Project initiation and planning

Project initiation is the stage of the project, at which a certain set of works is carried out for its successful launch. In particular, there is a clear definition of the goals and objectives of the project, the appointment of a project leader, the development of a charter, the identification of participants and interested parties.

In this article, you will learn who the customers and sponsors of the project are, who the project working group consists of, how to fix areas of responsibility in the WG, how to identify and work with stakeholders. We will also consider very important elements of starting a project, such as project KPI’s, Business Case and Project Roadmap.

There are five stages of project management in the project life cycle:

1) Initiation

2) Planning,

3) Execution,

4) Monitoring

5) Completion.

When working on complex projects, the team can focus on these milestones as a roadmap.

Very, very often this stage of the project life cycle seems unimportant and unnecessary to a novice project manager. Indeed, what is there to think about, the authorities said to do — so it must be done. Rather, run to plan, for example, or even immediately execute. And this is one of the biggest mistakes that can be made.

What exactly happens at the project initiation stage in a particular company most often depends on the company itself. Somewhere the decision that the “project should be” has already been made, and it is only necessary to prepare the charter, and somewhere at this stage the feasibility of the project is assessed and a decision is made after the preparation of the charter. But in any case, this is the control point after which it will be clear whether we are doing a project or not, and which allows us to formally start this project.

To summarize, the initiation of a project is a moment when you can still stop and think about whether to do a project at all? When money, time and effort have not yet been spent. When your reputation as a good project manager has not yet been damaged, which will be difficult to fix later. After the charter is signed and the project manager is appointed, it’s too late to decide anything.

Whatever is included in the initiation of the project in your company, at this stage it is necessary to clearly formulate and describe the basic information about the project, make a justification for its feasibility, describe the final product and the results of the project. That is, to formalize all the information that will allow you to understand whether this project needs to be done at all. It is important to understand that there can be only three reasons for initiating a project: reducing costs, increasing profits, and reducing risks.

Also, the project initiation stage is an opportunity to make sure that the main stakeholders understand what this project is about in general and what role they will play in it, do not delude themselves that you will do everything perfectly and come with a ready result, and realize that there will be no miracle, and they will also have to participate in it.

Glossary

• Stakeholders* — Responsible persons from functions that are directly or indirectly influenced by the project. For example: information security, finance, lawyers, etc.
• Artifacts are some products of the project generated or used in it when working on the final product
• Kpi — Key Performance Indicators

A project is a temporary enterprise aimed at creating a unique product, service or result.

The project lifecycle is a set of phases that the project goes through from the moment of its initiation to the moment of closure. It defines the basic framework of project management.

A project phase is a set of logically related project operations that end with the achievement of one or a number of deliverables.

Artifacts of the “Initiation” phase

• Project passport
• Product Description
• Business case
• Preliminary schedule
• Preliminary budget
• Minutes of the approving committee/management board

Project passport is a document containing a description of the main parameters of the project as a whole.

Basic content of the Project Passport:

• Goals and criteria for the success of the project
• Top-level requirements and restrictions
• Known risks of the project
• Key control points (milestones)
• Budget
• Well-known stakeholders of the project

Project Team

Project manager — a person appointed by the executing organization to lead the team and responsible for achieving the project goals.

Project customer:

The party interested in the implementation of the project and the achievement of its goals.

The future owner of the project results.

Defines the main requirements for the project results.

Types of customers:

• Internal
• Employees of internal divisions of the company: marketing, sales support, customer care, HR, etc.
• External
• Clients, Partners, Government

Sponsor — responsible for the success of the project as a whole. He is extremely interested not just in getting the result, but also in the fact that it is received on time, within budget and with the right quality. And for the fact that the customer is satisfied with the result, too. The sponsor moves the project in every possible way at the TOP level, protects it from detractors and helps to solve the problems escalated to it.

And also in the right project:

The sponsor must be more influential than the customer, or at least as influential, otherwise there will be no help from him.

The sponsor should be responsible for the business success of the project, and not be limited to the fact that “our task is to make the project, and what happens next with the result — we don’t care.”

Stakeholders can be:

-Those who are actively involved in the project and work in it (project team, sponsor, management committee, involved third-party companies and other performers, etc.)

-Those whose interests may be affected by the project and who will use its results (customers, heads of functional departments and their employees, business partners, customers, buyers, etc.)

Those who are not involved in the project, but who, by virtue of their position or professional activity, can influence it (top managers of the company, owners and investors, shareholders, creditors, external and internal partners, regulatory authorities, etc.)

The RACI model

This is a tool for identifying activities and distributing them into roles and areas of responsibility. Using the RACI matrix allows you to avoid misunderstanding about who needs to be involved in the project, as well as who and what should be done.

Example of a RACI matrix

RACI is an abbreviation of the main roles of project participants:

• Responsible: The person assigned this role is responsible for completing the work and achieving the goals of the project.
• Accountable: The performer of this role is responsible for the quality and results of the process. The holder of this role is provided with the authority to provide feedback to performers.
• Consulted: The one who is assigned this role is involved as a carrier of unique knowledge or information. Experts in the subject area often act in this role.
• Informed: This is a person who needs to be kept informed about the progress and results of the process, most often unilaterally, because he does not have the authority to directly influence the progress of the project

KPI’s project

• The project content is a list of project activities that need to be implemented in order to achieve the project goals and get the planned results. The more accurately the content of the project is described, the easier it is to predict the timing and budget of the project.
• Project implementation time is the duration of the project, including the date by which the expected results should be received in the project.
• Budget –the cost of the project.
• Quality — the degree/ratio of the fulfillment of requirements to the results of the project.

Business case

This is a detailed investment proposal. The BC contains an analysis of the costs, benefits and risks associated with the proposed investments and other reasonable alternatives.

The importance of BC in decision-making is confirmed during the entire life cycle of an investment project — from the initial decision on the implementation of the project to decisions on the continuation of the project, its modification or termination, taken at the intermediate stages of the project. The BC is reviewed and adjusted in accordance with changes in the project plan, the project itself or business functions. If the BC changes during the project, the project must go through the procedures of rescheduling and renegotiation.

Key indicators of the business case of the project (economic evaluation of the effectiveness of the project):

• Revenue
• EBITDA — earnings before interest, taxes and depreciation
• NPV — net present value
• IRR- internal rate of return (profitability)
• DPP-Discounted payback period

Project roadmap

The roadmap of the project is a visual representation of the implementation of the strategy. In fact, this is a master plan that covers the main milestones of the project development, allows you to save time on thinking about actions and move systematically.

Example of project initiation from real life

So, I’ve been living in an apartment for 15 years, the paint on the ceiling has peeled off, the batteries are old and in general I’m uncomfortable. And I think it would be nice to start a project “Apartment renovation”. How will this happen?

• First of all, I honestly answer myself the question “why?” and “what I want to achieve with this repair.” Not just “I want repairs”, but “to come home, and here is beauty and order, then it will be psychologically more comfortable for me, and now I have a straight depression immediately begins.” Or “in order to sell an apartment in a year, it will be more profitable with repairs and will sell faster. Or “so that the old wiring and pipes do not fail, otherwise from day to day I will flood the neighbors or there will be a fire, then I will pay for my whole life.” The more honestly I answer now, the easier it will be later. At the same stage, I ask other interested parties (for example, my husband) if they want repairs, and what they expect from him.
• Then I at least roughly determine whether I can afford it or not — I look at my deposits, estimate how much it will all cost, I will correlate the amount of money spent with the benefit received (if an apartment with a renovation will rise in price by 1 million, and you need to invest 2 million in repairs, then what the hell is such a project). I decide whether to do the project at all or not. If not, then I forget about it or look at what alternatives I have (for example, to make a purely cosmetic repair for 200 thousand. rubles, so that the apartment in the photo in the ad looks good, and communications do not change, no one will know that they are bad anyway).
• If it is decided what needs to be done, I think there are time limits (parents will be allowed to live for the repair period, but not for more than 4 months, then their brother and wife will come to them), money (it is necessary to meet 1.5 million together with furniture and kitchen), resources (who will do, we will take ourselves or some company). And I also think who this project will affect, and whether it is also necessary to coordinate it with them (for example, the local housing office was planning to replace general communications in just a couple of months so that they would not tear down all my repairs), and in what environment it will take place (there is not a single building materials store in the city, will have to carry everything from the neighboring city).
• I decide who will lead this whole process and what powers he/she will have. If it’s me, I agree with my husband that I will coordinate all purchases of more than 50,000 rubles with him (I understand everything that is smaller myself), and that I can count on him to do repairs at least 3 days a week.

After I came up with all this, counted it, figured it out, I carefully write it all down in one document, check for the adekvat and decide whether I am ready to take it on and whether I take responsibility to do everything on time and on budget, taking into account all existing factors. If yes, then I sign a piece of paper, give it to my husband and parents for signature, and voila — the project has begun!

Conclusion

Today we got acquainted with the first stage of the project life cycle — Project Initiation. Considered: terms, description, examples from life. We understood why the project initiation is being implemented and what this stage gives for project management. I will say for myself, this is a very important part of the project manager, which in the future affects the appropriateness and success of the project.