Chapter 2

Project Identification and

Selection

Lectured:
by
Bersisa Kacho (PhD)
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Contents and Session Objectives
 Contents
◦ Conceptual Clarification
◦ Sources of project ideas
◦ Steps in Project Identification and Selection
◦ Group Exercises
 Session objectives
◦ After this session, you will be able to:
• Identify project ideas to solve a problem or exploit
opportunities, and
• Apply project identification and selection methods.

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 Project Identification
 Project identification is the initial phase of the
project cycle.
- It begins with the conceiving of ideas or intentions
to set up a project.
- National development plans and strategies are also
translated into specific investment projects

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 Sources of project ideas:
 The community,
 researchers,
 experts,
 local leaders,
 Policy makers,
 entrepreneurs,
 donors,
 NGOs,
 Government policy priorities,

 unusual events,

 external threats,

 unsatisfied demands,

 underutilized natural resources, etc.

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 Project Identifications
 Who identifies projects?
◦ Various organizations, whether local or foreign, state
owned or private, government ministries, development
banks, interest groups, NGOs and individual experts can
identify projects.
 two major approaches to project identification
◦ Top-down approach
◦ Bottom-up approach

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 Top-Down Approach
 Projects are identified based on demands from national or
International stakeholders or International conventions.
 For example:
◦ international conventions (such as Kyoto Protocol for climate
change)
◦ international institutions that have determined particular
priorities
◦ national policy makers identifying projects that pertain to
party manifestos and/or national plans.
 Advantages of Top-Down Approach
◦ Serves as a rapid response to disasters like floods, war
outbreak, etc. Due to limited time and chance to consult the
beneficiaries.
◦ It can be effective in providing important services like
education, health, water, roads etc.
◦ It can contribute to wider national or international objectives
and goals
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 Limitations of Top-Down Approach
 Does not help in modifying strongly established ideas and
beliefs of people.
 Assumes external individuals know better than the beneficiaries
of the service.
 Communities have little say in planning process
 Does not help in local human resource development.
 Community develops dependency syndrome on outside
assistance and does not exploit their own potential.
 The development workers (change agents) become stumbling
blocks to people-led development

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Bottom-Up Approach
 community/ beneficiaries are encouraged to identify and
plan the projects themselves with or without outsiders.
Advantages of Bottom-Up Approach
 Interveners accomplish more with limited resources since
people tend to safeguard what they have provided for
themselves.
 Develops people’s capacity to identify problems and needs
and to seek possible solutions to them.
 Provides opportunities of educating people.
 Helps people to work as a team and develop a “WE” attitude
- makes project progressive and sustainable.
 Resources are effectively managed; dependence reduces,
there is increased equity, initiative, accountability, financial
and economic discipline.

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 Limitations of Bottom-Up Approach
 Not always effective for projects that require
urgency to implement
 Time-consuming and requires patience and
tolerance.
 People sometimes dislike this approach because they
do not want to take responsibility for action.
 The agency using this approach is never in control
and cannot guarantee the results it would want.
 The priorities of communities may not fit with
national or international priorities that seek to have a
broader impact.

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 Project Identification in Both
approaches
 Involves needs assessment
- collecting, processing and analyzing data on problems/needs
of communities
 Review of secondary data

- Look at books, survey reports/ research papers, publications,

media reports, internet etc.
 Collecting and analyzing primary information

• Interviews
• Community mapping
• Focus Group Discussions
• Other methods

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Questions to be addressed in a
project:
 What is the major objective of the project within specified time?
 What is the basis for the demand or need for the goods/services
to be produced by the project?
 What problem or opportunity is the project addressing?
 How does the project contribute to the wider goals of the
sector/organization/ region?
 What alternative ways of addressing the problem/opportunity/
have been considered?
 Why is the proposed project the most appropriate way of
addressing the problem/opportunity?
 What is the approximate cost and time schedules of the project?

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Questions cont’d…
 Who are the major stakeholders and
beneficiaries of a project?
 Which institution is the most appropriate

for implementation?
 Are there additional or special circumstances

relevant to the project?

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Methods in Project identification
and selection:
 Stakeholders analysis
 SWOT analysis
 Problem analysis
 Objective analysis
 Alternative Tree Analysis

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a) Stakeholder analysis?

 Stakeholder is any individuals, group or

organization, community, with an interest in the
outcome of a program/project.
 Stakeholder’s could be targeted groups/
beneficiaries, negatively affected groups, decision
makers, funding agencies, implementing agencies,
community leaders, potential opponents and
supporting groups, etc.

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Purpose of stakeholders analysis:

 to identify, assess and develop an idea/opportunity with a

view to perceived needs and how well it fits into the
organization's programs and strategies
 To identify those groups who, directly or indirectly, will
affect or be affected by a project.
 To determine, through consultation, the issues, concerns and
needs of different stakeholders.
 To estimate the probable impact which various stakeholders
will have on the project.
 To identify measures to enhance stakeholder support for the
sustainable development objectives of the project.

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Stakeholder Analysis promotes the three necessary
conditions for the effective implementation of a
project:
• Awareness/ Commitment: Obtaining stakeholders
understanding and belief in the objectives and
implementation strategy of the project.
• Capability: that stakeholders believe they can cope
with and benefit from the changes which the project is
intended to bring
• Inclusion: that stakeholders feel they are valued,
consulted and part of the change process which the
project represents
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 b) SWOT Analysis
 SWOT analysis is a tool for institutional appraisal and a
brainstorming exercise in which the representatives of the
organization participate fully.
 Purpose:
◦ To assess the performance and capacity of the participating units,
divisions of organization.
◦ Each participating unit has to undertake SWOT analysis.
 SWOT stands for:
◦ Strengths - the positive internal attributes of the organisation
◦ Weaknesses - the negative internal attributes of the organisation
◦ Opportunities - external factors which could improve the
organisation’s prospects
◦ Threats - external factors which could undermine the
organisation’s prospects
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c) Problem Analysis
 Begins with identifying a core problem. A problem- is an
obstacle, impediment, difficulty or challenge, gap or any
situation that needs solution.
 Problems Analysis visually shows the causes and effects
of existing problems in the project area, in the form of a
Problem Tree. It helps to clarify the relationships among
the identified problems.
 Purpose: to identify major problems and their main
causal relationships.
 Output: a graphical arrangement of problems
differentiated according to ‘causes’ and ‘effects’

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Steps in Undertaking Problem Tree
 Identify a “core” or central problem
 List all the problems related to or stemming from the

core problem
 Determine which related problems are causes and

which are effects of the core problem

 Arrange the problems in a cause-effect heirarchy

around the core problem

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Problem Tree
EFFECT

CAUSE

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Problem tree Analysis
 Relies on:
◦ Group-based inter-action eg. Workshop format
◦ Participation of key stakeholders
◦ Process facilitation
◦ Achieving consensus on problems, causes and
effects

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Example 1: Subject of the workshop is food security,
the possible problems mentioned in relation to this
are:
 Food production on hills  Dikes are degraded
decreasing
 Ethnic clashes in neighboring
 Soil fertility on hill slopes
districts is decreasing
 Food shortages  Soil erosion on hill slopes
 High incidence of malnutrition  Irregular supply of inputs
 Canals are blocked for rice production
 Rice production in low lands  High immigration rates
decreasing
 Poor maintenance of irrigation
 Irrigation water does not
facilities reach fields in desired
quantity

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 High incidence

Problem Tree of Malnutrition

Food shortages

Rice production in
Lowlands decreasing Food Production High immigration
on hills decreasing Rates
Effect

Irrigation water does Irregular supply of Soil fertility on Ethnic clashes in

not reach field in input for rice hill slopes neighboring
desired quantity production is decreasing districts

Canals are Dikes are Soil erosion

blocked degraded on hill slopes

Cause

Poor maintenance system

for irrigation facilities
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 d) Objective Tree Analysis
 An objective tree is a technique for identifying the
objectives that will be achieved as a result of solving the
problems cited in the problem tree.
 cause-effect relationships in problem tree are turned into
means-ends linkages in Objective tree
 The ‘negative situations’ of the problem tree are
converted into solutions, expressed as ‘positive
situations’. Problem statements converted into positive
statements
 Check the means-ends relationships to ensure validity and
completeness of the hierarchy

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 Incidence of
Malnutrition reduced
Diagram of objectives
Improved Food
situation

Rice production Food production

in low lands Lower
on hills increased immigration
increased
rates

Sufficient irrigation Regular supply of Soil fertility on Less ethnic

water reaches the inputs for rice hill slopes clashes in End
fields production increased neighboring
districts

Canals Dikes are Soil erosion on hill

cleared upgraded slopes reduced

Means

Maintenance
irrigation facilities
improved

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 e) Alternative Tree Analysis
 is a process in which specific project strategies are
identified and selected from among the objectives and
means raised in Objectives Analysis, based upon
selection criteria.
 The aim of alternative strategy analysis is division of the
objectives tree into more consistent smaller sub-units
 Each of the sub-units of the objective tree can represent
an alternative strategy for the future project.
 The project objectives set the framework for the strategy
of the project.

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Criteria for selecting the alternative:
 RELEVANCE: the strategy corresponds to the needs of
the stakeholders.
 EFFECTIVENESS: the lower level objectives of the

strategy will contribute to achievement of the project

purpose.
 EFFICIENCY: cost-effectiveness of the strategy in
transforming the means into results.
 CONSISTENT with development policies
 SUSTAINABILITY of the projects

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 Incidence of
Diagram of Alternatives Malnutrition reduced

Improved Food
situation

Rice production Food production

in low lands Lower
on hills increased immigration
increased
rates

Soil fertility on
Sufficient irrigation Regular supply of hill slopes
water reaches the inputs for rice increased
fields production
Less ethnic
clashes in
neighboring
districts
Canals Dikes are
cleared upgraded Soil erosion on hill
slopes reduced

Maintenance
irrigation facilities
improved
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 Alternatives for decision:
 Let us assume that agricultural inputs are
provided by one NGO, soil conservation
activities are already in place by agriculture
office, and conflict is on the process to be
resolved by government officials in the area.
Therefore, the project will focus on the
irrigation system alternative

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 The Logical
Framework Approach

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Logical Framework Approach (LFA)
 is a four by four matrix, which enables the decision maker to
identify project purposes and goals and plan for project
outputs and inputs.
 provides a concise summary of the project and helps to

identify any flaws in the logical linkages of activities, inputs,

outputs and objectives at an early stage.
In summary LFA is used as a tool to:
 plan and implement development projects effectively

 follow-up and evaluate development projects.

 Communicate and report the project outcomes

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 Important Terms in LFA
 Goal is the broader objective to which a project contributes.
 Purpose is the primary intention or aim of the project
 Outputs are the services or products that a project delivers to
a target population
 Inputs: financial, human , material and information resources
available to implement the project
 Sector is the largest system of which a project is a part. For
example building a dam is a project
in the agriculture sector, if the main purpose is irrigation or in the energy
sector if the main purpose is the generation of hydro-electric power.

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 Important terms in LFA…
 OVI: demonstrate the desired results accomplished or to be
accomplished ( in terms of quality, quantity, cost and time)
 Means of verification: sources of information for the
accomplishments of the project
 The logic: A vertical and horizontal logic.
◦ A vertical logic clarifies why a project is being undertaken. It
specifies goal, purposes, outputs and inputs.
◦ A horizontal logic identifies what is to be produced and the
evidence that will signal success.OVI, MOV and assumptions.

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 The Role of Assumptions in the Vertical Logic

• Once the activities have been carried out, and if the

assumptions at this level hold true, results will be
achieved;
• Once these results are achieved and the assumptions
at this level are fulfilled, the project purpose will be
achieved; and
• Once the purpose has been achieved and the
assumptions at this level are fulfilled, a contribution
to the achievement of the overall objectives will have
been made by the project.

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 Assumptions
• Describe necessary internal and external conditions in order
to ensure that the activities will produce results
• they describe circumstances required to achieve certain
objectives
• Assumptions should be relevant and probable
• If an assumption is not important or almost certain: Do not
include

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Example of Assumptions for the Goal and Purpose:
• Political – stability of the country

• Economic – sustainable economy

• Adequate funds/materials.

• Skilled people – training needs.

• Approvals & contracts – legal, administrative.

• Participation of stakeholders.

• Etc.

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 Narrative Objectively Means of Important
Summary verifiable indicators Verification assumptions

Goal: - Crop yield /hectare • Field observation • High community

increased • Periodic reports from participation
-agricultural productivity increased in
the region agriculture office • Commitment from
both gov’t and NGOs

Purpose: - Soil & water conservation • Field observation - Community will take
systems put in place • Periodic reports of care of the system
- Promote soil & water conservation established
practices through reducing district administrators
deforestation

Outputs: - 50 hectare of land covered • Field observation Reliability of rainfall

with vegitation • Sample survey No immigration
- Afforestation
of degraded land
- Agricultural density reduced • Community
-pop pressure reduced on farm land
- Birth rate reduced participation records

Inputs: Sites Organaisation report Funds available on

Garden center time
- plantation site identified
Drugs(contraceptives) DA assigned
- Labor organised
Employees (health and Community
- Nursery established
Agriculture workers) commitment and
- Family planning and awareness participation
creation introduced 21
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