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PROJECT IDENTIFICATION, FORMULATION

AND APPRAISAL

According to Nicholas, John M. (2001) some of the characteristics that warrant classifying an
activity as a project centers on the purpose, complexity, uniqueness, unfamiliarity, stake,
impermanence, and life cycle of the activity. Based on these features then project is defined as
follows:
A project involves a single, definable purpose, end-item, or results, usually specified in
terms of costs, schedule, and performance requirements.
Every project is unique, in that it requires doing something different than was done
previously.
Projects are temporary activities.
Projects cuts across organizational lines because they need the skills and talents from
multiple professionals and organizations.
Projects involve unfamiliarity. posses significant elements of uncertainty and risk.
The organization has something at stake when doing a project.
Finally, a project is the process of working to achieve a goal; during the process, projects
pass through several distinct phases, called the project life cycle.

Westland, Jason (2006): A project is a unique endeavour to produce a set of deliverables within
clearly specified time, cost and quality constraints. Projects are different from standard business
operational activities as they:
Are unique in nature. They do not involve repetitive processes. Every project undertaken
is different from the last, whereas operational activities often involve undertaking
repetitive (identical) processes.
Have a defined timescale. Projects have a clearly specified start and end date within
which the deliverables must be produced to meet a specified customer requirement.
Have an approved budget. Projects are allocated a level of financial expenditure within
which the deliverables are produced, to meet a specified customer requirement.
Have limited resources. At the start of a project an agreed amount of labour, equipment
and materials is allocated to the project.
Involve an element of risk. Projects entail a level of uncertainty and therefore carry
business risk.
Achieve beneficial change. The purpose of a project is typically to improve an
organization through the implementation of business change.
PROGRESSIVELY MORE DETAILED information about the community and project
circumstances is gathered and then confirmed in the project identification, formulation and
appraisal stages.

The final output is the project document which contains a statement of the goals, objectives,
activities and approach for the project. Theoretically, identification, formulation and appraisal
have distinct purposes and approaches:

_ The project identification phase is used to gather the information that is needed to analyse and
assess the project situation. Project identification research is extensive and fairly general.

_ During project formulation the relevant technical, economic and social considerations are
investigated in detail. The formulation stage leads to production of the project document.

_ Project appraisal validates the data and conclusions from formulation while also reviewing
the soundness of the project document on the policy, technical and financial levels.

Frequently identification, formulation and appraisal are done simultaneously or by a single team
of people. As noted in the descriptions, the type and depth of research and analysis will differ.
However, in each of the three phases the overriding principle is to ensure focus on:

_ people and the effect the project will have on individuals; and,

_ how the different activities, rights, needs and requirements of men and women can be
considered in project activities.

First, it is important to get an idea of the community. The local approach to division of labour,
and the rights, responsibilities, restrictions and benefits accrued by different subgroups,
particularly women and men, need to be understood if the project is to be constructed truly
considering all the relevant information. An analysis of local rules, regulations and customs can
help the team become aware of the motives for and constraints to participation by different
community members. It can also help the team to identify positive and negative effects of
participation on different community members. Simply looking and knowing what to look for
can provide a new view of men's and women's roles in the community and, therefore, indicate
how the project may need to be adjusted given the site. Driving, walking or riding through part
of the project site with the project's beneficiaries, objectives and some pertinent questions in
mind can yield a great deal of information about beneficiaries.

1. PROJECT IDENTIFICATION
Program and project identification refers to the process of identifying and searching for
promising development opportunities that are directed towards overcoming hindering or
constraining the achievement of defined and desired development objectives or towards
exploiting existing development potentials (NEDA, 1993). Development objectives and growth
potentials may be derived from national or regional development plans, sector surveys, industry
studies, technical packages, multi-lateral or bilateral priorities and many other sources.

In order to ensure that beneficiaries and the opportunities for and constraints to their involvement
are properly considered in project identification, social and socio-economic considerations must
be examined to learn how proposed beneficiaries live and work. The basic framework identified
in Table 1 provides the questions necessary for gathering the information that is needed at this
stage. Several methods can be used in information collection: research, observation and
consultation and discussion.

Research

Existing information

A review of literature is a good first step in project identification. The literature search should be
used to find out about the project area, the project objectives, the people living in area and
similar projects elsewhere. The literature that is used should not be limited to external reports.
When possible, it should combine international, national and local documentation.

Within the partner country. A review of partner country literature will help the team understand
the social or socio-economic issues: household characteristics, land tenure considerations,
population and migration, labour supply and employment, income levels, social welfare policy
end social organization-when possible all disaggregated by gender.

At national level, review government documents dealing with social or socioeconomic and
gender issues and literature from universities, non-governmental organizations and women's
groups.

At local level, review any literature from women's groups, municipal government agencies,
cooperatives, extension offices, non-governmental organizations.

New studies

A full socio-economic study of the project area is not appropriate during identification. Until the
project is formulated such surveys cannot be properly designed. Socio-economic surveys on a
variety of subjects (the specific topics will depend on the foreseen activities) will be needed later
to provide baseline data for participatory project planning, monitoring and evaluation.

Rapid rural appraisal or participatory rural appraisal of the project area might be advisable during
identification. There are many approaches to appraisals and the degree to which participants are
actively involved varies. The gender analysis framework in Table 1 provides the basic questions
for a rapid appraisal. A more detailed outline of the relevant questions is provided in Annex 1.
For more in-depth consideration of the rapid appraisal approach to information gathering see
Community Forestry Notes 3 and 5, Rapid appraisal and Rapid appraisal of tree and land
tenure which are available in the FAO Forestry Department.

Consultation and discussion

Consultation and discussion should also be used to gather information. A range of different
people can often give relevant information from various perspectives and help ensure that
relevant socioeconomic and gender-related issues are being considered. For example:

_ Discuss the issues with villagers, both men and women, local organizations, extension
personnel, leaders of cooperatives and heads of municipal agencies within the geographic
boundaries of the project.

_ Speak with the FAO Community Forestry Unit and Women in Agricultural Production and
Rural Development Service at FAO Headquarters in Rome, Italy.

_ Interview the heads of the governmental agencies within the partner country that deal with
women's concerns and with concerns of ethnic groups or the poor in the country.

_ Interview university department faculty who deal with gender issues in the partner country. If
they are to be partners in the development process, consultations with future project participants
will be particularly important. Their early collaboration helps ensure that the project is developed
with local circumstances in mind.

Observation

Direct observation can help quickly gather information about a potential project site. There are
many ways to systematically observe a community. Walk around the area at different times
throughout the day and observe who is doing which tasks.

In observing, the following people-related questions should be kept in mind.

In the town or village:

_ Who are the people?

_ Who looks prosperous and who less prosperous?

_ What are women, men and children doing?

_ Which institutions - such as schools, religious buildings, health facilities and markets - are
visible?

_ Who works in these institutions - men or women a- and who uses them?
Along hack roads:

_ Who are the people?

_ Who is in the various types of fields?

_ What are the women doing?

_ What are the men doing?

_ What natural resources are visible?

_ What trees, bushes, plants and flowers are present; which of them seem to be close to the
homestead?

Before beginning to gather information with the community, the team needs to introduce itself
and explain why it has come and what it will do. Initial introductions can be done through a
village meeting, radio announcements, or meetings with village leaders who disseminate the
information throughout the community. The best approach will vary based upon the culture of
the involved communities.

One quick way to assess a community through observation is the community profile. Beginning
at a predetermined point, members of the team walk in a straight line through the project site,
noting what they see. Each team member is assigned a particular factor to observe: housing,
trees, people, soils, etc. The members each walk with a community member/guide, asking
questions about their observations.

Another way of observing is to randomly select several households in the community to visit and
solicit help in touring both the community and the household's fields, trees, vegetation. When
using this approach it is important to have both the woman and man of the house show a team
member around independently. Separate tours often provide different insights.

Observation can also be done by a single member of the team wandering through the community
asking questions along the way.

In some locations it may be possible to spend at least one night with a local family. Requesting
such a stay can sometimes be made via a village head. This is perhaps the best way to learn about
many of the social and socio-economic factors influencing the community. It can also provide a
better opportunity to speak with women as they are frequently most available in the late evening.

Components of Program and Project Identification

Once the environmental scanning and screening processes are completed, the next step the
planner has to do is to consider the five components of program and project identification
developed by NEDA, 1993. These are 1) identification of essential development problem, 2)
identification of resources, 3) identification of projects and policies, 4) formulation of strategies,
and 5) setting of targets and strategies.

1. Identification of essential development problem

a. What are the essential current and future development needs and want of the people,
current and future? Examples of development projects in the different sectors are
presented to emphasize the growth potential of an academic institution in the
countrys development effort.

a.1 Social Sector


Sub-sector: Education and Manpower Development
Area of Concern: Information and Communications Technology
Problem/Barriers: Lack of technical manpower
Possible Project: Curriculum Development on Computer Science or Computer
Engineering

a.2 Economic Sector


Sub-sector: Agriculture
Area of Concern: Palay Production, Handling and Processing
Problem/Barriers: Low production due to wastage
Possible Project: Post Harvest Handling and Processing Technology

a.3 Infrastructure Sector


Area of Concern: Low production due to lack of irrigation system
Problems/Barriers: Lack of irrigation system
Possible Project: Improvement and construction of irrigation system

a.4 Political Sector


Sub-sector: Institution and Capability Building
Problems/Barriers: Weak and pathetic government officials and employees
Possible Project: Training and reorientation of government officials and
employees

b. What are the indicators or benchmarks to determine whether and to what extent
problems exist?

b.1 Social Sector: Dearth of technical manpower in computer and


communications technology
b.2 Economic Sector: Low productivity
b.3 Infrastructure Sector: Low hectarage yield
b.4 Political Sector: Waste of resources and excessive red tape

c. Who are the interest groups affected? How do they view the problems? What weights
of values do they attach to the problems?

c.1 What are the implications if nothing is done to solve the problems aforecited?

2. Identification of resources

What resources are available or can be tapped to solve the identified problem? How can
the resources and the problem be reconciled?

3. Identification of projects and policies

Given the range of essential problems, on the other hand, and the resources that may be
exploited for development, on the other, what are the potential or likely feasible projects
and policy measures that can be considered to resolved the problems?
4. Formulation of strategies

This involves the determination of methodologies and strategies as well as priorities and
phases in the pursuit of said development project.

5. Setting of targets and strategies

This calls for the formulation of targets and objectives which should be simple,
measurable, achievable, realistic, and time-bound.

2. PROJECT FORMULATION
Socio-economic studies of the project region and people, disaggregated by gender, need to be
conducted during project formulation. The studies that are completed during the formulation
stage are used to obtain answers to the more detailed questions related to beneficiaries (see
Annex 1). These studies provide the foundation for beneficiary identification and monitoring
participation. The in-depth analysis in formulation culminates in development of the project
document.

The project document


The project document must continue to emphasize the focus on people. Different parts of the
document need to highlight alternative elements of a beneficiary-focused approach.

The project document includes statements of:

_ the project's rationale;

_ the development objective(s);

_ the project's immediate objectives, outputs and activities;

_ the risks;

_ the project reporting scheme and a schedule for review and evaluation.

Each element of the document must be described to focus on the participants:

_ how beneficiaries can be identified;

_ how participation can be monitored;

_ how the project's impact on various beneficiary groups can be monitored;

_ how costs and benefits as they relate to different beneficiary groups can be compared and
assessed.

The project's rationale

The project rationale explains why the project is needed, outlining the location and resource
opportunity and constraints. In order to properly focus on people, this part of the project
document should centre analysis of the need fore project on the status and expressed needs of
proposed participants. For example, the project's rationale might first state: "The decline in
Rabat's forest economy and the resulting negative effect on agriculture have most directly
affected the rural poor in the Northeast. In that region the rural poor are primarily subsistence-
level cultivators that farm steeply-sloping marginal land. "

Following this participant-focused description, the rationale could go on to describe the site's
latitude, agriculture, climate, vegetation and technical assistance needs.

The development objective

The development objective describes the over-arching long-term project goal. It should present
the goal as it relates to intended beneficiaries. By communicating the objective in a detailed,
participant-oriented manner, consideration of beneficiary-related factors is promoted. Rather than
stating the objective "to develop and introduce a sustainable land utilisation system involving
intercropping of trees and plants", it could be specified to read:
"to develop an environmentally advantageous, productive land utilisation system that renders
rural communities' farming systems sustainable, especially those of the women and men of the
poorer strata as identified by low nutritional status."

The immediate objectives

The project document's explanation of the immediate objectives, outputs and activities would:

_ identify the intended beneficiaries,

_ design activities,

_ explain why beneficiaries would indeed benefit, and

_ encourage built-in monitoring of participation.

The statement of immediate objectives could build on the statement of the rationale and
development objectives: "to promote participatory agroforestry development on steep-sloping
farm land, especially considering the differential effect of customary land tenure on women and
men."

Determining outputs and activities

In order to select activities and outline outputs, opportunities and risks, formulation team
research would need to include analyses of people/gender-related issues. For example, the
potential feasibility of the project might be studied by examining land use rules to determine
division of labour and land use/ownership rights.

The statement of outputs and activities would build on that foundation to ensure involvement of
beneficiaries and activities to answer questions that would uncover participant-related risks. The
activities might include:

"Establish an extension station which encourages agroforestry on steep-sloping farm land by


both male and female farmers."

The opportunities and risks

A statement of the opportunities and risks highlights potential problems that may be encountered.
Proper research and activity design can decrease risks. No project can, however, hope to
eliminate them completely. Problems can relate to a variety of factors. As projects begin to
consider and incorporate socio-economic concerns earlier in the process of design, risks can be
minimized and better defined.

Project reporting, review and evaluation


The specifics for reporting, review and evaluation need to incorporate mechanisms to monitor
and evaluate participation by and the impact of the project on different beneficiary groups. The
methods that are recommended do not need to be complex. They do, however, need to ensure
awareness of the potentially different impact of the project on different groups within the
community.

3. PROJECT APPRAISAL
Project appraisal should, in addition to checking the soundness of the technical and financial
foundations of a project, examine the extent to which beneficiary-related considerations have
been adequately assessed and used in design. By using the relevant issues that were identified in
the last chapter as a guide, the appraisal team can ensure that men's and women's specific needs
have been considered and integrated into planning.

Project appraisal is the process of assessing and questioning proposals before resources are
committed. It is an essential tool for effective action in community renewal. Its a means by
which partnerships can choose the best projects to help them achieve what they want for their
community.
But appraisal has been a source of confusion and difficulty for projects in the past. Audits of the
operation of Single Project Budget schemes have highlighted concerns about the design and
operation of project appraisal systems, including:

Mechanistic, inflexible systems


A lack of independence and objectivity
A lack of clear definition of the stages of appraisal and of responsibility for these stages
A lack of documentary evidence after carrying out the appraisal
Its no surprise that audits or inspections arent impressed with the quality of appraisals, and are
specifically found with problems like;

Individual appraisals which do not cover the necessary information or provide only a
superficial analysis of the project
Particular problems in dealing with risks, options and value for money
Appraisals which are considered too onerous/burdensome for smaller projects
Rushed appraisals
Project appraisal is a requirement before funding of programs is done. But tackling problems
like those outlined above is about more than getting the systems right on paper. Experience in
projects emphasizes the importance of developing an appraisal culture which involves
developing the right system for local circumstances and ensuring that everyone involved
recognizes the value of project appraisal and has the knowledge and skills necessary to play their
part in it.
What can Project Appraisal Deliver?
Project appraisal helps project initiators and designers to;

Be consistent and objective in choosing projects


Make sure their program benefits all sections of the community, including those from ethnic
groups who have been left out in the past
Provide documentation to meet financial and audit requirements and to explain decisions to
local people.

Appraisal justifies spending money on a project.


Appraisal asks fundamental questions about whether funding is required and whether a project
offers good value for money. It can give confidence that public money is being put to good use,
and help identify other funding to support a project. Getting it right may help a community make
its resources go further in meeting local need

Appraisal is an important decision making tool.


Appraisal involves the comprehensive analysis of a wide range of data, judgments and
assumptions, all of which need adequate evidence. This helps ensure that projects selected for
funding:

Will help a partnership achieve its objectives for its area


Are deliverable
Involve local people and take proper account of the needs of people from ethnic minorities
and other minority groups
Are sustainable
Have sensible ways of managing risk.

Appraisal lays the foundations for delivery.


Appraisal helps ensure that projects will be properly managed, by ensuring appropriate financial
and monitoring systems are in place, that there are contingency plans to deal with risks and
setting milestones against which progress can be judged.
Getting the system right
The process of project development, appraisal and delivery is complex and partnerships need
systems, which suit local circumstances and organization. Good appraisal systems should ensure
that:

Project application, appraisal and approval functions are separate


All the necessary information is gathered for appraisal, often as part of project development in
which projects will need support
Race/tribal equality and other equality issues are given proper consideration
Those involved in appraisal have appropriate information and training and make appropriate
use of technical and other expertise
There are realistic allowances for time involved in project development and appraisal
Decisions are within a implementers powers
There are appropriate arrangements for very small projects
There are appropriate arrangements for dealing with novel, contentious or particularly risky
projects.
Appraising a project
Key issues in appraising projects include the following.

Need, targeting and objectives


The starting point for appraisal: applicants should provide a detailed description of the project,
identifying the local need it aims to meet. Appraisal helps show if the project is the right
response, and highlight what the project is supposed to do and for whom.

Context and connections


Appraisal should help show that a project is consistent with the objectives of the relevant funding
program and with the aims of the local partnership. Are there links between the project and other
local programs and projects does it add something, or compete?

Consultation
Local consultation may help determine priorities and secure community consent and ownership.
More targeted consultation, with potential project users, may help ensure that project plans are
viable. A key question in appraisal will be whether there has been appropriate consultation and
how it has shaped the project
Options
Options analysis is concerned with establishing whether there are different ways of achieving
objectives. This is a particularly complex part of project appraisal, and one where guidance
varies. It is vital though to review different ways of meeting local need and key objectives.

Inputs
Its important to ensure that all the necessary people and resources are in place to deliver the
project. This may mean thinking about funding from various sources and other inputs, such as
volunteer help or premises. Appraisal should include the examination of appropriately detailed
budgets.

Outputs and outcomes


Detailed consideration must be given in appraisal to what a project does and achieves: its outputs
and more importantly its longer-term outcomes. Benefits to neighborhoods and their residents
are reflected in the improved quality of life outcomes (jobs, better housing, safety, health and so
on), and appraisals consider if these are realistic. But projects also produce outputs, and we need
a more realistic view of output forecasts than in the past.
Value for money
This is one of the key criteria against which projects are appraised. A major concern for
government, it is also important for local partnerships and it may be necessary to take local
factors, which may affect costs, into account.

Implementation
Appraisal will need to scrutinize the practical plans for delivering the project, asking whether
staffing will be adequate, the timetable for the work is a realistic one and if the organization
delivering the project seems capable of doing so.

Risk and uncertainty


You cant avoid risk but you need to make sure you identify risk (is there a risk and if so what
is it?), estimate the scale of risk (if there is a risk, is it a big one?) and evaluate the risk (how
much does the risk matter to the project.) There should also be contingency plans in place to
minimize the risk of project failure or of a major gap between whats promised and whats
delivered.

Forward strategies
The appraisal of forward strategies can be particularly difficult, given inevitable uncertainties
about how projects will develop. But is never too soon to start thinking about whether a project
should have a fixed life span or, if it is to continue beyond a period of regeneration funding, what
support it will need to do so. This is often thought about in terms of other funding but, with an
increasing emphasis on mainstream services in neighborhood renewal, appraisal should also
consider mainstream links and implications from the first.

Sustainability
In regeneration, sustainability has often been talked about simply in terms of whether a project
can be sustained once regeneration funding stops but sustainability has a wider meaning and,
under this heading, appraisal should include an assessment of a projects environmental, social
and economic impact, its positive and negative effects.
While appraisal will focus detailed attention on each of these areas, none of them can be
considered in isolation. Some of them must be clearly linked for example, a realistic
assessment of outputs may be essential to a calculation of value for money. No project will score
highly against all these tests and considerations. The final judgment must depend on a balanced
consideration of all these important factors.
Checklist for project appraisal
Whether you are involved in a partnership with an appraisal system in place, or starting to design
one from scratch, these questions are worth asking.

Are appraisals systematic and disciplined with a clear sequence of activities and operating
rules?
Is there an independent assessment of the project by someone who has not been involved
with the development of the project?
Does the appraisal process culminate in clear recommendations that inform approval (or
rejection) of the project?
Is the approval stage clearly separate?
Is the appraisal process well documented, with key documents signed, showing ownership
and agreement, and allowing the appraisal documentation to act as a basis for future
management, monitoring and evaluation?
Does the appraisal system comply with any relevant government guidance
Are the right people involved at various stages of the process and, if necessary, how can you
widen involvement?