Chapter 3

International Development Projects: Methods and Tools

Given the peculiarities highlighted in the previous chapter, specific methods and tools have been developed to manage ID projects.

In this chapter we introduce these methods and tools and we discuss their potential and limitations. The tools are introduced and briefly explained, considering their first or most widespread versions. In the next chapter, we further discuss and compare different versions of these instruments.

3.1 ID Projects’ Methods and Tools

3.1.1 Project-cycle management

Project-cycle management (PCM) is a term used to describe the management activities and decision-making procedures used during the life cycle of an ID project. In general terms, the “life cycle” consists of “phases that connect the beginning of a project with its end” to provide better management control through appropriate links to the ongoing operation of performing organizations (PMBOK® Guide, 2004). In the context of ID projects, as Biggs and Smith (2003 p. 1743) observe, the project cycle consists of a number of progressive phases “that lead from identification of needs and objectives, through planning and implementation of activities to address these needs and objectives, to assessment of the outcomes.”

The project cycle’s origin dates back to 1970, when W. C. Baum outlined five phases in the life of a project and organized them into a cycle (Baum, 1970). Eight years later, he introduced “evaluation” to the sequence (Cracknell, 2000 p.95), arguing that “each project passes through a cycle that, with some variations, is common to all.” He finally outlined six progressive phases (Figure 3.1): identification, preparation, appraisal, negotiation, implementation and supervision, and evaluation (Baum, 1978). These steps aimed to provide a well-defined structure and direction to a project’s activities and keep the focus of attention on the development of objectives and issues.

Since that time, the project cycle has been used to manage and evaluate ID projects and, for this reason, the project-cycle management framework “has become a standard practice for development agencies to organize their activities” (Biggs & Smith, 2003 p. 1743). PCM suggests managing projects end-to-end and adopting different approaches and tools for the different parts of the project. The objective is to provide a schematic and friendly view of the project for all the stakeholders and support the design, plan, management, and communication of the project (Coleman, 1987; Gasper, 1997). In particular, Baum (1978) develops the project cycle along six phases:

1. Identification: Identification and selection of viable projects that support, within the broader program, the development and growth strategy adopted for a country or for a particular sector in it. This first step is characterized by a deep analysis that provides the basis for a continuous and fruitful interaction between the funding body-promoter and the recipients of the project: a good integration and a shared realization of the project, in fact, favors the success and sustainability of the project. The identification phase is therefore very delicate and, in a sense, decisive because it affects the achievement of the program objectives within which the project is carried on.
2. Preparation: Preparation of a summary of the project and feasibility study to show that there are all the technical, institutional, economic and financial resources necessary to achieve the project objectives. During this stage, possible design alternatives are compared.
3. Appraisal: During this phase, the project is evaluated and reviewed, checking that nothing is missing and the basis for the implementation is set correctly. The appraisal phase involves technical, institutional, economic, and financial aspects of the project.
4. Negotiation: In this stage, the financial institution and those who implement the project look for a shared agreement on necessary resources needed to develop the project. The agreements are then formalized and recorded into documents that accurately describe every detail of the budget. The funding allocation concludes the first part of the project cycle, linked to the planning activities, and a much more concrete and tangible part begins.
5. Implementation: Operational implementation of the project, ongoing supervision to prevent any leakage of effort and energy in order to obtain timely tangible results.
6. Supervision and Evaluation: Occurs once the project has been completed. The final evaluation is crucial not only because it verifies that everything was done according to the estimates and plans, but also because it provides invaluable knowledge, which, if properly handled and stored, facilitates the course of future projects similar to the one just concluded.

3.1.2 Logical Framework (LF)

The project cycle management represents a framework rather than a tool in itself. For this reason, inside the PCM, according to Biggs and Smith (2003), different tools have been developed and, among these, the most widely known and used tool is the logical framework (LF). This tool is widespread nowadays, and it is often considered as a stand-alone tool (Couillard, Garon, & Riznic, 2009).

The LF is a matrix (normally a 4 × 4 matrix) that summarizes the project’s goals, activities, assumptions, indicators, and sources of verification in order to measure and report the achievement of objectives (Coleman, 1987; Gasper, 1997).

The logical framework in the context of ID projects originated in 1969 from Fry Associates and Practical Concepts, Inc. (Solem, 1987), two U.S.-based consulting firms, at the request of the United States Agency for International Development (USAID). USAID officially adopted the logical framework in 1971 just for technical assistance projects, and then, in 1974, the agency extended the use of the logical framework to all types of foreign assistance projects (MacArthur, 1994).

A few years later, the Canadian International Development Agency (CIDA) was the first development agency that adopted, with only small differences, USAID’s logical framework (MacArthur, 1994). In 1985, the Department for International Development (DFID), a U.K. government department, introduced the logical framework in managing ID projects, with differences in the headings of the rows and the columns. In 1986, the Food and Agricultural Organization (FAO) adopted the logical framework, with the addition of one more row called “activities.”

While the logical framework was spreading throughout most of the United Nations’ development agencies (e.g., International Fund for Agricultural Development, United Nations Development Programme), in 1983, the German aid agency Gesellschaft für Technische Zusammenarbeit (GTZ), which was commissioned by the Federal Ministry for Economic Cooperation, modified the logical framework approach by creating an extended version, the Ziel Orientierte Projekt Planung (ZOPP) (GTZ, 1996, 1997). The ZOPP provides, through more participatory planning, a more systematic, participatory, and complete process to draw the matrix (Gasper, 1997; International Fund for Agricultural Development, 2001; Nakabayashi, 2000). Having obtained good results for a master plan, ZOPP became mandatory in 1986 for all of GTZ’s ID projects.

Many development organizations showed interest in the ZOPP approach. The Norwegian Agency for Development Cooperation (NORAD) introduced it without one column (means and sources of verification) (1999). The Danish International Development Assistance (1996), the Swedish International Development Cooperation Agency (1996), the Asian Development Bank (ADB), and the United Nations Industrial Development Organization (UNIDO) incorporated ZOPP into their project planning and management procedures.

The European Commission developed its own first version of project-cycle management based on the ZOPP approach in 1992. The European Commission produced the first PCM manual in 1993 (European Commission, 2004) and emphasized beneficiary needs (Eggers, 1994). Since that year, the guidelines have been updated several times as a result of user feedback.

In 1994, the Japan International Cooperation Agency (JICA), which was in charge for the technical cooperation schemes under the supervision of the Ministry of Foreign Affairs, introduced project-cycle management as a standardized method for managing ID projects. The following year, JICA defined its own logical framework called the project design matrix (Nakabayashi, 2000). The Japanese PCM and the logical framework were both based on the ZOPP approach.

Today, there are many versions and variations in the terminology, but the logical framework is typically thought of as a matrix that breaks down a project into its component parts in order to facilitate management (Cracknell, 2000).

3.2 The European Commission Logical Framework (LF)

One of the most widespread and studied version of the LF is the one developed and requested by the European Commission for its projects. The structure of the European Commission LF matrix and the meaning of each cell is shown in Table 3.1. In the following we will present the main features of this version, but all the existing different LF versions share the same main elements.

As previously mentioned, the LF is a matrix with four columns and four rows (but the rows can be less or more), which summarizes the key elements of a project plan:

• the project’s hierarchy of objectives (project description or intervention logic);
• the key external factors critical to the project’s success and outside project management’s control (assumptions);
• how the project’s achievements will be monitored and evaluated (indicators and sources of verification).

The preparation of the LF is an iterative process. As new parts of the matrix are completed, information previously gathered needs to be reviewed and, if required, revised. Nevertheless, the European Commission guide emphasizes that “there is a general sequence to completing the matrix, which starts with the project description (top down), then the assumptions (bottom-up), followed by the indicators and then sources of verification (working across).” (EU, 2004, p. 73).

The first step is the identification of the first column of the matrix (Project Description or Intervention Logic or Hierarchy of objectives). To help explain the logical structure of this first column it is easier to present it in the form of an objective tree as shown in Figure 3.2. (i.e., the River Water Pollution Reduction project example). In particular, the objective tree helps to understand the “Intervention Logic.” When the objective hierarchy is read from the bottom up, it can be expressed in terms of: IF results are produced, THEN the purpose will be achieved; IF the purpose is achieved, THEN this should contribute towards the overall objective. If the objective hierarchy is read in reverse (from the top down), it can be expressed in terms of: IF we wish to contribute to the overall objective, THEN we must achieve the purpose; IF we wish to achieve the purpose, THEN we must deliver the specified results.

It is important to note that the example provided in Figure 3.2 is only one of the possible ways in which the considered project (River Water Pollution Reduction project) could have been presented. For instance, as clarified in the European Commission document, it would be possible “to restructure the objective hierarchy to either: (i) have 3 separate purposes (one for each component) rather than one unifying purpose; or (ii) to include another level in the objective hierarchy, such as a ‘component objective.’” Following the same logic, the number of levels in the hierarchy of objectives can also be reduced (less rows). In other words, the LF can be adapted to different needs. Project managers “have some flexibility to adapt the formats to their practical needs. If the ideas are good and the logic is sound, the number of levels in the objective hierarchy or the exact formats used should not be of any great concern” (European Commission, 2004).

After completing the first column (Hierarchy of objectives) the second step consists in the identification of the fourth column of the matrix (Assumptions). Assumptions are “external factors that have the potential to influence (or even determine) the success of a project, but lie outside the direct control of project managers” (EU, 2004, p. 78).

Assumptions are usually progressively identified during the project planning phases. The analysis of stakeholders, objectives and tasks normally highlights a number of issues (e.g., political, institutional, technical, social, economic) that can impact on the project “environment”, but over which the project may have no direct control.

As already reported in Table 3.1, assumptions are the answer to questions like “If the results are achieved, what assumptions must hold true to achieve the purpose?” In other words, in the LF, “Once results and assumptions are fulfilled, the project purpose will be achieved.” These relationships between assumptions and the hierarchy of objective are illustrated in Figure 3.3.

In the case of the River Water Pollution Reduction example, important assumptions could be related, for example, to rainfall and river flow (beyond the project’s control, but potentially critical in terms of changes in levels and concentration of pollutants found in the river), or householders and businesses willingness to pay for improved sewerage connections (indicated as positive through preliminary discussions, but not yet fully confirmed), or sustained political commitment to address the problem of water pollution. These “issues” have to be further examined and then translated into specific actions on the work plan or in proper assumptions to be inserted in the LF. For instance, the issue related to the rainfall and river flow can be inserted as “River flows maintained above X mega liters per second for at least Y months of the year.”

Once the project description and assumptions have been drafted, the next step is to identify indicators that might be used to measure and report on the achievement of objectives (column 2) and the sources of information (column 3).

The indicators describe the project’s objectives in operationally measurable terms (quantity, quality, time). They are formulated in response to the question “How would we know whether or not what has been planned is actually happening or happened?”

The source of verification should be specified at the same time as the formulation of indicators. This will help to test whether or not the indicators can be realistically measured at the expense of a reasonable amount of time, money and effort.

As highlighted in the European Commission guide (2004) indicators should specify:

• How the information should be collected (e.g., from administrative records, sample surveys, observation, etc.) and/or the available documented source (e.g., progress reports, project accounts, official statistics).
• Who should collect/provide the information (e.g., contracted survey teams, the district health office, the project management team).
• When/how regularly it should be provided. (e.g., monthly, quarterly, annually).

Examples of indicators and sources of verification are provided in Table 3.2 that represents the LF for a river water pollution reduction project. The example also summarizes the other steps of the process to develop the LF actives except from the activities (that, as previously noted, are optional).

The European Commission considers the LF a core tool used within Project Cycle Management (PCM). In particular (European Commission, 2004):

• It can be used during the identification stage of PCM “to help analyze the existing situation, investigate the relevance of the proposed project and identify potential objectives and strategies”
• It can be used during the formulation or preparation stage to support “the preparation of an appropriate project plan with clear objectives, measurable results, a risk management strategy and defined levels of management responsibility”
• It can be used during project/program implementation, as “a key management tool to support contracting, operational work planning and monitoring”
• It can be used during the evaluation stage as “a summary record of what was planned (objectives, indicators and key assumptions), and thus provides a basis for performance and impact assessment”.

However, it is important to note that the European Commission distinguishes between the Logical Framework Approach (LFA) and the Logical Framework Matrix (LFM). The LFA is defined as an analytical process involving stakeholder analysis, problem analysis, objective setting, and strategy selection. The LFM, “while requiring further analysis of objectives, how they will be achieved, and the potential risks, also provides the documented product of the analytical process” (EU, 2004, p. 57). In this perspective, the EU introduces a detailed process and supporting tools (e.g., Stakeholder analysis matrix, SWOT matrix, etc.) in the LFA to guide toward the preparation of the LFM.

3.3 Limitations of the Tools

Despite the numerous benefits and advantages of PCM and LF, the use of these tools in the context of international development is still limited (Abbasi & Al-Mharmah, 2000). From one side, this could be related to a late adoption and to a lack of knowledge of the presence and of the advantages of these tools. On the other side, practitioners and researchers have raised critiques and limitations concerning the effectiveness of these tools.

Table 3.3: ID projects peculiarities and consequent Desired features of the PM tools

Peculiarity	Desired Features of the Project Management Tools
Lack of a defined and/or powerful customer	Be proactive to the beneficiaries’ needs and not reactive. Be flexible to project changes. Do not lose contact with the long-term goals.
High number of stakeholders	Need tools that are understandable by all stakeholders and that address different stakeholders in a differentiated way (e.g., different tools for involving, informing, and reporting)
Difficult, complex and risky environment	Tools should foster a systemic analysis of the context and help managing a large array of risks. Tools should also track and help manage project changes.
Resource scarcity	Plan efficiently, avoid waste, favor transparency and accountability.
Difficulty in using project management techniques in the context of other cultures	Tools and approaches should be understandable and respectful of different cultures and mindsets.
Presence of intangible project outputs, difficult to be defined and measured	Tools should help in finding measures of project outputs and keeping contact with the long term or program goals.

As illustrated in Table 3.3 there are several desired features of project management tools, according to the peculiarities identified before.

The standard project management tools and methodologies are especially critiqued for their unsuitability to the aforementioned peculiarities (Ahsan & Gunawan, 2010). According to Gasper (1997), the LF overcomes many of the limitations of the other tools in terms of:

• Better problem analysis and objective settings through systematic analysis of problems and placing the project within a broader context;
• Higher accountability of the project manager for the risks and the results;
• Better measurement of project progress and objectives fulfillment through the identification of indicators and sources of verification;
• Better stakeholder involvement and communication, thanks to the simple and clear format.

However, while the PCM is widely accepted (it is seen as a particular way of organizing the project life-cycle), the LF has been significantly criticized (Couillard et al., 2009; Crawford & Bryce, 2003; Gasper, 1997).

The main limitations reported by the literature are: oversimplification, deterministic and time-invariant logic, lack of flexibility, lack of accountability, unclear terminology, and lack of integration with other project management tools.

Going more in detail, the LF is considered to be sometimes too simple to represent the underpinning complexity of a project and may miss some important elements (such as cultural aspects or the objectives of all the stakeholders). Next, risks or variability in the variables (either positive or negative) are not included and the underlying logic is quite deterministic. Another issue is the difficulty in the objectives definition: ID projects are full of internal and external variables, and therefore objectives are particularly different to be identified and formalized. Moreover, given the high number of stakeholders involved with complex relationships and different interests, the project objectives can be mixed up or conflicting with individual objectives. Similarly, changes in the projects can lead to a difference between “official” and “actual” objectives. Furthermore, the LF has been criticized for its lack of flexibility.

Given the high number of external variables and their unpredictability it is likely that several changes during the project occur in terms of activities and also desired outcomes, and the LF appears to be rigid to the objectives and activities stated at the beginning. It basically lacks a “time” perspective. Furthermore, the LF has been criticized for being unclear in the cause and effect relationship between the levels. It is not always straightforward to identify a causality effect among the levels of the LF. Moreover, relationships can change over the execution of the project. Also unclear terminology can cause problems: Many users find unclear the difference between the different levels (e.g., purpose, goal, and outcome). Another issue is the lack of integration with other project management tools since PCM and LF are not substitutive of the traditional project management tools (e.g., work breakdown structure, Gantt chart). A final limitation is the lack of accountability: the LF does not show who is responsible for what.

All these problems led several NGOs to the use of the LF just as a formal tool rather than as guidance for the entire project and a way to measure the success of the project. Many NGOs just fill in the LF because the donor requires it and they do it only after the planning phase.

Couillard et al. (2009) propose a new LF called Logical Framework Approach Millennium (LFA-M). As we can see in Table 3.4, some substantial changes are introduced. First of all, the “resources” row is added while the “assumptions” column is dropped. Moreover, the risk events and the responsible authorities are introduced. Furthermore, the authors propose a guideline on how to integrate this new LF with other project management tools. First of all, the assumptions (that by definition are out of the control of the project manager) are transformed into risks, which, by definition, should be managed. Next, people accountable (responsible authorities) for guaranteeing the chain between project activities and strategic objectives (organizational values) are identified.

Also Ika and Lytvynov (2011) propose a variation of the logical framework on the basis of the literature of management per results (Figure 3.4).

These new models need to be tested, and there is no consenus on which is the best LF version (see also the next chapter for a discussion of the “governamental” tools introduced to manage ID projects). However, as it will be further discussed in the following chapters, there is an emerging evidence of the need for improving the LF and the other tools for ID projects, and the two models shown above represent a good direction of improvement for more effective ID project management.

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