Project risk management.

The A2N Training Programme revolve among others on –

• Analytical skills development – A2N will facilitate efforts towards the development and introduction of approaches aimed at enhancing people’s capacities for development. This will be done through farmer participatory approaches like methods for the activity participation [MAP].
• Information Dissemination – The promotion of information exchange will be a major activity of the network and it involves documentation and dissemination of farmer’s experiences and those of development workers.

The following are the major networking tools that the Network uses in information exchange –

• Publication on – Environmental Management

• Health including HIV and AIDS
• Gender Concerns
• Successful farming techniques and practices.

• Farmer to Farmer exchange visits
• Exposure visits
• Video shows
• Resource centers

The Project has clearly earmarked Us$ 20,000 per year for workshops to be used for disseminating information and sensitization.

The Project should spell out the line of reporting and interlink ages between the different stakeholders in order to have effective communication.

7. Supply Management competence

The Project should be able to manage the supplies, failure will put the budget off    balance. The document does not mention the criteria of sourcing for the best suppliers.

The suppliers should have the capacity to sustain the requests and should be credible. The project team must identify suppliers who will ensure sustained deliveries considering the area being infested by rebels.

There is no mention for the provision of storage facilities in time of harvest.

8. Human Resource competence

Projects tend to attract multi-displinary skills and yet the personnel have never worked together.Further more there is always an assumption that staff need no further training.

The budget has well catered for the training of the field workers on the tasks and results expected.

The document does not spell out the number of field workers to be recruited and the specific line of reporting. Though the document mentions the Project coordinator as the Project manager, it does not spell out the organization structure.

                                           

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Question 2: Discuss the potential risks associated with the project definition, State the extent these seem to have been recognized, suggest remedies /mitigates to their effects

2.1 Definitions

Project definition

This is the initial phase in the project lifecycle that is concerned with the identification of the need, which the project will serve; and a detailed description of the solution is obtained.

This is an important phase as; it is the foundation on which other phases of the project lifecycle are built. This phase has the sub-phases during which the identification of the need, concept and project is done.

• Need identification: A need is a stimulus that gives rise to the project.

            During this stage, the project promoters seek to determine the real need that is to    

            be satisfied, for the successful delivery of a project

            The different methods of need identification include participatory, quantitative,  

            objective and detached research approaches.

• Concept identification: during this stage, various ideas for possible solutions for the need are identified and the best option is chosen
• Project identification: during this stage, the optimum process for the task is determined.

Project risk can be defined as an unexpected event that may affect the expected outcomes of the project.

Project risk management: is the overall process of analyzing and addressing risk.

It involves assessment, mitigation and contingency planning of/for the project risks.

• Risk assessment this is concerned with the identification of risks involved and the likelihood of the impact on the project.
• Risk mitigation is concerned with minimizing the risks involved.
• Contingency plans are developed to offset consequences of failure in case the mitigates fail.

2.2 During the project definition phase, the following areas of risk may be noted:

2.2.1 Definition of a wrong need

 For each project, there is a problem for which a solution is sought. It is important that the real need, and not the perceived/imaginary need is identified. An imaginary need is one that is conceived based on historical information without assessing the situation on the ground. The financiers of the project may assume more knowledge than the intended beneficiaries, as a result, may identify a perceived need.

Need definition and identification sets the basis for the project.

In this project, this risk has been realized to a minimal extent. The need of food insecurity and low incomes of IDPs and demobilized communities has been identified. This has been substantiated by the situational analysis done by UNICEF in March 2001.

However there is no indication of the involvement of all the stakeholders in identification of the need. All the stakeholders, especially the direct beneficiaries should play a major role in need identification, this enables ownership of the project, thus increases chances of project success.

Mitigates to definition of wrong need:

• Group discussions with local and opinion leaders to obtain information about problems affecting their areas. Various problems identified may be rated so as to determine the problem that warrants immediate solution.
• Do a situational analysis- understand the situation on the ground prior to any intervention. The time lag between the situational analysis and the actual implementation should be minimized, as the majority of situations are dynamic and not static.
• Interviews/ Discussions with all the relevant stakeholders in an effort to identify the needs. The intended beneficiaries, donors, security organs and implementing agencies should be involved in group discussions so as to establish the real need and also to enhance a high degree of agreement between all the stakeholders.
• Use of historical information will enhance adequate identification of the real need. However due to the dynamism of various situations, this historical should be used with a caution.

2.2.2 Definition of a wrong scope

Scope defines the range of activities that are necessary for the delivery of the defined products and services.

In this project, there is a risk associated with the identification of a broad geographical area. The project document states that their operations will stretch from West Nile through Lango and Acholi sub region. The districts included are Arua, Adjumani,Nebbi,

Yumbe, Moyo, Gulu, Kitgum, Pader, Apac and  Lira. This area covers approximately 6.5 million people. The project document also states that this is a pilot study, with a view of learning from the interventions and seeking opportunities to scale it to other areas. Considering the size of the geographical area, this is too broad an area to be used as a pilot.

As this project involves different areas that have varying levels of insecurity, the lessons learnt in one area cannot be easily extrapolated in another area. This calls for increased innovation among the implementing agencies.  

Another risk identified is that the project seeks to satisfy everybody, it tries to be everything to everyone. This is displayed in the project document, the various activities to be undertaken include: gender mainstreaming, income generating activities, environmental conservation initiatives and HIV related issues. This broadens the range of activities to be undertaken, thus may result into failure to meet everyone’s expectations.

Non-recognition of time and resources limitations is another risk area. Every project has a particular set of constraints usually centered on time and resource. This project has not recognized the resource constraints, considering that there is a broad geographical area, which holds about 35% of the country’s population, to be covered.

 The time constraint has also been ignored. There are numerous activities which include, both project and pre-implementation activities, that are set to be carried out in two years. Also the set date, April 2004 for which the project was to start has already past, while it is still in the planning phase of the project lifecycle.

 Mitigates to scope definition:

• The project promoters should reveal as much information as possible to the stakeholders so that they are aware about their constraints. This will enable the stakeholders to understand and appreciate these constraints thus they able to limit their expectations.
• The project promoters should seek and gather information pertaining to similar projects /interventions being done in the same geographical area. This will improve their knowledge base of the various activities being undertaken by these other projects, thus are able to limit their activities. Also this information will avail learning tools and experiences of similar projects.
• The project promoters should be able to manage expectations of the different stakeholders. Group discussions held with all the stakeholders will encourage them to reveal their expectations.  

2.2.3 Definition of a wrong concept  

The concept of this project is to improve lives of IDPs in camps and demobilized communities in Northern Uganda and equip them with skills that they can use after the camp life.

Risk involved is exclusion of key stakeholders in the selection of the concept. In this project, key stakeholders that have been excluded include, among others, the security organs. The security agencies are important, as the project location is one that has been over run with insecurity, thus security is paramount for the success of this project. For the IDPs to successfully be involved in agricultural and other income generating activities, there has to be adequate security. This project promotes the creation of groups of villagers and farmers so as to access services which include credit and extension among others. However in times of intense insecurity, the various security organs prohibit any meeting that has at least four members.

Opinion leaders and Religious leaders have been ignored in the concept selection. These are important in that the local people follow their guidance and listen to their opinions. For the success of this project, it is important that they are involved in the concept selection.

Another risk that has not been recognized is that of inappropriate concept given the circumstances and constraints. Particular activities of this project necessitate that the beneficiaries are in groups so as to access saving and credit services. It may be difficult for these IDPs to form and sustain these groups, as they are strangers to each other.

 Also during times of intense insecurity, the security organs prohibit meetings that have more than four members, because these times are random and unpredictable, this will hinder the success of the project.

One of the ways the project intends to improve the household food security is to provide extension services to farmers. The constraint here is that majority of the NGOs working in the IDP camps have a limited radius within which they can work, so as to ensure their own security. This limitation may greatly affect the success of the project, as a core objective may not be achieved.

The activities that the IDPs are to do are labor intensive, in times of intense insecurity; such activities may be abandoned, thus bringing the project to a halt. For example, during the harvesting season, this activity may is halted by rebel activities.

Choice of a non-optimum concept given other options is another risk in the sub phase of concept selection. However this has been recognized in the definition of this project.

 Mitigates to risks in the concept definition sub-phase

• Inclusion of key stakeholders to brainstorm on ideas. All the key stakeholders should be involved and encouraged to brainstorm on possible solutions to the problem, for example, the security organs may avail ideas on how the group activities can be held with minimum interference, while keeping the peace of the area.        
• A cost benefit analysis should be done. Considering that this is a war-torn area, there may be no returns on the investment injected, thus an analysis of the cost of the project versus the benefits expected should be done so as to minimize the risk involved.
• Pre- feasibility studies should be carried out so as to assess the feasibility of the activities vis-à-vis the constraints in this project location. Socio-cultural pre-feasibility studies will help assess whether there will be a problem with the group formation.
• A policy should be taken with the Multilateral Investment Guarantee Agency (MIGA) to ensure that all funds and resources to be utilized in this project are insured this will minimize the loss on the resources invested in this project.

 

2.2.4 Choice of a wrong client

The choice of a wrong client may introduce risk to the project, as their expectations will not be met. The client of the project should be identified and defined distinctively.

This project has recognized this risk and has tried to identify its client, these include women, who are to be encouraged to send the girl-child to school; youth and children; men; the elderly; persons with disabilities; individual farmers and small holder farmer groups.

However this identification involves everyone in a community, thus inclusion and exclusion criteria should be set so as to define the client. The definition will result in various members of a single household being targeted as reduce the targeted number of households.  

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Mitigates to the risks associated with definition of a wrong client

• Utilization of information from similar projects already being implemented in the area. Such data will assist in setting the inclusion and exclusion criteria. This will reduce the ambiguity in the client definition thus enable smooth running of the project.

• Use of information collected from local and opinion leaders, as this project targets the household, this information will assist define a household thus reduce replication of activities to the same household.
• The various aspects of the project should be discussed with the intended client. These include: the objectives, their expectations and the constraints involved. This will ease the delivery of the client’s expectations and the project’s objectives in the midst of the existing constraints.    

Conclusion

There is need for proper identification of risks so as to enhance adequate risk management. Risk identification is a continuous process that should be done during all the phases of the project lifecycle.  

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For the increase in income, the project document identifies the following activities;

• Mobilization of farmers into farmers groups for collective marketing, advocacy and negotiation skills for better policies and reasonable prices.

• Conduct business and marketing skills training for improved business management.
•  Formation of savings and credit associations. These associations increase client’s safe heavens enabling farmers to save and negotiate for better prices.
• Produce seed money as a revolving fund into Village Savings and Credit Institutions (VSCI). This will help clients to store their produce and sell at appropriate prices since they can access seeds for planting through the revolving scheme.

3.3 The degree of consensus of the stakeholders:

Projects normally have more than one stakeholder with different views, perceptions and interests. These diverse values can affect the project activities if the different stakeholders do not identify with the proposed project need.

However, for this project, the different stakeholders share common understanding hence concede with the identified project need.  

These include:

i) Donors and collaborating agencies:

 Aid Liaison Department (ALD) of the Ministry of Finance Planning and Economic Development is the executor of the project.  It is responsible for the over all supervision and management of the project.

However, there other agencies like NARO that will provide the technical expert in the field of on-farm and post harvest crop management with special reference to improved crop variety and animal hybrids. World Food Programme (WFP) that will provide funds and ready market for the agricultural produce by the project clients. Other project donors include OCHA and UNDP/GEF/SGP that will assist in development of GEF bankable project proposals and implementation by the local NGOs/CBOs for project objective 3.

These organizations involvement in this project signifies a shared appreciation of the project need and the level of consensus on the approach to solve it.

ii) The implementing agencies:

        

Africa 2000 Network (A2N) and Hunger Alert are the implementing agencies of this project. They are responsible for the direct execution of the project activities like, training women and youth in income generating activities, savings and credit management and provision of extension services at household level.

District Promotion Centers (DPC’s) and Enterprise Uganda are going to provide technical trainings in enterprise identification and business sills management.

Their acceptance to sub-contract with ALD signifies their level of acceptance and identification with the project need.

iii) Host Communities of the IDPs:

The survey conducted by UNICEF in March 2001 revealed that there is a lot of arable land around camps, which is being utilized by IDPs. That if, utilized efficiently would produce enough. This acceptance of host communities to allow IDPs utilize their land, illustrates that they agree to the project need identified.

The degree of stakeholders consensus is high although some relevant stakeholders were not involved in the project identification and design hence from the project document, it is hard to establish their stand for the identified project need. They include; The UPDF and other security organs and local opinion leaders.

3.4: Compatibility of the need with values and strategies:

The project concept demonstrates a group-based approach for the execution of the project activities. Farmers groups and savings and credit associations will be formed to facilitate group savings, training, collective marketing and bargaining power.

Traditionally, people in Northern Uganda treasure communal work. They practice clustered settlement, communal digging and grazing and communal land ownership. This value will support the group-based approach proposed. Therefore, execution of project activities through groups is suitable for northern Uganda considering peoples cultural values.

3.5: Availability of opportunities taking into account project constraints:

Projects generally have constraints. These can be internal or external constraints. However, there are always opportunities identified by project designers before accepting a given project. For this project, it has the following opportunities:

• The implementing Agencies Hunger Alert and A2N are well established and have versed experience in the project activities they are to execute such activities include; training in agricultural practices, Business, information dissemination, agroforestry, animal husbandry, crop management.
• The government policy also favors the project need. The project need is identified with the national goal of Poverty Eradication Action Plan (PEAP) and contributes to the Millennium Development Goals (MDGs) 1 and 7. This identity increases the projects funding opportunities and international support.
• There is ready market for the agricultural produce by indirect beneficiaries like World Food Programme and Uganda Grain Traders. This will enable clients to overcome price exploitation by middlemen hence increasing their income.
• The will of the host communities to avail land to IDPs. This will be used for enterprise development.
• The targeted communities culture of communal work provides support to the proposed methodology, which initiates community self-sufficiency.
• The Donors UNDP/GEF/SGP are expected to develop the capacity of NGO’s/CBO’s and CSO’s to access grants/loans and undertake environmental projects and investments. These donors have been in Uganda since 1997.The expected funds have a high probability of being released in time to implement the environmental activities.

3.6: The environmental compatibility:

The sub-region of Acholi, Lango, and WestNile has a good climate, good soil that support   both crop growing and animal raring. These natural factors support a variety of both indigenous and hybrid crops that are not grown by many Ugandans. They include; sim sim, and other unique beans.

Therefore, the combination of the climate that is conducive, the appropriate technology, the training and introduction of improved crop varieties and hybrids, and enhancement of extension services would improve the agricultural production of the region.

The need identified suits well with the criteria used to validate a project need.

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Question 4What is the concept and scope of the project? To what extent would you think this has been well articulated given the resources and target group?

Answer:

 A project concept is the definition leading to the out comes of the project. It involves developing project objectives, strategies and what is required to complete the project. It considers costs and resources required to complete the project based on experience of other similar projects. It shows the work break down structure of the project.

The conceptual frame work for the proposed project

A well articulated  project concept have the following features:

Project objectives, project strategies, relevance for targeted clients and a clear definition and explanation of the resources needed to execute project activites.

• The project document spells out clearly the project objectives. These objectives fits well in the project concept and they are directly linked to the project goal as below:

         

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Objectives i and ii indicates well what the project is intended to achieve as its core business. Through mobilizing the targeted persons and training them in business skills and marketing and providing them with agricultural extension support, these persons are able to engage into income generating activities hence a source of household income thus achieving the project goal.

Agricultural extension support services that will be provided to the targeted persons, enables farmers to practice improved agricultural methods which increases farm yields and increased food production in the targeted areas hence improved food security which a requirement in the project goal.  

• The project concept is relevant for the targeted clients. From the situation analysis, it is mentioned that IDPs have access to some arable land hence they can conduct enterprise development activities. Traditionally people in Northern Uganda are agriculturalists commonly practiced through communal farming. This practice together with the good climate and fertile soils that support a veriety of crops agricultural production is the most suitable project as identified for these persons.

•  The projet concept defines and explains clearly the resources to execute the project activities. The budget and costs for each activity are well defined and allocated in the project document.

However, the document left out some relvent project activities like identification  of extension workers, supply of project equipment and the general Organization Breakdown Structure yet they have a high cost implication. Although the management and project strategy are mentioned in the project document, there gaps un explained and if not addressed early may jeopordise the project success.From the project document, executors assume that the current extension workers from the implementing partner organizations are enough and will conitnue to implement the new project’s activities.

• The project concept ignored other satke holders like similar projects being implemented in the targeted area. Consulting other similar projects being implemented in the targeted area controls duplication of work and increases the number of beneficiaries fostering effective resource utilization. For example,clients for the designed project were not consulted to suggest the most suitable intervention and support.
• Savings and credit associations may be difficult to form and sustain because IDPs have un predictable movements forward and back ward to their areas of orign when threats to security subsidize. This movement can lead to loan default and savings loss worsening their poverty situation.
• The concept though appropriate, some activities are inappropriate given the security situations in Acholi land. Such activities include; produce storage and marketing which are not well articulated on how they will be handled.

PROJECT SCOPE

The project scope describes the work required for the project and what is going to be its end product. It refers to what the project actually is and the work required to achieve its objectives. It explains the work that must be done inorder to deliver a product/service with the specified features and functions.

It is the most critical element in the project control cycle because it determines everything else that follows . if poorly defined, it can lead to:

• a completed project that is very different from the client and sponsor expectations
• additional costs
• delays in completion

FEATURES OF A GOOD PROJECT SCOPE

1. Embrace project preliminary activities such as; contracting and partnership development
2. Core project activities scheduled.
3. Secondary activities that are required to achieve the project objectives such as staff training
4. Divide the project into functional components and costing centres
5. (Cross cutting issues; like Gender, HIV/AIDS, and Environment)
6. Measurement of project performance/lessons learnt

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Project document assessment

1. Embracing the project preliminary activities such as; contracting and partnership development

The project document presents the partnership strategy and explains how the project will be implemented. The project will be implemented through Public Private Patnership (PPP) model in which Aid Liasion Department is the executing agency and two NGOs; Africa 2000Network (A2N) and Hunger Alert will be the lead implementers.

It further mentions other local private firms, NGOs like NARO, MAAIF, OCHA, World Food Programme’s stake in the project.

However, the activities involved at this stage are not clearly documented, scheduled and budgeted for in the project plan.  

2.  Core project activities scheduled

The core project activities are well documented in the project plan. Activities are well identified and sequenced with their respective project objectives. These activities include;

-Training farmers associations in savings and credit

- Provision of technical & business skills training

- Provision of extension services

-Training in marketing

- Training in on-farm environmental management

3. Secondary activities that are required to achieve the project objectives such as     staff training

Other secondary activities were identified and budgeted for in the project plan. The project budget lays out funds allocated to activities like national consultants, specialized training of Resource Persons, training in savings, mobilization,credit management and sustainable agriculture for Extension staff.

However, these activities are not mentioned in the narrative section of the project document hence it is not articulated on how they will be executed.

4. Divide the project into functional components and costing centres

The functional components are not well identified in the document. It is not clear about the number or functional units involved in the project. The document does not show the costing centres for effective employment of project resources. It lacks key components such as;

- Administration, Monitoring & Evaluation, Finance and Procurement. The current structure makes it difficult for the project coordinator to manage the desined project with out a team with the mentioned experiences at his level. The current arrangement compromise project quality.

5. (cross cutting issues; like gender, HIV/AIDS, and environment)

The project appriciates and recognizes the three cross cutting issues of gender, environment and HIV/AIDS. Environment is well presented in the project plan showing activities involved and has a budget vote. However, gender mainstreaming and HIV/AIDS are just mentioned in the project document but they are not well articulated on how they will be dealt with during the execution of the project activities and do not have a budget.

6. Measurement of project performance/lessons learnt

The over all project performance indicators are well documented in the project plan. However, it is not mentioned how they will be measured. Activities, resources and time involved are not mentioned and provided for in the project plan.

The project plan provides for continuous monitoring and evaluation of project activities.

Conclusion:

 

There is need to articulate clearly the project concept and scope because if they are misinterpreted by the implementers, project activities can change and hence changing the project. This frustrates donors and project clients.

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Question5: Summarize risks associated with the project into internal (unsystematic) and external (systematic)

Risk can be defined as an unexpected event that may affect the expected outcomes of the project. Risks associated with the project may be classified as sources of risk or as resources exposed to risk.

Internal risk is that which is within the control of the project management while an external risk is that which is outside the control of management.

Sources of risk can be further classified depending on the environment in which they arise:

• Physical environment
• Social environment
• Political environment
• Operational environment
• Economic environment
• Cognitive environment

 

Physical environment

This is a source of risk associated with the natural environment of project location.

The assumptions made for this project are good soils and favorable weather conditions. The risk associated here is that there may be weather changes or reduced productivity due to poor soils. This is an external risk, as management cannot control the weather or the productivity of the soils.

Social risks

The social environment is another source of risk. The breakdown of the social structures due to the impending war, human behavior changes are risks that could affect this project. The psychosocial effects of the war may lead in decrease in morale of the host communities, thus may result in laziness and a development of a ‘don’t care’ attitude. This could affect the success of the project. To a certain extent, this is an internal risk, as the project management can provide psychosocial therapy to reduce their effects.

Political risks  

This project is situated in a war-torn area, stifled with political unrest. This is a major source of risk as insecurity is necessary for the successful execution of the project. Considering that this project is situated in a war-torn area, it will pose a risk in de-stabilizing the project activities; for example, the security agencies may fail to provide the necessary security required to perform the project activities, which may lead to rebel activities de-stabilizing the project.  The project management cannot influence the political environment, thus this is an external risk.

Operational environment

There is a risk in identifying the suitable human resource required for this project. Unfavorable working conditions may pose as a risk as they affect the health of the employers. Unskilled human resource will introduce risk, by failing to identify potential risk areas. The project management can control the risks associated with the project operations, for example, it is within the authority of management to adequately remunerate their employers, provide good working conditions for the best candidates selected for the job.  Thus this is an internal risk.

Economic risks

This project is being financed by donor funds, thus the global economic situation is a source of increased risk. Examples of risk include interest rate, credit policy, recession and depression. The donors may have a change in areas of priority; this will introduce risk to the project. This is an external risk as it is outside the control of management.

References

1. Project Management, Financial Times; by Maylor H (1999) Pitman Publishing
2. Risk Identification – Basic stage in risk management, Environmental Management and Health; by Tchankova L (2002) Journal, Vol 13 No 3, Emerald Group Publishing Limited  
3.  The Effectiveness of Risk Management- measuring what didn’t happen, Management Decision; by McGrew J, Bilotta J, (2000) Journal Vol 38,No 4, Emerald Group Publishing Limited
4. Advanced Project Management A Structured Approach; by F.L.Harrison 3rd edition
5. A guide to Project Management Body of Knowledge Project Management Institute Standards Committee.

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