Selection of Idea for Project Formulation

The last step for project identification is selection  of idea for project formulation. It analyszed ideas which are classified as:

• Promising ideas: Promising ideas are possible alternatives for new projects.
• Marginal ideas: Marginal ideas are stored for future uses. They are not immediately useful.
• Reject ideas: Reject ideas are dropped due to various limitations and constraints.

A choice is made from among promising ideas for project formulation. The selected idea becomes a project.

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• Development of Project Ideas
• Preliminary Analysis of Ideas
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Project Formulation

Project formulation refers to the development of the project from the generated idea of the firm, the idea is the seed of the project. Project formulation includes the total procedures or activity of altering the project concept, theme etc. from intuitions based to an institutional based and rational based to result feasible work form. It is detail procedure of analyzing the feasibility of any specific project. So various factors are taken into consideration to test the viability of the proposed project. It plays the dominant role into the success of the any project.

Project formulation task defines the parameters of the proposed project and develops the objectives and outputs of the project in broad terms. It aims at gaining preliminary formal commitment to the project and the project idea to justify the further work on it. It serves at the basis of project planning. It is the basis of project planning.

There are various techniques available for the project formulation. Most commonly used techniques are as follows:

1. Cost Benefit Analysis
2. Feasibility Analysis
3. Input Analysis
4. Financial Analysis
5. Network Analysis

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• Project Management Information System (PMIS)
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• Project Specification

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