1. Project Formulation
Project is a specific task, with well defined objectives, which require certain time, and
resources for its implementation, which can be reasonably planned and appraised in
advance and also can be evaluated as an independent work unit and with defined
budget.
Those around a project, who may affect or be affected by a project, Opportunities
and relationships to build upon in implementing a project to help make it a success,
Who should be encouraged to participate in a project.
Three main components:-
a. Stakeholder analysis b. Problem analysis c. Objective/Strategies analysis
Any Individual, community, group or organization or Institution with an interest in the
outputs/outcomes of a project. Either as a result of being affected by it positively or
negatively or by being able to influence project activities.
2. What is a project? A project is a complex of non-routine activities that must
be completed with a set amount of resources and within a set time interval.
It is carried out in an organized manner with a clearly pre-defined need ,
start point and end-point. A project follows a hierarchy of assumptions and
objectives: Inputs Activities Proposals Outputs Goals
3. Characteristics of Project
Objectives-Every project has aimed to achieve certain objective. Once the
objective is achieved the project is said to be completed .
Life cycle- stages of Life cycle are as follows:
a. conception b. Design c. Implementation d. Commissioning
Definite time limit
Uniqueness
Change
Optimality
Control mechanism
5. Project Idea Generation
Project Formulation
• Identification of Project Ideas
• Project Formulation
6. Source of Project Idea
Our own needs
Trade and professional journals, project profiles
Trade fairs and exhibitions
Success stories of friends and relatives, prospective customers
Research organizations, utilization of waste materials, study of govt policies,
development of Nation.
Items reserved for small scale units
Screening of project ideas
7. Factors of Project Idea generation
Cost of the Project : material cost, labour cost, facory overhead cost etc
Profitability : project yielding higher returns
Marketing Facilities : Potential demand, nature of competition, sales and
distribution system, consumption trends etc.
Availability of Inputs : the resources and inputs required for the project
must be reasonably assured.
Compatibility with the Entrepreneur : the idea suits with the interest,
personality and resources of the Entrepreneur
11. Identification of Project Ideas • Develop Project Ideas – Situation Survey –
Internal Sources – External Sources
Define Objectives and Constraints • Objective is defined in terms of how the
what will be your project, output of the project and how the output will help
to satisfy the need customers • Objectives must also be defined taking
consideration of constraints – Time – Cost – Quality
Preliminary Analysis of Ideas • Risk Analysis – Project Risk – Technical Risk –
Process Risk – associated with each stage of project • Assessment of Risk –
Qualitative Risk – Quantitative Risk
Select the Ideas for Project Formulation • Promising Ideas • Marginal Ideas •
Rejecting Ideas
12. Identification and formulation of Research Problem
• Review of Literature • Identification of objectives of the study • Clarity
of expression and direction • Measurability • Comprehensiveness •
Judiciousness
Formulation of hypothesis •Providing Direction •Should be testable •Should be
brief and clear Forms - Declarative - Null - In Question form •
Operationalization of Concepts • Research Design • Exploration • Description
• Diagnosis • Experimental
Choice of variable • Selection of sample •Selection of method and tools of
data collection •Collection of data
Processing of data • Editing of data • Coding of data • Classification of data •
Tabulation of data
Analysis and Interpretation of data • Presentation of the Report • Time
Estimate • Budget Estimate
13. Project Formulation • Statement of Work – Need for the project – Scope of the
project – Objective and output of the project – Budget – Time
Prefeasibility Study • Technical Analysis • Financial Analysis • Economic Analysis •
Marketing Analysis • Management Analysis • Environmental Analysis
Preliminary Design • Technical Aspects – Engineering Design for example •
Preliminary Project Schedule and Implementation Plan • Estimated Project Cost
Proposal Development • Project Objective and Output • Project Activities •
Project Implementation - implementation strategy, organization and party
involved • Project Schedule • Project Monitoring and Evaluation
Project Planning • Understand the project objective • Identify the key project
stages • Work Breakdown Structure • Determine the logical sequence of activities
• Determine time and resource allocation – Capital Cost – Working capital cost •
Allocate the responsibility of each activity • Finalize the project plan
Content of Project Plan • Overview • Objective • General Approach • Contractual
Approach • Schedule • Resources • Human Resources • Evaluation Method •
Potential Problem
Feasibility Analysis • Technical Analysis • Economic Analysis • Marketing Analysis •
Managerial Analysis – Institutional Relationship – Project Organization – Project
Management – Stakeholder Analysis • Environmental Analysis – Environmental
Impact – EIA • Financial Analysis
14. Elements of Project Formulation
Feasibility Analysis
Techno Economic Analysis
Estimation of Demand Or Market Potential
Selection of Technology
Project Design and Network Analysis
Input Analysis
Financial Analysis
Social Cost benefit Analysis
Pre-Investment Appraisal
