 The dictionary meaning of a project is that it

is a scheme, design, a proposal of

something intended or devised to be
achieved
 According to Encyclopedia of Management,
“a project is an organised unit dedicated to
attainment of a goal—the successful
completion of a development project on
time, within budget, in conformance with
pre-determined programme
specifications”.
 Newman defines it that “a project typically has a
distinct mission that it is designed achieve and a
clear termination point, the achievement of the
mission”.
 Gillinger defines project “as the whole complex
of activities involved in using resources gain
benefits”.
 Project can be defined as a scientifically evolved
work plan devised to achieve a specific objective
within a specified period of time.
(i) A Course of Action

(ii) Specific Objectives, and

(iii) Definite Time Perspective

1. Quantifiable and Non-Quantifiable
Projects
2. Sectoral Projects
3. Techno-Economic Projects
a. ) Factor Intensity Oriented
Classification
b.) Causation-Oriented Classification
c) Magnitude-Oriented Classification
 Basically, project selection consists of two

main steps:

1. Project Identification

2. Project Selection
An entrepreneur has an infinitely wide choice with
respect to this project. The important dimensions
of choice are:
 Product/service,
 Market,
 Technology,
 Equipment,
 Scale of production,
 Location,
 Incentives, and
 Time phasing.
The task of identifying a feasible and promising
project is somewhat difficult. Moreover it is
interrelated with the government policies,
infrastructural development and skills of people.
 The project ideas can be discovered from various–internal and
external sources. These may include:

(i) Knowledge of potential customer needs,

(ii) Watching emerging trends in demands for certain products,
(iii) Scope for producing substitute product,
(iv) Going through certain professional magazines catering to specific
interests like electronics, computers etc.,
(v) Success stories of known entrepreneurs or friends or
relatives,
(vi) Making visits to trade fairs and exhibitions displaying new
products and services,
(vii) Meeting with the Government agencies,
(viii) Ideas given by the knowledgeable persons,
(ix) Knowledge about the Government policy, concessions and
incentives, list of items reserved for exclusive manufacture in
small-scale sector, and
(x) A new product introduced by the competitor.
 They become the catalytic agents of economic
development.
 They initiate the process of development in terms of
employment and income generation.
 They have beneficial consequences which are long-
term in nature.
 Projects provide the framework of the future pattern
of activities and services of the enterprises.
 Projects usually involve substantial financial outlays.
 They also initiate development of basic infrastructure
and environment.
 Project commitment cannot be easily reversed.
 Project identification brings the necessary changes
in society in course of time.
 Project accelerates the process of socio-cultural
development.
 Project selection is not an isolated activity. It
has a social economic and environmental
context, besides financial viability.
 Project selection starts from where project
identification ends
 Project ideas, are analysed in the light of
existing economic conditions, the
government policy and so on.
 On the basis of this analysis, the most
suitable idea is finally selected to convert it
into an enterprise. The process involved in
selecting a project out of some projects is
also described as the “zeroing in process”