Project M&E (unit 1-4)


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Project M&E (unit 1-4)

  1. 1. Page 1/10 Unit 1 Lecture Notes 01 – 04 Monitoring and Evaluation Concept Introduction of faculty, students and the course module was conducted at the very outset. Objective of the Module is “To illuminate to the students to different aspects of project implementation and project management and its output together with involving students in practical realism of project through rigorous field exercises.” It is a 3 credit course module comprising of 42 hours (28 lectures), 6 hours of presentation of learnings from a 2/3 days field visit, 3 assignments, 3 internal assessments, 1 guest lecture (if available) and 1end semester examination. Various issues according to bellow given tentative session plan will be discussed with the perspective of overall project management. Rather than deriving mathematical equations, our discussion will be focused towards understanding the physical meanings and importance each have in in total project management. 1. Introduction to Project M & E, Project environment, ex-ante, ongoing and ex-post evaluations 2. Project cycle, M & E logic and M & E cycle 3. Definition of key concepts, M & E need and design 4. M & E types, Clients of Eavaluation output, difference between M & E 5. Ex-ante evaluation (Appraisal), economic eveluation 6. Social evaluatio 7. Impact evaluation 8. Evaluation techniques 9. Logical framework, participatory M & E 10. M & E Indicators 11. M & E practices in Nepal 12. Utilization of evaluation results 13. Current issues and practices with example of result oriented evaluation and MDG 14. Data collection for M & E 15. Field Visit (3 days) and Presentation We may have to readjust the certain part of discussion as per students’ need. Reference books are: 1 S Chaudhari, Project Management – 4th Edition 2 Meredith and Mantle, Project Management – 6th Edition Further recommended readings are: 1 J P Gittnger, Economic Analysis of Agriculture and Rural Development 2 Prasanna Chandra, Project: Preparation, Appraisal, Budgeting and Implementation 3 Harold Kerzner, Project Management: A Systems Approach to Planning, Scheduliong and Controlling 4 Public Works Directives, Organizational Directive, GoN 5 Development plans of GON, NPC 6 Economic Surveys of GON and Portfolio reviews, Ministry of Finance 7 Various project monitoring and evalaution documents availabel in World Bank and Asian Development Bank websites Project Management is a mix of all best practices in general management in project scenario, that is to achieve a set objective within given time, cost and quality. It utilises innovative processes/techniques to achieve the end result as desired and utilises indicators and their measurements to identify the gap between the plan and the execution level so that corrective measures can be taken it time to achieve the set objective. All the stages in project cycle have their own importance. However, the implementation is
  2. 2. Page 2/10 considerd more challenging as it trasforms the paln into reality. The role of human resources play a huge role in achieving success. Control measures shall be made efficient and effective to compare the paln with execution, to implement corrective measures and to achieve the set target. Today, we will try to test the level of understanding amongst the students regarding bellow given aspects related with project management before entering into the topics according to session plan. 1. Management, Administration, Governance and Differences between them 2. Project, Types (Private, Public, PPP/Central, Local/Sectoral, Integrated) etc 3. Project Mangement, Result achievemnt, how to measure? 4. Project Indicators (Financial, Technical, Time wise, Socio-environmental) etc. 5. Efficiency and Effectiveness, Inputs, outputs, effects and impacts 6. What do we want at the end of the day, How do we achieve and measure what we want etc… Projects are defined as a series of activities which requires various types of resources (investments) to achieve a set target, objective, and Goal to produce value addition within defined time and with given quality. Shift in one of priority does create visible effects on remaining two priorities, such as focusing on time will, will first on cost (most probably, it will go up), then on quality (certain adjustments may be required there). Time and cost are more closely associated with resource requirement, where as quality has its implication directly on project products Further, human resource management has to dealt with very sensibly, as it is a resource which is not inert and has its own aspiration, can organize themselves and may improve or regress industrial relationship in organization. Project cash flow and cummulative cash flow as given below help to understand the project environment. Project cash Flow Diagram Cumulative Project Cash Flow ma Project follows various stages in its own cycle. It shall be discussed in detail in relevant session. A project is a unit of management that clearly specifies what is to be accomplished, over what period of time, and at what cost. The clearly specified "what" to be accomplished are the project objectives. Project Time Cost Project Quality Money Revenue Expenditure Time MaximumBreak Even Minimize +ve Money Time -ve Money Break Even Maximize Minimize Balance
  3. 3. Page 3/10 implementation is usually associated with cost/time overrun, and requires project redesign. That is the reason why project life is on a continuum and planning is also re-adjustment of procedure, time, and/or cost based on the feedbacks from on going evaluation. Planning and preparation is the primary and very imporatnt stage of a project cycle when the mould of the project is cut, objectives are defined, strategies outlined, Working procedure established, Financial and socio-economic benefits quantified, Required resources identified, Bench mark fixed against which the project and its effects, outcomes and impact will be judged and the INDICATORS against which its success or failure will be measured are set.. Aspects that have to be considered during project planning and preparation in general are; Technical, Institutional/organizational, Social/political/cultural,Economical and Financial, Environmental, and Legal aspects. All these areas are to monitored and evaluated to measure achivement vis a vis plan. There are cross cutting issues such as; corporate governance, value based management and earned value analysis etc. Shareholder, stockholder and stakeholder dynamics will have to visited. Overall objective of public sector project is to increase economic benefit to citizens whereas it is increasing wealth to shareholders in private sector projects. PPP demands for both, hence are more challenging. Performance evaluation of past activities is not adequate, performance based motivating model linked with future activities shall be talk of the day. If one has money, go invest; if one has knowledge, go manage for value addition to nation, investors as well as own. Lec_02_Project Cycle and ME Logic and Cycle Systems Approach 1. Financiers, Donors, Proponents, Shareholders etc. 2. Project executing agency, implementation agency, service and good providers etc. 3. Beneficiaries, customers, communities etc. Time Schematic diagram of a systems approach to Project Management Time Cost Quality Beneficiary Customer Community Financier Donor Shareholder s Executing, Implementing Service providers Project Project as a SYSTEM - a whole comprising of sub systems Change in system Resulting Change in system elsewhere
  4. 4. Page 4/10 Types of Projects and its Enviroments Based on Who is involved: o Private Sector Projects – Product based, service based o Public Sector Projects – Sectoral projects, Integrated projects, o PPP – Huge Infrastructyure project, Service providing projects Based on Fund providing agencies: o Public sector projects  Domestically funded project  ODA supportred projects Bilateral Multi lateral INGO o Private sector projects  FDI projects  100 % equity  Balanced equity and loan funding Domestic lenders International lenders such IFC and Private wing of ADB Based on impact on economy o Huge projects having impact on national economy (Macro Economy) o Small localized projects having impact on local economy (micro economy) Based on who governs or managesd the project o Central level project o District level project o Local level project Based on product o Project with hard core engineering product o Soft ware Projects intended towards social upliftment and awareness building Rural Development Projects Projects with a targeted group Community based projects Etc. M & E Logic Logic is derived from the management functions: POSDCoRB simplified in project management as PODC. P – Planning O – Orginizing D – Directing C – Controlling M & E in a part of controlling function in order to control Time, Cost and Quality aspects of a given project.
  5. 5. Page 5/10 PROJECT CYCLE 13. Learning for Future 12. Audit Achievement for future project formulation 11. Completion 1. Identification 10. Monitoring and Evaluation 2. Planning PROJECT CYCLE 9. Implementation 3. Approval 4. Preparation 8. Procurement of Goods, Services, and Works 7. Agreement [Approval] 5. Appraisal 6. Negotiations Monitoring is required also during Project Appraisal and Project Impact Study Definitions of Key Concepts and Need of ME Inputs: It is the answer to question “What resources are used”? The resources; financial, human, technological and others, if any, which are identified and estimated as required in order to carry out the project activities Activities: It is the answer to question “What is done”? Work Breakdown Structure of works of similar nature. Output: It is the answer to question “What is produced or delivered?” It is the intended products or deliverables as envisaged to be generated after the project activites are complete. Effects/Outcome: It is the answer to question “What do you wish to achieve”? It is the targeted immediate changes brought about by a project in the targeted customesr, beneficieries, and organisations with whom it works. Ex-ante Evaluation Project Appraisal On-going Evaluation Monitoring Ex-post Evaluation Project Impact Study
  6. 6. Page 6/10 Monitoring and Evaluation Cycle Learning for Future Achievement for future project formulation M & E CYCLE Impacts: It is the answer to question “What long term changes that you are aiming for?” It is the long term change in in the behaviour of people, groups, and organisations with whom a project is concerned directly. Planning: - Task - Process - Resources Design: - Task - Process - Resources Implementation Approval and Procurement of Services Decsion Coorective measures Data Collection Analysis Reporting Useful information
  7. 7. Page 7/10 Risks: Events or conditions that may occur and whose occurrence, if it does takle place, has a harmful or negative effect on project process Monitoring: MONITORING is the continuous review by management of the implementation process to ensure that input deliveries, work schedules, output and other activities are proceeding as planned. Monitoring is a recurring task already beginning in the planning stage of a project or programme. Monitoring allows results, processes and experiences to be documented and used as a basis to steer decision-making and learning processes. Monitoring is checking progress against plans. The data acquired through monitoring is used for evaluation. Evaluation: EVALUATION, on the other hand, is a discontinuous function, concerned with ascertaining the degree to which objectives have been achieved through the activities. Evaluations appraise data and information that inform strategic decisions, thus improving the project or programme in the future. It uses information gathered in relation to these aspects during the monitoring process. Monitoring and Evaluation Need: Purposes, hence the need of Monitoring are: To learn from experiences to improve practices and activities in the future; To have internal and external accountability of the resources used and the results obtained; To take informed decisions on the future of the initiative; To promote empowerment of beneficiaries of the initiative. Similarly, the need of the Evaluation is reflected by its scope which helps to draw conclusions about five main aspects of the project: Relevance Effectiveness Efficiency Impact Sustainability Monitoring and Evaluation Design M&E is an embedded concept and constitutive part of every project design (“must be”). M&E is not an imposed control instrument by the donor or an optional accessory (“nice to have”) of any project. M&E is ideally understood as dialogue on development and its progress between all stakeholders. Having ways to check on progress (monitoring) and take stock of where things are at on a regular basis (evaluation), are important for projects to function effectively and also to 'learn as we go'. Monitoring and evaluation can help to identify issues, measure success and learn from any mistakes. This notion is closely linked to the 'learning' principle of successful projects. Why M & E ? Keeping records and monitoring activities helps people see progress and builds a sense of achievement. Records can be useful and even essential when promoting a project or applying for funding. Monitoring also has significance for the wider fields like ; conservation, health service, securities etc. What to M & E : The following list of questions will help you decide on your monitoring objectives: What information will help us make informed decisions? What will help us know that our project is on track? What's the appropriate scale for monitoring (e.g. catchment, district, reserve boundary, whole forest or whole ecosystem)? What are our timeframes for monitoring (e.g. days, months or years)?
  8. 8. Page 8/10 Do we need input from others (groups or agencies)? Features of effective monitoring: Monitoring can be considered to be effective when: Scientifically valid techniques are used. Aspects relevant to your project are measured. It's carried out regularly and consistently. Accurate records are kept. It is used as part of your evaluation to support or adjust project goals and actions. In general, monitoring is integral to evaluation. Monitoring focuses on the measurement of the following aspects of an intervention: On quantity and quality of the implemented activities (outputs: What do we do? How do we manage our activities?) On processes inherent to a project or programme (outcomes: What were the effects /changes that occurred as a result of your intervention?) On processes external to an intervention (impact: Which broader, long-term effects were triggered by the implemented activities in combination with other environmental factors?) EVALUATION: The evaluation process is an analysis or interpretation of the collected data which delves deeper into the relationships between: Results of the project, Effects produced by the project and Overall impact of the project. Evaluation provides an opportunity to reflect and learn from what you've done, assess the outcomes and effectiveness of a project and think about new ways of doing things. In other words, it informs your future actions. You may decide that you will: Refine your project as you go, so that evaluation is part of your regular project activities. Evaluate the project at agreed milestones e.g. on a yearly basis or after major activities. Carry out an initial baseline exercise against which you compare progress at the end of the project. To ensure your evaluation is effective, it is important to consider: Your purpose - what to evaluate: When designing your evaluation, make sure you're clear about your purpose. It's helpful to determine what questions you want answered - make sure everything you ask or investigate during evaluation relates back to these questions. Your approach - how to evaluate: There are many different ways to evaluate your project, depending on what your purpose is. However, it's important to make sure the evaluation process involves valid and sound methods for information gathering and analysis. Once evaluation data has been gathered and analysed, remember to check your conclusions against your goals and objectives. So the process design of M & E shall address to its scopes. Basically M & E design is concerned with: Number of critical Indicators which reflects progress and the impacts Data collection, methodology and volume of data (How, What and to what level of accuracy) Data processing (Tools, instruments, softwares) Data Analysis (Basis, baseline, evaluation, interpretation and forecasts and projections)
  9. 9. Page 9/10 Creation of useful information Reporting system (best done by using the recent achievements in information and computer technology) Storage and retrival system Resources (Financial, human, institutional) Types to be adopted (inhouse, thirdparty, independent, participatory, public etc) Types of M & E In-house: Project proponent group/organization carries it out by itself. Such projects should have planned a separate M & E Cell in the project itself and equip it with adequate human resources in terms of quantuty and quality, adequate financial resources in order to effectively carry out M & E activities, and other logistics required to successfully implement the M & E process. Third Party: This is opposite of the first option. Here project organization does not have its own separate M & E setup. But it outsources the job to service providers, consultants and experts based on procurement of consulting service. TOR are drawn, SOW are defined as planned and srvice procured. However, project financial resources are utilized for this purpose. Independent: There is a management proverb, “the loyalty shifts towards those who hold the string of your purse”. In above version of outsourcing, the financial resources used belongs to the project people and they are the ones from whom the assigned consultants receive their payments for the works carried out. Thus there is always chances of having the scenario described by above adage. Independent M & E, hence could avoid this dynamics. But reality, this is very difficult because required financial resources has to be allocated to some independent organization. In Nepal, money has to be provisioned by project to be paid to NVC, which is mandated to carry out independent Technical Audits of public sector projects. Apart from TA, other independent M & E are elusive in our country, as well as elsewhere too. Participatory: We all know that there has been a significant paradigm shift in development process. It is more moving towards need based and participatory approach. Participation means involvement of stakholders whose livelyhood is affected by project activities and products in decision making process of the project from inception to completion, operations to maintenance. In this case, they shall be equally made responsible for identifying whether project process and achievements are as planned (M & E). In this model, the M & E process is also made participatory with key stakeholders. Public: This is further ahead than participatory M & E. In this model public opinion is the main source of information for M & E of a given project. This is rather difficult to implement in project targeted toward improving microeconomy, let alone the projects targeted towards improving macroeconomy of the country as a whole. Clients of Evaluation Products Basically clients of the project evaluation outcomes are: Project proponent organization Corporate body Sectoral organizations Regulatory organization Financing organizations Organized group of beneficieries
  10. 10. Page 10/10 Academic and policy advocating agencies Development partners National Planning Commission National Development Commission etc etc Difference between M & E: There is clear difference between M & E as follows. Temporal aspect: Continuous versus Spontanious Coverage aspect: Inputs – Output (Monitoring) vis a vis Effects – Impacts (Evaluation) Perception aspect: Efficiency (doing things right) in Monitoring and Effectiveness (doing right things) in Evaluation Views aspect: Efficiency is internal views based on facts whereas Effectiveness is rather other people’s version, impression and views. An example from an Irrigation project is as follows. Monitoring Evaluation (Efficiency) (Effectiveness) Unit 2 Lecture Notes 05 – 08 Project Evalution Techniques Ex –ante Evaluation of Project Identification [PCN] Design of Planning [Feasibility Study] M & E Preparation [DPR and DED] Appraisal Appraisal (External) [Donor’s Appraisal/Due diligence] Negotiations [Between Provides and Recivers] Approval [By both Provider and Receiver] Planning Approaches: There are few planning approaches. SWOT – Strength, Weakness, Opportunity, and Threats Rapid Appraisals [RRA, PRA, Appreciative enquiries] Cost benefit Approach or Value Added Approach [Popular Approach] Logical Frame Work Approach [Objective Oriented Project Planning] [Popular Approach] Cost benefit Analysis method is based on the comparison of two streams; a) of Cost and b) of Benefits. The common indicators that are understood by the development practitioners are: 1. Net Present Value [NPV] Impacts Increased access to goods and services with multiplier effects Effects Increased farm income Outputs Increased paddy production level Inputs Irrigation Seed Fertilizer Extension
  11. 11. Page 11/10 2. Benefit to Cost Ration [BCR] 3. Internal Rate of Return [IRR] Feasibility study: It derives above indicators and provides basis for the approval of the project. In our context, however, the feasibility study deals with: Technical, Financial, Economic, Social Environmental Legal and Institutional aspects. Steps of Feasibility Study 1. Preparation of Terms of References 2. Invitation of Bids, Tendering and Appointment of Feasibility Consultant 3. Developing Project objectives and scopes 4. Data Collection 5. Developemnt of Project Works 6. Stakeholder Participation 7. Preliminary engineering 8. Preliminary cost estimate 9. Economic and financial analyses 10. Analysis of institutional and training requirements 11. Proposed implementation modalities 12. Proposed funding modaities 13. Assessment of project risks in different alternatives 14. Initial implementation plan 15. Feasibility report Financial Analysis: Value added approach or the cost benefit analysis at first requires: 1. Generation of stream of cost Land and site development Construction cost [Buildings and civil engineering works] and Plant and Machinaries Technical know-how [fees payble to various consultants (including foreign)] Expences for training local technicians Fixed assets, Preliminary and capital issue expences Cost of capital, Inflation, and depreciation Pre-operative cost and Provision for contingencies Expenditure for advertizement, research and development Margin money for working capital Operation and maintenance cost Taxes 2. Generation of stream of benefits: Direct revenue [by selling the product or by toll or service charge – telephone] Time saving [Time saved by women to fetch water] Saving on operation cost [eg VOC]
  12. 12. Page 12/10 Secondary benefits; Enhanced production, Life savings Immediate need postponded [school across the river after bridge construction] Terciary and Other social/cultural benefits Time Value of Money: Money has time value. A Rupee today is more valuable than a rupee a year later. As the project life involves many years all the costs and benefits are to be translated in its value related to certain single year. There are two ways to do this; a) Compounding, b) Discounting Compounding S = P ( 1 + i ) n , Where: S = Future value after n years; P = Present amout invested today; i = internal interest rate for the period and n = number of year. Discounting S P = [ 1 + i ] n Financial Net Present Value [NPV] It is defined as the net worth of the project as of today. If NPV is positive, the project is acceptable financially. Higher the NPV greater is the viability and acceptability. n Bi - Ci NPV = Σ i =1 (1 + d)i Where: Bi = Total discounted Benefit in year I; Ci= Total discounted [compounded] Cost in the year I; d = Rate of discount and I = No of years in active project life considered in economic analysis. Financial Benefit to Cost ratio [BCR] Σ Bi BCR = It should be greater than 1 Σ Ci Financial Internal Rate of Return [FIRR] It is the rate at which the net benefits are discounted so as to arrive at the cost of the project, meaning rate of return when NPV is ZERO. It provides a measure of the project profitability. IRR > DR n Bi - Ci NPV = Σ = 0 i =1 ( 1 + d)i Economic Analysis Financial viability provides a measure of the commercial profitability of a project, while the economic profitability indicates the real worth of a project to the country. Economic analysis is must for public sector projects. Indicators of economic analysis are; a) ENPV, b) EBCR and c) EIRR
  13. 13. Page 13/10 In economic analysis, benefits are defined in terms of their effects on national outputs, while costs are defined in terms of their opportunity cost, i.e. the benefits foregone by not using the resources in the next best available alternative. In developing countries the market prices of goods, services, capital, and foreign exchange are distorted for a variety of reasons. For instance: Many developing countries suffer from large degree of unemployment. In this situation the real cost to society of withdrawing labor from other sectors for use in the project will be far bellow the financial cost. Similarly market price do not provide a good measure of the benefits if there is no freely operating market for project output e.g. water or electricity. Willingness to pay [WTP] on the part of consumers provides the economic measure of the benefit of the project. Traded and non traded goods are valuated in different way. Foreign exchange at border price and its conversion into local currency using shadow exchange rate is used in economic analysis. Internal transfers within the national economy are not counted for in it. Few important concepts “With” and “Without” Comparison: New project reduces the supply of inputs [consumed by the project] and increases the outputs [produced by the project] and thereby changes the availability of inputs and outputs in the economy compared with what it would have been without the project. Identifying the difference between these inputs and outputs “with and without” project is the basic method of identifying the costs and benefits of the project. It should not be confused, however, with the before and after scenario. For instance certain changes may take place in both inputs and outputs even if the project is not implemented. These changes should be excluded from the project cost and benefit analysis. Transfer Payments: Economic analysis excludes from both the costs and benefits streams all transfer payments, i.e., payments made by one sector in the economy to another sector, because these transfers do not impose any direct claim on country’s resources. Taxes, subsidies, interests, borrowing and repayment of loans, and royalty payments within the country are all examples of transfer payments. Externalities: A project may involve positive and negative impacts with significant effect in the economy which are not reflected in the financial analysis. These effects known usually as “externalities” should be taken into consideration in estimating the overall net economic impact of a project. On the cost side the externality may include increased pollution caused by a chemical or cement plant, or the adverse effects of chemical fertilizers on health and fisheries. External benefits may include health benefits of a water supply scheme or recreational benefits of a storage dams. Economic Price of Traded Goods and Services: Traded goods are goods and services that are actually imported to or exported from a country, either in whole or in parts. Economic analysis has its own way to fix the price of traded goods involving CIF, Transport and handling costs, FOB etc.
  14. 14. Page 14/10 Economic Price of Non - Traded Goods and Services: A commodity is non-traded when it cannot be exported or imported or due to economic reasons and legal restrictions. Valuation of non-traded goods is more complex because its production affects the domestic prices, which in turn affects the use and production of these goods by others and is beyond our consideration. Economic Price of Labor: Labor is the single most important component among non-traded goods and services. Labor wage, apart from entirely being determined by the supply and demand, it is influenced by; a) Market structure, b) Government regulations and control, c) Labor unions, d) Collective bargaining, and e) Lack of labor mobility etc. Economic price of labor or the economic wage rate [EWR] is derived in two steps; a) Estimate the EWR in domestic prices and b) Convert the domestic price into border price by using conversion factors. Based on the level of skill the EWR or sometimes also called as the shadow wage is calculated differently for; a) Skilled labor, b) Semiskilled labor, and c) Unskilled labor Price Changes, Exchange Rates and Conversion Factors are usually defined by Central Bank or Ministry of Finance. Identification of Economic Costs: In economic analysis, costs include only those items which, when used, affect the availability of resources to the rest of the economy. For example, economic cost of unskilled labor is ~ zero in a society with very high un-employment. Followings are to be considered: 1. Contingencies – economic cost of additional real resources required beyond the base cost 2. Sunk Cost – It is the cost of existing facilities 3. Depletion Premium – It is the cost of exploitation of non-renewable natural resources Identification of Economic Benefits: The difference between what the consumers are willing to pay and what they actually have to pay is the consumer’s surplus. This surplus accrues to the consumer if when a project contributes to a reduction in price and should be treated as a benefit. In order for a public project to be feasible, EIRR should be > OCC Social Analysis What we have done up to now is also referred to as the Traditional Cost Benefit Analysis [TCBA], in which the valuation of the inputs and the outputs is done in terms of the opportunity cost for the country. The objective of public investment is considered to maximize the economic growth of the country. TCBA, however, does not concern itself as to whom the benefits accrue and as to the purpose for which they are used. In order to look into these matters, the Social Cost Benefit Analysis [SCBA] was developed in early 1970s in recognition of the inadequacy of public sector resources to address persistent problems of poverty and inequality of income distribution in developing countries. The determination of social accounting price is influenced by two basic assumptions: 1. Extra consumption is worth more to the poor than to the rich; 2. An extra unit of consumption may be worth less than an extra unit of savings today. The general effect of social accounting prices is that projects which generate greater consumption benefits to the higher income groups are not favored. Projects which favor the lower income group of society are preferred as they show higher social returns because of the way the social accounting prices are defined. Consistent use of SCBA is expected to raise the level of investment over the time, to change the sectoral allocation of public investment, to reduce income disparity, and to influence the choice of technology.
  15. 15. Page 15/10 There are ways developed for it already. Net Social Cost of Inputs = Foregone output at efficiency price + Cost of foregone savings because of extra consumption – Benefit accruing from extra consumption Net Social Benefit = efficiency benefits – Value of foregone savings because of extra consumption + Benefits accruing from extra consumption Issues concerned are: Valuation of income distribution Valuation of public income Diminishing marginal utility of extra consumption Social Wage Rate Value of private savings Project Appraisal: Project appraisal (external) is an independent study of the proposed project by the client, financier, and donor in order to check whether the proposal is a sound one or not in aspects related with Market, Technical Financial, Economic, Environmental and Social Appraisal Risk Analysis: Project planning and its implementation is always associated with various hazards and risks. The risk arises due to many factors such as; a) Assumptions made during project planning may go wrong, b) Cost could rise in any area and in unpredictable magnitude, c) Benefits could be lessened, d) Government regulation, control on market, and Taxation policy changes, e) Market forces do not work properly and f) There are too many regulations Sensitivity Analysis: This is the most practiced tool of assessing sensitivity in a project. In this method few unfavorable scenarios are considered and the three indicators – NPV, BCR, and IRR – are calculated for different scenarios such as; a) 10 % rise in cost with constant benefit, b) 10 % fall in benefit with the same cost and c) 10 % rise in cost and 10 % fall in benefit. The change in values of the indicators can be plotted graphically and the risk assessed in most likely worst scenario. Evaluation techniques have to be developed during project planning and preparation in order to facilitate a proper evaluation later on. There are varieties of such techniques such as: Cost benefit review: Benefit and Costs are reviwed in order to establish that B > C Earned value analysis: EVM is calculated to find out the status of project interms of cost and time overun Benefit incidence: It refers to the availability of intended benefits to the targeted people. Equilibrium model: This is a complex model of looking at project output, effect and impacts in equillibrium with other sets of policy, socio-economical and development level, domestic and beyond the border situations etc. Like we talked about project with a Systems approach, similarly it is all abpout looking for effects of projects deliverables on targeted people in a wholistic manner. Effects analysis (social and economical and on income distribution): It is all about looking for intended short term changes brought about by the project producs, may they be goods or services. Project impact evaluation including experimental design: Here the long term changes in behaviours, living conditions and social standings anticipated by the project due to its
  16. 16. Page 16/10 deliverables is looked upon amongst the involved stakeholders of the projects, including the proponent.There are PIE without an experimental design, with quasi-exprimental design and full experimental design. These referres basically to the setting of PIE objective, its methodology, data collection (to what level of accuracy), analysis and reporting including resource allocation, time line setting and the moidality of utilization of output of the PIE. PERT, CPM, Slack (float) time analysis, Gannt chart: Gannt chart and Critical Path Method are basically tools utilized for projects scheduling and rescheduling. Project Evaluation and Review Techniqu (PERT) is based on network diagram. All three; GC, CPM and PERT allows project managers to evaluate, how their project is progressing, is there already any time overrun, over/under utilization of other resources and the possibility of utilizing the Float time to recover these damages, if any. SCHEDULING and CHARTS Thus scheduling is defined as the process of establishing the sequence of work tasks and activities on time scale. Some scholars have differentiated planning as a process of devising the work tasks and the order in which they are to be undertaken and the scheduling as putting the plan in time dimension. It involves following studies. Time study: It is a principle technique of work measurement. Analysis defines standard time required for standard production output or for carrying out a specified job at defined level of performance. It has to make allowance for Relaxation time based on Personal need, Fatigue need, Environmental allowance and Climatic allowance Method study: It concerns with the systematic recording and critical examination of ways of doing things in order to make improvements. Process charts:Process charts provide diagrammatic means for recording the sequence of activities in an existing method under study. Multiple activity charts: This chart incorporates a time scale against which various activities are plotted. It is used to illustrate the inter relationships between the activities of two or more objects. Method statement: This details the method of carrying out every operations of consequence and the combination of equipment and manpower established as being the worst suitable for the said work. Work Breakdown Structure: Work task/activity is a specific item of work that can be clearly identified and delineated in such a way that its commencement, content, and the completion can be recognized. A work task uses resources including time. It is to establish inter relationships and future schedule for work tasks. It is the basis for the scheduling. Manpower requirement: it basically has to deal with the requirement of labor and requirement of staff. Incentive schemes for manpower: Whenever some work is carried out by certain person, he/she should be provided with some remuneration or the incentives. Bar chart also referred to as Gantt chart is the most popular type of scheduling for projects of reasonable size and involving reasonable number of activities. This was developed by Henry Gantt - a scientist involved in developing theories and practice of better management practices in France during the 19th century.
  17. 17. Page 17/10 Activity (Work) ( 1st, 2nd, etc. are weeks from the start of assignment) 1st 2nd 3rd 4th 5th 6th 7th 8th 9th Field Work Preparation Field Work Draft Report Preparation and Submission Final Report Preparation and Submission Bar charts could incorporate the time, resources [both cost and manpower] required for an activity. Alternatively, the most popular way of presenting a bar chart is with a set of charts as follows: a) Work schedule, b) Manning schedule, and c) Cost schedule A lot of works have to carry out to arrive at this point. The most important one is defined as the identification of the work duration for any specific activity. Quantity to be carried out Work Duration = Average productivity of operatives * number of operatives This is influenced by: Weather; Availability, quality, and training of the operatives; Familiarization with the work, with the place of work, and with the people with whom to work together; Quality of specified workmanship; Quality of supervision; Size of the project; Completion date and the time pressure for the project; Length and incidence of holidays; Repetitiveness of work nature leading to learning advantages Physical constraints such as access etc. PERT and CRITICAL PATH METHOD (CPM) Project Evaluation and Review Technique [PERT] was developed by US Navy to evaluate project of fleet of ballistic Missile weapon [Polaris Missile]. This mega-project involved the services of more that 3000 contractors. This method used brought the time overrun in such a project to a level of 36 %, which was then considered to a great achievement. PERT can make allowance probable errors in time dimension regarding the duration of activities. Critical Path Method [CPM] was developed by engineers at the DU PONT plant in France based on simple calculation, whose result is the definition of a critical path through a network diagram. Its implication is that, activities in the critical path, if completed in time lead to timely completion of project. Other activities which are not in the CP can be managed if the CP is met. It was piloted in DUPONT and a 125 hour operation was completed within 93 hours. After this the CPM has established its root in the project planning and scheduling. Critical Path Analysis is a dynamic model, which utilizes the techniques of Network Analysis to present a project plan by systematic diagram which represents the sequence and interrelationships of activities within a given project. It also gives the time dimension. Foundation for both is the Network Diagram, which is a Display of series of operations, their inter relationships, their inter dependencies, and duration with various arrows and nodes. Before preparing a CP Analysis, following basics have to be understood:
  18. 18. Page 18/10 a. Resources: Men, Material and Machines and the Time b. Activities: This is the work breakdown structure [WBS] which consumes resources. WBS analyses any activity in terms of its type of work/type of resource required, location of work, and any restraints on the continuation of the activity. c. Logic: It is the relationship and interdependence between activities. It is analyzed in terms of the earliest possible time of start. d. Duration: It is the duration of each activities depending upon level of resource allocated to the activity, output of those resources, and quantity of work to be completed within the said activity. e. External Restraints: These are specified completion dates of the whole or the part of work, access problems, any other situational problems related to specific activity. f. Other anticipated problems: If there are any. It might include many problems which arise in a construction project. An arrow is used in CPM to represent one activity within the WBS, the tail of which represents the starting time and the head the completion/end time and the direction of represents the direction of work flow. At either end of the arrow [activity] an event shall occur. This is a milestone where an activity/operation is complete and another activity/operation could start. All networks are constructed logically on the principle of DEPENDENCY. Example Setting out Foundation Order Make Erect Excavation Timber Formwork form Setting out Foundation excavation erect formwork Order timber Make Formwork Here in this example, erection of formwork can not take place without Foundation excavation and without formwork preparation. But, two sets of work can be undertaken in parallel. Activity identification is usually done by so called I – j convention, i denote the number of event at the tail and j denotes the number of event at the head. Forward numbering [0 – 1] is used in CPM Electric conduits Built Wall Plumbing Plaster Joints fixation Electric Conduits Built wall Plumbing Plaster 1 2 3 4 5 6 1 2 3 4 5 4321 1 2 4 3 5 6
  19. 19. Page 19/10 Joints fixation In the second example activities 3 -5 and 4 – 5 are called dummy activities. Dummy activities can represent logic in certain situation where the use of activity arrow would not allow this. If the activities would follow only in a clear sequence it will be very simple linear diagram. But the actual logic is very complex. This is also because a number of activities could start after an event and an activity may be dependent upon a number of earlier activities. In a network, the objective of a project is the last event in the network, to which all other arrows should converge. In network construction three questions are very important; a) What activity must immediately precede, b) What activity must immediately follow, and c) What activities could be taking place concurrently Once the planning logic of network is established, then the time dimension is added to it. Start from the first event and based on the simple arithmetic add on the duration and work out a forward pass defining the earliest start time. Once the end event is reached then make a backward pass similarly by subtracting the duration from each event for each activity. This gives the latest event time. These two figures for each activity could be different for many activities. But there will be one or a few more paths in which these two figures for earliest start time and late finish time are equal. These events are called critical events which have to occur as planned in order not to have negative effect on project schedule. The path that passes through these critical events is called the Critical Path. Other paths are associated with floats, which is the difference between the earliest start time and the latest finish time. Activities which have floats could be achieved easily utilizing these floats for carrying out the work. But the critical path, by its name itself suggest that it is the most critical, to achieve which is the prime priority of each project manager. Another important aspect of the CPM is of the resource optimization. For an example, if we consider the network diagram on a given unit of time and draw a cross section, we can identify all the activities that are to be carried on that unit of time. Based on this we can easily compute the resources such as money, men, and machines required for that particular day. If it is too unbalances, say for example we require many machines today and don’t require them tomorrow, but again need them day after tomorrow; this is hard to manage. Similar case is with the labor. Machines and men cannot be manipulated in such a way. The money requirement identified thus could be helpful to work out the cash flow of the company. Basically most of the techniques involve data collection as raw material, its processing and analysis according to accepted design in order to generate the useful information. There are many tools for data collection. Secondary data is consolidated from existing documents and primary data is collected in fields. Surveys, RRA/PRA (tools), Appreciative enquiries ets are the popular models. Starting from simple logical analysis and growing along the way; SPSS, mathematical tools such as linear and regression analysis, developing mathematical models are the potential tools utilized for data analysis. Selection of the tools depends upon characteristics, size, affordabilty and requirements set forth during the project appraisal. Project Concept Note (PCN) This is a conceptual paper which introduces a paper to all itys stakeholders. It is beyond Brochure level and less than a Project Proposal and detailed Project Report.
  20. 20. Page 20/10 PCN is a device used to introduce a project to all its stakeholders, supporters to enhance the confidence level and opposing groupm to sensitize about its positive points and to convince them. A PCN could be of any type of projects such as; a) New project, b) Expansion of existing project tec. From propent’s standpoint, a PCN is the primary source of information from which the concerned individuals and institution comes to learn about your project idea. It should be able to convey in brief:  Ideas, Concept, Capability  Project Description, location, type of work etc  Objectives, Scope, Purpose  Financial assessment (cost versus benefit)  Time requirement assessment  Human Resource requirement assessment  Implementation arrangement  Project Engineering, operations, Manufacturing, procurement etc.  Environmental and social assessment Preparation of a PCN is important as it forms the basis for future involvement of stakeholders. Home Work : Prepare a PCN. 4 pages A4. Use your wildest imagination. Within 7 days. Unit 3 Lecture Notes 09 – 12 Logical Framework Approach and Project M & E OBJECT ORIENTED PROJECT PLANNING If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle. (Sun Tzu, Chinese general. The Art of War) Every project is besieged by at least one of these enemies: Inadequate requirements Unstable requirements Inadequate customer communications Poor team communications Unnecessary complexity Ineffective team behavior Conquering Enemies with Object Technology: Objects are program components that accomplish a limited task, such as maintaining a list, or drawing a line. Objetcs entails followings: Dynamic and static descriptions of requirements. Capturing not only what but also how Dynamic and static descriptions and design. Not only how but how the objects interact Encapsulation. Hiding the internal working of the object from the rest of the system, which permits division of state, function, labor. Inheritance. Allowing for more than one kind of type of object, which enables reuse and a focus on new functionality. Aggregation. Creating a large object from a small simpler object Packages. Encapsulating objects into larger components with hidden internal workings
  21. 21. Page 21/10 It is by taking advantage of these features that you can improve productivity of your team and quality of your product. Simply put, object-oriented projects achieve the manager’s mantra, “faster, cheaper, better,” for three reasons: Objects provide the flexibility and control necessary to deal with evolving requirements. Object use facilitates collaboration. Objects help manage complexity. Project Palnning Matrix – Logical Frame Work (LOGFRAME) Logical Framework Approach [LFA] to planning projects is a product of object oriented project planning and MfDR. It is adopted by many international agencies. It is very important for us for us because the National Planning Commission demands a Logical Frame Work Matrix with every project proposal prior to its approval. The LFA is an analytical tool for object oriented project planning and management. LFA also is a set of interlocking concepts which must be used together in a dynamic fashion to permit the elaboration of a well designed, objectively described and evaluate projects. It is: a) objective oriented, b) target group oriented and c) participatory. It helps to: Clarify and justify a projects Indentify information requirements Analys the project setting at early stage Facilitate communication between all parties involved Identify how the success or failure of a project is measured Basic premises of LFA are:  Projects are designed to achieve quantifiable and measurable objectives and outputs;  Project success and quality needs to monitored and measured by the extent to which projected objectives outputs are actually achieved;  Projected achievements of objectives and outputs is based on a series of hypothesis, of cause and effects relationship, that should be clearly agreed to and monitored; and  Stakeholders are in agreement on validity of these hypotheses, which become the basis of project design. The end product of LFA planning is a Logical Framework Matrix [LFM] or Project Planning Matrix [PPM]. In short it is called the LOGFRAME. Development of Logframe involves following steps, which we shall discuss about each in its own time. 1. Sectorial performance and stakeholder analysis; 2. Problem analysis; 3. Objective analysis; 4. Alternative analysis 5. Project design Logical Framework Matrix [LFM]/Project Planning Matrix [PPM]/LOGFRAME. Logframe usually is a 4 by 4 matrix comprising of 4 columns and 4 rows as follows. The content of each column is arranged in a logical sequence that corresponds to the logical structure that was developed during objective analysis. First Column cells are as follows. The first level of the hierarchy of the objective tree corresponds to the first row of the Logframe and contains overall goal of the project. The second level hierarchy of the
  22. 22. Page 22/10 PURPOSE INPUTS OUTPUTS PRESENT SCENARIO FUTURE SCENARIO National and sector area objective tree is taken as the purpose. Third level hierarchy of the objective tree is taken as outputs or results and the fourth level is considered as the inputs or the activities. Second Column describes the indicators of the objectives. Third column indicates the source of information for the verification of the indicators later during monitoring and evaluation. Fourth column shows the important assumptions or risks for the successful achievement of the project objectives. Example of a LOGFRAME PROJECT DESIGN [Narrative Summary] PERFORMANCE INDICATORS [Objectively Verifiable Indicators] PROJECT MONITORING MECHANISM [Means of Verification] RISKS [Important Assumptions] GOAL PURPOSE OUTPUTS INPUTS Goal: The higher level objective towards which the project is expected to contribute. Purpose: The effect which is expected to be achieved as the result of the project process Outputs: The result that the project management should be able to guaranttee Activities: The activities that have to be carried out by the project in order to produce the outputs Inputs: Goods and services necessary to undertakr the activities Indicators: Measure (direct or indirect) which verify to what extent the outputs are produced, purpose fulfilled and goal achieved Assumptions: Important events, conditions and decisions outside the control of project management necessary for the achievement of the immediate objective. LF deals with three major areas related with the projects. They are: A schematic diagram which heklps to understand LFA GOAL The project environment The objectives The project Project area National and sector area Project area Activities Resource Book by NORAD on LOGFRAME has been referred to while preparing these lectures
  23. 23. Page 23/10 Logframe development; stakeholder and problem analysis Logical framewors are developed in a workshop scenario. LFA Workshops are considered as a major instrument for project palnning and analysis. It can be organized in different ways. In simplest form, it can be a brief, internal exercise carried out at an early stage to decide whether or not to continue palnning the project further. It could be an extensive exercise depending upon the type of projects and can last up to for 12 days. Extensive workshops shall be participated by representatives of development partners, donors, affected and involved organizations, relevant specialists, and stakeholders (beneficieries, sffected people, supporters and opponents) in order to make it more inclusive and to seek early “consensus” on project objectives and “road map:. Preferably, the WS should be conducted in project area. It sahould be facilitated by a professional specialist, who should be independent and shall not enter into substantial discussion apart from managing the methodological part of the LFA. Visualization teckniques are used. Mostly used are Meta Cards. All participants write down their contribution in those colored cards, which are then pinned to a wall for everyone to see. Discussions are rationalized and deepened, the results are gradually improved. Followings are the basic rules for visualization: 1. Write dow suggestions rather than time consuming discussion 2. One statement in one card 3. Clear and distinct message with sticking to facts and avoiding speculations 4. Cards with general statements replaced by specific statements 5. Statements can be changed or moved by moderator on participant’s request 6. Statement can be removed or changed only when all participants agree (consensus) 7. Unproductive discussion shall be checked by moderator using so called “traffic signs” 8. Line indicatinf causal relationships should not be drawn until end of session Traffic signs: Needs clarification later More information required Disagreement, controversy Discontinue discussion Sectorial performance and stakeholder analysis Sector Analysis: General sectoral performance analysis: it is carried to assess the present scenario in the concerned sector. Stakeholder Analysis: Lack of knowledge among development planners both on donr and partner sides about people affected by development project has proved to be a common cause of project problems as evidenced by numerous evaluation reports and studies. At the very outset, therefore, a comprehensive picture of interest groups, the individuals and intitutions involved has to be developed. Organizations and authorities at different levels and interest groups have different motives and interests, expectations all of which have to be analysed at early stage of project planning and implementation. Fundamental requirement is that the objectives reflect the needs of the society and interest groups and not merely the internal needs of an institution. All parties whose views are necessary to investigate in order to understand the problem should be listed together with project affected groups, may they be positively affected or negatively affected and for that matter directly or indirectly affected. Equal representation should be ? Info ? Stop ?
  24. 24. Page 24/10 sought frominterst groups, individual specialists, organizations, authorities, stakeholders. Geographical, gender, and other sociual aspects also have to be assessed while selecting participants. Group analysis shall be based on: Problems affecting them Their interests Their potentials Linkages It can be summarized as follows:  Identification of stakeholders; o Participation analysis and analysis of interested groups:  Institutions  Groups  Persons o List of participants o Classification of participants  Beneficiaries  Supporters  Opponents Problem analysis: Existing situation is analyzed on the basis of available information. Major problems are identified and main causal relationships between these problems are visualized in a problem tree.All possible options should remain open during problem analysis. The aim at early stage is to establish an overview of the situation. Later in the process, the perspectives could be narrowed and developed in order to prepare for the design of the project. Few tips are useful as follows: Identify EXISTING problems, not imagined ones Problem is not the absence of solutions, but are merely an existing “negative state” Example: No pesticides are available (wrong statement); crop injfected with pest (right statement) Each participant writes down a suggestion for the focal problem. The theme guidiong the discussion and solution of the focal problem is the INTERESTS and PROBLEMS of interest groups, persons and institutions involved in project process. LFA converges to ONE focal problem drawn by vigorous discussion. Developing a Problem Tree: Subatantial and direct Causes of the focal problem are palced parrallel underneath it Subatantial and direct Effects of the focal problem are palced parrallel above it Causes and effects are further developed along the same principle to form the problem tree. Identify substantial and direct causes of focal problem Identify substantial and direct effects of focal problem Construct a problem tree showing the cause and effect relationships between the problems Review the problem tree, verify its validity and completeness and make necessary adjustments.  Core problem analysis [method] o Problem as negative statement, One problem from one participant o Problem listing, Selection of core problem [unanimous]  cause and effect analysis of core problem o causes bellow the core problem
  25. 25. Page 25/10 o Effects above the core problem o Multi-level cause/effect links o Use of exact words in explaining cause/effect Example of a Problem Tree Loss of confidence in Road transport Effects Loss of life Delays High frequency of accidents Causes Driver Bus Road Bad license Inexperienced Old Not maintained Bad No Tr. /control Objective Analysis and Alternative Analysis In the objective analysis the problem tree is transformed into a tree of objectives – future solutions of the problems identified – and analyzed. Working from TOP to BOTTOM, all problems are reworded, making them into objectives – positive statements. Focal problem is also reworded and transformed in primary objective – Goal. Problem: “If there is a cause A, then the effect B is produced” Objective: “Provide means X in order to achieve end Y” Working from BOTTOM to TOP ensure that “Cause – Effect” relationships have become “Means – End” relationships. Finally draw lines to indicate the “Means – End” relationship in the objective. Now, in order to formulate aproject, identify Project Elements from Top to Bottom as follows: Goal Purpose Outputs Activities Inputs Summarised  Negative statement in problem tree are reworded to become positive conditions  Cause and effect in a problem tree become means and ends in objective tree based on further analysis of objectives [every cause - effect relationship does not automatically is transformed to the means – end relationship, it is situational]  Objective at one level should be consistent with the one in other level. Each objective should be realistic, attainable, and measurable  Objective of higher level Logframe could be goal to lower level Logframe. Example of objective tree
  26. 26. Page 26/10 Better confidence in Road transport Ends Passengers not hurt Timely services Frequency of accidents reduced Means Cable Driver Bus Road Good license Experienced New Maintained Good Traffic control Alternative analysis: This analysis is all about following: Identify different “Means and End” ladders as possible alternatives Eliminate objective which are obviously not desirable or not achievable Eliminate objectives which are pursued by other projects in the area (remove duplications) Discuss and draw implications on affected group It should identify potential alternative solution to a problem and to achieve the objective. Criteria for selection of alternatives are:  Development policies and priorities  Specific condition  Availability of resources – funds, human resource  Sustainability  Past experiences  Effect on target group  Cost Benefit Analysis  Social and political feasibility  Implement ability Select the best alternative based on: Total cost Benefit to priority group Probability of achieving goal Social risk and further Technical aspects Financial and economic aspects Institutional aspects Social and Environmental aspects OVI, MOV and Assumptions, Vertical Cause and Effect OBJECTIVELY VERIFIABLE INDICATORS Indicators determine how we can measure to what extent the objectives have been achieved at different times. Measurements can be:
  27. 27. Page 27/10 Quantitative (km of road length maintained) Qualitative (farmer’s cooperative functioning effectively) Behavioural (increased use of sanitary facility) Qualitative indicators should also me made measurable tp the extent possible. There are two types of indicators: Direct indicators: These are the ones that can be directly measured and reflects the achievements Proxy indicators: These indicators are linked with the achievement of objectives Direct indicators have to be supplemented by additional proxy indicators. For an example: Purpose: Increased income of small farmers Direct Indicator: Sales of the Crop Indirect (Proxy) Indicators: Purchase of consumer goods Thatch roof replaced by Tin roof Several indicators are preferred as they provide better picture of the improvement made and objectives achieved. Indicators should specify the performance standard to be reached in order to achieve the goal, purpose, outputs etc. They should specify: Target Group (For WHOM) Quantity (how MUCH) Quality (how WELL) Time (by WHEN) Location (WHERE) These indicators provide basis for and are very important for Monitoring and Evaluation purpose. A good indicator is: Substantial – reflects an essential aspect of an objective in precise terms Independent – each indicator is expected to reflect evidence of one achievement, cross referrences are usually avoided Factual – It shoud reflect fact rather than subjective judgement Palusible – recorded changes can be directly attributed to the project Based on obtainable data – should drwa upon data that are readily available or that can be collected with reasonable extra effort and resources Measures provided by indicators should be accurate to make them “Objectively Verifibale”. An indicator is called objectively verifiable when different persons using the same measuring process independently of one another will obtain the same measurement. MEANS OF VERIFICATION Along with the indicators, the sources of information necessary to use them should be specified as follows: What information is necessary In what form the information is required Who should provide the required information Sources outside the projects should be assessed for:
  28. 28. Page 28/10 Accessibility Reliability and Relevance The volume of work and the additional cost involved in producing such infprmation should also be assessed and added in the total project cost. It should be kept minimum to the extent possible. Indicators for which means of verification can not be identified should be discarded. Simple and cheaper (cost effective) indicators and means of verification shall be used. ASSUMPTION and VERTCAL LINKAGE Assumptions describe conditions that must exist if the project is to succeed, but which are outside the direct control of the project management. Assumptions are worked out from BOTTOM to TOP, as follows: Examine whether inputs are sufficient (including from outside the project environment) Some of the assumptions are derived from the objective tree (If, then scenario) Have to be identified for each level (project elements); Input, output, purpose Each level of project element should contain the necessary and sufficient conditions to achieve the next level. Examples: Fellowship recipients return to workplace Local institutions collaborate in project planning activities Changes in price can be accomodated within given budget Obvious assumptions as follows shall be eliminated. Not important for outcome Very likely to occur Assess the probability of ocurence for remaining assumptions as follows: Quite likely to occur: Monitor, Report change, Influence Not likely to occur(Killing Factor) : Redesign the project This is not possible: reject the project Basic of the assumptions is based on the fact that it clearly states the IF, THEN condition in the project planning, making it clear to every level concerned in decision making. Vertical Linkage If input is supported by its assumption then output is achieved. If output is associated with its assumption, then the purpose if achieved. If purpose is commensurate with its assumption then the goal is achieved. This is the reason why the cell [1r * 4c] is kept usually empty unless in specific case. + + + Goal Purpose Output Assumptions Assumptions Assumptions
  29. 29. Page 29/10 + + Pros and Cons, Use and Practical approach vis a vis Logframe Advantages: It ensures that fundamental questions are asked and weeknesses a re analyzed in order to provide decision makers with better and more relavant information It guides systemetic and logical analysis of thee inter related key elements which constitute a well designed project It improves planning by highlighting linkages between project lements and external factors It provides better basis for systematic monitoring and anbalysis of the effects of a given project It facilitates common understanding and better communication between decision makers, managers and other parties involved in the project It provided support to management and administration by standardized procedure for collecting and assessing information Its use and systematic monitoring ensures continuity of approach when original project people are replaced It may facilitate communication betwwen government and donor as more and more agencies are using this tool Widespread use of LFA format makes it easier to undertake both sectoral studies and comparative studies in general Limiatations: Rigidity in project administration may arise when objectives and external factors specified at the outset are overemphasized. This can be avoided by regular project reviews where the key element can be revaluated and adjusted LFA is a generic analytical tool. It is policy – neutral on such questions as; income distribution, employment opportunity, access to resources, local particiapation, cost and feasibility of strategies and technology or the effect on environment. LFA is only one of several tools to be used during project planning and preparation, implementation and evaluation It should not be understood to replace target group analysis, cost benefit analysis, time planning (scheduling), impact analysis and most important of all – the Feasibility Study Full benefit of utilizing LFA can be achieved only through systematic trainig of all parties involved and methodological follow ups. Uses: Its use is growing by number of international agencies working as development partners in developing countries However, the format have been even enhanced to meet the new standards set by management for Development results (MfDR) In Nepal, NPC has made it mandtory to draw LF for any project that has to be approved by it Inputs Activities Assumptions Assumptions
  30. 30. Page 30/10 Following are the combined use of LFA in different types of projects. Large Project: LFA (must) + Feasibility Study Experimantal projects: LFA necessary regardless of size of the project Programmes: LFA on each projects and that of the Program itself Small Projects; LFA is the simplest way to plan them It is used during various stages of project development in each of its stages such as; Identification, Feasibility Study, Project Design, Project Planning, M & E, Progress review Practical approach: The best thing in it for a project manager is the vertical linkage. This saves him/her from unnecesary hassles as the non achievement of one level of project element can be directly linked with non complying of an assumption associated with predecessor element. Home Work: Develop a LOGFRAME for your Project. Just Matrix. 7 days. Unit 4 Lectures 13 & 14 Monitoring and Evaluation Indicators Developing Indicators for Project Monitoring and Evaluation In order to reap out efficiency and effectiveness from M & E process, the INDICATORS against which project activities shall be monitored and evaluated shall be established already at the outset. The first set of indicators could be taken from Logical Framework of a project (if Logframe exists). Second and third column of Project Palnning matrix (Logframe) are; Objectively veriable indicators (OVI) and Means of verification (MoV). Development of indicators may vary from project to project based on their types, size, time frame, expected output, effect, and impact. Indicators developed during project planning and preparation shall avoid the future confusion, and should be defined as: Quantifiable and qualitative, Objective and subjective Quantifiable indicators shall be measured objectively and exactly reflected in monitoring reports in terms of their achievements. Qualitative indicators could be only explained in subjective way to show the correlation in plan and achievement in terms of input/output and or effect/impacts for monitoring and evaluation respectively. Basic Features of Indicators including Reliability, Validity and Sensitivity Indicator for technical types the projects is more quantifiable and tangible indicators. Software and social sector type of projects may suffice with few quantifiable and more qualitative indicators. Indicators in themselves should be SMART: S - Sensible M - Measurable A - Attainable R - Reasonable
  31. 31. Page 31/10 T - Timely Further its validity and reliability should be established. Monitoring and evaluation need not be expensive or complicated, nor do they require specialists or grand calculations. The complexity and extent of the studies can be adapted to fit the project/program needs. The job of the project manager in this process is to point out those areas in need of monitoring or evaluation. If this is left to the researchers, the studies may tend to be too academic and not as useful to project management. If the INDICATORS are designed correctly, Evaluation and Monitoring systems can be an effective way to: Provide constant feedback on the extent to which the projects are achieving their goals. Identify potential problems at an early stage and propose possible solutions. Identify accessibility of the project to all sectors of the target population. Ascertain the efficiency with which the different components of the project are being implemented and suggest improvements. Evaluate the extent to which the project is able to achieve its general objectives. Provide guidelines for the planning of future projects Influence sector assistance strategy. Relevant analysis from project, program and policy evaluation can highlight the outcomes of previous interventions, and the strengths and weaknesses of their implementation. A reasonable set of INDICATORS helps further to: Improve project design. Use of project design tools such as the logframe (logical framework) results in systematic selection of indicators for monitoring project performance. The process of selecting indicators for monitoring is a test of the soundness of project objectives and can lead to improvements in project design. Incorporate views of stakeholders. Awareness is growing that participation by project beneficiaries in design and implementation brings greater “ownership” of project objectives and encourages the sustainability of project benefits. Ownership brings accountability. Objectives should be set and indicators selected in consultation with stakeholders, so that objectives and targets are jointly “owned”. The emergence of recorded benefits early on helps reinforce ownership, and early warning of emerging problems allows action to be taken before costs rise. Show need for mid-course corrections. A reliable flow of information during implementation enables managers to keep track of progress and adjust operations to take account of experience). Types of Indicators used in M & E Good monitoring and evaluation design during project preparation is a much broader exercise than just the development of indicators. Good design has five components: 1. Clear statements of measurable objectives for the project and its components, for which indicators can be defined. 2. A structured set of indicators, covering outputs of goods and services generated by the project and
  32. 32. Page 32/10 their impact on beneficiaries. 3. Provisions for collecting data and managing project records so that the data required for indicators are compatible with existing statistics, and are available at reasonable cost. 4. Institutional arrangements for gathering, analyzing, reporting project data, and for investing in capacity building, and to sustain the M&E service. 5. Proposals for the ways in which M&E findings will be fed back into decision making. Examples 1. Project objectives: Projects are designed to further long-term sectoral goals, but their immediate objectives, at least, should be readily measurable. Thus, for example, a health project might be designed to further the sectoral goals of a reduction in child mortality and incidence of infectious diseases, but have an immediate, measurable objective of providing more equitable access to health services. Objectives should be specific to the project interventions, realistic in the timeframe for their implementation, and measurable for evaluation. Input indicators are quantified and time-bound statements of resources to be provided. Information on these indicators comes largely from accounting and management records. Input indicators are often left out of discussions of project monitoring, though they are part of the management information system. A good accounting system is needed to keep track of expenditures and provide cost data for performance analysis of outputs. Input indicators are used mainly by managers closest to the tasks of implementation, and are consulted frequently, as often as daily or weekly. Examples: vehicle operating costs for the crop extension service; levels of financial contributions from the government or cofinanciers; appointment of staff; provision of buildings; status of enabling legislation. Process indicators measure what happens during implementation. Often, they are tabulated as a set of contract completions or milestone events taken from an activity plan. Examples: Date by which building site clearance must be completed; latest date for delivery of fertilizer to farm stores; number of health outlets reporting family planning activity; number of women receiving contraceptive counseling. Output indicators show the immediate physical and financial outputs of the project: physical quantities, organizational strengthening, initial flows of services. They include performance measures based on cost or operational ratios. Examples: Kilometers of all-weather highway completed by the end of September; percentage of farmers attending a crop demonstration site before fertilizer usage; number of teachers trained in textbook use; cost per kilometer of road construction. Impact refers to medium or long-term developmental change. Measures of change often involve complex statistics about economic or social welfare and depend on data that are gathered from beneficiaries. Early indications of impact may be obtained by surveying beneficiaries' perceptions about project services. This type of leading indicator has the twin benefits of consultation with stakeholders and advance warning of problems that might arise. Examples of impact: (health) incidence of low birth weight, percentage of women who are moderately or severely anemic; (education) continuation rates from primary to secondary education by sex, proportion of girls completing secondary education; (forestry) percent decrease in area harvested, percent increase in household income through sales of wood and non-wood products. Exogenous indicators are those that cover factors outside the control of the project but which might affect its outcome, including risks (parameters identified during economic, social, or technical analysis, that might compromise project benefits); and the performance of the sector in which the project operates. Concerns to monitor both the project and its wider environment call for a data collection
  33. 33. Page 33/10 capacity outside the project and place an additional burden on the project’s M&E effort. Data Collecting and Managing Project Records The achievement of project objectives normally depends on how project beneficiaries respond to the goods or services delivered by the project. Evidence of their response and the benefits they derive requires consultation and data collection that may be outside the scope of management. Indications that beneficiaries have access to, are using, and are satisfied with project services give early indication that the project is offering relevant services and that direct objectives are likely to be met. Market research information is an example of a leading indicator of beneficiary perceptions that can act as a proxy for later, substantive impact. Other leading indicators can be identified to give early warning about key assumptions that affect impact. Examples would include price levels used for economic analysis, passenger load factors in transport projects, and adoption of healthcare practices. When planning the information needs of a project there is a difference between the detail needed for day-to- day management by the implementing agency or, later, for impact evaluation, and the limited number of key indicators needed to summarize overall progress in reports to higher management levels. Project field records. Indicators of inputs and processes will come from project management records originating from field sites. The quality of record keeping in the field sets the standard for all further use of the data and merits careful attention. M&E designers should examine existing record-keeping and the reporting procedures used by the project authorities to assess the capacity to generate the data that will be needed. At the same time, they should explain how and why the indicators will be useful to field, intermediate, and senior levels of project management. Surveys and studies. To measure output and impact may require the collection of data from sample surveys or special studies (including, where appropriate, participatory methods). Studies to investigate specific topics may call for staff skills and training beyond those needed for regular collection of data to create a time series. Where there is a choice, it is usually better to piggyback project-specific regular surveys on to existing national or internationally supported surveys than to create a new data collection facility. Special studies may be more manageable by a project unit directly, or subcontracted to a university or consultants. Data comparability. Some desired indicators of impact, such as mortality rates, school attendance, or household income attributable to a project, may involve comparisons with the situation before the project, or in areas not covered by the project. Such comparisons may depend on the maintenance of national systems of vital statistics, or national surveys. Before data from such sources are chosen as indicators of project impact the designer needs to confirm that the data systems are in place and reliable and that the data are valid for the administrative area in question and for any control areas. Potential problems in making comparisons with existing data include incomplete coverage of the specific project area; the use of different methods to collect data, such as interviewing household members in one survey and only household heads in another; and changes in techniques such as measuring crop output in one survey and collecting farmers’ estimates in another. Participatory methods of data collection can bring new insights into peoples’ needs for project planning and implementation, but are no less demanding on skills than questionnaire surveys. They are time-consuming and require substantial talent in communication and negotiation between planners and participants.
  34. 34. Page 34/10 4. Institutional arrangements; capacity building Good M&E should develop the capacity within an organization and build on existing systems. Capacity building is widely acknowledged to be important but is often poorly defined. It means: upgrading skills in monitoring and evaluation, which include project analysis, design of indicators and reporting systems, socioeconomic data collection, and information management; improving procedures, to create functional systems that seek out and use information for decisions; and strengthening organizations to develop skilled staff in appropriate positions, accountable for their actions. Referrence: Monitoring and Evaluating Urban Development Programs, A Handbook for Program Managers and Researchers. Bamberger, Michael and Hewitt, Eleanor. World Bank Technical Paper no 53. (Washington, D.C.: 1986)