Project Lifecycle

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Project Life Cycle:

Project Life Cycle Presented By: Anupam Kumar Reader, School of Management Sciences, Varanasi. Email: anupamkr@gmail.com 1 © Copyright 2013 Anupam Kumar

Project:

Project Project is a proposal for investment to create, expand and / or develop certain facilities in order to increase the production of goods and / or services in a community during a certain period of time. Purpose of project being: To increase (Start) production of goods and / or services To increase capacity of existing projects To increase productivity of goods / services 2 © Copyright 2013 Anupam Kumar

Key Aspects of Project:

Key Aspects of Project Project has a mission or a set of objectives Project has a specified start and end points Project are unique undertakings Project are composed of interdependent activities Project create quality deliverables Project involve multiple resources Projects have a life cycle Projects are not synonymous with the products of the project Projects are driven by competing constrains 3 © Copyright 2013 Anupam Kumar

Types of Projects:

Types of Projects Quantifiable and non-quantifiable Sectoral projects Agriculture and Allied Sectors Irrigation & Power Industry & Mining Transport & Communication Social service sector Miscellaneous Techno-Economic Projects Factor Intensity-oriented Causation oriented Magnitude oriented Financial Institution Classification New Projects Expansion Projects Modernization Projects Diversification Projects Service Projects Welfare Projects Service Projects Research & Development Projects Educational Projects 4 © Copyright 2013 Anupam Kumar

Project Lifecycle:

Project Lifecycle 5 © Copyright 2013 Anupam Kumar

Project Lifecycle:

Project Lifecycle 6 © Copyright 2013 Anupam Kumar

Project Initiation:

Project Initiation Develop a Business case Undertake a Feasibility study Establish Project Charter Appoint Project Team Set up a Project Office Perform Phase Review 7 © Copyright 2013 Anupam Kumar

Developing Business Case:

Developing Business Case The Business Case Includes: A detailed description of the problem or opportunity A list of the alternative solutions available An analysis of the business benefits, costs, risks and issues A description of the preferred solution A summarized plan for implementation 8 © Copyright 2013 Anupam Kumar

Developing Business Case - Alternatives:

Developing Business Case - Alternatives IPR and Legal Issues Time Constraint Loss of Control Financial Constraints Technological Knowhow Managerial Constraints Authors Interface Pvt. Ltd. Company Society Formation Partnership Firm Sole Proprietor-ship Limited Company 9 © Copyright 2013 Anupam Kumar

Developing Business Case - Analysis:

Developing Business Case - Analysis Product / Service Are customers reachable & receptive? Product life is durable? Market opportunities in terms of potential revenues and margins Source of Advantage First movers advantage? Control over prices or costs Patents or copyrights Special relationship with customers or suppliers Contractual advantage Value Creation Returns on Investment Capitalization needs Is it fundable? Exit strategy options Risk / reward balance Customer / Market Need Customer identifiability & reachability Demand durability Market capacity Competitive Advantage Competitor Assessment Entry Barriers 10 © Copyright 2013 Anupam Kumar

Developing Business Case:

Developing Business Case Does the business idea Creates significant value for customers by solving a significant unmet need? Offers significant profit potential to the entrepreneur / investors to meet their risk / reward expectations? Represents a good fit with the capabilities of the founder and management team in terms of experience and skills? Provide opportunity for profit over a reasonable length of time and is it durable? Provide an opportunity which is amenable to financing? 11 © Copyright 2013 Anupam Kumar

Undertake Feasibility Study:

Undertake Feasibility Study The Purpose of the Feasibility Study includes To assess the benefits of each alternative solution outlined in the business case To investigate whether The forecast costs are reasonable The solution is achievable The risks are acceptable The Identified issues are avoidable 12 © Copyright 2013 Anupam Kumar

Economic Feasibility Analysis:

Economic Feasibility Analysis Value Cost Price Is every step in the process adding value? Is the product optimally designed? Are the costs as low as possible? Are the prices appropriate given the value, competition and costs involved? Hidden Costs Has any hidden costs been identified? Has it been quantified? Has it been eliminated? Trade offs Has the trade off decisions been identified? Has the pain V/s gain in each case been quantified? Can it be justified? Can they be avoided? Cost Functions Would the cost change with the changes in the output? What are the marginal and average costs? What are the fixed and variable costs? Can it be varied? 13 © Copyright 2013 Anupam Kumar

Economic Feasibility Analysis:

Economic Feasibility Analysis People / Knowledge & Machines Are all resources being used cost effectively? Do we have the right mix of people, knowledge and machines? Can we substitute one for the other? Scale V/s Scope Can cost be saved by expanding the scale? Can cost be saved by expanding the scope? Can the two be combined? Is it possible to mass customize? Market & Demand How does our product / service create value? Can we manage the key forces of demands for the product line? Risks Can we appropriately evaluate the risks involved? Can we measure and quantify all risks? Can we avoid the pitfalls of managing probabilities? Can the risks involved in key business decisions be justified? 14 © Copyright 2013 Anupam Kumar

Marketing Feasibility Analysis:

Marketing Feasibility Analysis Description of the Industry Based on the product – market fit Possibility of Government subsidies Attractiveness to Venture Capitalists and Investors Current Market Analysis Competition Anticipated Future Market Potential Potential Buyers and Sources of Revenue Sales Projections 15 © Copyright 2013 Anupam Kumar

Financial Feasibility Analysis:

Financial Feasibility Analysis Start up Capital Requirements Cost of sales Professional fees Technology costs Administrative & Operational costs Sales & marketing costs Wages & salary Start up Capital Sources Potential Returns for Investors 16 © Copyright 2013 Anupam Kumar

Technical Feasibility Analysis:

Technical Feasibility Analysis Outline for technical feasibility analysis: Material Parts needed to produce a product Supplies Other materials Labour Senior Level Management Office & Clerical staff Production or Distribution Professional staff Fulfillment Transportation and shipping requirements Physical location of business Office space Factory / Warehouse space Any other premise Technological Requirement Inventory Management Computer (hardware & software) Manufacturing Equipments Other devices need to conduct business 17 © Copyright 2013 Anupam Kumar

Establish Project Charter:

Establish Project Charter Define The vision Objectives Scope Deliverables Identify Risks Issues Planning Assumptions Constraints Describe Organizational structure Activities Resources Funding Required 18 © Copyright 2013 Anupam Kumar

Dimensions of Project:

Dimensions of Project The three critical project dimensions are Performance Cost Time Client expectation is an inherent part of the project specification 19 © Copyright 2013 Anupam Kumar

Traditional Project Lifecycle:

Traditional Project Lifecycle Stages of a conventional project cycle Slow beginning Build up of size Peak Begin a decline Termination 20 © Copyright 2013 Anupam Kumar

Project Planning:

Project Planning Create a Project Plan Create a Resource Plan Create a Financial Plan Create a Quality Plan Create a Risk Plan Create an Acceptance Plan Create a Communication Plan Create a Procurement Plan Contract the Suppliers Define the Tender Process Issue a Statement of Work Issue a Request for Information Issue a Request for Proposal Create Supplier Contract Perform Phase Review 21 © Copyright 2013 Anupam Kumar

Appoint Project Team:

Appoint Project Team Create Detailed Job Description for each role Recruit people for each role based on their relevant skills and experience 22 © Copyright 2013 Anupam Kumar

Create Quality Plan:

Create Quality Plan Define the quality for the project List the quality targets for each deliverables List out the plan of activities to ensure that the quality targets are met Build in techniques for the control of the quality level of each deliverable. 23 © Copyright 2013 Anupam Kumar

Project Execution:

Project Execution Build Deliverables Monitor and Control Perform Time Management Perform Cost Management Perform Quality Management Perform Change Management Perform Risk Management Perform Issue Management Perform Procurement Management Perform Acceptance Management Perform Communication Management 24 © Copyright 2013 Anupam Kumar

Project Lifecycle:

Project Lifecycle Time distribution of project effort 25 © Copyright 2013 Anupam Kumar

Project Lifecycle:

Project Lifecycle Other projects also exist which do not follow the conventional project life cycle These projects are comprised of subunits that have little use as a stand alone unit, yet become useful when put together Unlike the more conventional life cycle, continued inputs of effort at the end of the project produce significant gains in returns 26 © Copyright 2013 Anupam Kumar

Risks during Project Lifecycle:

Risks during Project Lifecycle With most projects there is some uncertainty about the ability to meet project goals Uncertainty of outcome is greatest at the start of a project Uncertainty decreases as the project moves toward completion 27 © Copyright 2013 Anupam Kumar

Project Lifecycle:

Project Lifecycle It is essential for the Project Manager to understand the characteristics of the life cycle curve for his project The distinction between the two life cycles plays a critical role in the development of budgets and schedules for the project 28 © Copyright 2013 Anupam Kumar

Project Closure:

Project Closure Perform Project Closure Review Project Completion 29 © Copyright 2013 Anupam Kumar

Project Completion Review:

Project Completion Review take corrective action continue unchanged if performance meets objectives revise objectives decide on action measure performance set objectives compare performance with objectives 30 © Copyright 2013 Anupam Kumar

For further details,…:

For further details,… Contact Anupam Kumar Reader, School of Management Sciences, Varanasi. Email: anupamkr@gmail.com 31 © Copyright 2013 Anupam Kumar

Bibliography:

Bibliography Desai, Vasant. Project Management . Third Revised Edition. Mumbai: Himalya Publishing House, 2008. Mishra, R.C. and Soota, Tarun. Modern Project Management. Second Edition. New Delhi: New Age International Publishers, 2011. Badi, N.V. and Badi, R.V. Entrepreneurship . Delhi: Vrinda Publications (P) Ltd., 2005 Desai, Vasant. Dynamics of Entrepreneurial Development and Management . Fourth Revised & Millennium Edition. Mumbai: Himalaya Publishing House,2007. Nirjhar Abhishek Entrepreurship Development . First Edition. Lucknow: Word Press, 2011. Khanka, S.S. Entrepreneurial Development . New Delhi: S Chand & Company Ltd. 2010 Kennedy, Dan S. How to make MILLIONS with Your IDEAS . Bangalore: Master Mind Books 2001. Sahay, A and Sharma, V. Entrepreneurship and New Venture Creation . First Edition. New Delhi: Excel Books, 2008 Hisrich, Rober D. and Peters, Michael P. Entrepreneurship . Fifth Edition. New Delhi: Tata Mc Graw Hill Publishing Company Limited, 2002 Acknowledgement for images & cliparts: Method123.com; 32 © Copyright 2013 Anupam Kumar

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