Ethiopian Civil Service University

College of Urban Development & Engineering

Project Cycle

By: Goitom Abraha(PhD)

Week Two
 Project Phases
 A project life cycle is the series of phases that a project passes
through from its initiation to its closure. In other words, a
project moves through stages.
 Phases are generally time bounded, with a start and ending or
control point.
• It is convenient to think of project work as taking place in
several distinct stages.
• These stages are commonly referred to as the “Project cycle”
to make the point that they are closely linked to each other and
follow a logical progression.
• All projects are divided into phases : at a minimum, a project
will have a beginning phase, an intermediate phase(s) and an
ending phase.
• Generally projects are divided into multiple project phases in
order to improve management control.
 Project Phases….Cont’d
• All the collective phases the project progresses
through is called the project life cycle.
• An idea germinates; then it passes through various
steps which will clarify the concept; objectives, and
activities required to achieve the objectives; the
appraisal of the alternative options and actions;
decision making; implementation; monitoring;
completion and final evaluation.
• The entire process from the first idea to the final
evaluation is called a project cycle, to indicate the
phased or cyclical nature of this process.
• In operational terms each stage in the project cycle
can be understood as leading to a decision point.
 Elements of the Project Cycle (Project Phases)
• Different terms can be used to describe the various stages of
project cycle.
• The World Bank uses the following stages of project cycle:
1. Identification
2. Preparation(Planning)
3. Appraisal
4. Implementation
5. Monitoring
6. Evaluation
 Each phase of this cycle is equally important.
 These lessons should then contribute to ongoing adaptation of the
current projects, and lead to the assessment and design of
subsequent projects.
 Thus, project design is part of a cycle of activities through which
projects can continually improve.
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Elements of the Project Cycle (Project Phases)
 Elements of the Project Cycle…Cont’d
• Identification
• The identification stage involves finding potentially fundable
projects.
• Sources include technical specialists, local leaders, proposals to
extend existing projects.
• During the identification phase, the team work with government
to identify projects which can be funded as part of the agreed
development objectives.
• Once a project has been identified, the team creates a Project
Concept Note (PCN) which is an internal document of four to
five pages that outlines the basic elements of the project, its
proposed objective, likely risks, alternative scenarios to
conducting the project, and a likely timetable for the project
approval process.
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 Identification…..Cont’d
• Identification involves source of finance in the selection of
suitable projects that support national and sectoral
development strategies.
• Economic and sector analyses an understanding of the
development potential of the economy, and a framework for
assessing creditworthiness and for evaluating national and
sectoral policies and problems.
• Continuing dialogue among stakeholders based on this analysis
leads to the formulation of a coherent development strategy
and to the identification of projects which fit into it.
• These projects must meet the standards of feasibility-they
must involve technical and institutional solutions at costs
commensurate with expected benefits.

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 Elements of the Project Cycle…Cont’d
• Preparation (planning)
• Once a project idea has passed the identification “test”, it
must be advanced to the point at which a firm can be made
whether or not to proceed with it.
• This requires a progressive refinement of the design of the
project in all its dimensions-technical, economic, financial,
social, institutional, and so on.
• A Preparation study focusing on qualitative and subjective
analysis could provide enough information for deciding to
proceed with a more detailed analysis.
• During the preparation stage, the major objectives of the
project are however clearly defined.
• Once the pre-feasibility study is done, detailed planning and
analysis follows.
 Preparation(planning) ……Cont’d
• Project planning is at the heart of the project life cycle, and tells
everyone involved where you’re going and how you’re going to get
there.
• The planning phase is when the project plans are documented, the
project deliverables and requirements are defined, and the project
schedule is created.
• The basic processes of project planning are:
• Scope planning – specifying the in-scope requirements for the
project to facilitate creating the work breakdown structure
• Preparation of the work breakdown structure – spelling out the
breakdown of the project into tasks and sub-tasks
• Project schedule development – listing the entire schedule of the
activities and detailing their sequence of implementation

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 Preparation(planning) ……Cont’d
• Resource planning – indicating who will do what work, at
which time, and if any special skills are needed to accomplish
the project tasks.
• Budget planning – specifying the budgeted cost to be incurred
at the completion of the project
• Procurement planning – focusing on vendors outside your
company and subcontracting
• Risk management – planning for possible risks and considering
optional contingency plans and mitigation strategies
• Quality planning – assessing quality criteria to be used for the
project
• Communication planning – designing the communication
strategy with all project stakeholders
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 Preparation(planning) ……Cont’d
• With large projects, the project may be prepared by a special
team to include experts from the analytical areas considered
crucial.
• A preparation exercise during planning ensure that the
project identified is technically and economically viable, and
compatible with the existing production systems, resource
use patterns, as well as the social and cultural beliefs of the
target group.
• During this period, the technical, institutional, economic,
environmental and financial issues facing the project will be
studied and addressed-including whether there are
alternative methods for achieving the same objectives.
• An assessment is required of projects proposed for the
financing to help ensure that they are environmentally sound
and sustainable.
 Appraisal
• Before approving a loan, external agencies normally require a
formal process of appraisal to assess the overall soundness of
the project and its readiness for implementation.
• The extent of formal appraisal varies widely in accordance with
government practice.
• After the report on the detailed analysis of all relevant project
modules is completed, a critical review and appraisal of all these
aspects are conducted by an independent team.
• This team re-examines every aspect regarding feasibility,
soundness and appropriateness.
• The team may recommend further preparation work if some
data are questionable or some of the assumptions are faulty.
• These documents are released to the public after the project is
approved.
Appraisal….Cont’d

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 Appraisal….Cont’d
• Preparatory work culminates in the appraisal phase of
the cycle, which involves a comprehensive; and
systematic review of all aspects of the project, and lays
the foundations for project implementation and
evaluation.
• Appraisal covers four major aspects: technical,
institutional, economic, and financial.
• During this process, the project may be extensively
modified or redesigned.
• An appraisal report is drafted and outlining the
findings of the appraisal mission and making
recommendations.
 Implementation
• The implementation stage covers the actual development or
construction of the project, up to the point at which it becomes
fully operational.
• It includes monitoring of all aspects of the work or activity as it
proceeds and supervision by “oversight” agencies within the
country or by external leaders.
• Implementation is a crucial part of the project cycle and,
therefore, requires equally rigorous analysis and planning in
order to develop a realistic project management plan.
• Procurement of goods and works for the project must follow
guidelines for efficiency and economy, and supervision focuses
on ensuring that procurement rules are observed in practice.
• An annual review of supervision experience on all projects
under way is intended to stimulate continual improvement in
policies and procedures.
 Monitoring
• Monitoring is ongoing and tends to focus on what is happening.
• Monitoring data is typically used by managers for ongoing project
implementation, tracking outputs, budgets, compliance with
procedures, etc.
• Monitoring is the continuous assessment of a project in relation to
the agreed implementation schedule.
• It is also a good management tool which should, if used properly,
provide continuous feedback on the project implementation as well
assist in the identification of potential successes and constraints to
facilitate timely decisions.
• Projects are monitored so as to:
• assess the stakeholders’ understanding of the project;
• minimise the risk of project failure;
• promote systematic and professional management; and
• assess progress in implementation.
 Evaluation
• Evaluation is a process of assessing whether the project has
achieved its intended objectives.
• By drawing conclusions, evaluation intends to provide
recommendations for the improvement on the future course
of the project as well as lessons learned for other projects.
• Some big organizations use specific criteria when they do
evaluation. Often, the main criteria assessed are efficiency,
effectiveness and impact, but relevance and sustainability are
usually included.
• Evaluation involves measuring elements of success and failure
of the project.
• Evaluation is usually done by an independent evaluation
team.
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 Evaluation…..Cont’d
• Evaluation looks at the extent to which original objectives and
specifications are met, in other words:
• Technical appropriateness.
• Organization/institution/management.
• Commercial undertaking.
• Financial aspects.
• Soundness of assumptions.
• Economic implications.
• Social and distributional issues.
• The evaluation stage is usually used as “lessons-from-experience” for
future project planning and analysis.
• Evaluations are normally divided into two categories: formative and
summative.
 Evaluation…..Cont’d
• A formative evaluation (sometimes referred to as internal) is a
method for judging the worth of a program while the program
activities are forming (in progress).
• A summative evaluation (sometimes referred to as external) is a
method of judging the worth of a program at the end of the program
activities (summation). The focus is on the outcome.
• An independent department, the Operations Evaluation Department
(OED), reviews the completion report and prepares its own audit of
the project.
• This evaluation provides lessons from experience which are
incorporated in the identification, preparation and appraisal of
subsequent projects.
• Following the completion of a project, the Operations Evaluation
Department conducts an audit to measure its outcome against the
original objectives. The audit entails a review of the project
completion report and preparation of a separate report. 19
 Evaluation…..Cont’d
• During the final closure, or completion phase, the emphasis is
on releasing the final deliverables to the customer, handing
over project documentation to the business, terminating
supplier contracts, releasing project resources, and
communicating the closure of the project to all stakeholders.
• The last remaining step is to conduct lessons-learned studies to
examine what went well and what didn’t.
• Through this type of analysis, the wisdom of experience is
transferred back to the project organization, which will help
future project teams.

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Project Life Cycles Characteristics
• At the start of a project, cost
and resources are low, higher
toward the implementation, and
drop rapidly as the project
draws to a conclusion.
• Cost and resources are at the
highest at the execution phase.
• At the start of the project, the
probability of successfully
completing the project is
lowest, and hence the project
risk and uncertainty are
highest.
• The probability of successful
completion generally gets
progressively higher as the
project continues.
 Common Project Management Groups
• Five progress groups
1. Initiating process group
• Help to define a new piece of
work – either a complete new
project or the phase you are
2 about to begin.
1 • They ensure you have authority to
proceed.
• Where the project official kick off
start
2. Planning process group
• Help define objectives and scope
out the work to be done.
• They also encompass all the work
around planning and scheduling
tasks
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Common Project Management Groups….Cont’d
3. Executing process group
• The ‘delivery’ part of project
4 management,
• Where the main activity happens
and you create the products.
4. Monitoring and Controlling Process
group
• consists of those processes
required to track, review, and
orchestrate the progress and
performance of the project
3 • Compare performance to
predetermined standards, plans,
objectives.
• Detect and rectify errors and
prevent reoccurrence
• Available at all process groups
Common Project Management Groups….Cont’d
5. Closing process group
 consists of those processes
performed to conclude all
activities across all Project
5 Management Process Groups to
formally complete the project,
phase, or contractual
obligations.

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Process Groups interaction with project or project phases

 Initiating process group

are high during start,
decline during the
planning and execution
and relatively rise during
monitoring and control
 Planning process groups
are high during start and
decline over the life of
the project
 Execution process
groups high at the
middle of the project
 Project Manager Responsibilities and Project Cycle
• A project manager, with the help of their team, is
charged with multiple responsibilities that span the five
project phases of a project life cycle (initiating,
planning, executing, monitoring and closing) .
• The project management phases intersect with
knowledge areas.
• The knowledge areas include integration, scope, time,
cost, quality, human resources, communication, risk
procurement and stakeholder management.
• Initiating phase
• Integration management: Developing a project charter
• Stakeholder management: Identifying stakeholders
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 Project Manager Responsibilities….Cont’d
• Planning phase
• Integration management: Developing a project management plan
• Scope management: Defining and managing scope, creating a work
breakdown structure (WBS), and requirements gathering
• Time management: Planning, defining, and developing schedules,
activities, estimating resources and activity durations
• Costs management: Planning and estimating costs, and determining
budgets
• Quality management: Planning and identifying quality requirements
• Human Resource management: Planning and identifying human
resource needs
• Communications management: Planning communications
• Risk management: Planning for and identifying potential risks,
performing qualitative and quantitative risk analysis, and planning risk
mitigation strategies
• Procurement management: Planning for and identifying required
procurements
• Stakeholder management: Planning for stakeholder expectations
 Project Manager Responsibilities….Cont’d
• Executing phase
• Integration management: Directing and managing all work
for the project.
• Quality management: Performing all aspects of managing
quality
• Human resource management: Selecting, developing, and
managing the project team.
• Communications management: Managing all aspects of
communications
• Procurement management: Take action on securing
necessary procurements
• Stakeholder management: Managing all stakeholder
expectations
 Project Manager Responsibilities….Cont’d
• Monitoring and controlling phase
• Integration management: Monitoring and controlling the
project work and managing any necessary changes
• Scope management: Validating and controlling the scope of the
project
• Time management: Controlling the scope of the project
• Costs management: Controlling project costs
• Quality management: Controlling the quality of deliverables
• Communications management: Controlling all team and
stakeholder communications
• Procurement management: Controlling procurements
• Stakeholder management: Controlling stakeholder engagements
• Closing phase
• Integration management: Closing all phases of the project
• Procurement management: Closing all project procurements
 Reading Assignments

1. What are the tools used in project management? Reflect

on the following points by showing examples in view of
project management tools:
• Gantt chart
• PERT(Program Evaluation Review Technique) chart
• WBS(Work Breakdown Structure) chart
2. What is Goal achievement matrix? Develop Goal
achievement matrix by assuming a given housing project in
your community?

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Thank you

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