements are needed.50 per cent rule - Varianc follows: if a task has been started.. _ effects on costs due to schedule variances. with actual expenditures less than scheduled expenditures.000 less than 21. i. This is obtained by determining the percent of physical completion of the various tasks multiplied by the tota.Appendix Continu ~ ppen Contini Therefore. no matter how far along..000 = 1. AVWP less thez BVWS. Moreover. or 18. There are other standard rules used as follows: Task A B C D E F G H I 0) 0 . A grap perforn values) 127 128 . final costs different from those estimated.

Manhours) BVWP Computation 2/3 x 3. In this example at the end of Month 4: BVWP .. under the circumstances described above for their use.000 4/12 (12.000 Variances ollows: from estimated values at any particular reporting period are determined as Schedule Variance = BVWP . that is.e. .000 = 6.000 0 0 0 1/6 x 6.000 . which we have tabulated: Task A B C 0 E F G H I Physical Status Completed 2/3 of Area 1. that is. BVWP and AVWP are cumulative current ues).000 a 0 8.21.000 m Completed Not Started Not Started Not Started Not Started Not Started Completed Full PMO Staff Worked full time % Completion Rule Used % Units (Hectares) % Units (Meters) 0-100% % Units (km) 50% . the budgeted value of what was actually done compared to the actual value of what was actually done. In this example at the end of Month 4: BVWP . of pumps) 50% . For this example. behind schedule) Cost Variance = BVWP .50% % Units (Meters2) % Units (No.e.000 (i. indicating the Project X rformance curves (note: all values of BVWS.AVWP.000 out of 6.Appendix 12 Continued These two rules are used for convenience.BVWS = 15.000 15. any temporary inaccuracies in computing total BVWP will not materially affect performance measurement.000 .000) TOTAL BVWP = 8.000 (i.000 = -3. the budgeted value of what was actually done compared to the budgeted value of what was scheduled to be done.BVWS.000 4.18. let us say that our visual inspection of the work at the end of Month 4 reveals the following.AVWP = 15..000 1.50% Level of Effort (No.000 BVWP 2. cost overrun) .graphical display of the above situation is shown in Figure 4.

. 0 rn 15 BVWP ./ .J- 0 J. .Appendix 12 Continued pperu ... 0 Ql //.~~~_-__-~~I 4 .: ....BVWS = Schedule Variance (here./ a. an overrun) 10 5 BVWP../ .. (\) o 0 ro 20 BVWP -/-/~f\j -. E EC •.ontinu Figure 4. ro :J a: > E u 30 BVWS~ AVWP-\ \ \ :"J // ..: / ro c 0 •.... fOR EI c •.. Project x Performance Curves As i cost bas 80 A B EAC Cost Overrun n other _0 per ( :-emainil "7leansl 70 65--/ Original Completion Cost ECO =OR EJ 60 / EA / / / 50 ~ co 0 rn •./ ./ / / ~ 40 •..A VWP = Cost Variance (here.. 0 0 0 Ql c '0 o. Q) / / / / / .~ 2 3 5 6 7 8 TIM 9 E 10 11 12 0 14 15 16 Schcdi 129 130 .. behind schedule) In one me units ( pedorr that is I compu Actual ../ .

mits of measure must be used for all the project activities. Other (ECD) follows: cost based on the project status at the end of Month 4 may be computed by: AVWP x Total Budget = = BVWP 15.000 18. if at is useful.000 . for consultant efforts.. or scheduled vs.15.7143 = ECD Remaining Time + Time Spent 51 12 . as indicated at Month 4..BVWP) + AVWP CI $81. the estimate at completion 18. One may also establish nerforrnance curves plotting percentage completed against time. ontinued 5.000 . 22% BVWS (at Month 4) x 100 = 21.9% Total Budget 68. AVWP and BVWP. or the costs to complete all in this example.7 per cent late time completion In place of using dollars or other currency for measuring BVWS.000 x 100 = 30.000 x 68.833 EAC $ + AVWP = (Total Budget . actual.000 = 0. one may use man-hours.000 a other words.4 + 4 mos. The point to remember is that the same .833 15. The total project percent completion percentage at the end of Month 4 may be computed as follows: ctual percentage complete: BVWP (At Month 4) x 100 Total Budget cheduled percentage complete: 15.2 months or a 26. 0.000 (EAC) for the final estimated project 81. the final project costs will 20 per cent. A more accurate determination would be to reestimate :emaining work and add that to the AVWP at the end of month eans for computing the EAC and the estimated completion date ::OR EAC: Cost index (CI) = BVWP AVWP Remaining CI 68.600 overrun by $13.000 21. As an approximation.000 = 0..000 0. say.000 + 18.000 .000 x 100 68.000..ppendix 12 .7143 15.600 or a 20 per cent overru n ?OR ECD: Schedule Index (51) BVWP BVWS 15.

: soon agen for H finan are: APPENDIX 13 DESCRIPTION OF BANK PROJECT ADMINiSTRATION MISSIONS (\ .The execi also A.

8. To review with the borrower the tentative timing for the first review mission. To check on the arrangement and provisions for local financing for the project. particularly with regard to requirements for personnel. To advise the borrower on the preparation the loan effective. 9. A. procurement and disbursement. The purposes of each type of mission are also described. To estabiish working relationship between Bank staff and the staff of the executing agency who are directly involved in the implementation of the project both at the executing agency's administrative headquarters and at the project site. of legal documents necessary to make () L. To discuss implementation of the various loan covenants and assist in workinq out a suitable timetable for carrying them out. To explain the reporting requirements of the Bank for the project. '7 I .Appendix 13 DESCRIPTION OF BANK PROJECT ADMINISTRATION MISSIONS The following is a list of project administration missions that visit the borrower and the executing agency after a loan has been approved. To review in general the preparatory work undertaken by the executing aqcncy. for the recruitment To assist the Borrower in setting up records and accounting systems for the loan. and to provide such assistance as may be necessary to start implementation of the project. Earlier contacts might have been with persons who are concerned only with securing the loan. 133 . ') <J To further explain procedures and relevant Bank requirements of consultants. The Bank generally sends a project inception mission soon after the signing of the loan agreement. The functions of a project inception mission are: 1. Problems likely to arise in connection with the borrower's compliance with its undertakings should be anticipated and correc five actions taken. particularly in cases in which the executino agency of the project approved by the Bank is having operational relationship with the Bank for the first time or is relatively inexperienced in dealing with the execution of projects financed by international lending institutions. Project Inception Mission.

agency on specific institutional.Appendix 13 Continued B. where a cost overrun is anticipated.. 4. Special Project Administration Mission.1" 2. To assist executing agencies contract negotiations. t34 . where there is any non-compliance or delay in compliance . 3. 2. 5. Bank missions that are sent to deal with specific problems or matters of project implementation that are not generally covered by an inception mission or a review mission. the schedule of project implementatio To review the problems that the project is encountering or is likely to encounter 'its implementation. To review the overall progress of project implementation and to update. during evaluation of consultants' proposals or 1'1 F p in the field. technical or To consult with the borrower/executing financial matters. C.~ Bank staff. 4. Review Mission. To look into such other matters related to the projects requiring the attention (. C4 . such as those mentioned hereunder art: classified as special project administration missions. to reviev the arrangements made by the borrower for financing the cost overrun. Among their principal functions are: 1. based 0:comparisons of the Bank's and executing agency's records. To review draft tender documents To discuss specific procurement problems. 3. and to work out with the executing agency measures to so these problems. the contracts awarded and disbursements made. To review expenditures on the project and make realistic estimates as to wheth the project can be expected to be completed within the original cost estimates (foreign currency and local currency). To review compliance by the borrower/executing agency with particular loa covenants and. The Bank sends review missions at scheduled intervals du '-project implementation to conduct a detailed analysis of the overall progress of the proj Their principal functions are: 1. 6. consultation with the executing agency. To review the progress of procurement and disbursement and verify. 0 discuss proposed remedial measures with the borrower/executing a~~cncy.

of the rnaqnitudc ad ". financial and procedural issues related to ongoing projects in a particular country. To discuss with central government agencies concerned on country-specific corn man project implementation problems and constraints and to work out appropriate remedial measures for such problems. discussions with senior government officials on broad institutional. and disbursement and compare the B21l1k" s agencies with regard to contracts awarded and 2. 4. with specific reference to such aspects as consultant's services. To recommend to the borrower/executing the operation of the project. Project Completion Report Mission. :3. To review the borrowers'rcxecutmq agencies' compliance with the Bank's rcqulations concerning procurement and disbursement and to assist the agencies in the timely submission of related documents. A project completion report mission is sent in connection with the preparation of a Bank's project completion report after the physical completion of a particular project. the Bank and the borrower. To visit projects for more concrete identified problems and issues.Appendix 13 Continued D. steps to be taken with respect to A country projects review mission undertakes E. To assess the record of the borrower/executing agency in the implementation of the project. appraisal. During such a mission the responsibilities of staff are 1. To review the progress of procurement records with those of the executing withdrawals made.ffeets of F. Country Projects Review Mission. disbursements and institutional improvements.- . project costs. To review problem projects with executing agencies solutions for specific problems being encountered. To review the problems encountered during the implementation the effectiveness of the measures taken to solve these problems. compliance with loan covenants. Country Loan Disbursement pose of accelerating procurement country are called country loan missions are: Mission. The principal function's of such 1. procure ment. agency of the project and both on the part of 2. 135 - . on the part of both the Bank and the borrower. observation concerned and to propose 2. 3. Among its functions are: 1. Bank missions sent for the specific pur and disbursement under loans extended to a particular disbursement missions. To evaluate the adequacy and appropriateness of the actions taken in connection with the formulation. and implementation of the project. construction.

to work out with the executing agency the most suitable extended closing date. To review the accounting system. and to extend assistance in resolving such problems or in eliminating the bottlenecks. 2. To identify possible savings or cost overruns that may materialize under the loan. the budgetary system.Appendix 13 Continued 3. 7. 3. . where such a need exists. [ii] loan category. G. To obtain copies of approved contracts that have not been submitted to the Bank. to identify problem or bottlenecks being encountered in relation thereto. 6. The principal functions of such missions arc: 1. The projections to be reviewed would cover: (i description of items. To ascertain the need for reallocating loan proceeds from one category to another. To ascertain the need for extending the loan closing date. 4. To explain the exchange risk pooling scheme and to follow-up on payment by the borrower of principal and interest due under the loans. (iii] estimated amount of contract. Disbursement Mission. To give advice and counsel to the executing agencies with regard to financial and accounting problems and to devise measures to assist in solving cash flow problems such that sufficient funds would be made available on time for project implementation. 136 . 9. To review projections of contract awards and disbursements for the current year and for the following year. and to review the commercial banking arrangements for handling import and export business through letters of credit. and {i projected dates of awarding of contracts. 5. Disbursement missions are sent by the B~nk to solve project-specific financial and disbursement problems. 8. To ascertain shortfalls in contract awards and disbursements. To ensure that adequate records are kept for contracts awarded and disbursements made. and the internal control and audit arrangements of the borrower and of the executing agencies. This review is necessary to smooth out loan disbursement and enable the Bank to approve special disbursement procedures such as the imprest account and statement of expenditures..

. ) ..APPENDIX 14 GUIDELINES FOR TRANSITION FROM PROJECT IMPLEMENTATION TO PROJECT OPERATIONS <.

This is seldom possib because of the demands of implementation problems and delays. Expose future operations personnel to design/construction activities to increase familiaritv and understanding of the physical "plants" within which they will work. phase personnel for mainte- 139 40 . phase and objectives in management's focus during all ea. Check original project assumptions necessary as the project environment regarding operational or design change. do not assume that "operating" personnel can manage construction phases. The economic cost of an empty facility is usually far greater than a few months 0: extra "trainee' operator salaries. losses of original trainees. transition should be carefully covered in negotiations and planning. Operation and maintenance will be enhanced. Howe er._ a re Op ae eq Ensure that project planning recognizes all elements of operations and that schcdu' "lead times. Attempt to retain executing agency or PMO construction nance support during operations. Keep the "operating" project activities. The following "" _ a few suggested actions for maintaining perspectives on project operation needs and mas =. Also. as preparations for training and operations are just as subject to extenso. the transition a timely and successful one. and unforseen expenses Use pilot facilities for testing training assumptions and bringing trainees "up to speed" in actual operations wherever possible. Do not delay excessively the initiation of training/operations activities if construction is delayed. As such. -realities are that the initial phases or "physical" parts of the project get more atte because they are tangible and of more immediate management concern. training and borrower or execu "-agency administrative and organizational development are realistic..Appendix GUIDELINES FOR TRANSITION FROM PROJECT IMPLEMENTATION PROJECT OPERATIONS T ( Preparing for a smooth transition into the operations phase normally begins during pr -design. delay. elements and realig 1 fin. Do not assume that executing agency or PMO project construction monitoring perso nel will be available to support training and start up activities. preparations should also be coordinated with other implementation elements. Reserve a sizeable contingency factor in the training and operations budget to cover salary extensions." especially for technical assistance.

). if necessary. lead times. If the entity requires external ingredients for operations (raw materials. storage and utilization of capital equipment. and understood by the intended users. Make sure the project operating cycle is compatible with the borrower's budget cycle to avoid funding availability problems. materials availabilities.Appendix 14 Continued Review the borrower's or executing agency's budget planning. appropriation and administrative mechanisms for obtaining and utilizing operating and maintenance funds. Mechanisms must be set up for the future procurement. review financing. 40 . and procurement methods. etc. Operations manuals and procedures for all equipment must be complete and translated. Review borrower or other donor guarantees for provision of timely and sufficient recurrent costs financing. consumables and spare parts.

P B. .A. F APPENDIX 15 SUGGESTED TOPICS FOR A PROJECT COMPLETION REPORT c.

4. with reference to the procedures prescribed by the Bank. 143 . 2.J. assessment of supplier's or contractor's performance vis-a vis the terms cf the contract. and maintenance of project facilities: prospects for project benefits being realized. staffing. Comparison between original implementation schedules and actual performance.Appendix 15 SUGGESTED TOPICS FOR A PROJECT COMPLETION REPORT A. if any. Components of project Implementation methods used. 3. Initial Operations 1. Description and justifications for changes in project components tion methods. causes of delay and remedial action taken. factors that contributed to any significant overruns or underruns. length of delay. C. Need for and types of future Bank assistance in operation of project. Extent of borrower/executing agency's compliance with loan covenants: reasons for non-compliance or delays in compliance and the remedial actions taken. S. 2. assessment of consultants' work and the working relationship between executing agency and the consultant. justification therefor 2. Comparison between cost estimates made durinq appraisal and actual costs (foreign and local). Statement of problems or difficulties encountered in the procurement of goods and services (including civil works) with reference to the Bank's procedures and requirements. funding. Objectives of project. indicate areas of delay. 4. Measures taken to insure continued smooth operation of project relative to management. Description of initial operations of the project. transitional problems encountered from the completion of project to initial operation. 3. :. Statement of problems or difficulties encountered in the recruitment of consultants. Project Implementation 1. Project Description 1. If there was reallocation of loan proceeds. Reasons for any delays in loan utilization: appropriateness of the disbursements methods used. or implementa- B.

Assessment of the Bank's performance in supervising the implementation of the project. suggested changes in such procedures and requirements.Appendix 15 Continued D. procedures and requirements. effectiveness and timeliness of assistance extended by the Bank to the solution of problems encountered during implementation. Comments on the Bank's guidelines. problems encountered and measures taken to resolve these problems. 144 . 2. Bank's Performance 1.

INDEX ) .

12 Cost control measures. 41 Auditing. 12. 32 Administration contract. 9 Data bank. 12 Borrower. 31 Consultants consulting firm. 21. 21 individual. 11. 4. 15. 20. 16 Construction management. 39 Contingencies. Inten Inten bic Intro Inves Job ( Lead Loar ag de do ne Loar pe 147 148 . 11 Administrative procedures. 21 procedures for selecting. 23. 3. Wi Hanc 35. 23 Delegation of authority. 8 Us Bar Graph. 10. control of. 15. 7. 11 forecasting of. 13. 29. 31 project. 32 Conflict management. 31 Evaluation. 3 Appropriations. 27 Civil works. 32 Disbursement procedures. 1. 12 Counterpart funds. 32. 2. 37. 11 overrun. 11 Asian Development Bank (Bank). 35 short list of. loan proceeds. 32 Coordination. 29 Cost estimates. 7 Covenants. 12 Authority. 6 Expenditures administrative. 11 indirect. 11. 29 Charts. 4. 31 Costs direct. 9 Benefits. 7. 6 Equipment installation. 4. 28 objectives of. 28 Critical Path Method (CPM). 14. 31 property. 20 engagement of. ?acili Fea . 27. channels of. 2. 6 Communication. 11 D Accounting cost. 31 training. 30 Changes. 35. 21 reports. 11 variances. 28. 19. 11. 31 Environment. 33 Cost to complete. 10. 13 tools and techniques. 19 Agreements. 6 Cost accounting.INDEX supervising work of. 11 indirect. 31 Administrative expenses. 3. financing. 33 Budgeting. 31 Change order. 34 underrun. 11. 5. 28. 10. 36. 15 Delays Bank approval. 19 Co-financed projects. 28 procurement. 10. Finar Exec Fixec ForCE Fo Funo ini SOl Grap Guid Pre Pn 20. 1. 12 project. 1 multiple. 8 Deputy Project Manager. 21 compliance with project covenants'. 13. 33. 29. 31 supervision of. 40 Books of Accounts. 21 Impa Infor Initia Inpu InspE Integ Inter. 15 reports. 37. 40 Executing agency definition of. 20-23 external sources of names. 32 Diaries. See Construction Code of Accounts. 3. 23. 36 Budget. 21. delegation of. 1 Allocation. 11 Contractors managing contractor's action. 28 scope of.

32 Planning complex projects. 8 cost control. 13 detailed scope of. 16 Loan agreement. 36 types of. 15 financial. 3 Management consultants. 28 148 . 28. 35 disbursements. 7. 38 covenants. 6. 34 Procurement of goods/works 4. 15 Master schedule. 3. 15.INDEX Facilities. 20 Loan negotiations minutes of. 6. 39 Operations Manager. 1 negotiations. 7. 3 Loan regulations.30 Funds initial work. 31 Project agreement. 4. 16 International competitive bidding. 31. 20 Inputs. 3 Loan effectiveness period for. 32. 33. 13 Price escalation. 19 Leadership. 29 documents. 32. 6. 9 Guidelines Procurement Under ADB Loans. 34 Problems types of. 35. 14 commissioning. 12 Fixed overhead. 2 project data. 28 Force account. 4. 20 requirements. 4 Financial statements. 36 preparations for. 7 Use of Consultants Under ADB Loans. suppliers. loan 3 Networks. 4. 4 Organizational structure. 14 Management Information System. 3. 7 Project Benefit Monitoring and Evaluation. 20 sources and allocation of. contractors. 7. 40 Information. 36 closing date. 36 Negotiations. 23 Introduction. 12 financial management! accounting. 40 Initial works. 4 Job description. 1 Investment. 10 schedule control. 12 Missions description of. 38 Feasibility studies. 13 technical performance. 6 Interaction. 6. 36 Interfacing. 37 Overhead. 11 Fixed price contracts. 6. 9 Operating agency. 3. 7 Withdrawals of Proceeds of ADB Loans. 11 Inspection. 33 Forms. 19. 11 Photographs. 36 changes. 27. 12 Orientation. 12 Handbooks. 33. 29 Graphs. 34 Integration. 3. 23-27. 7 Impact Evaluation. 9.

6 measuring project progress. 30 Staffing. 41 Project work plan. 33. 30-34 Project organization. 8 types of. 18. 30 fund utilization. 38 Project Benefit Monitoring and Evaluation. controlling. . 13. 3 integration of. 8 methods of preparing. . 13 staffing. 34 Withdrawals. 13.3. 19 Project reports Bank requirements. 9 Specifications. 9. 13 Work breakdown structure. 18 turn-over.38-39 Reviews changes. 38-39 Project cycle scope of activities. 2 list of tasks. 19. 19. 2 start of.30. 8 subsidiary. 32 Quality assurance. 30 management control system. 6. 40 Project changes. 29 Right-of-way. transferring. 3 Technical performance control quality assurance. 18 functions of staff. 14 project completion reports 14. 27. 9. 32. 1-2 Project management. 14. 34 scope of. 29 Project commissioning. 12 Variances. 34 Table of activities and events. 27 Project implementation preparing for.27. 38. .31. .38 Suppliers managing supplier' Systems.INDEX documents.20.36. planning. 11. 33 records. 3-4 . 18 definition of. 6-7 interfacing. 16-17 Project monitoring.2. 1 scope of. 39. 15. 10. 15 16. 18 stages of. 34 Training. 9 Technical assistance. 34 149 . . 2 purposes of. 6 Start-up. 41 qualities. 14 Project Evaluation and Review Technique (PERTl. 13. 14. 3 progress reports. 19 Project Manager activities during execution. 32. 4. 2 Project management office facilities of. 8.34 Reports appraisal. 34 quality control. 2. 3. 8. Project data. 10. 28 Usage scheduling.29. 39 Unit price contract. 31. 12 Responsibility. 10. 19 reporting. 12. 29 Work authorization procedure. 31 Project procedures manual. . 34 technical specifications.35 project completion reports. 30. 14. 8 master schedule. 18. Quality control. 1 Project implementation management functional areas. 1 functions and responsibilities. 5 stages of. 31. 14. 32 9 5 action. 35 information needed. . 7 Schedules in loan agreement.30. 41 Resources.21.

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