1. Project Management: Tools & Techniques
LESSON 4

2. The problem
The city of XYZ has several bus companies. During the last years the frequency of bus accidents has gone up significantly. This has caused much delay and inconvenience for the passengers. There have also been several serious accidents in which passengers have been killed. The newspapers have taken a particular interest in the problem, and some of the companies that have had more than their share of bad publicity have registered a reduction in the number of passengers. Much of the problem is technical: the buses are old, and are in bad condition because of a persistent lack of spare parts. But the human factor is also important: many accidents have been caused by high-speed driving on bad roads. Assignment: Suppose that you are acting as the manager of one of the interested bus companies. Your task is to implement the Logical Framework Approach (LFA) in order to decide upon a project that will address above problem.

3. Participation Analysis
On the basis of the available information, the first task is to develop a comprehensive picture of the interest groups, the individuals and institutions involved. Present these groups in the cells of the matrix shown in the following slide.

4. INSTITUTIONS INTEREST GROUPS OTHERS

5. Hints to perform Participation Analysis:
From the given problem information, think about the following involved stakeholders:
Bus company
Passengers
General public
Mass media
Drivers
Bus owners
Categorize the above groups / stakeholders into three classes:
Institutions
Interest Groups
Others

6. Solution INSTITUTIONS INTEREST GROUPS OTHERS Bus company Passengers
 General public
 Mass media
 Drivers
 Owners

7. Make a more detailed analysis of the most important groups
Select as most important groups:
Passengers, and
Bus Companies
Make a more detailed analysis of these groups, i.e., identify for each group the following:
Problems: The main problems affecting or facing the group
Interests: The main needs and interests as seen from the group's point of view
Potentials: The strengths and weaknesses of the group
Linkages: Main conflicts of interests, patterns of cooperation or dependency with other groups
Present your findings in the cells of the matrix shown in the following slide.

8. BUS COMPANIES
PASSENGERS
PROBLEMS
INTERESTS
POTENTIALS
LINKAGES

9. Hints to identify problems, interests, potentials and linkages:
Consider the following findings:
1. Economic losses caused by busses out of service
2. Sufferings for victims and their families
3. Economically viable operations
4. Able to directly influence the problem
5. Can choose other bus companies if necessary
6. Delays caused by accidents
7. Reduced number of passengers
8. Dependent upon the passenger’s cooperation
9. Safe, expedient and cheap transport
10. Boycott the only means to influence the problem
11. Economic losses caused by payments to victims
Categorize the above findings into four classes:
Problems
Interests
Potentials
Linkages
and identify the group (Bus Companies or Passengers) each finding is more relevant / valid

10. Solution PROBLEMS INTERESTS POTENTIALS LINKAGES BUS COMPANIES
BUS COMPANIES
PASSENGERS
PROBLEMS
 Economic losses caused by busses out of service
Delays caused by accidents
Economic losses caused by payments to victims
Sufferings for victims and their families
Reduced number of passengers
INTERESTS
Economically viable operations
Safe, expedient and cheap transport
POTENTIALS
Able to directly influence the problem
Boycott the only means to influence the problem
LINKAGES
Dependent upon the passenger’s cooperation
Can choose other bus companies if necessary
Solution

11. Problem Analysis
Suppose that you decided to give priority to passengers’ interests
Set as “focal problem” for passengers the following: frequent bus accidents
Identify the causes / effects of the focal problem
Construct the “problem tree”
You can complete the problem tree presented in the following slide
Hints to perform problem analysis:
The substantial and direct causes of the focal problem are placed parallel underneath it
The substantial and direct effects of the focal problem are placed parallel on the line above it
Causes and effects are further developed along the same principle to form the problem tree

12. Complete the Problem Tree
Effect
Cause

13. More hints for Problem Analysis:
Consider the following factors :
Drivers are not careful enough
People arrive too late
Insufficient maintenance
Economic losses for passengers
Bad condition of vehicles
Loss of confidence in the bus company
Bad condition of roads
Passengers are hurt or killed
Vehicles are too old
Categorize them into cause and effect factors of the focal problem (“frequent bus accidents”)
Place each factor accordingly in the problem tree

14. Solution
Effect
Cause

15. Objectives Analysis
Suppose that you have decided to add "training of drivers" as a means to make drivers more responsible
Construct the objectives tree by rewording problems in the problem tree into objectives (positive / desirable conditions)

16. Hints to perform Objectives Analysis
The problem tree is transformed into a tree of objectives (future solutions of the problems)
Working from the top downwards, all problems are reworded, making them into objectives (positive statements)
The focal problem is similarly transformed into an objective
Difficulties in rewording may be solved by clarifying the original problem statement
If the statements make no sense after being reworded from problems, write a replacement objective, or leave the problem unchanged
Check that meeting objectives at one level are sufficient to achieve the objective at the next level
Problems: "If cause A, then effect B"
Objectives: "Means X in order to achieve end Y“
Caution: Every cause-effect relationship does not automatically become a means-end relationship. This depends on the rewording
Working from the bottom upwards, ensure that cause-effect relationships have become means-ends relationships
Finally, draw lines to indicate the means-ends relationships in the objectives tree.

17. How the Objectives Tree is developed
Reformulate all elements in the problem tree into positive (desirable) conditions
Review the resulting means-ends relationships to assure validity and completeness of the objective tree
If necessary:
Revise statements
Delete objectives which appear unrealistic or unnecessary
Add new objectives where necessary
Draw connecting lines to indicate the means-ends relationships.

18. Reformulate “Problems” into “Objectives”
Economic losses for passengers
Loss of confidence in the bus company
Passengers are hurt or killed
People arrive too late
Frequent bus accidents (focal problem)
Drivers are not careful enough
Bad condition of vehicles
Bad condition of roads
Vehicles are too old
Insufficient Maintenance
Complete the objectives (cells of the 2nd column) in the table:
Add “Drivers are better trained” as a means to make drivers more responsible

19. Problems
Objectives
Economic losses for passengers
Passengers economic losses are reduced
Loss of confidence in the bus company
Passenger’s confidence is restored
Passengers are hurt or killed
Few passengers hurt or killed
People arrive too late
Passengers arrive on time
Frequent bus accidents (focal problem)
Frequency of accidents is considerably reduced (focal objective)
Drivers are not careful enough
Drivers drive carefully and responsibly
Bad condition of vehicles
Vehicles are kept in good condition
Bad condition of roads
Road conditions are improved
Vehicles are too old
Old vehicles are replaced
Insufficient Maintenance
Vehicles are maintained regularly
Solution
“Drivers are better trained” is the cause factor for “Drivers drive carefully and responsibly”

20. Complete the Objectives Tree
End
Means

21. Solution
End
Means

22. Alternatives Analysis
Three steps:
Eliminate the objectives which cannot be achieved
Identify two possible alternative options (means-end branches in the objectives tree) which could become possible projects
These means-end branches constitute the alternative options
Number and label thee alternative options
Evaluate the two alternative options (and their combination) with respect to the following viability criteria:
Cost
Chance for success
Cost/Benefit
Time horizon
Social risk

23. Alternatives Analysis: 1st Step
Determine and eliminate the objectives which cannot be achieved

24. Alternatives Analysis – Objectives which cannot be achieved (Solution)
Improved road conditions are entirely outside the reach of any of the bus companies

25. Alternatives Analysis: 2nd Step
Identify two possible alternative options (means-end branches in the objectives tree) which could become possible projects
These means-end branches constitute the alternative options
Number and label thee alternative options
Show these options in the objectives tree

26. Re-design the Objectives Tree
OPTION 1
OPTION 2

27. “Improved road conditions” should be eliminated
Solution
OPTION 1: Better drivers
OPTION 2: Better buses
“Improved road conditions” should be eliminated
OPTION 1
OPTION 2

28. Alternatives Analysis: 3rd Step
Evaluate the two alternative options (and their combination) with respect to the following viability criteria:
Cost
Chance for success
Cost/Benefit
Time horizon
Social risk
Select one of the options (option 1, option 2 or their combination) as the appropriate project strategy for the bus company

29. (Option 1 & Option 2 combined)
Complete the Comparison Table
Use linguistic terms (Low/High, Short/Long etc.) to evaluate the options
Justify your evaluations
Option 1
Option 2
Option 3
(Option 1 & Option 2 combined)
Cost
Chance for success
Cost/Benefit
Time horizon
Social risk

30. (Option 1 & Option 2 combined)
Solution
Option 1
Better drivers
Option 2
Better buses
Option 3
(Option 1 & Option 2 combined)
Cost
Low
High
Chance for success
Cost/Benefit
Time horizon
Short
Long
Social risk

31. Justification for the evaluations (shown in the comparison matrix) and final project decision
Option 1 (better drivers) is limited to a training programme. The chance of success is low if the buses are still in bad condition
Option 2 (better buses) is more expensive, and there is no guarantee that the result will be positive unless the drivers also improve
A third option would be to combine option 1 and option 2. It would be the most expensive alternative, but has a higher probability of success
The result is that one of the options are chosen as the project strategy, in this case option 3

32. Compete the
Project Matrix (PM)

33. Complete the Project Matrix (PM): 1st Step (1/2)
Identify main project elements for the selected project strategy
Use the objectives tree to identify the main project elements
Start at the top of the objectives tree and work downwards
If necessary, reformulate the wording from the objectives tree to make them more accurate

34. Complete the Project Matrix (PM): 1st Step (2/2)
Transfer the project elements into the first vertical column of the project matrix (Goal, Purpose, Outputs, Activities)
The goal describes the anticipated long term objective towards which the project will contribute
The purpose describes the intended effects of the project (project purpose) for the direct beneficiaries as a precisely stated future condition. There should be only one immediate objective
The outputs are expressed as objectives which the project management must achieve and sustain within the life of the project. Their combined impact should be sufficient to achieve the immediate objective
Activities are expressed as processes. Avoid detailing activities
Main inputs for the activities can be expressed in terms of funds, personnel, goods etc.

35. Complete “Goal”, “Purpose”, “Outputs”, “Activities” and “Inputs” cells in the PM matrix

36. Solution

37. Complete the Project Matrix (PM): 2nd Step
Identify assumptions
Assumptions describe conditions that must exist if the project is to succeed but which are outside the direct control of the project management
Start from the bottom of the objectives tree and work upwards
Examine whether the inputs are sufficient to undertake the anticipated activities or whether additional events must also take place outside the project (assumptions)
Some assumptions can be derived from elements in the objectives tree which were eliminated

38. Complete “Assumptions” cells in the PM matrix

39. Remember that "improved roads“ was eliminated from the objectives tree
Solution
Remember that "improved
roads“ was eliminated from the objectives tree

40. Complete the Project Matrix (PM): 3rd Step
Determine indicators
The indicators specify how to verify the attainment of objectives and outputs.
Some indicators can be derived from the objectives tree (an indicator, for example, can specify exactly how much the frequency of bus accidents should be reduced and by which date)

41. Complete “Indicators” cells in the PM matrix

42. Solution (1/2)

43. Solution (2/2)
More detailed indicators can be identified as part of the project monitoring system.
Taking output no. 1 “Drivers Trained”, as example, two indicators can be specified:
Indicator 1:
From the existing 120 drivers at least 60% are trained in year 1 and 40% in year 2; of the trained drivers all register a qualitative improvement in driving abilities, style and adherence to traffic rules, verified according to criteria set and agreed upon with the Traffic Department of the city and surveyed sporadically through checks and road controls.
Indicator 2:
Complaints against trained bus drivers concerning driving ability, style and observation of traffic rules is less than 20% of present levels (30 complaints / day) by middle of year 2. Means of verification:
Traffic Control Reports, Traffic Dept.
Independent Bus Traffic Surveys
Bus company Complaint Book
Traffic Rules Violation and Fines Register, city Police Dept.

45. The assignment presented in the previous slides is based on an example described in the following report: The Logical Framework Approach (LFA) – Handbook for objectives-oriented planning 4th edition, the Norwegian Agency for Development Cooperation (NORAD), 1999