Project Management

PROJECT MANAGEMENT A project may be defined as a scientifically evolved work plan devised to achieve a specific objective with a specified period of time. The three basic attributes are 1. A course of action 2. Specific objectives 3. Definite time perspective. A project is a single non-repetitive enterprise. It is generally undertaken to achieve specified objectives within a time limit and a cost budget. PRODUCT IDEA: It had been an exhausting day, Mansukbhai had spent all morning cycling to and fro, hawking his home made goods in the by lanes of the crowded city. Now he sat outside a pan shop trying to snatch a few mins rest before starting another round. As he sat there he noticed how the customers at the pan shop kept growing in no and impatience Mansukhbai saw the time it took to make each pan the panwallah trying to attend to a dozen people at the same time it occurred to him that if pan could be packaged and sold it would instantly find a ready market. AND AN IDEA WAS BORN: A man of the masses had hit upon a marketing idea in a million--- he kind that takes a genius to think of that man was Mansukhbai Kothari --- the man behind pan parag pan masala. Project management has been evolved as a special branch of mgmt and is concerned with coordinating and controlling of the complex project activities of modern industries. A project has specific objectives in terms of geographical location, specific starting point and end point, and most important is to serve a target population, by achieving good investment returns. However for starting a project, finance has been always a constraint, particularly when a large project is started by the promoters or entrepreneur internal accruals may not be enough to meet the expenses of the project. Project appraisal report is prepared to prove the feasibility of the project. This feasibility report is utilized for applying loan to financial institutions and banks.

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PROJECT STAGES: PROJECT STAGES 1.PRE-INVESTMENT STAGE

COMPONENTS A)PROJECT IDENTIFICATION B)PR OJECT APPRAISAL C)PROJECT APPROVAL A)PROJECT PLANNING & ORGANISATION

2.INVESTMENT STAGE

B)DETAILED ENGINEERED PLANNING C)MONITORI NG D)COMMISSNG A) PROJECT EVALUATION

3.POST-INVESTMENT STAGE

B)OPERATIONS &CONTROL C)PROJECT STABLISATION

Project management deals with proper identification formulation, and appraisal. These three aspects form the basic foundation for the success of the projects. PHASES OF PROJECT MANAGEMENT: An entrepreneur has to consider carefully various factors from the start to the finish in converting profitable opportunities into realities. The process of project management may be divided into 6 phases: Identification, Formulation Appraisal  Selection  Implementation  Management of projects   

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PHASES OF A PROJECT PHASE 1.IDENTIFICATION

REQUIREMENT Selection of a project after careful scanning of the environment, investment opportunity and return. Translation of idea into a concrete project with scrutiny of preliminary aspects Searching, scrutiny and evaluation of market, technological, financial and economic variables assessing profitability return on investment and break even points

2.FORMULATION 3.APPRAISAL

4.SELECTION

Rational choice of project, in the light of objectives & inherent constraints.

5.IMPLEMENTATION

Expeditious completion within the allocated resources.

6.MANAGEMENT

Judicious opportunity of a project/enterprise with objectives like maximization of npv, maximum msn of return,& increase in rate of return at low risk.

In a developing country like India huge capital investment has been made for a large no of public utility projects. Completion of these programmes is highly desirable as it benefits the general public. Industrial projects generate employment and help building the nation. Any delay in completion of these national projects not only increases the cost of the projects --- but also affects many other schemes and programmes, thereby huge investments remain below expectations. PROJECT PLANNING: The project manager must formulate an effective plan through which the objectives are attainable. He must ensure that the plan is most economical and the project be completed within the due date to make the plan effective the full items are considered. 1.

Activities required to complete the project

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Correct sequence in which activities are performed. 3. Availability of funds 4. Knowledge of cost structure of expenditure 5. Correct time estimation of each activity. WORK BREAKDOWN STRUCTURE: 2.

Work Breakdown structure is a project planning that enable project analyst to break a project into a set of physically identifiable components. The components are in turn divided into subcomponents. A major output of this approach is: 1) A list of all the activities required for completion in a systematic, hierarchal and structured manner. 2) He generation of the activities could be either on the basis of depth responsibilities, cost centre or geographical location or by any other subdivision. 3) He work breakdown structure looks like an organization chart, beginning at the top with the project title. 4) The next lower level includes the major components of the project. The subsequent levels represent a systematic breakdown of the activities directly above into smaller activities representing the total scope and content of the parent activity shows a breakdown structure of a housing project. 5) Work breakdown structure provides a starting put-off development of project work for such reasons, the work breakdown structure is a critical project activity and proper care must be taken to prepare it. PROJECT COST ESTIMATION: One of the main objectives in project management is to optimize the cost of running a project. An accurate estimate of project cost during project planning stage serves a basis for mgmt control any project manager, for this reason must thrive to minimize the controllable costs. The controllable costs typically cover labor, material, support services, etc. FOR ESTIMATING THE PROJECT COST FOLL STEPS ARE GENERALLY FOLLOWED: 1. List of all the activities required to complete the project. 2. Allot all activities in different account head. Generally the allotment can be made as per work breakdown structure, product group or any logical method of classification. A classification scheme may also 4

be developed –in this step to identify group task and activity such codification is useful for generating various reports.

3. Design the forms for cost estimation The project mgr,--should have a working budget for the project. The expenditure for various elements of the project should be collected for proper scrutiny. The procedure for collecting data should be standardized throughout a co by the accurate project estimates carried out according to a standard procedure results can be compared among different projects. PROJECT CONTROL AND MONITORING The process of control and monitoring is carried out generally for the whole of the project. However the progress of each activity or group of activities is continually scrutinized and if any deviation occurs is corrected so that the project is completed within due date. Some delays may occur for completing certain activities. However the mgmt must be appraised of the progress of the project so that corrective actions can be taken by the authorities within their competence.

PROJECT APPRAISAL: Before venturing into any manufacturing project, a project appraisal, or feasibility report needs to be prepared. Such report is necessary to assess the viability of the project. The lenders always examine this report before sanctioning any financial loan to the promoters,. This report is carried out as pre-investment study to determine the economic prospects of a particular project. If such a report indicates excess of sales realisation over expenses the project is considered to be a viable one. FOR PREPARING A PROJECT APPRAISAL REPORT THE FOLL ITEMS ARE TO BE HIGHLIGHTED: 1. Precise description of what is decided to be manufactured. 2. Technical appraisal report that specifies the facilities and resources required to carry out the project and post project manufacturing activities. 3. Commercial appraisal report that indicates demand and supply position in future and the company's market share.

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4. Financial projections of the proposed project and sources of finance.

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