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PROJECT PLANNING &
MANAGEMENT:
GOLLIS UNIVERSITY
FACULTY OF BUSINESS ADMINISTRATION &
ECONOMICS
SEMESTER SIX

CHAPTER 2:
CONCEPTS, DEFINITIONS & NATURE OF
PROJECTS:
2
GOLLIS UNIVERSITY BURAO CAMPUS SOMALILAND

CHAPTER LEARNING OBJECTIVES:
3
 By the End of this Chapter, students should be able to:
i. Define a project.
ii. Explain the different types of Projects.
iii. Analyze the reasons why projects are initiated.
iv. Discuss the Triple Constraints of Project Management.
v. Explain the concept of Project Participants or
Stakeholders.
vi. Explain the major characteristics of a project.

WHAT IS A PROJECT?
 “A project is a problem scheduled for solution.”
 Problem refers to the gap between where you are and
where you want to be, with an obstacle that prevents easy
movement to close the gap. Projects are a group of
activities that have to be performed with limited resources to
yield specific objectives, in a specific time, and in a specific
locality.
 Thus, a project is a temporary endeavor employed to
create a unique product, service or results.
4

 Projects are an investment on which resources are used
to create assets that will produce benefits over an
expanded period of time.
 It is a unique process, consisting of a set of
coordinated and controlled activities with start and
finish dates, undertaken to achieve an objective
conforming to specific requirements, including the
constraints of time, cost and resources.
5

Short Range Projects:
 They are completed within one year, and are focused
towards achieving the tactical objectives. They are less
rigorous; require less or no risk. They are not cross
functional. These projects require limited Project
Management tools, and have low level of sophistication. It
is easy to obtain approval, funding and organizational
support for short range projects.
6

Long Range Projects:
 These projects involve higher risk and a proper
feasibility analysis is essential before starting such
projects. They are most often cross functional. Their
major impact is over long period of time, on internal as
well as external organization. Large numbers of
resources are required to undertake long range projects
and they require breakthrough initiatives from the
members.
7

Why are Projects initiated?
Projects are initiated in the following scenarios:
 When starting a new business.
 In order to develop/ modify a product or service.
 For relocating and/or closing a facility.
 For regulatory mandate.
 For some community issues.
 In order to re-engineer the process so as to reduce
complaints, reduce cycle time, and eliminate errors.
 For implementing a new system or process.
 To introduce new equipment, tools or techniques.
8

Characteristics of Projects:
 Projects are temporary with a definite beginning and a
definite end.
 They also have temporary opportunities and
temporary teams.
 Projects are terminated when the objectives are
achieved, or conversely, if the objectives cannot be
met.
 They involve multiple resources (human and non-
human) and require close coordination.
 They are composed of interdependent activities.
 At the end of the project, a unique product, service or
result is created.
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The Project Environment:
All projects are planned and implemented in a social, economic,
environmental, political and international context.
 Cultural and Social Environment: is that how a project affects
the people and how they affect the project. This requires
understanding of economic, demographic, ethical, ethnic,
religious and cultural sensitivity issues.
 International and Political Environment: refers to the
knowledge of international, national, regional or local laws and
customs, time zone differences, teleconferencing facilities, level
of use of technology, national holidays, travel means and logistic
requirements.
 Physical Environment: is the knowledge about local ecology
and physical geography that could affect the project, or be
affected by the project.
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Project Participants:
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Stakeholders:
 Stakeholders are the ones who have a share, or an interest
in an enterprise. Stakeholders in a company may include
shareholders, directors, management, suppliers,
government, employees, customers, and the
community.
 Stakeholders are influenced by the outcomes and
objectives. They have varying level of responsibility and
authority. Thus, they should not be ignored. A project
manager should try to manage and fulfill the
expectations of the stakeholders.
12

Cont…
 Project stakeholders are individuals and
organizations that are actively involved in the
project, or whose interests may be affected as a
result of project execution or project completion.
They may also exert influence over the project’s
objectives and outcomes.
 The project management team must identify the
stakeholders, determine their requirements and
expectations, and, to the extent possible, manage
their influence in relation to the requirements to
ensure a successful project.
13

Cont…
 Stakeholders may have a positive or negative influence
on a project. Positive stakeholders are those who
would normally benefit from a successful outcome from
the project, while negative stakeholders are those who
see negative outcomes from the project’s success.
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Key Stakeholders include:
 Project Manager:
 Customers, End Users:
 Performing Organization:
 Project Management Team
 Project Team Members:
 Sponsors:
 Influencers:
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Relevant stakeholders:
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Sub Projects:
17
 Projects are frequently divided into more
manageable components or sub projects.
 Individual sub projects are also a project
and are managed as such. They can be
sub contracted or out sourced.

Triple Constraints of Project
Management:
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 Meeting stakeholder needs and expectations involves
balancing competing demands among cost, quality,
scope, and time.
Q = f (T, C, S)
 Where Q is Quality, S is Scope and T is Time.
 Project quality is affected by balancing these three
factors.
 Projects fail when:
 Estimates are faulty
 Time, talent and resources are insufficient or incorrectly applied

REVIEW QUESTIONS:
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 Define a project.
 Explain the different types of Projects that you know.
 Analyze the reasons why projects are initiated.
 Discuss the Triple Constraints of Project Management.
 With examples, explain the concept of Project Participants
or Stakeholders.
 Explain at least five characteristics of a project.

20
END

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