PIA 2731, Lecture 1:

The Project Cycle1

Design—Identifying Nature of the Problem and possible solutions—specific needs and desired
changes

Appraisal: (Mandatory) data needed to prepare the project plan

Analysis: Collection of…

1. Social Analysis targeted groups: women,

minorities, indigenous peoples

2. Economic Analysis- Cost Benefit

3. Institutional Analysis

a. Sustainability Issue

b. Organizational Requirements

c. Recurrent Cost Implications

d. Human Skills Needed

e. Social Acceptance

4. Prediction

5. Selection of preferred alternatives

6. The Logical Framework: (LOGFRAME)

“AID did, in fact, move away from the logframe. It was replaced by a system based on
identifying Strategic Objectives, Intermediate Results, Measurable Indicators, etc. That
system was recently "de-emphasized." AID mission requests for funds were tied to
promises of specific results. I'm not sure whether we couldn't measure results or AID
Mission Directors were simply unwilling to be held responsible for results. At any rate,
the Results Framework system is "under review."

You can go to AID's web page (www.usaid.gov) and, near the bottom, right hand corner
of the page, click on "USAID's Policies and Procedures.”

1
Excerpts from "Planning Development Projects" edited by Dennis A. Rondinelli, Stroudsburg, Pennsylvania,
Dowden, Hutchinson and Ross, Inc., Community Development Series, Volume 35, 1977.
 This will take you to USAID's Automated Directives Series. The documents that may be
helpful to you are under "Series 200."

 Use: World Bank, UNDP, EU

(Europe), etc.
 If-then conditions

7. The documents:

The Project Cycle

1. Design

Project
3. Evaluation Objectives 2. Execution

Achieved

Source: Project Management System, Practical Concepts, Inc., Washington, DC 1979.

 Project Management System Provides Management Tools
to Support all Stages of the Project Cycle
Logical Framework Performance Networks

1. Design

Networks display performance

plans over time

Project
3. Evaluation Objectives 2. Execution
Achieved

Evaluation System Reporting System

ACHIEVEMENT

EXCEPTION

Evaluations assess performance Progress indicators and formats for

against plans and analyze causal communicating project information
linkages
Practical Concepts, Incorporated
 Preparation of Documents: Donor - USAID

 Country Strategy Paper

 Concept Paper
 Project Identification Document (PID)

Implementation Documents
Program Agreement
(Donor)

PP (USAID) Technical Proposal

(PP = Project Paper) (Contractor to Donor)

Country Context
(Contractor to Country)
A. Implementation-

1. Carrying out actions planned

2. Personnel- local [and foreign]

3. Physical and organizational Needs

B. Monitoring and Evaluation. Understanding what has happened and assessing the
changes and the quality of the change

1. Issue: sustainability re. follow on within the country and replicability from one
country to an other

2. Nature of Data:

a. Interview vs. survey

b. Seat of the pants observation= "the old quick and dirty"

c. The problem of project goals:

1. Goals are to be limited and bounded

2. Specific activities are to be clearly

defined and achieved

3. Short run success leads to successful

evaluation

4. The short-term loop is five years

d. Judgment: Evaluation vs. Assessment

1. Two views:

a. Learn from experience

b. Judge performance

2. Problem: judgment requires clear goals,

in contradiction with learning

3. Problem: the power of the expert

e. Evaluation is a donor requirement

1. It is an External activity

2. Targets the blueprint activity (CPA)

3. Critical path analysis (Time based

action)

4. PERT chart (Project Evaluation Review

Technique,) very technical, programmed

5. Evaluation often the need for more

action

f. Evaluation as an end project

1. Separate from implementation

2. Action pre-determined in the design

prior to evaluation

g. Separates the evaluation from the on-going activity.

h. Problem with the Evaluation concept- implementation suggests a

finished product

1. Bureaucratic action is ongoing

2. Part of a larger system with ambiguous

boundaries

i. Assessment: On going, part of the implementation process. Assessment

and Monitoring are part of an on-going process.
 Contracting Out

The Relationship Between Contracts and Projects

A contract is a legally enforceable agreement. The purpose of the contract is judicial review in
the event of a disagreement between the parties. The essence of a good contract is its ability to be
understood by a member of the judiciary.

A judge may be assumed to be a lay-person in terms of the technical aspects of the contract,
although knowledgeable in requirements and implications of law. It follows then, that for judicial
review the contract should strive to make the technical issues as clear as possible-understandable
not just to the project teams but to lay individuals as well.

Very few contracts are in fact brought before the judiciary for determination. Nonetheless, it is
this ultimate test--against judicial criteria--that sets the pattern for contract administration.

Project planning documents help clarify contract elements. As such, a contract consists of the
following elements:

1. A meeting of the minds

2. Specific deliverables

3. Consideration

4. Force majeure

5. Objectively Verifiable Indictors

The relationship of each of these to Logical Framework terms is briefly outlined in the following.

1. A meeting of the minds: The meeting of the minds, or intent, of a contract establishes for
judicial review "why" the contract was entered into. This includes knowing why the two
parties have entered into a contract, their long-term objectives.

From this one can analyze the activities of the parties of the contract to see if they were
consistent with that “meeting of the minds” (identified in the contract). Actions consistent
with the meeting of the minds are consistent with the contract.

Those that are inconsistent with the meeting of the minds may constitute breach of contract
or non-performance.

The meeting of the minds concept in contracts relates directly to the purpose and goals
identified in the project’s planning document. The reason the project document always
indicates “outputs” is in the hope that they will result in an agreement that the task is
completed.

By implication, the contractor is expected to obey the “reasonable-person rule.” That is the
contractor is expected to all the things that any reasonable person would do given the
resources available, and to add to the list of outputs in order to reach the agreed upon
purpose. The contracting agent agrees to modify or add to the inputs in order to reach a
modified “meeting of the mind” with regard to the purpose identified in the project
document.

The purpose is the most important project focus. It facilitates the "meet1ng of the minds" by
clarifying for the parties to the “contract" their long-term objectives.

In the development context, the parties to the contract are essentially the developing country,
the sponsoring or donor agency (USAID, the World Bank, UNDP), the host country and the
Contractor (NGO, For profit private firm, university). The developing (host) country is
usually considered the ultimate “client” of the contractor, although this is not legally binding
if the contract is made with the donor agency.

Just as the contracting agent has a reasonable right to expect that the contractor will do all
things that a reasonable person would do in order to achieve the contract’s purpose, so the
contractor expects that the contracting agent will attempt to take all reasonable actions
necessary to realize the overall goal of the activities. The contractor implicitly accepts a
reporting responsibility to identify situations where the achievement of the purpose (and
overall intent) of the contract will be met.

2. The Deliverables or Line Items: These under the contract are essentially the outputs. These
are the things the contractor has agreed to produce, given that his/her input-level assumptions
(money) are valid.

It is particularly important to note that the deliverables under a contract should be results, not
activities (or inputs). Further, objectively verifiable indicators must be provided for each
output with qualitative, quantitative, and time targets.

3. Consideration: The essence of a contract is, particularly in terms of its equity provisions,
“consideration”. What do a contractor and contracting agent each promise to provide each
other.

The minimum guarantee is, of course. the inputs. On the one hand, the contractor agrees to
provide technical personnel, commodities and undertake activities, etc. On the other hand,
the sponsor agrees to pay the contractor certain fees, and may provide on-site support, etc. as
agreed upon in the contract.

4. Provisions for Force Majeure: The project framework documents and the contract clarify
force majeure by identifying those factors that would require re-analysis of the ability to
perform, and by setting forth levels at which those factors become important.
The essence here lays the assumptions built into the agreement. At the input level, the
contractor identifies the assumptions that he/she must make In order to guarantee his/her
ability to produce his/her outputs. If the contractor needs to assume that the host government
will provide ten vehicles and drivers, In order for him/her to produce his/her project outputs,
but in fact only five are provided then we expect a corresponding reduction in the quantity or
quality of outputs produced.

5. Objectively Verifiable Indicators: These are the indicators that determine if the terms of a
contract have been met. Often statements in the contract on the goal, the purpose or the
inputs may be open to different interpretations. To avoid a mis-understanding and to provide
an objective means for recognizing what specific conditions will demonstrate successful
achievement of the project objectives, the contract and associated planning documents must
establish objectively verifiable indicators.

Indicators show the results of an activity (but they are not the conditions necessary to achieve
those results). Indicators clarify exactly what we mean by our statement of the objectives at
each level in the project planning document.

 At Input level we are only concerned with consumption of project resources

 Showing indicators at the purpose level are of particular importance so these are
given a special name: End of Project Status (EOPS)

EOPS are of great importance and are the primary target of project efforts and discussion. A
project is usually very complex so it is common to find that no single indicator is sufficient to
describe the project achievement completely, so in determining the EOPS we apply the
following principle:

 If all EOPS conditions are satisfied, then there would be no credible alternative
explanation, except that the purpose of the project (and the contract) has been
achieved.

 Good project design will include the conditions that demonstrate successful
achievement of the Project Purpose.

PROJECT PURPOSE IN THE DEVELOPMENT OF AN OIL FIELD:

Export oil.

EOPS

1. 50,000 Barrels of crude/day transferred to tankers at nearest port;

2. Quality of crude produced is competitive with that currently sold on world market. To
verify, one needs a) the purity of oil, b) the world price, c) price sold, d) amount sold
 The Project Cycle Revisited

An analysis of the project cycle is helpful for two reasons. First, since different
organizations and individuals commonly assume responsibility for different aspects of
project planning and execution, the cycle provides an overview of tasks performed by a
diversity of organizations, each considered essential to a project's success. Economists or
program officers within assistance agencies, for instance, concentrate on national and
sectoral analysis and on project identification and definition. Government-hired technical
experts and consultants perform feasibility studies. Loan officers organize and define
terms of reference for appraisal missions, identify key issues for analysis, and lead
negotiations on the final loan agreement. For other projects, the government may take the
initiative in identification, planning, and preparation, involving a variety of ministries
and agencies.

A second reason for using the cycle as an ordering framework is the potential value of
seeing the complexity of the entire process from the point of view of a developing nation when
all of the international assistance agencies' prescriptions are combined. A common complaint of
project management systems theorists is that few people or organizations in developing nations
view a project as an interrelated set of activities and fewer plan and implement projects within an
integrated management framework. "It would be more useful to visualize the phases of the life
cycle of a project in terms of links in a chain," the U.N. Public Administration Division argues,
"and to think of project administration as an instrument for making these links of equal strength.
Unless this is done, the weakest links will affect the performance of the whole project.
 Project Design—L.A. Picard

Preparation Documents:

Strategy Paper
Concept Paper
Project Identification Document (PID)

Implementation Documents:

PP (Project Paper)

Monitoring and Assessment Documents:

Annual Work Plan

Financial Status Report
Evaluation

Implementation Issues:

1. Capacity Building
2. Skills Transfer
3. Institution Building
4. Organization and mobilization of participants
5. Address Physical Infrastructure Problems
6. Completion within Time and Resource Constraints
 Individual Project

Objectives

 To allow participant to solve a problem or to initiate improvement within his organization

 To allow participant to integrate his experience and knowledge acquired through the
program

Project guideline

1. Project definition: priority, basic motive, organizational stakes, threats and

opportunities
2. Strategic objectives (organizational and environmental impact)
3. Operational objective (Project output/Project Outcome)
4. Feasibility analysis
5. Logical Framework
6. Operational Planning (activities breakdown, Gantt, resources required,
budget)
7. Monitoring and Evaluation

Steps

 Participant should have identified his project concerns, obtained

consent of his supervisor and collected the necessary documentation before coming
to Pittsburgh.
 Briefing and explanation of the project guideline by the instructor on
the first day of the program
 Writing the paper within the first three weeks of the program
 Individual progress evaluation meeting (Week 2)
 Project due date (Week 4)

Note

 The paper should not exceed 10 pages typed - not including appendix
 Paper would be evaluated by the instructor and a quality feedback would be given to
the participant or directly to his supervisor.
 Development Planning and its Management 1

1. The History of Planning

Following World War II, several events conspired to make national planning a necessity for
Western Europe and most of Africa, Asia and, later, Latin America. In the first place, Marshall
Plan reconstruction finance was contingent upon national planning. And with the advent of the
independence of India, the idea of national planning captured the imaginations of nationalists in
Asia and quickly became linked in their thinking with the possibility of development. Later,
major lending countries, especially the United States, insisted upon comprehensive national
plans prior to granting assistance, and this practice spread throughout the major international
organizations - the United Nations, the World Bank, the regional development banks
(Interamerican Bank, Asian Development Bank, and the African Development Bank.)

The attention and resources given to planning vary with the country. In India, national
planning is done by the prestigious Indian Planning Commission at the center, and state
planning by state planning authorities within each state.

In federal systems, one of the more difficult issues is negotiating the subnational and national
planning agreements; experimentation and constant revisions are endemic. Again India is in the
forefront, both in terms of its experience in this area and of the complexity of its plans. Each
Indian state has a planning and development authority that has a liaison system downward with
district and block planning units, as well as upward with the National Planning Commission.
Each state also has a series of sectoral working groups that parallel those of the central
government.

In the case of Latin America, it is worth noting that the big push toward planning came from the
Alliance for Progress. Following its establishment, no less than nine countries instituted central
planning agencies where previously none had existed.

2. What is Planning?

Planning is an elusive concept, more preached than practiced, more discussed than
defined. At the national level, development planning involves the economizing of scarce
resources on the part of the publicly constituted authority. Second, it has to involve
organized, conscious, and continual attempts to select the best available alternatives to
achieve specific goals. There are more broadly conceived definitions of planning. For
instance, the attempt to deal holistically with a system of problems is what planning, in
contrast to problem solving, should be all about. Frequently planning means setting goals
and priorities and establishing a sequence of activities to accomplish them. Planning is
not merely concerned with the efficient instrumentation of objectives, it is also a process
by which society may discover its future.

1
Excerpts from Carole Bryant and Louise G. White, Managing Development in the
Third World , Boulder Colorado, Westview Press 1982.
3. Tasks of National Development Planning

National development planning, as the term is most often used, means a conscious effort
to undertake some, if not all, of the following tasks:
1. Collecting and assessing aggregate indicators of the nation's economic and
social conditions.
2. Collecting and assessing data on major sectors within the nation's economy.
3. Identifying the relationships between sectors in order to specify areas of
essential activity for key problems.
4. Specifying alternative approaches for the amelioration of problems affecting
the whole economy and those affecting particular sectors.
5. Identifying the allocative implications of alternative approaches.
6. Identifying and specifying alternatives to top decision makers, usually at the
cabinet level. Laying out their implications in light of sectoral linkages.
7. Following up on decisions taken in earlier planning discussions.
8. Continual monitoring of the indicators of national economic and social
well-being and of the sectoral linkages.
9. Carrying out evaluations and insuring that results are included in successive
plans and policy discussions.

Not all these tasks are done by all planning agencies, but they are the major ingredients of
the planning process. Each of the tasks must be managed; some of them amount to
coordination of the work of other agencies, such as the central statistics office, with the
planning process.

4. Planning and Decentralization

Planning in the 1950s and 1960s was centralized: the development models of the day
encouraged, if not abetted, centralization. Enmeshed in their models, and committed to
industrialization, planners lived and worked almost wholly in capital cities.
There are two methods used for decentralizing or at least deconcentrating national
planning. First, sectoral planning can be one way of reaching down to subnational areas
through functional arenas. (A sector is a functional arena of productive activity within an
economy such as mining, livestock, industrial production, housing, education, or
communications.) Second, subnational planning can be initiated within state or district
units.

Sectoral planning grew out of the earlier concerns with the appropriate balances between
sectors. In planning practice it has come to mean that a section within a ministry will
have responsibility for planning for that sector, for gathering the necessary data, and for
communicating the plan to the central planning office. The difficulty is that this
organizational arrangement means that officials within the sectoral planning unit get
caught between two different offices. Good central planning is built upon sectoral
planning and upon devising management strategies to improve the quality of
coordination.
5. Project Planning

Project planning is assuming an increasingly important role in the public administration

of developing countries. In economic development, projects contribute to the integration
of markets by linking productive activities, provide the organization and technology for
transforming raw materials into socially and economically useful goods and services, and
establish the physical infrastructure necessary to increase exchange among organizations
and geographical areas. Projects provide channels for public and private investment,
rechannel unused or under-employed resources into productive uses, and offer expanded
opportunities for entrepreneurship.

In a broader context projects have become vehicles for social change in many developing
countries; as parts of larger social programs and sector plans, they can create the capacity
for ameliorating serious problems that obstruct growth and delay progress. Experimental
or pilot projects provide an opportunity for organizations in developing nations to
formulate development problems and test alternative solutions. Demonstration projects
can increase the acceptability of new technology or change attitudes and norms. The
outputs of completed projects, institutionalized in permanent organizations, expand
productive capacity, increase problem-solving and administrative capabilities, and add to
the critically low stock of administrative talent available to developing societies.
Projects, as crucial components of development administration, translate plans into
action. The term connotes purposefulness, some minimum size, a specific location, the
introduction of something qualitatively new, and the expectation that a sequence of
further development moves will be set in motion. Thus projects are not ends in
themselves; they are identifiable units of activity designed to achieve larger
developmental goals.