Unit Two:

Project Identification
 Group discussion
 Is problem identification the same as project
identification? Why or why not?

 Who are responsible to identify projects?

 Project Identification
 The first stage in the project life cycle is to
find potential projects.
 Such projects start as new ideas which are
carefully examined and if found desirable are
translated in to projects.

 At this stage, a company plans and strategies

are translated into specific investment
projects based on felt human needs.

 Project ideas are normally initiated by a

perceived PROBLEM or OPPORTUNITY in an
organization and converted in to a formal
project proposal.
Sources of project ideas
 The community, researchers, experts, local leaders,
Policy makers, entrepreneurs, donors, NGOs,
Planners, etc
 Government policy priorities, unusual events, external
threats, unsatisfied demands, under utilized natural
resources, etc
 Who identifies projects?
 Various organizations, whether local or foreign, state
owned or private, government ministries,
development banks, interest groups, CBOs, NGOs
and of course individuals can identify projects.
Wherever initial project ideas come from we must
ensure that:
 They are consistent with Government’s policy
plan and strategy
 They are consistent with the strategy and
policy of the donor(s) from whom we hope to
attract funds
 They are agreed as priorities by the direct
beneficiaries of the assistance
Steps in Project identification and
selection:
Stakeholders analysis
Problem analysis

Objective analysis
Alternative tree analysis

Log-frame analysis
1. Stakeholders Analysis
1. Stakeholders Analysis
A stakeholder is an individual, group, or
organization who may affect, be affected by, or
perceive itself to be affected by a decision,
activity, or outcome of a project

 Stakeholderanalysis is a technique of gathering

and analyzing quantitative and qualitative
information to determine whose interests should
be given priority throughout the project.
Analysis cont’d
 It identifies the interests, expectations, and
influence of the stakeholders and relates them
to the purpose of the project

Uses of stakeholder analysis to identify:

 Who should be involved in the process
 Stakeholders who may affect or be affected
(have interest) by the potential project;

 Potential conflicts or risks that could

jeopardize the initiative
Use continued
 Groups that should be encouraged to participate in
different stages of the project;

 Those who are powerful actors in ensuring the

project’s success or failure

 Interest and views that should be given priority

when analysing the problems

 Strategies to tap the potential of stakeholders who

are in favour of the project and minimise negative
impacts on vulnerable and disadvantaged groups.
Process of Stakeholder Analysis:

Step 1: Group organization

Step2: Detailed analysis
Step 3: Impact Assessment
Step1: Group organization
Identify all people, group and institution who:
has an interest (positive or negative), contributes
to or is affected by or influence the project as
follows:
 Target Groups (Beneficiaries): for which
positive change is desired
 Negatively Affected Groups: groups
adversely affected by the potential project
 Decision Makers: decision making authorities
Stakeholder’s analysis cont’d
 Funding agencies: group which can bear expenses
 Implementing agencies: contractors,
 Community leaders: groups representing the
community
 Potential opponents: groups which may oppose or
obstruct a project
 Supporting groups: groups likely to cooperate with
the expected project
Step2: Make a more detailed analysis
Make a more detailed analysis of each stakeholder in
terms of :
 Specific interests these stakeholders have in the
project( project’s benefit, damage or conflict for the
stakeholder).
 Powers of the stakeholder: the ability of the
Stakeholder to take effective action.

Step 3: Conduct Impact Assessment

 Estimate the value each stakeholders place on their
stake or interest in the project. The value can be
positive or negative
Stakeholder’s analysis cont’d
 Assignvalue 5 for very high, 4 for high, 3 for
moderate, 2 for low and 1 for not very important

 Assign a power level to each stakeholder. This rates the

ability of the Stakeholder to take effective action
 Assign value 5 for very high, 4 for high, 3 for
moderate, 2 for low and 1 for not very important

 Multiply the value of the stake to the stakeholder by the

power to take action. The result is an indication of the
stakeholder’s ability to secure their stake in the project
Stakeholder’s analysis cont’d
 Consider the kind of things you could do to get
stakeholders support and reduce opposition.
How you approach stakeholders?
What kind of support will they need?
How important is to involve stakeholders?
 Tool for stakeholders analysis
 The following worksheet can be used to conduct full
stakeholders analysis
stakeholders interest Potenti value power value impact Relativ strategy
al e
impact priorit
y
Stakeholder’s Analysis Grid
High
Keep satisfied Mange closely

power
Monitor Keep informed
(minimum effort)

Low Interest High

Stakeholder’s Analysis Grid cont’d
Guidance for stakeholders map
 High power, high interest: fully engage these people
and make the greatest effort to satisfy them

 High power, less interest: make enough work to satisfy

these people

 Low power, high interest: keep these people adequately

informed, and talk to them to ensure that no major issues are
arising.
 Less power and less effort: monitor these people but
do not bore them with excessive communication
Activity 2:1 (25 minutes)
Identify project ideas by examining problems and
opportunities related to refuge hosting region in
Ethiopia.
1. Shortage of cement products in Addis Ababa
2. Street children and begging
3. Youth drug addiction problems
4. High burden on social services (school, health centres,
water facilities..) in the area
5. ------( any idea you may feel is important)
Required:
6. Conduct stakeholders analysis
7. Identify the priority interest needs to be given emphasis
during designing and project implementation.
2. Problem Tree Analysis

Identifying a problem is half of the solution

A good project comes from a good problem

definition
 2. Problem Tree Analysis
Purpose:
 To identify major problems and their main causal
relationships.

Output:
 A graphical arrangement of problems differentiated
according to ‘causes’ and ‘effects’
 … Problem analysis
 Problem analysis is a procedure which allows to
analyze an existing situation, identify key problems
and visualize the problem in form of diagram/tree
(cause and effect relationships)

 Problem analysis helps primary stakeholders to

identify the causes and effects of the problem

 Begins with identifying a core problem. The tree is

then expanded upwards and downwards as the causes
and effects of the problem are identified.
Steps in Undertaking Problem Tree
1. Identify a “core” or central problem
2. List all the problems related to or
stemming from the core problem
3. Determine which related problems are
causes and which are effects of the core
problem
4. Arrange the problems in a cause-effect
heirarchy around the core problem
Problem Tree
EFFECT

CAUSE
 Example
 Core problem: Frequency of bus
accidents
 Prepare problem and objective trees
 Select one alternative solution

Chapter 2: Project identification and

Preparation
 Problem analysis
Loss of confidence
in bus company
Effects Passengers hurt
People are late
or killed

Frequent bus
accidents
Core
problem
Drivers not Bad conditions of Bad road
careful enough vehicles conditions

Causes
Vehicles too old No ongoing
maintenance
3. Objective Tree Analysis
3. Objective Tree Analysis
 Objective tree analysis is a technique that utilises
problem tree diagramming as the starting point
for the identification of objectives

 An objective tree is a technique for identifying the

objectives that will be achieved as a result of
solving the problems cited in the problem tree.

 The objectives are also displayed as a series of cause

and effect relationships.
Objectives Analysis
Customers have a
better image of the
bus company

Less Passengers
passengers hurt arrive at
scheduled time
Frequency of bus
accidents
considerably
reduced

Drivers drive Vehicles kept in Road

carefully and good condition conditions
responsibly improved

Old vehicles are Vehicles regularly

regularly replaced maintained and
checked
4. Alternative Tree Analysis
Alternative Tree Analysis

 A technique for identifying alternative solutions or course of

action that can be used to achieve the same objectives.
Procedure:
 Group objectives, to get possible stratégies or components
(clustering)
 Examine the objective tree to determine which objectives are
unrealistic (not desirable or achievable) due to resource
limitations
 Determine alternatives that represent the optimal project
(desirable) in terms of probability of success
 Make decision to select the feasible project
 Activity 2.2 ( 25 minutes)
Take a moment and consider the project problem you
identified in the prvious section to conduct the
following analysises
Required:
 Identify the central or the core problem
 Prepare problem and objective trees
 Generate as many alternative as possible to solve the
root causes of each problem
 Based on sound evaluation select one alternative
project .
5: Logical Framework Approach
(LFA)
5: Logical Framework Approach (LFA)
 Is a four by four matrix, which enables the
decision maker to identify project purposes
and goals and plan for project outputs and
inputs.

 is useful in planning, analysis, follow up and

evaluation of the project.
Important Terms in LFA
 Goal is the broader objective to which a project
contributes such as poverty reduction, income
increase, profit maximization, natural resource
protection etc…
 The overall objective provides a link to the policy
or sector programme context.
 Purpose is the primary objective in terms of the
sustainable benefits for the target group or aim of the
project
Important Terms in LFA contiu’d
 Outputs: are tangible products or services that
a project delivers to a target population to
achieve the project purpose

Results are largely under the project

management’s control.
Important Terms in LFA contiu’d
 Inputs: Tasks undertaken in order to get the project
results
 Financial, human , material and information
resources available to implement the project

 Sector is the largest system of which a project

a part
 Objectively verifiable indicators (OVI):
demonstrate the desired results have been
accomplished ( in terms of quantity, quality, cost
and time)
 Means of verification(MOV): sources of
information for the accomplishments of the project
 The logic: A vertical and horizontal logic.
A vertical logic: clarifies why a project is being
undertaken. It specifies goal, purposes, outputs
and inputs
A horizontal logic: identifies what is to be
produced and the evidence that will signal
success.OVI, MOV and assumptions.
 Characteristics yes – then logical framework

Narrative Objectively Means of Important

Summary verifiable Verification assumption
indicators

Goal then

Purpose if then and

Results if then and

Inputs if and

17
The Role of Assumptions in the Vertical Logic
 Once the activities have been carried out, and if the
assumptions at this level hold true, results will be
achieved;

 Once these results are achieved and the assumptions

at this level are fulfilled, the project purpose will be
achieved; and

 Once the purpose has been achieved and the

assumptions at this level are fulfilled, a contribution
to the achievement of the overall objectives will
have been made by the project.
 Assumptions
 Describe necessary internal and external
conditions in order to ensure that the activities
will produce results
 Assumptions are risks, which can threaten the
success of the project
 Are worded positively, i.e. they describe
circumstances required to achieve certain
objectives
 Assumptions should be relevant and
probable
 If an assumption is not important or
almost certain: Do not include
 If an assumption is unlikely to occur:
Killer assumption – abandon project
Example of Assumptions for the Goal and
Purpose:
• Political – stability of government
• Economic – sustainable economy
• Adequate funds/materials.
• Skilled people – training needs.
• Approvals & contracts – legal, administrative.
• Participation of stakeholders.
• Etc.
Activity 2.3 (15 minutes)

Prepare a Logical framework for the

project idea/ideas you selected in the
pervious section.