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
• Objectives and Constraints of Project
• Risk Analysis and Risk Management

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Risk Analysis and Risk Management

Risk Analysis

Assessment of risk is used to identified and evaluated potential risk. Anticipation of what may to wrong is done. The assessment can be:

• Qualitative: It is mainly judgmental or subjective, based on previous experience.
• Quantitative: It manipulates past data for forecasts, especially to assess cost and time overruns.

Based on the probability of occurrence, the identified risk can be ranked as High, Medium and Low.

b) Possible Actions:
They are actions required to contain the risk and minimize its impact on project success.

Risk Management

Risk management involves:

1. Monitoring of Risk: The changes in the risk are monitored over time.
2. Containing of Risk: Corrective actions are taken promptly to control risk.
3. Contingency Planning for Risks: Contingency planning is done to deal with changing environmental forces.

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You may also like this:

• Development of Project Ideas
• Preliminary Analysis of Ideas
• Objectives and Constraints of Project
• Selection of Ideas for Project Formulation

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Development of Project Ideas

The second step for project identification is development of project ideas. The projects really begin as ideas. The project ideas need to be developed. The source for project ideas can be:

• Situation Survey
• Internal Sources
• External Sources

1. Situation Survey: The situation survey involves the survey of current situation in the environment. The different changes are studied and identified. Changed already under way are detected. The changes that are found in environment may be political-legal, economic, socio-cultural and technological.
2. Internal Sources:
• Corporate vision, mission, objectives, strategies and plans provide ideas for projects.
• Management efforts to overcome problems or identify opportunities can suddenly provide new ideas for projects.
• Suggestions made by research and development department, committees, task forces, work teams and quality circles can provide useful ideas for projects.
3.  External Sources:
• Needs and requirements of project clients are an important source of project ideas.
• Outside consultants and experts can provide promising ideas for new projects. So can research laboratories.
• Technological developments and competitor's activities provide new project ideas.
• Legal provisions can also be the source of project ideas.
• Politicians identify projects to serve the interest of their constituencies. Most government-financed road projects in Nepal are the brainchild of politicians.
• Donor agencies identify project ideas that fit-in with their aid priorities.

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• Traditional Vs Modern Era Project
• Project Monitoring and Evaluation
• Procedures for Project Proposal
• Project Management Information System (PMIS)
• Project Manager and Line Manager Interface
• Understanding Project Environment
• Project Authority
• Project Management Model
• Sources of Project Authority
• Meaning of Project Proposal
• Elements / Components of Project Specification
• Project Specification

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Objectives and Constraints of Project

• The main objectives of the project to be accomplished should be clearly defined.
• The customer and his needs should be clearly understood. What is needed to satisfy these needs is determined.
• The different constraints i.e. time, cost and quality of project activities should be identified. They constrain the use of resources. They can be:
• Time: Schedule for the delivery of project result.
• Cost: Resources available for the project, including people.
• Quality: Specifications and standards to be achieved.