This document discusses the classification and identification of projects. It defines a project as a scientifically planned work scheme to achieve specific objectives within a set time period. Projects are classified in several ways, including whether their benefits are quantifiable, the sector they fall under, their use of resources, and the institution financing them. Identifying projects involves collecting economic data to find investment opportunities in utilizing existing resources better, complementing current operations, or fundamentally changing a business. Project objectives must be specific, measurable, realistic, consistent with resources, and aim to complete the project on time and within budget while earning a profit. Both economic and social objectives are important to consider.

1. Project Identification &
Classification
Revathy Rajasekaran
Coordinator, Edc
V.V.Vanniaperumal College for
Women
Virudhunagar
V.V.Vanniaperumal
College for Women

2. Meaning of Project
• Project is the scientifically evolved work plan
devised to achieve a specific objectives within a
specified period of time.
• A project involves capital investment for the
purpose of developing facilities to provide goods
or services.
• It is interrelated activities to achieve a specific
objective.
• Project involve allocation & consumption of
resources on one hand & generation of goods
and service on other hand
V.V.Vanniaperumal
College for Women

3. Project Classification
1.Quantifiable & Quantifiable Projects
Quantifiable Projects
▫ The projects in which quantitative assessment of
benefits can be made.
▫ Ex: Power generation, Mineral development
Non-Quantifiable Projects
▫ The projects where the benefits & outcomes
cannot be measured.
▫ Ex: Heath, Education, Defense
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College for Women

4. Project Classification
2. Sectoral Projects
• Agricultural & Allied Sector
• Irrigation & Power Sector
• Industry & Mining Sector
• Transport & Communication Sector
• Social Service Sector
• Miscellaneous Sector
V.V.Vanniaperumal
College for Women

5. Project Classification
3.Techno –Economic Projects
• Factor intensity oriented classification
▫ Based on the large investments in factor of production
▫ Plant & machinery (capital-intensive)
▫ Human resources (labour-intensive)
• Causation Oriented classification
▫ Demand based projects
▫ Raw material based projects
• Magnitude oriented classification
▫ The size of investment classifies the project as large-
scale, medium scale, small scale projects
V.V.Vanniaperumal
College for Women

6. Project Classification
4.Finacial Institution Classification
▫ Based on the age, experience & purpose
▫ New projects
▫ Expansion projects
▫ Modernization projects
▫ Diversification projects
Social Service projects
▫ Welfare projects
▫ Service projects
▫ R & D projects
▫ Educational projects
V.V.Vanniaperumal
College for Women

7. Project Identification
• Project Identification is concerned with the
collection, compilation and analysis of economic
data for the eventual purpose of locating possible
opportunities for investment.
• Opportunity are 3 types
• Additive- better utilization of existing resources
without change in the character of business.
• Complementary- introduction of new ideas and
do certain amount of change in existing structure.
• Break-through- fundamental change in both
the structure & character of business.
V.V.Vanniaperumal
College for Women

8. • Every project has 3 dimensions- inputs, outputs,
social cost and benefits.
• Input- what the project consume in terms of
raw materials, energy, manpower, finance and
organizational setup.
• Output- what project generate in form of goods
and services employment, revenue etc.
• Social cost & Benefit- impact on the society;
sacrifice & benefit accrue to the society.
Project Identification
V.V.Vanniaperumal
College for Women

9. Internal Constraints
• The lack of entrepreneur to prepare the
feasibility report and rely more on outside
consultants for preparing report.
• The entrepreneur within the budgeted cost and
time schedule cannot develop project
management systems.
• The project objectives are determined by top
executives. The project management team is not
involved in determining it and it is unrealistic
for them to achieve it.
• The availability of necessary physical & non-
physical resources
V.V.Vanniaperumal
College for Women

10. External Constraint
• The external constraints are the project
environment-people, things and situation outside
the project. Social taboos, government policies and
capital market.
• The external environment factors like nature, size,
location are limiting factor when project does not
conform to the socio-economic objectives of the
country.
• Government policies & regulations are the hurdle
– delay in approval of licensing, environment
clearance, foreign collaboration permit.
• The financial institution cumbersome procedures
and documentation system delay in financing
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College for Women

11. Project Objectives
• Project objective say what the project is expected
to achieve.
• Essential of project objectives are:
▫ Specific, not general
▫ Not complex
▫ Measurable, tangible and verifiable
▫ Realistic & attainable
▫ Consistent within resource available or anticipated
▫ Consistent with organisational plans & policies
V.V.Vanniaperumal
College for Women

12. • Project objectives aimed to complete project on
time, within the given cost complete with profit
to the company.
• Retentive objective- concerned with retention
and preservation of resources like money, time,
energy, equipment & skill.
• Acquisitive objectives- involve acquisition of
resource or attaining states that organisation do
not have.
Project Objectives
V.V.Vanniaperumal
College for Women

13. • Project objectives are economical & social in
nature.
• Economical objectives are profit oriented.
Concerned with financial cost and benefits of
project.
• Social objectives are service oriented.
• The process of project development involves
stage by stage development of project idea into
investment proposition. The output of one stage
acts as the input of the next.
• It is required for backward look to recheck and
modify the initial assumptions.
Project Objectives
V.V.Vanniaperumal College for Women